**Exhibit 10.1**

 

THIRD AMENDED ANDRESTATED CREDIT AGREEMENT

 

among

 

ARGOSY GAMING COMPANY,

 

THE OTHER BORROWERS NAMEDHEREIN,

 

THE LENDERS NAMED HEREIN,

 

CALYON NEW YORK BRANCHand BANK OF SCOTLAND

 

as Co-Syndication Agents,

 

MORGAN STANLEY BANK

 

as Documentation Agent

 

and

 

WELLS FARGO BANK,NATIONAL ASSOCIATION,

 

as the AdministrativeAgent, L/C Issuer and Swing Line Lender

 

Dated as of September 30,2004

 

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**TABLE OF CONTENTS**

 
| ARTICLE I.    |   | INTERPRETATION                                    |   |
|---------------|--------|---------------------------------------------------|--------|
|          |   |                                              |
|          | 1.01.  | Definitions                                       |   |
|          |   |                                              |   |
|          | 1.02.  | GAAP                                              |   |
|          |   |                                              |   |
|          | 1.03.  | Headings                                          |   |
|          |   |                                              |   |
|          | 1.04.  | Plural  Terms                                     |   |
|          |   |                                              |   |
|          | 1.05.  | Time                                              |   |
|          |   |                                              |   |
|          | 1.06.  | Governing  Law                                    |   |
|          |   |                                              |   |
|          | 1.07.  | Construction                                      |   |
|          |   |                                              |   |
|          | 1.08.  | Entire  Agreement                                 |   |
|          |   |                                              |   |
|          | 1.09.  | Calculation of Interest and Fees                  |   |
|          |   |                                              |   |
|          | 1.10.  | References                                        |   |
|          |   |                                              |   |
|          | 1.11.  | Other Interpretive Provisions                     |   |
|          |   |                                              |   |
| ARTICLE II.   |   | CREDIT FACILITIES                                 |   |
|          |   |                                              |
|          | 2.01.  | Revolving Loan Facility                           |   |
|          |   |                                              |   |
|          | 2.02.  | Term Loan Facility                                |   |
|          |   |                                              |   |
|          | 2.03.  | Letters  of Credit                                |   |
|          |   |                                              |   |
|          | 2.04.  | Swing  Line                                       |   |
|          |   |                                              |   |
|          | 2.05.  | Amount Limitations, Commitment Reductions, Etc.   |   |
|          |   |                                              |   |
|          | 2.06.  | Fees                                              |   |
|          |   |                                              |   |
|          | 2.07.  | Prepayments                                       |   |
|          |   |                                              |   |
|          | 2.08.  | Other Payment Terms                               |   |
|          |   |                                              |   |
|          | 2.09.  | Loan Accounts; Notes                              |   |
|          |   |                                              |   |
|          | 2.10.  | Loan  Funding                                     |   |
|          |   |                                              |   |
|          | 2.11.  | Pro Rata Treatment                                |   |
|          |   |                                              |   |
|          | 2.12.  | Change of Circumstances                           |   |
|          |   |                                              |   |
|          | 2.13.  | Taxes  on Payments                                |   |
|          |   |                                              |   |
|          | 2.14.  | Funding Loss Indemnification                      |   |
|          |   |                                              |   |
|          | 2.15.  | Security                                          |   |
|          |   |                                              |   |
|          | 2.16.  | Replacement of the Lenders                        |   |
|          |   |                                              |   |
|          | 2.17.  | Increases of the Total Revolving Loan  Commitment |   |
|          |   |                                              |   |
| ARTICLE  III. |   | CONDITIONS  PRECEDENT                             |   |
|          |   |                                              |
|          | 3.01.  | Initial Conditions Precedent                      |   |

 

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|          | 3.02.  | Conditions Precedent to each Credit Event                 |   |
|---------------|--------|-----------------------------------------------------------|--------|
|          |   |                                                      |   |
|          | 3.03.  | Covenant to Deliver                                       |   |
|          |   |                                                      |   |
| ARTICLE  IV.  |   | REPRESENTATIONS  AND WARRANTIES                           |   |
|          |   |                                                      |
|          | 4.01.  | Borrowers’ Representations and Warranties            |   |
|          |   |                                                      |   |
| ARTICLE V.    |   | COVENANTS                                                 |   |
|          |   |                                                      |
|          | 5.01.  | Affirmative Covenants                                     |   |
|          |   |                                                      |   |
|          | 5.02.  | Negative Covenants                                        |   |
|          |   |                                                      |   |
|          | 5.03.  | Financial Covenants                                       |   |
|          |   |                                                      |   |
| ARTICLE VI.   |   | DEFAULT                                                   |   |
|          |   |                                                      |
|          | 6.01.  | Events  of Default                                        |   |
|          |   |                                                      |   |
|          | 6.02.  | Remedies                                                  |   |
|          |   |                                                      |   |
|          | 6.03.  | Effect of Reverse Trigger Event                           |   |
|          |   |                                                      |   |
| ARTICLE VII.  |   | THE ADMINISTRATIVE AGENT AND RELATIONS  AMONG THE LENDERS |   |
|          |   |                                                      |
|          | 7.01.  | Appointment, Powers and Immunities                        |   |
|          |   |                                                      |   |
|          | 7.02.  | Reliance by the Administrative Agent                      |   |
|          |   |                                                      |   |
|          | 7.03.  | Defaults                                                  |   |
|          |   |                                                      |   |
|          | 7.04.  | Indemnification                                           |   |
|          |   |                                                      |   |
|          | 7.05.  | Non-Reliance                                              |   |
|          |   |                                                      |   |
|          | 7.06.  | Resignation or Removal of the  Administrative Agent       |   |
|          |   |                                                      |   |
|          | 7.07.  | Authorization                                             |   |
|          |   |                                                      |   |
|          | 7.08.  | The Administrative Agent in its Individual  Capacity      |   |
|          |   |                                                      |   |
| ARTICLE VIII. |   | MISCELLANEOUS                                             |   |
|          |   |                                                      |
|          | 8.01.  | Notices                                                   |   |
|          |   |                                                      |   |
|          | 8.02.  | Expenses                                                  |   |
|          |   |                                                      |   |
|          | 8.03.  | Indemnification                                           |   |
|          |   |                                                      |   |
|          | 8.04.  | Waivers; Amendments                                       |   |
|          |   |                                                      |   |
|          | 8.05.  | Successors and Assigns                                    |   |
|          |   |                                                      |   |
|          | 8.06.  | Setoff; Security Interest                                 |   |
|          |   |                                                      |   |
|          | 8.07.  | No Third Party Rights                                     |   |
|          |   |                                                      |   |
|          | 8.08.  | Partial Invalidity                                        |   |
|          |   |                                                      |   |
|          | 8.09.  | Jury  Trial                                               |   |

 

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|                   | 8.10.                                               | Confidentiality                               |   |
|------------------------|-----------------------------------------------------|-----------------------------------------------|--------|
|                   |                                                |                                          |   |
|                   | 8.11.                                               | Counterparts                                  |   |
|                   |                                                |                                          |   |
|                   | 8.12.                                               | Consent to Jurisdiction                       |   |
|                   |                                                |                                          |   |
|                   | 8.13.                                               | Joint and Several Obligations                 |   |
|                   |                                                |                                          |   |
|                   | 8.14.                                               | Assignment of Revolving Loans                 |   |
|                   |                                                |                                          |   |
|                   | 8.15.                                               | Application of Gaming Laws                    |   |
|                   |                                                |                                          |   |
|                   | 8.16.                                               | Damages; Insurance and Condemnation  Proceeds |   |
|                   |                                                |
| Schedules and Exhibits |                                                |                                          |
| Schedule I             | The Lenders                                         |                                          |
| Schedule II            | Existing Letters of Credit                          |                                          |
| Schedule 4.01(g)       | Litigation                                          |                                          |
| Schedule 4.01(h)       | Intercompany Notes and  Real Property               |                                          |
| Schedule 4.01(l)       | Multiemployer Plans                                 |                                          |
| Schedule 4.01(n)       | Intellectual Property                               |                                          |
| Schedule 4.01(q)       | Subsidiaries                                        |                                          |
| Schedule 4.01(t)       | Labor Matters                                       |                                          |
| Schedule 4.01(z)       | Existing Insurance                                  |                                          |
| Schedule 4.01(aa)      | Contingent Obligations                              |                                          |
| Schedule 5.02(a)       | Existing Indebtedness                               |                                          |
| Schedule 5.02(b)       | Existing Liens                                      |                                          |
| Schedule 5.02(e)       | Existing Investments                                |                                          |
| Schedule 5.03(e)       | Specified Capital  Expenditures                     |                                          |
|                   |                                                |                                          |
| Exhibit A              | Notice of Revolving Loan  Borrowing                 |                                          |
| Exhibit B              | Notice of Revolving Loan  Conversion                |                                          |
| Exhibit C              | Notice of Revolving Loan  Interest Period Selection |                                          |
| Exhibit D              | Notice of Term Loan  Conversion                     |                                          |
| Exhibit E              | Notice of Term Loan  Interest Period Selection      |                                          |
| Exhibit F              | Notice of Swing Loan  Borrowing                     |                                          |
| Exhibit G              | Revolving Loan Note                                 |                                          |
| Exhibit H              | Term Loan Note                                      |                                          |
| Exhibit I              | Swing Loan Note                                     |                                          |
| Exhibit J              | Assignment Agreement                                |                                          |
|                        |                                                     |                                               |        |  |

 

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**THIRD AMENDED AND RESTATED CREDIT AGREEMENT**

 

THISTHIRD AMENDED AND RESTATED CREDIT AGREEMENT, dated as of September 30, 2004, isentered into by and among: (1) ARGOSY GAMING COMPANY, a Delaware corporation (“Argosy”),ALTON GAMING COMPANY, an Illinois corporation (“Alton Gaming”), ARGOSYOF IOWA, INC., an Iowa corporation (“Argosy of Iowa”), ARGOSY OFLOUISIANA, INC., a Louisiana corporation (“Argosy of Louisiana”), BELLEOF SIOUX CITY, L.P., an Iowa limited partnership (“Belle of Sioux City”),CATFISH QUEEN PARTNERSHIP IN COMMENDAM, a Louisiana partnership in commendam (“CatfishQueen”), CENTROPLEX CENTRE CONVENTION HOTEL, L.L.C., a Louisiana limitedliability company (“Centroplex”), EMPRESS CASINO JOLIET CORPORATION, anIllinois corporation (“Empress Casino Joliet”), INDIANA GAMING II, L.P.,an Indiana limited partnership (“Indiana Gaming II”), THE INDIANA GAMINGCOMPANY, an Indiana corporation (“Indiana Gaming Corporation”), INDIANAGAMING HOLDING COMPANY, an Indiana corporation (“Indiana Gaming Holding”),INDIANA GAMING COMPANY, L.P., an Indiana limited partnership (“IndianaGaming Partnership”), IOWA GAMING COMPANY, an Iowa corporation (“IowaGaming”), JAZZ ENTERPRISES, INC., a Louisiana corporation (“JazzEnterprises”), and THE MISSOURI GAMING COMPANY, a Missouri corporation (“MissouriGaming”); (2) each of the financial institutions from time to time partyhereto (collectively, the “Lenders”); (3) CALYON NEW YORK BRANCHand BANK OF SCOTLAND, as Co-Syndication Agents; (4) MORGAN STANLEY BANK,as Documentation Agent; and (5) WELLS FARGO BANK, NATIONAL ASSOCIATION, anational banking association, as Administrative Agent, L/C Issuer and SwingLine Lender.

 

**RECITALS**

 

A.            The Borrowers have requested that(i) the Total R/C Commitment, the R/C Funded Outstandings (each as definedin the Existing Credit Agreement) and the Existing Letters of Credit outstandingunder the Existing Credit Agreement be continued as or converted into (as thecase may be) Revolving Loan Commitments, Revolving Loans and Letters of Creditunder this Agreement, (ii) the Revolving Loan Commitment be increased to$500,000,000, (iii) that the proceeds of the Term Loan hereunder and a portionof the Revolving Loans hereunder be used to repay the “Term Lenders” under andas defined in the Existing Credit Agreement and (iv) the Existing CreditAgreement otherwise be amended and restated in its entirety as set forth belowin this Agreement.

 

B.            The Lenders are willing, on andsubject to the terms and conditions set forth in this Agreement, to amend andrestate the terms of the Existing Credit Agreement and to extend credit underthis Agreement as more particularly hereinafter set forth.

 

**AGREEMENT**

 

NOW,THEREFORE, in consideration of the above Recitals and the mutual covenantsherein contained, the parties hereto hereby agree to amend and restate theExisting Credit Agreement as follows:

 

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**ARTICLE I.**          **INTERPRETATION****.**

 

1.01.        Definitions. Unless otherwise indicated in this Agreement, each term set forth belowor in the preamble hereto, when used in this Agreement, shall have the meaninggiven to that term below, in the preamble hereto or in the provision of thisAgreement or other document, instrument or agreement referenced below, asapplicable.

 

“2001 Senior Subordinated Indenture” shall meanthat certain Indenture dated as of July 31, 2001 by and among Argosy, asissuer, the Subsidiaries of Argosy referred to therein, as guarantors, and BankOne Trust Company, NA, as trustee.

 

“2001Senior Subordinated Notes” shall mean those certain $200 million 9.0%Senior Subordinated Notes due 2011 issued by Argosy pursuant to the 2001 SeniorSubordinated Indenture.

 

“2004Senior Subordinated Indenture” shall mean that certain Indenture dated asof February 12, 2004, between Argosy and J.P. Morgan Trust Company, NationalAssociation, as trustee.

 

“2004Senior Subordinated Notes” shall mean the 7% Senior Subordinated Notes due2014 issued by Argosy pursuant to the 2004 Senior Subordinated Indenture in theoriginal aggregate principal amount of $350,000,000.

 

“AdministrativeAgent” shall mean Wells Fargo Bank, National Association, in its capacityas administrative agent for the Lenders.

 

“AdministrativeAgent’s Fee Letter” shall mean the letter agreement dated as ofJune 30, 2004, between Argosy and the Administrative Agent regardingcertain fees payable by Argosy to the Administrative Agent.

 

“Affiliate”shall mean, with respect to any Person, (a) each Person that, directly orindirectly, owns or controls, whether beneficially or as a trustee, guardian orother fiduciary, ten percent (10%) or more of any class of Equity Securities ofsuch Person, or (b) each Person that controls, is controlled by or isunder common control with, such Person or any Affiliate of such Person; provided,however, that in no case shall the Administrative Agent or any Lender bedeemed to be an Affiliate of Argosy or any of its Subsidiaries for purposes ofthis Agreement.  For the purpose of thisdefinition, “control” of a Person shall mean the possession, directly orindirectly, of the power to direct or cause the direction of its management orpolicies, whether through the ownership of voting securities, by contract orotherwise.

 

“Agreement”shall mean this Third Amended and Restated Credit Agreement.

 

“ApplicableLending Office” shall mean, with respect to any Lender, (a) in the case ofits Base Rate Loans and Base Rate Portions, its Domestic Lending Office, and(b) in the case of its LIBOR Loans and LIBOR Portions, its Euro-Dollar LendingOffice.

 

“ApplicableMargin” shall mean:

 

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(a)           With respect to each Revolving Loan,the *per annum* margin which is determinedpursuant to the Revolving Loan Pricing Grid and added to the Base Rate or LIBORRate, as the case may be, for such Revolving Loan; provided, however,that each Applicable Margin determined pursuant to the Revolving Loan PricingGrid shall be increased by two percent (2.00%) on the date an Event of Defaultoccurs and shall continue at such increased rate unless and until such Event ofDefault is cured or waived in accordance with this Agreement.  The Applicable Margins set forth in thissubsection (a) shall be determined as provided in the Revolving LoanPricing Grid and may change as set forth in the definition of Revolving LoanPricing Grid.

 

(b)           Withrespect to each Term Loan, the Applicable Margin for LIBOR Portions shall be1.75%, and the Applicable Margin for Base Rate Portions shall be 0.50%; provided,however, that each such Applicable Margin shall be increased by twopercent (2.00%) on the date an Event of Default occurs and shall continue atsuch increased rate unless and until such Event of Default is cured or waivedin accordance with this Agreement.

 

“Approved Fund” shall mean any Fund that isadministered, managed or advised by (a) a Lender, (b) an Affiliate ofa Lender or (c) an entity or an Affiliate of an entity that administers ormanages a Lender.

 

“Argosy” shall have the meaning given to thatterm in clause (1) of the introductory paragraph hereof.

 

“AssigneeLender” shall have the meaning given to that term in Section 8.05(c).

 

“Assignment”shall have the meaning given to that term in Section 8.05(c).

 

“AssignmentAgreement” shall have the meaning given to that term in Section 8.05(c).

 

“AssignmentEffective Date” shall have, with respect to each Assignment Agreement, themeaning set forth therein.

 

“AssignorLender” shall have the meaning given to that term in Section 8.05(c).

 

“BaseRate” shall mean, on any day, the greater of (a) the Prime Rate in effecton such date and (b) the Federal Funds Rate for such day plus one-halfpercent (0.50%).

 

“BaseRate Loan” shall mean, at any time, a Revolving Loan which then bearsinterest as provided in clause (i) of Section 2.01(c).

 

“BaseRate Portion” shall mean, at any time, a Portion of the Term Loan Borrowingor a Term Loan, as the case may be, which then bears interest at a ratespecified in clause (i) of Section 2.02(c).

 

“Borrowers”shall mean, collectively, Argosy, Alton Gaming, Argosy of Iowa, Belle of SiouxCity, Argosy of Louisiana, Catfish Queen, Centroplex, Empress Casino Joliet,Indiana Gaming II, Indiana Gaming Corporation, Indiana Gaming Holding, IndianaGaming Partnership, Iowa Gaming, Jazz Enterprises and Missouri Gaming.  Notwithstanding a transfer of the capital

 

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stockof Empress Casino Joliet pursuant to the terms of the Transfer Agreement, untila Sale (as defined in the Transfer Agreement) occurs, Empress Casino Jolietshall remain a Borrower for all purposes of this Agreement (other than forpurposes of Section 2.01(a), 2.03(a)(i) or 2.04(a)).

 

“Borrowing”shall mean a Revolving Loan Borrowing, the Term Loan Borrowing or a Swing LineBorrowing, as the context may require.

 

“BusinessDay” shall mean any day on which (a) commercial banks are not authorized orrequired to close in San Francisco, California, New York, New York or Chicago,Illinois and (b) if such Business Day is related to a LIBOR Loan or a LIBORPortion, dealings in Dollar deposits are carried out in the London interbankmarket.

 

“CapitalAdequacy Requirement” shall have the meaning given to that term in Section 2.12(d).

 

“CapitalAsset” shall mean, with respect to any Person, any tangible fixed orcapital asset owned or leased (in the case of a Capital Lease) by such Person,or any expense incurred by such Person that is required by GAAP to be reportedas a non-current asset on such Person’s balance sheet.

 

“CapitalExpenditures” shall mean, with respect to any Person and any period, allamounts expended by such Person during such period to acquire or to constructCapital Assets (including renewals, improvements and replacements, butexcluding repairs in the ordinary course) computed in accordance with GAAP(including all amounts paid or accrued on Capital Leases and other Indebtednessincurred or assumed to acquire Capital Assets).

 

“CapitalLease” shall mean any lease that, in accordance with GAAP, is required tobe capitalized on the books of a lessee.

 

“CashCollateral Account” shall mean the restricted depository savings account tobe established by the Borrowers or the Administrative Agent on behalf of theBorrowers with the L/C Issuer at its offices located at 5340 Kietzke, Suite201, Reno, Nevada, or at such other office located in the United States as maybe designated from time to time by the L/C Issuer, for the purpose of depositingcash collateral for the Obligations upon the occurrence of any Event ofDefault.

 

“CashCollateral Pledge Agreement” shall mean that certain Deposit Account PledgeAgreement, dated as of September 30, 2004, among the Borrowers and the L/CIssuer.

 

“CashCollateralize” shall mean to pledge and deposit with or deliver to theAdministrative Agent, for the benefit of the Administrative Agent and theLenders, as collateral for the Obligations, cash or deposit account balances inan amount equal to the L/C Obligations pursuant to documentation in form andsubstance satisfactory to the Administrative Agent and the L/C Issuer (whichdocuments are hereby consented to by the Lenders).  Derivatives of such term shall havecorresponding meaning.  Each Borrower herebygrants the Administrative Agent, for the benefit of the Administrative Agentand the Lenders, a Lien on all such cash and deposit account balances assecurity for the Obligations.  Cashcollateral shall be maintained in blocked, non-interest bearing depositaccounts at Wells Fargo or other institutions satisfactory to it.  The

 

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Lienheld by the Administrative Agent in such cash collateral to secure theObligations shall be released upon the satisfaction of each of the followingconditions: (a) no Letters of Credit shall be outstanding, (b) all L/CObligations shall have been repaid in full and (c) no Default shall haveoccurred and be continuing.

 

“CashEquivalents” shall mean:

 

(a)           Direct obligations of, or obligationsthe principal of and interest on which are unconditionally guaranteed by, theUnited States of America (or by any agency thereof to the extent suchobligations are backed by the full faith and credit of the United States ofAmerica), in each case maturing within one year from the date of acquisitionthereof;

 

(b)           Investments in commercial papermaturing within 270 days from the date of acquisition thereof and having, atsuch date of acquisition, the highest credit rating obtainable from Standardand Poor’s Rating Group or from Moody’s Investor Services, Inc.;

 

(c)           Investments in certificates ofdeposit, banker’s acceptances and time deposits maturing within one year fromthe date of acquisition thereof issued or guaranteed by or placed with, andmoney market deposit accounts issued or offered by, any domestic office of anycommercial bank organized or licensed under the laws of the United States ofAmerica or any State thereof which has a combined capital and surplus andundivided profits of not less than $500,000,000;

 

(d)           Fully collateralized repurchaseagreements with a term of not more than 30 days for securities described inclause (a) above and entered into with a financial institution satisfyingthe criteria described in clause (c) above; and

 

(e)           Money market funds that (i) complywith the criteria set forth in Securities and Exchange Commission Rule 2a-7under the Investment Company Act of 1940, (ii) are rated AAA by Standard andPoor’s Rating Group and Aaa by Moody’s Investor Services, Inc. and (iii) haveportfolio assets of at least $5,000,000,000.

 

“Casinos” shall mean, collectively, the casinosowned or operated by the Loan Parties from time to time.

 

“Changeof Control” shall mean:

 

(a)           Any “person” or “group” (as suchterms are defined in Sections 13(d) and 14(d) of the Securities ExchangeAct of 1934, as amended) acquires ownership or control of more than fortypercent (40%) of the voting common stock of Argosy; or

 

(b)           During any period of twenty-four (24)consecutive months commencing after the Restatement Effective Date, individualswho at the beginning of such period constituted Argosy’s Board of Directors(together with any new or replacement directors whose election by Argosy’sBoard of Directors or whose nomination for election by Argosy’s shareholders,was approved by a vote of at least a majority of the directors then still inoffice who were either directors at the beginning of such period or whoseelection or nomination for election was

 

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previously so approved) cease for any reasonto constitute a majority of the directors then in office.

 

“Change of Law” shall have the meaning given tothat term in Section 2.12(b).

 

“Class”shall have the meaning given to that term in Section 1.10(e).

 

“Collateral”shall mean all property in which the Administrative Agent or any Lender has aLien to secure the Obligations.

 

“CommitmentFee Percentage” shall mean, with respect to the Revolving Loans at anytime, the *per annum* percentage which is used tocalculate Commitment Fees for the Revolving Loans.  The Commitment Fee Percentages shall bedetermined as provided in the Revolving Loan Pricing Grid and may change as setforth in the definition of Revolving Loan Pricing Grid.

 

“CommitmentFees” shall have the meaning given to that term in Section 2.06(b).

 

“Commitments”shall mean, collectively, the Revolving Loan Commitments and the Term LoanCommitments.

 

“ComplianceCertificate” shall have the meaning given to that term in clause (iii) of Section5.01(a).

 

“ContingentObligation” shall mean, with respect to any Person, (a) any GuarantyObligation of that Person; and (b) any direct or indirect obligation orliability, contingent or otherwise, of that Person (i) in respect of any SuretyInstrument issued for the account of that Person or as to which that Person isotherwise liable for reimbursement of drawings or payments, (ii) as a partneror joint venturer in any partnership or joint venture, or (iii) to purchase anymaterials, supplies or other property from, or to obtain the services of,another Person if the relevant contract or other related document or obligationrequires that payment for such materials, supplies or other property, or forsuch services, shall be made regardless of whether delivery of such materials,supplies or other property is ever made or tendered, or such services are everperformed or tendered.  The amount of anyContingent Obligation shall (subject, in the case of Guaranty Obligations, tothe last sentence of the definition of “Guaranty Obligation”) be deemed equalto the maximum reasonably anticipated liability in respect thereof.

 

“ContractualObligation” of any Person shall mean, any indenture, note, lease, loanagreement, security, deed of trust, mortgage, security agreement, guaranty,instrument, contract, agreement or other form of contractual obligation orundertaking to which such Person is a party or by which such Person or any ofits property is bound.

 

“CreditDocuments” shall mean and include this Agreement, the Notes, the SecurityDocuments, all Rate Protection Agreements of any Borrower with any Lenderrelated to any Loan, the Environmental Indemnity and the Administrative Agent’sFee Letter; all other documents, instruments and agreements delivered to theAdministrative Agent or any Lender pursuant to Section 3.01; and allother documents, instruments and agreements delivered by any Loan Party to theAdministrative Agent or any Lender in connection with this Agreement on or

 

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afterthe date of this Agreement, including, if applicable, the Guaranty or anyjoinder agreement thereto, each as amended, modified or supplemented from timeto time.

 

“CreditEvent” shall mean the making of any Loan (including a Swing Line Loan) orthe making of an L/C Credit Extension.

 

“Default”shall mean an Event of Default or any event or circumstance not yetconstituting an Event of Default which, with the giving of any notice or thelapse of any period of time or both, would become an Event of Default.

 

“DefaultingLender” shall mean a Lender which has failed to fund its portion of anyBorrowing which it is required to fund under this Agreement and has continuedin such failure for three (3) Business Days after written notice from theAdministrative Agent.

 

“DepartingLenders” shall mean Bank of America, N.A., First Hawaiian Bank and WestCoast Bank.

 

“DesignatedAsset Sale Proceeds” shall mean the Net Proceeds payable to the LoanParties from the sale, transfer, lease or other disposition of assets orproperty, other than any sale or other disposition permitted by clause (i),(ii), (iv) or (v) of Section 5.02(c).

 

“DevelopmentAgreements” shall mean, collectively, (i) that certain Agreement under dateof April 18, 1991 by and between the City of Alton, Illinois and the AltonRiverboat Gambling Partnership (the predecessor in interest to Alton Gaming),(ii) that certain Contract under date of September 21, 1994 by and amongthe City of Baton Rouge, Louisiana, the Parish of East Baton Rouge and JazzEnterprises, (iii) that certain Riverboat Gaming Development Agreement betweenthe City of Lawrenceburg, Indiana, and the Indiana Gaming Company, L.P.,executed by Indiana Gaming Partnership, and by the City of Lawrenceburg,Indiana under date of April 13, 1994, as amended by that certain AmendmentNumber One to Riverboat Gaming Development Agreement under date ofDecember 28, 1995 and by that certain Amendment Number Two to RiverboatGaming Development Agreement under date of August 20, 1996, (iv) that certainLease and Development Agreement executed by the City of Riverside, Missouri andby Alton Gaming under date of June 7, 1993 and (v) that certainDevelopment Agreement under date of June 22, 1992, by and between the Cityof Sioux City, Iowa and Sioux City Riverboat Corp., as assigned to Belle ofSioux City by Sioux City Riverboat Corp., Inc. pursuant to that certainAssignment and Assumption Agreement executed by Sioux City Riverboat Corp.,Inc. and by Belle of Sioux City under date of December 1, 1994.

 

“Distributions”shall mean dividends (in cash or property) on, or other payments ordistributions on account of, or the setting apart of money for a sinking orother analogous fund for, or the purchase, redemption, retirement or otheracquisition of, any shares of any class of stock of any Loan Party or of anywarrants, options or other rights to acquire the same.

 

“DocumentationAgent” shall mean Morgan Stanley Bank, in its capacity as the documentationagent.

 

“Dollars”and “$” shall mean the lawful currency of the United States of Americaand, in relation to any payment under this Agreement, same day or immediatelyavailable funds.

 

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“DomesticLending Office” shall mean, with respect to any Lender, (a) initially, itsoffice designated as such to the Administrative Agent (or, in the case of anyLender which becomes a Lender by an assignment pursuant to Section 8.05(c),its office designated as such in the applicable Assignment Agreement) and (b)subsequently, such other office or offices as such Lender may designate to theAdministrative Agent as the office at which such Lender’s Base Rate Loans andBase Rate Portions will thereafter be maintained and for the account of whichall payments of principal of, and interest on, such Lender’s Base Rate Loansand Base Rate Portions will thereafter be made.

 

“EBITDA”shall mean, for any period, the sum of the following items of the Loan Parties:(a) Net Income after tax for such period, (b) Interest Expense for such period,(c) depreciation and amortization for such period, (d) all other non-cashexpenses (less non-cash gains) for such period, (e) income tax expense for suchperiod, (f) pre-opening expense for such period and (g) all extraordinaryitems, including non-recurring fees incurred in connection with thenegotiation, execution and delivery of this Agreement and other PermittedIndebtedness (in each instance to the extent deducted in the determination ofNet Income and in each case as determined in accordance with GAAP), aftergiving effect on a pro forma basis to any acquisition of assets or Personspermitted under Section 5.02(d) and/or any disposition of assets orPersons permitted under Section 5.02(c) (as if such otheracquisition or disposition occurred on the first day of the relevant fourfiscal quarter period).

 

“EffectiveAmount” shall mean (i) with respect to Revolving Loans, Term Loans andSwing Line Loans on any date, the aggregate outstanding principal amountthereof after giving effect to any borrowings and prepayments or repayments ofRevolving Loans, Term Loans and Swing Line Loans, as the case may be, occurringon such date; and (ii) with respect to any L/C Obligations on any date, theamount of such L/C Obligations on such date after giving effect to any L/CCredit Extension occurring on such date and any other changes in the aggregateamount of the L/C Obligations as of such date, including as a result of anyreimbursements of outstanding unpaid drawings under any Letters of Credit orany reductions in the maximum amount available for drawing under Letters ofCredit taking effect on such date.

 

“EligibleAssignee” shall mean a Person which (a) is to the extent required underapplicable Gaming Laws, registered or licensed with, approved or found suitableby, or not disapproved, denied a license or approval or found unsuitable by(whichever may be required under applicable Gaming Laws), any applicableGovernmental Authorities, (b) does not (either alone or as part of a “group” (asdefined in Sections 13(d) and 14(d) of the Securities Exchange Act of 1934, asamended), own or control more than 40% of the voting securities of any directcompetitor of Argosy or any of its Subsidiaries and (c) is (i) with respect tothe Revolving Loans, Revolving Loan Commitments or the Term Loans, (A) acommercial bank organized under the laws of the United States, or any statethereof, and having a combined capital and surplus of at least $100,000,000,(B) a commercial bank organized under the laws of any other country which is amember of the Organization for Economic Cooperation and Development (the “OECD”),or a political subdivision of any such country, and having a combined capitaland surplus of at least $100,000,000, provided that such bank is acting througha branch or agency located in the country in which it is organized or anothercountry which is also a member of the OECD, (C) a Person that is primarilyengaged in the business of commercial lending and that is (1) a Subsidiary of aLender, (2) a Subsidiary of a Person of which a Lender is a Subsidiary or (3) a

 

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Personof which a Lender is a Subsidiary or (D) an Approved Fund or (ii) solely withrespect to the Term Loans, any other entity that is an “accredited investor”(as defined in Regulation D under the Securities Act of 1933) that extendscredit or buys loans as one of its businesses including insurance companies,mutual funds, lease financing companies and investment funds.

 

“EmployeeBenefit Plan” shall mean any employee benefit plan within the meaning ofsection 3(3) of ERISA maintained or contributed to by Argosy or any ERISAAffiliate, other than a Multiemployer Plan.

 

“EnvironmentalIndemnity” shall mean that certain Environmental Indemnity Agreement, datedas of the date hereof, among the Borrowers and the Administrative Agent.

 

“EnvironmentalDamages” shall mean all claims, judgments, damages, losses, penalties,liabilities (including strict liability), costs and expenses, including costsof investigation, remediation, defense, settlement and reasonable attorneys’fees and consultants’ fees, that are incurred at any time as a result of theexistence of any Hazardous Material upon, about or beneath any real propertyowned by Argosy or any of its Subsidiaries or migrating or threatening tomigrate to or from any such real property, or arising from any investigation,proceeding or remediation of any location at which Argosy, any of itsSubsidiaries or any predecessors are alleged to have directly or indirectlydisposed of Hazardous Materials or arising in any manner whatsoever out of anyviolation of Environmental Laws.

 

“EnvironmentalLaws” shall mean the Clean Air Act, 42 U.S.C. Section 7401 etseq.;the Federal Water Pollution Control Act, 33 U.S.C. Section 1251 etseq.;the Resource Conservation and Recovery Act of 1976, 42 U.S.C. Section 6901 etseq.; the Comprehensive Environment Response, Compensation and LiabilityAct of 1980 (including the Superfund Amendments and Reauthorization Act of1986, “CERCLA”), 42 U.S.C. Section 9601 etseq.; the ToxicSubstances Control Act, 15 U.S.C. Section 2601 etseq.; theOccupational Safety and Health Act, 29 U.S.C. Section 651; the EmergencyPlanning and Community Right-to-Know Act of 1986, 42 U.S.C. Section 11001 etseq.; the Mine Safety and Health Act of 1977, 30 U.S.C. Section 801 etseq.; the Safe Drinking Water Act, 42 U.S.C. Section 300f etseq.;and all other Governmental Rules relating to the protection of human health andthe environment, including all Governmental Rules pertaining to the reporting,licensing, permitting, transportation, storage, disposal, investigation orremediation of emissions, discharges, releases, or threatened releases ofHazardous Materials into the air, surface water, groundwater, or land, orrelating to the manufacture, processing, distribution, use, treatment, storage,disposal, transportation or handling of Hazardous Materials.

 

“EquitySecurities” of any Person shall mean (a) all common stock, preferred stock,participations, shares, membership interests, partnership interests or otherequity interests in and of such Person (regardless of how designated andwhether or not voting or non-voting) and (b) all warrants, options and otherrights to acquire any of the foregoing.

 

“ERISA”shall mean the Employee Retirement Income Security Act of 1974.

 

“ERISAAffiliate” shall mean any Person which is treated as a single employer withArgosy under Section 414 of the IRC.

 

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“Euro-DollarLending Office” shall mean, with respect to any Lender, (a) initially, itsoffice designated as such to the Administrative Agent (or, in the case of anyLender which becomes a Lender by an assignment pursuant to Section 8.05(c),its office designated as such in the applicable Assignment Agreement) and (b)subsequently, such other office or offices as such Lender may designate to theAdministrative Agent as the office at which such Lender’s LIBOR Loans and LIBORPortions will thereafter be maintained and for the account of which allpayments of principal of, and interest on, such Lender’s LIBOR Loans and LIBORPortions will thereafter be made.

 

“Eventof Default” shall have the meaning given to that term in Section 6.01.

 

“EvergreenLetter of Credit” shall have the meaning given to that term in Section 2.03(b)(iii).

 

“ExistingAssignments” shall mean, collectively, each of the assignment agreementsset forth on Schedule I.

 

“ExistingCredit Agreement” shall mean that certain Second Amended and RestatedCredit Agreement, dated as of July 31, 2001, among the Borrowers, the Lendersnamed therein, Wells Fargo, as Swingline Lender, L/C Issuer and AdministrativeAgent, Credit Lyonnais, Los Angeles Branch, as Syndication Agent and Bank ofScotland and Bankers Trust Company, as Documentation Agent, as amended,supplemented or otherwise modified and in effect on the date hereof.

 

“ExistingLetters of Credit” shall mean the letters of credit described on ScheduleII.

 

“ExistingMortgages” shall mean, collectively, each of the mortgages referenced on ScheduleIII.

 

“ExistingSecurity Agreements” shall mean, collectively, each of the securityagreements referenced on Schedule IV.

 

“ExistingShip Mortgages” shall mean, collectively, each of the ship mortgages referencedon Schedule V.

 

“FederalFunds Rate” shall mean, for any day, the rate per annum (rounded upwards tothe nearest 1/100 of 1%) equal to the weighted average of the rates onovernight Federal funds transactions with members of the Federal Reserve Systemarranged by Federal funds brokers on such day, as published by the FederalReserve Bank on the Business Day next succeeding such day; provided,that (a) if such day is not a Business Day, the Federal Funds Rate for such dayshall be such rate on such transactions on the next preceding Business Day asso published on the next succeeding Business Day, and (b) if no such rate is sopublished on such next succeeding Business Day, the Federal Funds Rate for suchday shall be the average rate charged to Wells Fargo on such day on suchtransactions as determined by the Administrative Agent.

 

“FederalReserve Board” shall mean the Board of Governors of the Federal ReserveSystem.

 

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“FinancialStatements” shall mean, with respect to any accounting period for anyPerson, statements of income, stockholders’ equity (prepared on an annual basisonly) and cash flows of such Person for such period, and a balance sheet ofsuch Person as of the end of such period, setting forth in each case incomparative form figures for the corresponding period in the preceding fiscalyear if such period is less than a full fiscal year or, if such period is afull fiscal year, corresponding figures from the preceding annual audit, all preparedin reasonable detail and in accordance with GAAP.

 

“FixedCharge Coverage Ratio” shall mean, as at any date of determination, theratio of (a) EBITDA for the period of four consecutive fiscal quartersending on or most recently ended prior to such date minus the sum of (i)Distributions actually made in cash during such period (to the extent notincluded in Fixed Charges) other than Distributions made to or for the accountof another Loan Party, (ii) income taxes actually paid in cash during such period****and (iii) Maintenance Capital Expenditures actually madeduring such period, to (b) Fixed Charges for the period of fourconsecutive fiscal quarters ending on or most recently ended prior to suchdate.

 

“FixedCharges” shall mean, for any period, the sum, for the Loan Parties(determined on a consolidated basis without duplication in accordance withGAAP), of the following: (a) Interest Expense for such period,(b) scheduled payments of principal on Indebtedness, to the extentactually paid during such period, (c) the portion of****scheduled****paymentsmade under Capital Leases that should be treated as payment of principal inaccordance with GAAP, to the extent actually paid during such period****and (d) Distributions on the preferred capital stock ofArgosy to the extent actually paid in cash during such period, after givingeffect on a pro forma basis to any acquisition of assets or Persons permittedunder Section 5.02(d) and/or any disposition of assets or Personspermitted under Section 5.02(c) (as if such acquisition ordisposition occurred on the first day of the relevant four fiscal quarterperiod).

 

“Fund” shall mean any Person (other than a natural Person) thatis (or will be) engaged in making, purchasing, holding or otherwise investingin commercial loans and similar extensions of credit in the ordinary course ofits business.

 

“GAAP”shall mean generally accepted accounting principles and practices as in effectin the United States of America from time to time, consistently applied.

 

“GamingAuthorities” shall mean, collectively, the Illinois Gaming Board, theIndiana Gaming Commission, the Iowa Racing and Gaming Commission, the LouisianaGaming Control Board, the Missouri Gaming Commission and any other GovernmentalAuthorities which enforce the Gaming Laws.

 

“GamingFacility” shall mean each Casino and all other Property owned by a LoanParty which is directly ancillary thereto or used in connection therewith,including any hotels, resorts, card clubs, theaters, parking facilities,recreational vehicle parks, timeshare operations, retail shops, restaurants,other buildings, land, golf courses and other recreation and entertainmentfacilities, marinas, vessels, barges, ships and related equipment.

 

“GamingLaws” shall mean all statutes, rules, regulations, ordinances, codes,administrative or judicial orders or decrees or other laws pursuant to whichany Gaming

 

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Authorityor other Governmental Authority possesses regulatory, licensing or permitauthority over gambling or gaming activities conducted by any Loan Party withinits jurisdiction.

 

“GamingLicense” shall mean, collectively, any and all Governmental Authorizations(i) necessary to enable any Loan Party to engage in the casino, gambling orgaming business, including the operation of racetracks, and the conduct ofpari-mutual wagering and other gaming activities at such racetracks orotherwise continue to conduct its business as it is conducted on theRestatement Effective Date, or (ii) required by any Governmental Authority orunder any Gaming Law.

 

“GamingNew Venture” shall mean any New Venture which (i) holds a Gaming License,(ii) owns or operates a casino or racetrack or (iii) owns an asset or operatesa business adjacent to or within close proximity of an entity which holds aGaming License or owns or operates a casino or racetrack, including any hotel,resort, card club, theater, parking facility, recreational vehicle park,timeshare operation, retail shop, restaurant, golf course or other recreationand entertainment facility, marina, vessel, barge or ship.

 

“GamingSubsidiary” shall mean any Subsidiary which (i) holds a Gaming License,(ii) owns or operates a casino or racetrack or (iii) owns an asset or operatesa business adjacent to or within close proximity of an entity which holds aGaming License or owns or operates a casino or racetrack, including any hotel,resort, card club, theater, parking facility, recreational vehicle park,timeshare operation, retail shop, restaurant, golf course or other recreationand entertainment facility, marina, vessel, barge or ship.

 

“GovernmentalAuthority” shall mean any domestic or foreign national, state or localgovernment, any political subdivision thereof, any department, agency,authority or bureau of any of the foregoing, or any other entity exercisingexecutive, legislative, judicial, regulatory or administrative functions of orpertaining to government, including the Federal Deposit Insurance Corporation,the Federal Reserve Board, the Comptroller of the Currency, any central bank orany comparable authority.

 

“GovernmentalAuthorization” shall mean any permit, license, registration, approval,finding of suitability, authorization, plan, directive, order, consent,exemption, waiver, consent order or consent decree of or from, or notice to,action by or filing with, any Governmental Authority.

 

“GovernmentalCharges” shall mean, with respect to any Person, all levies, assessments,fees, claims or other charges imposed by any Governmental Authority upon suchPerson or any of its property or otherwise payable by such Person.

 

“GovernmentalRule” shall mean any law, rule, regulation, ordinance, order, codeinterpretation, judgment, decree, directive, guidelines, policy or similar formof decision of any Governmental Authority.

 

“Guarantor”shall mean each Restricted Subsidiary which has executed and delivered aGuaranty pursuant to Section 5.01(j).

 

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“Guaranty”shall mean a General Continuing Subsidiary Guaranty executed by the RestrictedSubsidiaries in favor of the Administrative Agent on behalf of the Lenders fromtime to time.

 

“GuarantyObligation” shall mean, with respect to any Person, any direct or indirectliability of that Person with respect to any indebtedness, lease, dividend,letter of credit or other obligation (the “primary obligations”) of anotherPerson (the “primary obligor”), including any obligation of that Person,whether or not contingent, (a) to purchase, repurchase or otherwise acquiresuch primary obligations or any property constituting direct or indirectsecurity therefor, or (b) to advance or provide funds (i) for the payment ordischarge of any such primary obligation, or (ii) to maintain working capitalor equity capital of the primary obligor or otherwise to maintain the net worthor solvency or any balance sheet item, level of income or financial conditionof the primary obligor, or (c) to purchase property, securities or servicesprimarily for the purpose of assuring the owner of any such primary obligationof the ability of the primary obligor to make payment of such primaryobligation, or (d) otherwise to assure or hold harmless the holder of any suchprimary obligation against loss in respect thereof.  The amount of any Guaranty Obligation shallbe deemed equal to the stated or determinable amount of the primary obligationin respect of which such Guaranty Obligation is made or, if not stated or ifindeterminable, the maximum liability in respect thereof.

 

“HazardousMaterials” shall mean all pollutants, contaminants and other materials,substances and wastes which are hazardous, toxic, caustic, harmful or dangerousto human health or the environment, including petroleum and petroleum productsand byproducts, radioactive materials, asbestos, polychlorinated biphenyls andall materials, substances and wastes which are classified or regulated as “hazardous,”“toxic” or similar descriptions under any Environmental Law.

 

“HonorDate” shall have the meaning given to that term in Section 2.03(c)(i).

 

“ICC”shall have the meaning given to that term in Section 2.03(h).

 

“Indebtedness”of any Person shall mean, without duplication:

 

(a)           All obligations of such Personevidenced by notes, bonds, debentures or other similar instruments and allother obligations of such Person for borrowed money (including obligations torepurchase receivables and other assets sold with recourse);

 

(b)           All obligations of such Person forthe deferred purchase price of property or services;

 

(c)           All obligations of such Person underconditional sale or other title retention agreements with respect to propertyacquired by such Person (to the extent of the value of such property if therights and remedies of the seller or the Lender under such agreement in the eventof default are limited solely to repossession or sale of such property);

 

(d)           All obligations of such Person aslessee under or with respect to Capital Leases;

 

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(e)           All obligations of such Person, contingentor otherwise, under or with respect to Surety Instruments;

 

(f)            The Termination Value (if negative)with respect to all Rate Protection Agreements of such Person;

 

(g)           All Guaranty Obligations of suchPerson with respect to the obligations of other Persons of the types describedin clauses (a) - (f) above and all other Contingent Obligations of such Person;and

 

(h)           All obligations of other Persons ofthe types described in clauses (a) - (f) above to the extent secured by (or forwhich any holder of such obligations has an existing right, contingent orotherwise, to be secured by) any Lien in any property (including accounts andcontract rights) of such Person, even though such Person has not assumed orbecome liable for the payment of such obligations.

 

“Intercompany Notes” shall mean, collectively,the promissory notes described on Schedule 4.01(h).

 

“Interest Expense” shall mean, for any period,the sum, for the Loan Parties (determined on a consolidated basis withoutduplication in accordance with GAAP), of the following: (a) all interest, fees,charges and related expenses allocable to****such period inconnection with Indebtedness or the deferred purchase price of assets that istreated as interest in accordance with GAAP, (b) the portion of rent actuallypaid during such period under Capital Leases that should be treated as interestin accordance with GAAP and (c) the net amounts payable (or minus thenet amounts receivable) under Rate Protection Agreements accrued during suchperiod (whether or not actually paid or received during such period); provided,however, that the amortization of fees and expenses incurred and paid inconnection with the incurrence of any Indebtedness or entering into any RateProtection Agreements shall be excluded from the determination of InterestExpense.

 

“InterestPeriod” shall mean, with respect to any LIBOR Loan or LIBOR Portion, thetime periods selected by the Borrowers pursuant to Section 2.01(b), Section2.01(d) or Section 2.02(d) which commences on the first day ofsuch Loan or Portion or the effective date of any conversion and ends on thelast day of such time period, and thereafter, each subsequent time periodselected by the Borrowers pursuant to Section 2.01(e) or Section 2.02(e)which commences on the last day of the immediately preceding time period andends on the last day of that time period.

 

“Investment”of any Person shall mean any loan or advance of funds by such Person to anyother Person, any purchase or other acquisition of any Equity Securities orIndebtedness of any other Person, any capital contribution by such Person toany other Person or any payment under any Guaranty Obligation by such Person inrespect of the Indebtedness of any other Person; provided, however,that Investments shall not include (a) accounts receivable or otherindebtedness owed by customers of such Person which are current assets andarise from sales of inventory in the ordinary course of such Person’s businessor (b) prepaid expenses of such Person incurred and prepaid in the ordinarycourse of business.

 

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“IRC”shall mean the Internal Revenue Code of 1986.

 

“L/CAdvance” shall mean, with respect to each Lender, such Lender’sparticipation in any L/C Borrowing in accordance with its RevolvingProportionate Share.

 

“L/CBorrowing” shall mean an extension of credit resulting from a drawing underany Letter of Credit which has not been reimbursed on the date when made orrefinanced as a Revolving Loan Borrowing.

 

“L/CCredit Extension” shall mean, with respect to any Letter of Credit, theissuance thereof or extension of the expiry date thereof, or the renewal orincrease of the amount thereof.

 

“L/CIssuer” shall mean Wells Fargo (or Trade Bank, as agent for Wells Fargo) inits capacity as issuer of Letters of Credit hereunder, or any successor issuerof Letters of Credit hereunder.

 

“L/CObligations” shall mean, as at any date of determination, the aggregateundrawn face amount of all outstanding Letters of Credit plus the aggregateof all Unreimbursed Amounts, including all L/C Borrowings.

 

“LenderRate Protection Agreement(s)” shall mean one or more Rate ProtectionAgreements with respect to the Indebtedness evidenced by this Agreement betweena Borrower and one or more of the Lenders (or an Affiliate of a Lender, whetheror not such Lender subsequently ceases to be a “Lender” hereunder for anyreason), on terms acceptable to that Borrower and such Lender or Lenders.  Each Lender Rate Protection Agreement shallbe a Loan Document and shall be secured by the Liens created by the SecurityDocuments to the extent set forth in Section 2.15.

 

“Lenders”shall have the meaning given to that term in clause (2) of the introductoryparagraph hereof and includes the L/C Issuer and the Swing Line Lender (unlessthe context otherwise requires).

 

“Letter of Credit” shall mean any letter ofcredit issued hereunder and shall include the Existing Letters of Credit.  A Letter of Credit may be a commercial letterof credit or a standby letter of credit.

 

“Letterof Credit Application” shall mean an application and agreement for theissuance or amendment of a letter of credit in the form from time to time inuse by the L/C Issuer.

 

“Letterof Credit Expiration Date” shall mean the day that is five Business Daysprior to the Revolving Loan Maturity Date.

 

“Letterof Credit Sublimit” shall mean an amount equal to the lesser of the TotalRevolving Loan Commitment and $50,000,000. The Letter of Credit Sublimit is part of, and not in addition to, theTotal Revolving Loan Commitment.

 

“LIBORLoan” shall mean, at any time, a Revolving Loan which then bears interestas provided in clause (ii) of Section 2.01(c).

 

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“LIBORPortion” shall mean, at any time, a Portion of the Term Loan Borrowing or aTerm Loan, as the case may be, which then bears interest at a rate specified inclause (ii) of Section 2.02(c).

 

“LIBORRate” shall mean, with respect to any Interest Period for the LIBOR Loansin any Revolving Loan Borrowing consisting of LIBOR Loans or any LIBOR Portionof the Term Loan Borrowing, a rate *per annum* equalto the quotient (rounded upward if necessary to the nearest 1/32 of onepercent) of (a) the rate *per annum*appearing on the Telerate Page 3750 (or any successor publication) on thesecond Business Day prior to the first day of such Interest Period at or about11:00 a.m. (London time) (for delivery on the first day of such InterestPeriod) for a term comparable to such Interest Period, divided by (b)one minus the Reserve Requirement for such Loans or Portion in effect from timeto time.  If for any reason rates are notavailable as provided in clause (a) of the preceding sentence, the rate to beused in clause (a) shall be the rate *per annum* atwhich Dollar deposits are offered to the Administrative Agent in the Londoninterbank eurodollar currency market on the second Business Day prior to thecommencement of such Interest Period at or about 10:00 a.m. (for delivery onthe first day of such Interest Period) for a term comparable to such InterestPeriod and in an amount approximately equal to the amount of the Loan orPortion to be made or funded by the Administrative Agent as part of suchBorrowing.  The LIBOR Rate shall beadjusted automatically as to all LIBOR Loans and LIBOR Portions thenoutstanding as of the effective date of any change in the Reserve Requirement.

 

“LicenseRevocation” shall mean the loss, revocation, failure to renew, terminationor suspension of any Gaming License issued by any Gaming Authority covering anyGaming Facility; provided, that the transfer of the capital stock ofEmpress Casino Joliet to the Trustee (as defined in the Transfer Agreement)pursuant to the terms of the Transfer Agreement shall not constitute a LicenseRevocation.

 

“LiquorLaws” shall have the meaning given to that term in Section 8.15.

 

“Lien”shall mean, with respect to any property, any security interest, mortgage,pledge, lien, charge or other encumbrance in, of, or on such property or theincome therefrom, including the interest of a vendor or lessor under aconditional sale agreement, Capital Lease or other title retention agreement,or any agreement to provide any of the foregoing, and the filing of anyfinancing statement or similar instrument under the Uniform Commercial Code orcomparable law of any jurisdiction.

 

“Loan”shall mean a Revolving Loan, a Term Loan or a Swing Line Loan.

 

“LoanAccount” shall have the meaning given to that term in Section 2.09(a).

 

“LoanParties” shall mean, collectively, the Borrowers and the RestrictedSubsidiaries.

 

“MaintenanceCapital Expenditures” shall mean Capital Expenditures by the Loan Parties,on a consolidated basis, that are made to maintain, restore or refurbish thecondition or usefulness of property of Argosy or any of its Subsidiaries, orotherwise to support the continuation of such Person’s day to day operations asthen conducted, but that are not properly chargeable to repairs and maintenancein accordance with GAAP.

 

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“MarginStock” shall have the meaning given to that term in Regulation U issued bythe Federal Reserve Board.

 

“MaterialAdverse Effect” shall mean a material adverse effect on: (a) the business,operations or condition (financial or otherwise) of the Loan Parties, taken asa whole; (b) the ability of any Borrower to pay or perform its Obligations inaccordance with the terms of this Agreement and the other Credit Documents; (c)the rights or remedies of the Administrative Agent or any Lender under thisAgreement, the other Credit Documents or any related document, instrument oragreement; (d) the value of the Collateral, the Administrative Agent’s or anyLender’s security interest in the Collateral or the perfection or priority ofsuch security interests; (e) the validity of any of the Credit Documents;or (f) the use, occupancy or operation of the Gaming Facilities taken as awhole.

 

“MaterialAgreements” shall mean, collectively, the certificate or articles ofincorporation and bylaws, partnership agreement, limited liability company oroperating agreement or other formation or organizational documents of eachBorrower, the Development Agreements, the Baton Rouge Leases, the 2001 SeniorSubordinated Indenture, the 2001 Senior Subordinated Notes, the 2004 SeniorSubordinated Indenture, the 2004 Senior Subordinated Notes and any otherdocuments or agreements evidencing the issuance of subordinated debt by anyBorrower.

 

“maturity”shall mean, with respect to any Loan, interest, fee or other amount payable byany Borrower under this Agreement or the other Credit Documents, the date suchLoan, interest, fee or other amount becomes due, whether upon the statedmaturity or due date, upon acceleration or otherwise.

 

“MultiemployerPlan” shall mean any multiemployer plan within the meaning ofsection 3(37) of ERISA maintained or contributed to by Argosy or any ERISAAffiliate.

 

“NetGaming Revenues” shall mean with respect to any fiscal period, all gamingrevenues of the Loan Parties which are subject to taxation by any GamingAuthority.

 

“NetIncome” shall mean with respect to any Person for any fiscal period, thenet income of such Person determined in accordance with GAAP, consistentlyapplied.

 

“NetProceeds” shall mean:

 

(a)           With respect to any sale of any assetor property by any Person, the aggregate consideration received by such Personfrom such sale less the sum of (i) the amount of liabilities for taxesincurred by such Person in connection with such sale (after taking into accountavailable deductions, credits, carry-backs, carry-forwards or similar itemsrelating to the assets or property sold) based upon the overall effective taxrate payable by such Person for the tax year in question, (ii) the sum of theactual amount of the reasonable fees and commissions payable to Persons otherthan such Person or any Affiliate of such Person, the reasonable legal expensesand other costs and expenses directly related to such sale that are to be paidby such Person and (iii) the amount of any indebtedness (other than theObligations) which is secured by such asset and is required to be repaid orprepaid by such Person as a result of such sale;

 

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(b)           With respect to any sale or issuanceof any Indebtedness by any Person, the aggregate consideration received by suchPerson from such sale or issuance less the sum of the actual amount ofthe reasonable fees and commissions payable to Persons other than such Personor any Affiliate of such Person, the reasonable legal expenses and the otherreasonable costs and expenses directly related to such sale or issuance thatare to be paid by such Person; and

 

(c)           With respect to any issuance ofEquity Securities by any Person, the aggregate consideration received by suchPerson from such issuance less the sum of the actual amount of thereasonable fees and commissions payable to Persons other than such Person orany Affiliate of such Person and the other reasonable costs and expenses(including reasonable legal expenses) directly related to such issuance thatare to be paid by such Person; provided, however, that for thepurpose of this clause (c), an issuance of Equity Securities shall notinclude any of the following: (i) any capital contribution made by Argosy orany Subsidiary of Argosy to any Subsidiary of Argosy, whether or not evidencedby any issuance or sale of Equity Securities by any Subsidiary of Argosy toArgosy or any other Subsidiary of Argosy; or (ii) any issuance by anySubsidiary of Argosy of Equity Securities in connection with the formation ofSubsidiaries pursuant to transactions otherwise permitted pursuant to Sections 5.02(d)and 5.02(e).

 

“Net Worth” shall mean, as at any date ofdetermination, total stockholders’ equity of the Loan Parties (determined on aconsolidated basis without duplication in accordance with GAAP).

 

“New Venture” shall mean a Person in which anyLoan Party has made an Investment that is not (either before or after givingeffect to such Investment) a Subsidiary.

 

“Non-GamingNew Venture” shall mean any New Venture which is not a Gaming New Venture.

 

“Non-GamingSubsidiary” shall mean any Subsidiary which is not a Gaming Subsidiary.

 

“Nonrenewal Notice Date” shall have the meaninggiven to that term in Section 2.03(b)(iii).

 

“Note”shall mean a Revolving Loan Note, a Term Loan Note or a Swing Line Note.

 

“Noticeof Borrowing” shall mean a Notice of Revolving Loan Borrowing, the Noticeof Term Loan Borrowing or a Notice of Swing Line Borrowing.

 

“Noticeof Interest Period Selection” shall mean a Notice of Revolving LoanInterest Period Selection or Notice of Term Loan Interest Period Selection.

 

“Noticeof Conversion” shall mean a Notice of Revolving Loan Conversion or Noticeof Term Loan Conversion.

 

“Noticeof Revolving Loan Borrowing” shall have the meaning given to that term in Section2.01(b).

 

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“Noticeof Revolving Loan Conversion” shall have the meaning given to that term in Section2.01(d).

 

“Noticeof Revolving Loan Interest Period Selection” shall have the meaning givento that term in Section 2.01(e).

 

“Noticeof Swing Line Borrowing” shall mean a notice of a Swing Line Borrowingpursuant to Section 2.04(b), which, if in writing, shall besubstantially in the form of Exhibit F.

 

“Noticeof Term Loan Conversion” shall have the meaning given to that term in Section 2.02(d).

 

“Noticeof Term Loan Interest Period Selection” shall have the meaning given tothat term in Section 2.02(e).

 

“Obligations”shall mean and include all loans, advances, debts, liabilities, andobligations, howsoever arising, owed by any one or more of the Loan Parties tothe Administrative Agent or any Lender of every kind and description (whetheror not evidenced by any note or instrument and whether or not for the paymentof money), direct or indirect, absolute or contingent, due or to become due,now existing or hereafter arising pursuant to the terms of this Agreement orany of the other Credit Documents, including all Loans, L/C Obligations,interest (including interest that accrues after the commencement by or againstany Loan Party or any Affiliate thereof of any proceeding under anyliquidation, conservatorship, bankruptcy, moratorium, rearrangement,receivership, insolvency, reorganization, or similar debtor relief laws namingsuch Person as the debtor in such proceeding), fees, charges, expenses,attorneys’ fees and accountants’ fees owing by the Borrowers or payable by theBorrowers hereunder or thereunder.

 

“Participant”shall have the meaning given to that term in Section 8.05(b).

 

“PBGC”shall mean the Pension Benefit Guaranty Corporation.

 

“PermittedIndebtedness” shall have the meaning given to that term in Section5.02(a).

 

“PermittedLiens” shall have the meaning given to that term in Section 5.02(b).

 

“Person”shall mean and include an individual, a partnership, a corporation (including abusiness trust), a joint stock company, an unincorporated association, alimited liability company, a joint venture, a trust or other entity or aGovernmental Authority.

 

“Portion”shall mean a portion of the principal amount of the Term Loan Borrowing or aTerm Loan.  The Term Loan Borrowing shallconsist of one or more Portions, and each Term Loan comprising the Term LoanBorrowing shall consist of the same number of Portions, with each such TermLoan Portion corresponding pro rata to a Term Loan Borrowing Portion.  Any reference to a Portion of the Term LoanBorrowing shall include the corresponding Portion of each Term Loan comprisingthe Term Loan Borrowing.

 

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“PricingCertificate” shall have the meaning given to that term in clause (iv) of Section 5.01(a).

 

“PrimeRate” shall mean the *per annum* rateat any time the rate of interest most recently announced within Wells Fargo atits principal office in San Francisco, California as its Prime Rate, withthe understanding that Wells Fargo’s Prime Rate is one of its base rates andserves as the basis upon which effective rates of interest are calculated forthose loans making reference thereto, and is evidenced by the recording thereofafter its announcement in such internal publication or publications as WellsFargo may designate.  Any change in theBase Rate resulting from a change in the Prime Rate shall become effective onthe Business Day on which each change in the Prime Rate occurs.

 

“ProportionateShare” shall mean (a) with respect to a Revolving Lender, its RevolvingProportionate Share and (b) with respect to a Term Lender, its TermProportionate Share.

 

“QuarterlyDates” shall mean the last day of March, June, September and December ineach year, the first of which shall be the first such day after the RestatementEffective Date; provided, that if any such day is not a Business Day,then such Quarterly Date shall be the next succeeding Business Day (unless suchBusiness Day falls in a subsequent calendar month, in which event suchQuarterly Date shall be the next preceding Business Day).

 

“RateProtection Agreements” shall mean one or more written agreements between aLoan Party and one or more financial institutions providing for a “swap,” “cap,”“collar” or other interest rate protection to such Loan Party with respect toany Indebtedness of such Loan Party or a “swap,” “cap,” “collar” or otherforeign exchange protection to such Loan Party with respect to its operationsoutside the United States.

 

“Register”shall have the meaning given to that term in Section 8.05(d).

 

“ReportableEvent” shall have the meaning given to that term in Section 4043(c) ofERISA and applicable regulations thereunder, excluding any such event withrespect to which notice to the PBGC has been waived by regulation.

 

“RequiredClass Lenders” shall mean, at any time, (a) with respect to the Class ofRevolving Loans, the Required Revolving Lenders and (b) with respect to theClass of Term Loans, the Required Term Lenders.

 

“RequiredLenders” shall mean, at any time, the Lenders whose Proportionate Sharesthen exceed 50% of the total Proportionate Shares of all Lenders, except thatthe Proportionate Shares of any Lender that is a Defaulting Lender shall beexcluded in determining “Required Lenders”, and “Required Lenders” shallthereupon mean non-Defaulting Lenders having total Proportionate Sharesexceeding 50% of the total Proportionate Shares of all non-Defaulting Lenders,but in no event shall Required Lenders consist of fewer than three (3) Lenders;provided, however, that if there are fewer than three (3) Lendersat such time, Required Lenders shall mean all non-Defaulting Lenders at suchtime.

 

“RequiredRevolving Lenders” shall mean Revolving Lenders holding in excess of 50% ofthe Revolving Loan Commitments (or, if the Revolving Loan Commitments areterminated,

 

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RevolvingLenders having in excess of 50% of the sum of (x) the Effective Amount of allRevolving Loans and (y) the Revolving Proportionate Shares multiplied by theEffective Amount of all L/C Obligations and all Swing Line Loans at any timeoutstanding), except that the Revolving Loans and Revolving ProportionateShares of any Lender that is a Defaulting Lender shall be excluded indetermining “Required Revolving Lenders”, and “Required Revolving Lenders”shall thereupon mean non-Defaulting Lenders having total Revolving LoanCommitments exceeding 50% of the total Revolving Loan Commitments of allnon-Defaulting Lenders (or, if the Revolving Loan Commitments are terminated,non-Defaulting Lenders having in excess of 50% of the sum of (x) the EffectiveAmount of the total Revolving Loans of all non-Defaulting Lenders and (y) theRevolving Proportionate Shares of all non-Defaulting Lenders multiplied by theEffective Amount of all L/C Obligations and all Swing Line Loans at any timeoutstanding).

 

“RequiredTerm Lenders” shall mean (a) on or prior to the Restatement Effective Date,Term Lenders holding in excess of 50% of the Term Loan Commitments or (b) afterthe Restatement Effective Date, Term Lenders having in excess of 50% of theEffective Amount of all Term Loans, except that the Term Loan Commitments andTerm Loans of any Lender that is a Defaulting Lender shall be excluded indetermining “Required Term Lenders”, and “Required Term Lenders” shallthereupon mean non-Defaulting Lenders having Term Loans exceeding 50% of the totalTerm Loans of all non-Defaulting Lenders.

 

“Requirementof Law” applicable to any Person shall mean (a) any Governmental Ruleapplicable to such Person, (b) any conditions or requirements contained in anylicense, permit, approval or other authorization granted by any GovernmentalAuthority to or for the benefit of such Person or (c) any judgment, decision ordetermination of any Governmental Authority or arbitrator, in each caseapplicable to or binding upon such Person or any of its property or to whichsuch Person or any of its property is subject.

 

“ReserveRequirement” shall mean, with respect to any day in an Interest Period fora LIBOR Loan or LIBOR Portion, the aggregate of the reserve requirement rates(expressed as a decimal) in effect on such day for eurocurrency funding(currently referred to as “Eurocurrency liabilities” in Regulation D of theFederal Reserve Board) maintained by a member bank of the Federal ReserveSystem.  As used herein, the term “reserverequirement” shall include, without limitation, any basic, supplemental oremergency reserve requirements imposed on any Lender by any GovernmentalAuthority.

 

“RestatementEffective Date” shall mean September 30, 2004.

 

“RestrictedSubsidiary” shall mean any Subsidiary of Argosy (other than the Borrowers)designated by the Borrowers as a Restricted Subsidiary and meeting thefollowing conditions at the time of designation: (a) such Subsidiary is notsubject to any Liens except Permitted Liens and Liens created in connectionwith a Security Agreement, (b) such Subsidiary has executed and deliveredto the Administrative Agent a joinder agreement to the Credit Agreement (unlessexecution and delivery of a joinder agreement to the Credit Agreement isprohibited by any Requirement of Law, in which case such Subsidiary shall haveexecuted and delivered to the Administrative Agent a joinder agreement to theGuaranty (or if the Guaranty has not previously been executed, shall haveexecuted the Guaranty)) and has executed and delivered to the

 

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Administrative Agent such security instruments,mortgages, ship mortgages and other documents as the Administrative Agent mayreasonably require for the purpose of adding its assets, real and personal, asadditional Collateral securing repayment of the Obligations and the CreditAgreement or Guaranty, as applicable (each in form and substance satisfactoryto the Administrative Agent), (c) all of the Equity Securities of suchSubsidiary have been pledged in favor of the Administrative Agent by a SecurityAgreement, and (d) such Subsidiary has been designated by Argosy to be aRestricted Subsidiary by written notice thereof to the Administrative Agent,subject to Argosy’s right to redesignate such Subsidiary as an UnrestrictedSubsidiary by written notice thereof to the Administrative Agent so long as:(i) no Default or Event of Default has occurred and is continuing, and(ii) giving effect to such redesignation as of the end of the mostrecently ended Fiscal Quarter on a pro forma basis, no Default or Event ofDefault would exist under the financial covenants set forth in Section 5.03;provided, however, that (x) absent the prior written consent ofthe Administrative Agent and the Required Lenders, each Gaming Subsidiary inwhich 100% of the voting Equity Securities of such Subsidiary are beneficiallyowned directly by Argosy and/or another Loan Party shall be a RestrictedSubsidiary (in which event the Borrowers shall comply, and shall cause suchRestricted Subsidiary to comply, with Section 5.01(j)) and (y) subjectto the foregoing clause (x), to the extent a newly formed or acquiredGaming Subsidiary in which 100% of the voting Equity Securities of suchSubsidiary are beneficially owned directly by Argosy and/or another Loan Partyis not declared a Restricted Subsidiary or an Unrestricted Subsidiary within 90days of its formation or acquisition and the Administrative Agent and theRequired Lenders have not provided written consent during such 90-day periodallowing the Borrowers to designate such Subsidiary as an UnrestrictedSubsidiary, such Subsidiary shall be deemed to have been designated by theBorrowers as a Restricted Subsidiary.

 

“ReverseTrigger Event” shall have the meaning set forth in the Transfer Agreement.

 

“RevolvingLender” shall mean (a) on the Restatement Effective Date, the Lendershaving Revolving Loan Commitments at such time and (b) thereafter, theLenders from time to time holding Revolving Loans and Revolving LoanCommitments after giving effect to any assignments permitted by Section 8.05(c).

 

“RevolvingLoan” shall have the meaning given to that term in Section 2.01(a).

 

“RevolvingLoan Borrowing” shall mean a borrowing by the Borrowers consisting of theRevolving Loans made by each of the Lenders on the same date and of the sameType pursuant to a single Notice of Revolving Loan Borrowing.

 

“RevolvingLoan Commitment” shall mean, with respect to each Lender, the Dollar amountset forth in the Register maintained with the Administrative Agent.

 

“RevolvingLoan Maturity Date” shall mean September 30, 2009; provided, that upon theBorrowers’ written request made on or prior to September 30, 2009, such datemay be extended to September 30, 2010 with the approval of all of the RevolvingLenders so long as no Default or Event of Default shall have occurred and becontinuing.

 

“RevolvingLoan Note” shall have the meaning given to that term in Section 2.09(b).

 

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“RevolvingLoan Pricing Grid” shall mean:

 

RevolvingLoan Pricing Grid

(ratesare expressed in basis points *per annum*)

 
| **Tier** | ** ** | **Total Funded Debt to   EBITDA Ratio** | ** ** | **Applicable   Margin for   LIBOR   Loans   (bps)** | ** ** | **Applicable   Margin for   Base Rate   Loans   (bps)** | ** ** | **Commitment****Fee   Percentage   (bps)** | ** ** |
|----------|------------|-----------------------------------------|------------|-----------------------------------------------------|------------|---------------------------------------------------------|------------|--------------------------------------------|------------|
| 1        |       | < 2.50                               |       | 125.0                                               |       | 0                                                       |       | 25.0                                       |       |
| 2        |       | > 2.50, < 3.00                    |       | 137.5                                               |       | 12.5                                                    |       | 25.0                                       |       |
| 3        |       | > 3.00, < 3.50                    |       | 150.0                                               |       | 25.0                                                    |       | 37.5                                       |       |
| 4        |       | > 3.50, < 4.00                    |       | 175.0                                               |       | 50.0                                                    |       | 37.5                                       |       |
| 5        |       | > 4.00, < 4.50                    |       | 200.0                                               |       | 75.0                                                    |       | 37.5                                       |       |
| 6        |       | > 4.50                               |       | 225.0                                               |       | 100.0                                                   |       | 50.0                                       |       |

 

TheApplicable Margin for LIBOR Loans, the Applicable Margin for Base Rate Loansand the Commitment Fee Percentage effective as of the Restatement EffectiveDate shall be based upon the Pricing Certificate delivered on to theRestatement Effective Date with respect to the period of four fiscal quartersending on June 30, 2004.  Thereafter, anyincrease or decrease in the Applicable Margin for LIBOR Loans, the ApplicableMargin for Base Rate Loans and the Commitment Fee Percentage resulting from achange in the Total Funded Debt to EBITDA Ratio shall become effective as ofthe sixtieth day following the last day of the quarter prior to the date themost recent Pricing Certificate is delivered pursuant to Section 5.01(a);provided, however, that (1) if no Pricing Certificate isdelivered when due in accordance with such Section, then Tier 6 shall apply asof the date of the failure to deliver such Pricing Certificate until such dateas Argosy delivers such Pricing Certificate and thereafter the ApplicableMargin for LIBOR Loans, the Applicable Margin for Base Rate Loans and theCommitment Fee Percentage shall be based on the Total Funded Debt to EBITDARatio indicated on such Pricing Certificate until such time as the ApplicableMargin for LIBOR Loans, the Applicable Margin for Base Rate Loans and theCommitment Fee Percentage is further adjusted as set forth in this definitionand (2) if a Pricing Certificate erroneously indicates an Applicable Margin forLIBOR Loans, Applicable Margin for Base Rate Loans or Commitment Fee Percentagewhich is (x) more favorable to the Borrowers than should be afforded by theactual calculation of the Total Funded Debt to EBITDA Ratio, the Borrowersshall promptly pay additional interest and Commitment Fees to correct for sucherror, and (y) less favorable to the Borrowers than should be afforded by theactual calculation of the Total Funded Debt to EBITDA Ratio, the RevolvingLenders shall promptly reimburse the Borrowers an amount equal to such excessinterest and Commitment Fees to correct for such error.

 

“RevolvingProportionate Share” shall mean:

 

(a)           With respect to any Revolving Lenderat any time prior to the Restatement Effective Date, the ratio (expressed as apercentage rounded to the eighth digit to the right of the

 

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decimal point) of (i) suchLender’s Revolving Loan Commitment at such time to (ii) the TotalRevolving Loan Commitment at such time;

 

(b)           With respect to any Revolving Lenderat any time after the Restatement Effective Date and prior to the RevolvingLoan Maturity Date, the ratio (expressed as a percentage rounded to the eighthdigit to the right of the decimal point) of (i) such Lender’s Revolving LoanCommitment at such time to (ii) the Total Revolving Loan Commitment atsuch time; and

 

(c)           With respect to any Revolving Lenderat any time after the Revolving Loan Maturity Date, the ratio (expressed as apercentage rounded to the eighth digit to the right of the decimal point) of(i) the sum of (A) the aggregate Effective Amount of such Lender’s RevolvingLoans, (B) such Lender’s Proportionate Share of the Effective Amount of all L/CObligations, and (C) such Lender’s Proportionate Share of the aggregateEffective Amount of all Swing Line Loans to (ii) the sum of (A) theaggregate Effective Amount of all Revolving Loans and Swing Line Loans and (B)the Effective Amount of all L/C Obligations.

 

 “Security Documents” shall mean andinclude the Existing Assignments, the Existing Mortgages, the Existing SecurityAgreements, the Existing Ship Mortgages, the Cash Collateral Pledge Agreementand the Trademark Security Agreement, each as amended (or amended and restated)in connection with this Agreement in form and substance satisfactory to theAdministrative Agent and the Lenders, all documents evidencing the creation orperfection of a security interest by any Subsidiary of a Borrower pursuant to Section5.01(j), and all other instruments, agreements, certificates, opinions anddocuments (including Uniform Commercial Code financing statements and fixturefilings and landlord waivers) delivered to the Administrative Agent or anyLender in connection with any Collateral or to secure the Obligations.

 

“SeniorFunded Debt” shall mean, as at any date of determination, all Total FundedDebt of the Loan Parties that is not Subordinated Indebtedness.

 

“SeniorFunded Debt to EBITDA Ratio” shall mean, as of each date of determination,the ratio of (a) Senior Funded Debt as of that date, to (b) EBITDA for the fourconsecutive fiscal quarter period most recently ended.

 

“Solvent”shall mean, with respect to any Person on any date, that on such date (a) thefair value of the property of such Person is greater than the fair value of theliabilities (including contingent, subordinated, matured and unliquidatedliabilities) of such Person, (b) the present fair saleable value of the assetsof such Person is greater than the amount that will be required to pay theprobable liability of such Person on its debts as they become absolute andmatured, (c) such Person does not intend to, and does not believe that it will,incur debts or liabilities beyond such Person’s ability to pay as such debtsand liabilities mature and (d) such Person is not engaged in or about to engagein business or transactions for which such Person’s property would constitute anunreasonably small capital.

 

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“SubordinatedIndebtedness” shall mean the Indebtedness evidenced by the 2001 SeniorSubordinated Notes, the Indebtedness evidenced by the 2004 Senior SubordinatedNotes and all other subordinated Indebtedness permitted by Section5.02(a)(viii) or 5.02(a)(xii).

 

“Subsidiary”of any Person shall mean (a) any corporation of which more than 50% of theissued and outstanding Equity Securities having ordinary voting power to electa majority of the board of directors of such corporation (irrespective ofwhether at the time capital stock of any other class or classes of suchcorporation shall or might have voting power upon the occurrence of anycontingency) is at the time directly or indirectly owned or controlled by suchPerson, by such Person and one or more of its other Subsidiaries or by one ormore of such Person’s other Subsidiaries or (b) any partnership, joint venture,limited liability company or other association of which more than 50% of theequity interest having the power to vote, direct or control the management ofsuch partnership, joint venture or other association is at the time owned andcontrolled by such Person, by such Person and one or more of the other Subsidiariesor by one or more of such Person’s other Subsidiaries.  Unless otherwise indicated in this Agreement,“Subsidiary” shall mean a Subsidiary of Argosy.

 

“SuretyInstruments” shall mean all letters of credit (including standby andcommercial), banker’s acceptances, bank guaranties, shipside bonds, suretybonds and similar instruments.

 

“SwingLine” shall mean the revolving credit facility made available by the SwingLine Lender pursuant to Section 2.04.

 

“SwingLine Borrowing” shall mean a borrowing of a Swing Line Loan.

 

“SwingLine Lender” shall mean Wells Fargo in its capacity as provider of SwingLine Loans, or any successor swing line lender hereunder.

 

“SwingLine Loan” has the meaning specified in Section 2.04(a).

 

“SwingLine Note” shall have the meaning given to that term in Section 2.09(d).

 

“SwingLine Sublimit” shall mean an amount equal to the lesser of (a) $20,000,000and (b) the Total Revolving Loan Commitment. The Swing Line Sublimit is part of, and not in addition to, the TotalRevolving Loan Commitment.

 

“SyndicationAgent” shall mean each of Calyon New York Branch and Bank of Scotland intheir respective capacities as co-syndication agent.

 

“Taxes”shall have the meaning given to such term in Section 2.13(a).

 

“TermLender” shall mean (a) on the Restatement Effective Date, the Lendershaving Term Loan Commitments at such time and (b) thereafter, the Lendersfrom time to time holding Term Loans after giving effect to any assignmentspermitted by Section 8.05(c)

 

“TermLoan” shall have the meaning given to that term in Section 2.02(a).

 

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“TermLoan Borrowing” shall mean the borrowing by the Borrowers consisting of theTerm Loans made by each of the Term Lenders.

 

“TermLoan Commitment” shall mean, with respect to each Lender, the Dollar amountset forth under the caption “Term Loan Commitment” in the Register maintainedby the Administrative Agent.

 

“TermLoan Installment Date” shall have the meaning given to that term in Section 2.02(f).

 

“TermLoan Maturity Date” shall mean June 30, 2011.

 

“TermLoan Note” shall have the meaning given to that term in Section 2.09(c).

 

“TermProportionate Share” shall mean:

 

(a)           With respect to any Term Lender atany time prior to the Restatement Effective Date, the ratio (expressed as apercentage rounded to the eighth digit to the right of the decimal point) of(i) such Term Lender’s Term Loan Commitment at such time to (ii) theTotal Term Loan Commitment at such time; and

 

(b)           With respect to any Term Lender atany time after the Restatement Effective Date, the ratio (expressed as apercentage rounded to the eighth digit to the right of the decimal point) of(i) the Effective Amount of such Term Lender’s Term Loan outstanding at suchtime to (ii) the Effective Amount of all Term Loans outstanding at suchtime.

 

“TerminationValue” shall mean, in respect of any one or more Rate ProtectionAgreements, after taking into account the effect of any legally enforceablenetting agreement relating to such Rate Protection Agreements, (a) for any dateon or after the date such Rate Protection Agreements have been closed out andtermination value(s) determined in accordance therewith, such terminationvalue(s), and (b) for any date prior to the date referenced in clause (a), theamount(s) determined as the mark-to-market value(s) for such Rate ProtectionAgreements, as determined by the Administrative Agent based upon one or moremid-market or other readily available quotations provided by any recognizeddealer in such Rate Protection Agreements which may include any Lender.

 

“Total Funded Debt” shall mean the obligationsof the Loan Parties on a consolidated basis which are described in clauses (a),(b), (c), (d), (e) and (g) of the definition of “Indebtedness”; provided,however, that guaranties by any Loan Party of Indebtedness of any Personin an aggregate amount of up to $250,000,000 shall not constitute Total FundedDebt except to the extent the amount of Indebtedness guaranteed is required tobe reflected as a liability on the Borrowers’ balance sheet in accordance withGAAP.

 

“TotalFunded Debt to EBITDA Ratio” shall mean, as of each date of determination,the ratio of (a) Total Funded Debt as of that date, to (b) EBITDA for thefour fiscal quarter period most recently ended.

 

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“TotalRevolving Loan Commitment” shall mean, at any time, Five Hundred MillionDollars ($500,000,000) or, if such amount is reduced pursuant to Section2.05 or increased pursuant to Section 2.17, the amount to which soreduced or increased and in effect at such time.

 

“TotalTerm Loan Commitment” shall mean, subject to Section 2.05(c)(iii), One Hundred Seventy Five Million Dollars($175,000,000).

 

“TradeBank” shall mean Wells Fargo HSBC Trade Bank, N.A.

 

“TrademarkSecurity Agreement” shall mean that certain Second Amended and RestatedTrademark Security Agreement, dated as of July 31, 2001, by certain of theBorrowers in favor of the Administrative Agent, as further amended or amendedand restated, in form and substance satisfactory to the Administrative Agent.

 

“TransferAgreement” shall mean that certain Transfer of Ownership Agreement, datedas of July 24, 2001, among Argosy, Empress Casino Joliet and the IllinoisGaming Board, as amended, restated, supplemented or otherwise modified fromtime to time.

 

“TriggerEvent” shall have the meaning set forth in the Transfer Agreement.

 

“Type”shall mean, with respect to any Loan, Borrowing or Portion at any time, theclassification of such Loan, Borrowing or Portion by the type of interest rateit then bears, whether an interest rate based upon the Base Rate or the LIBORRate.

 

“UnreimbursedAmount” has the meaning set forth in Section 2.03(c)(i).

 

“UnrestrictedSubsidiaries” shall mean all Subsidiaries of Argosy other than theRestricted Subsidiaries.

 

“UnusedCommitment” shall mean, at any time, the remainder of (a) the TotalRevolving Loan Commitment at such time minus (b) the sum of (i) theEffective Amount of all Revolving Loans outstanding at such time and (ii) theEffective Amount of all L/C Obligations outstanding at such time.

 

“Vessels”shall mean, collectively, the documented and undocumented vessels, barges,watercraft and floating structures utilized by the Loan Parties, as of theRestatement Effective Date or thereafter, in the operation of their riverboatcasino businesses.

 

“WellsFargo” shall mean Wells Fargo Bank, National Association.

 

1.02.        GAAP.  Unlessotherwise indicated in this Agreement or any other Credit Document, allaccounting terms used in this Agreement or any other Credit Document shall beconstrued, and all accounting and financial computations hereunder orthereunder shall be computed, in accordance with GAAP.  If GAAP changes during the term of thisAgreement such that any covenants contained herein would then be calculated ina different manner or with different components, the Borrowers, the Lenders andthe Administrative Agent agree to negotiate in good faith to amend thisAgreement in such respects as are necessary to conform those covenants ascriteria for evaluating the Borrowers’ financial condition to substantially the

 

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samecriteria as were effective prior to such change in GAAP; provided, however,that, until the Borrowers, the Lenders and the Administrative Agent so amendthis Agreement, all such covenants shall be calculated in accordance with GAAPas in effect immediately prior to such change.

 

1.03.        Headings. Headings in this Agreement and each of the other Credit Documents arefor convenience of reference only and are not part of the substance hereof orthereof.

 

1.04.        Plural Terms. All terms defined in this Agreement or any other Credit Document in thesingular form shall have comparable meanings when used in the plural form andvice versa.

 

1.05.        Time.  Allreferences in this Agreement and each of the other Credit Documents to a timeof day shall mean San Francisco, California time, unless otherwise indicated.

 

1.06.        Governing Law. Unless otherwise expressly provided in any Credit Document, thisAgreement and each of the other Credit Documents shall be governed by andconstrued in accordance with the laws of the State of New York.

 

1.07.        Construction. This Agreement is the result of negotiations among, and has beenreviewed by, the Borrowers, the Lenders, the Administrative Agent and theirrespective counsel.  Accordingly, thisAgreement shall be deemed to be the product of all parties hereto, and noambiguity shall be construed in favor of or against any Borrower, any Lender orthe Administrative Agent.

 

1.08.        Entire Agreement.  This Agreement and each of the other CreditDocuments, taken together, constitute and contain the entire agreement of theBorrowers, the Lenders and the Administrative Agent and supersede any and allprior agreements, negotiations, correspondence, understandings andcommunications among the parties, whether written or oral, respecting thesubject matter hereof (excluding the Administrative Agent’s Fee Letter).  To the extent that any termor provision of this Agreement conflicts with any of the terms or provisions ofthe Security Documents in effect as of the Restatement Effective Date, theterms and provisions of this Agreement shall control except as otherwiserequired by applicable law.

 

1.09.        Calculation of Interest and Fees.  All calculations of interest and fees underthis Agreement and the other Credit Documents for any period (a) shallinclude the first day of such period and exclude the last day of such periodand (b) shall be calculated on the basis of a year of 360 days for actualdays elapsed, except that during any period any Loan or Portion bears interestbased upon the Prime Rate, such interest shall be calculated on the basis of ayear of 365 or 366 days, as appropriate, for actual days elapsed.

 

1.10.        References.

 

(a)           References in this Agreement to “Recitals,”“Sections,” “Exhibits” and “Schedules” are to recitals, sections, exhibits andschedules herein and hereto unless otherwise indicated.

 

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(b)           References in this Agreement or anyother Credit Document to any document, instrument or agreement (i) shallinclude all exhibits, schedules and other attachments thereto, (ii) shallinclude all documents, instruments or agreements issued or executed inreplacement thereof if such replacement is permitted hereby, and (iii) shallmean such document, instrument or agreement, or replacement or predecessorthereto, as amended, modified and supplemented from time to time and in effectat any given time if such amendment, modification or supplement is permittedhereby.

 

(c)           References in this Agreement or anyother Credit Document to any Governmental Rule (i) shall include any successorGovernmental Rule, (ii) shall include all rules and regulations promulgatedunder such Governmental Rule (or any successor Governmental Rule), and (iii)shall mean such Governmental Rule (or successor Governmental Rule) and suchrules and regulations, as amended, modified, codified or reenacted from time totime and in effect at any given time.

 

(d)           References in this Agreement or anyother Credit Document to any Person in a particular capacity (i) shall includeany successors to and permitted assigns of such Person in that capacity and (ii)shall exclude such Person individually or in any other capacity.

 

(e)           References in this Agreement or anyother Credit Document to the “Class” of a Loan (or of a Commitment to make aLoan) refers to whether such Loan is a Revolving Loan or a Term Loan, each ofwhich constitutes a Class.

 

1.11.        Other Interpretive Provisions.  The words “hereof,” “herein” and “hereunder”and words of similar import when used in this Agreement or any other CreditDocument shall refer to this Agreement or such other Credit Document, as thecase may be, as a whole and not to any particular provision of this Agreementor such other Credit Document, as the case may be.  The words “include” and “including” and wordsof similar import when used in this Agreement or any other Credit Documentshall not be construed to be limiting or exclusive.  In the event of any inconsistency between theterms of this Agreement and the terms of any other Credit Document, the termsof this Agreement shall govern.

 

**ARTICLE II.******            **CREDIT FACILITIES.**

 

2.01.        Revolving Loan Facility.

 

(a)           Revolving Loan Availability.  Subject to the terms and conditions of thisAgreement (including the amount limitations set forth in Section 2.05),each Revolving Lender severally agrees to advance to the Borrowers from time totime during the period beginning on the Restatement Effective Date and endingon the Revolving Loan Maturity Date such loans as the Borrowers may requestunder this Section 2.01 (individually, a “Revolving Loan”); provided,however, that (i) the sum of (A) the Effective Amount of all RevolvingLoans made by such Revolving Lender at any time outstanding and (B) suchRevolving Lender’s Revolving Proportionate Share of the Effective Amount of allL/C Obligations and all Swing Line Loans at any time outstanding shall notexceed such Revolving Lender’s Revolving Loan Commitment at such time and (ii)the sum of (A) the Effective Amount of all Revolving Loans made by all theRevolving Lenders at any time outstanding and (B) the Effective Amount of allL/C Obligations

 

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andSwing Line Loans at any time outstanding shall not exceed the Total RevolvingLoan Commitment at such time.  AllRevolving Loans shall be made on a *pro rata* basisby the Revolving Lenders in accordance with their respective RevolvingProportionate Shares, with each Revolving Loan Borrowing to be comprised of aRevolving Loan by each Revolving Lender equal to such Lender’s RevolvingProportionate Share of such Revolving Loan Borrowing.  Except as otherwiseprovided herein, the Borrowers may borrow, repay and reborrow Revolving Loansuntil the Revolving Loan Maturity Date.

 

(b)           Notice of Revolving Loan Borrowing.  The Borrowers shall request each RevolvingLoan Borrowing by delivering to the Administrative Agent an irrevocable writtennotice in the form of Exhibit A, appropriately completed (a “Noticeof Revolving Loan Borrowing”), which specifies, among other things:

 

(i)            The principal amount of the requestedRevolving Loan Borrowing, which shall be in the amount of (A) $1,000,000 or anintegral multiple of $100,000 in excess thereof in the case of a Borrowingconsisting of Base Rate Loans; or (B) $5,000,000 or an integral multiple of$1,000,000 in excess thereof in the case of a Borrowing consisting of LIBORLoans;

 

(ii)           Whether the requested Revolving LoanBorrowing is to consist of Base Rate Loans or LIBOR Loans;

 

(iii)          If the requested Revolving LoanBorrowing is to consist of LIBOR Loans, the initial Interest Periods selectedby the Borrowers for such LIBOR Loans in accordance with Section 2.01(e);and

 

(iv)          The date of therequested Revolving Loan Borrowing, which date shall be a Business Day;

 

provided,however, that all Revolving Loan Borrowings made during the periodcommencing on the date of this Agreement and ending three (3) Business Daysthereafter shall consist solely of Base Rate Loans.  The Borrowers shall give each Notice ofRevolving Loan Borrowing to the Administrative Agent not later than 11:00 a.m.at least three (3) Business Days before the date of the requested RevolvingLoan Borrowing in the case of a Revolving Loan Borrowing consisting of LIBORLoans and not later than 11:00 a.m. at least one (1) Business Day before thedate of the requested Revolving Loan Borrowing in the case of a Revolving LoanBorrowing consisting of Base Rate Loans. Each Notice of Revolving Loan Borrowing shall be delivered byfirst-class mail or facsimile to the Administrative Agent at the office orfacsimile number and during the hours specified in Section 8.01.  The Administrative Agent shall promptlynotify each Lender of the contents of each Notice of Revolving Loan Borrowingand of the amount and Type of (and, if applicable, the Interest Period for) theRevolving Loan to be made by such Lender as part of the requested RevolvingLoan Borrowing.

 

(c)           Revolving Loan Interest Rates.  The Borrowers shall pay interest on theunpaid principal amount of each Revolving Loan from the date of such RevolvingLoan until the maturity thereof, at one of the following rates *per annum*:

 

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(i)            During such periods as such RevolvingLoan is a Base Rate Loan, at a rate *per annum* equalto the Base Rate plus the Applicable Margin therefor, such rate to change fromtime to time as the Applicable Margin or Base Rate shall change; and

 

(ii)           During such periods as such RevolvingLoan is a LIBOR Loan, at a rate *per annum* equalat all times during each Interest Period for such LIBOR Loan to the LIBOR Ratefor such Interest Period plus the Applicable Margin therefor,such rate to change from time to time during such Interest Period as theApplicable Margin shall change.

 

AllRevolving Loans in each Revolving Loan Borrowing shall, at any given time priorto maturity, bear interest at one, and only one, of the above rates.  The number of Revolving Loan Borrowingsconsisting of LIBOR Loans shall not exceed ten (10) at any time.

 

(d)           Conversion of Revolving Loans.  Subject to Section 2.14, the Borrowersmay convert any Revolving Loan Borrowing from one Type of Revolving LoanBorrowing to the other Type; provided, however, that no Base RateLoan may be converted into a LIBOR Loan after the occurrence and during thecontinuance of an Event of Default.  TheBorrowers shall request such a conversion by an irrevocable written notice tothe Administrative Agent in the form of Exhibit B, appropriatelycompleted (a “Notice of Revolving Loan Conversion”), which specifies,among other things:

 

(i)            The Revolving Loan Borrowing which isto be converted;

 

(ii)           The Type of Revolving Loan Borrowinginto which such Revolving Loan Borrowing is to be converted;

 

(iii)          If such Revolving Loan Borrowing is tobe converted into a Revolving Loan Borrowing consisting of LIBOR Loans, theinitial Interest Period selected by the Borrowers for such LIBOR Loans inaccordance with Section 2.01(e); and

 

(iv)          The date of therequested conversion, which date shall be a Business Day.

 

TheBorrowers shall give each Notice of Revolving Loan Conversion to the AdministrativeAgent not later than 11:00 a.m. at least three (3) Business Days before thedate of the requested conversion.  EachNotice of Revolving Loan Conversion shall be delivered by first-class mail orfacsimile to the Administrative Agent at the office or to the facsimile numberand during the hours specified in Section 8.01.  The Administrative Agent shall promptlynotify each Lender of the contents of each Notice of Revolving Loan Conversion.

 

(e)           LIBOR Loan Interest Periods.

 

(i)            The initial and each subsequentInterest Period selected by the Borrowers for a Revolving Loan Borrowingconsisting of LIBOR Loans shall be one (1), two (2), three (3) or six (6)months; provided, however, that (A) any Interest Period whichwould otherwise end on a day which is not a Business Day shall be extended tothe next succeeding Business Day unless such next Business Day falls in anothercalendar month, in which case such Interest Period shall end on the immediatelypreceding Business Day; (B) any Interest Period

 

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whichbegins on the last Business Day of a calendar month (or on a day for whichthere is no numerically corresponding day in the calendar month at the end ofsuch Interest Period) shall end on the last Business Day of a calendar monthand (C) no Interest Period shall end after the Revolving Loan Maturity Date.

 

(ii)           The Borrowers shall notify theAdministrative Agent by an irrevocable written notice in the form of ExhibitC, appropriately completed (a “Notice of Revolving Loan Interest PeriodSelection”), not later than 11:00 a.m. at least three (3) Business Daysprior to the last day of each Interest Period for a Revolving Loan Borrowingconsisting of LIBOR Loans of the Interest Period selected by the Borrowers forthe next succeeding Interest Period for such LIBOR Loans; provided, however,that no LIBOR Loan shall be continued for an additional Interest Period afterthe occurrence and during the continuance of an Event of Default.  Each Notice of Revolving Loan Interest PeriodSelection shall be given by first-class mail or facsimile to the office or thefacsimile number and during the hours specified in Section 8.01.  If (A) the Borrowers fails to notify theAdministrative Agent of the next Interest Period for a Revolving Loan Borrowingconsisting of LIBOR Loans in accordance with this Section 2.01(e)or (B) an Event of Default has occurred and is continuing on the last day of anInterest Period for any LIBOR Loan, such LIBOR Loan(s) shall automatically convertto Base Rate Loan(s) on the last day of the current Interest Period therefor.

 

(f)            Scheduled Revolving Loan Payments.  The Borrowers shall repay the principalamount of the Revolving Loans on the Revolving Loan Maturity Date.  The Borrowers shall pay accrued interest onthe unpaid principal amount of each Revolving Loan in arrears (i) in the caseof a Base Rate Loan, on the last Business Day of each March, June, Septemberand December, (ii) in the case of a LIBOR Loan, on the last day of each InterestPeriod therefor (and, if any such Interest Period is longer than three (3)months, every three (3) months) and upon prepayment (to the extent thereof) and(iii) in the case of all Revolving Loans, at maturity.

 

(g)           Purpose.  The Borrowers shall use the proceeds of theRevolving Loans (i) to continue and convert R/C Funded Outstandings (as definedin the Existing Credit Agreement) into Revolving Loans in accordance with Section8.14, (ii) together with the proceeds of the Term Loans, to repay theprincipal amount of, and all interest accrued on, the “Term Loan” under and asdefined in the Existing Credit Agreement, (iii) to refinance other existingIndebtedness of the Borrowers, (iv) to finance capital expenditures andpermitted acquisitions and (v) to provide for working capital and other generalcorporate purposes of the Borrowers.

 

2.02.        Term Loan Facility.

 

(a)           Term Loan Availability.  Subject to the terms and conditions of thisAgreement, each Term Lender severally agrees to advance to the Borrowers in asingle advance on the Restatement Effective Date a loan under this Section2.02 (individually, a “Term Loan”); provided, however,that (i) the principal amount of the Term Loan made by such Lender shall notexceed such Lender’s Term Loan Commitment on such date and (ii) the aggregateprincipal amount of all Term Loans made by all Lenders shall not exceed theTotal Term Loan Commitment on such date. The Term Loans shall be made on a *pro rata* basisby the Term Lenders in accordance with their respective Term ProportionateShares, with the Term Loan Borrowing to be comprised of a Term Loan by eachTerm Lender equal to such Lender’s Term 

 

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Proportionate Share of the Term Loan Borrowing.  The Borrowers may not reborrow the principalamount of a Term Loan after repayment or prepayment thereof.

 

(b)           Term Loan Borrowing.  Each Term Lender severally agrees to make theproceeds of its Term Loan available to the Borrowers on the proposedRestatement Effective Date selected by the Borrowers; provided, that theentire amount of the Term Loan Borrowing made on the Restatement Effective Dateshall be a Base Rate Portion.  If for anyreason the Restatement Effective Date shall occur on a date other than the dateproposed by the Borrowers and the Term Lenders shall have made the proceeds oftheir Term Loans available to the Administrative Agent in anticipation of afunding of the Term Loans, then (i) the Administrative Agent shall retain suchfunds and, if practicable, invest such funds in overnight securities selectedby the Administrative Agent and (ii) the Borrowers shall pay interest on suchfunds to the Term Lenders at a *per annum* rateequal to the Base Rate plus 0.50% (after credit for any interest earned on suchovernight securities), whether or not the Restatement Effective Date shalloccur.  If for any reason the RestatementEffective Date shall not occur on the next succeeding Business Day, theAdministrative Agent shall return such funds to the Term Lenders by 3:00 p.m.on such next succeeding Business Day.

 

(c)           Term Loan Interest Rates.  The Borrowers shall pay interest on theunpaid principal amount of each Term Loan from the date of such Term Loan untilthe maturity thereof, at the following rates per annum:

 

(i)            During such periods as any Portion ofsuch Term Loan is a Base Rate Portion, at a rate *per annum*on such Portion equal to the Base Rate plus the Applicable Margin therefor,such rate to change from time to time as the Applicable Margin or Base Rate shallchange; and

 

(ii)           During such periods as any Portion ofsuch Term Loan is a LIBOR Portion, at a rate *per annum*on such Portion equal at all times during each Interest Period for such Portionto the LIBOR Rate for such Interest Period plus the Applicable Margintherefor, such rate to change from time to time as the Applicable Margin shallchange.

 

EachBase Rate Portion of the Term Loan Borrowing shall be in a minimum amount of$1,000,000 or an integral multiple of $100,000 in excess thereof and each LIBORPortion of the Term Loan Borrowing shall be in a minimum amount of $5,000,000or an integral multiple of $1,000,000 in excess thereof (except to the extentthat any lesser Portion results from a mandatory prepayment of the Term Loanspursuant to Section 2.07(c)).  Thenumber of LIBOR Portions of the Term Loan Borrowing shall not exceed six (6) atany time.

 

(d)           Conversion of Term Loan Portions.  The Borrowers may convert any Portion of theTerm Loan Borrowing from one Type of Portion to another Type; provided, however,that any conversion of a LIBOR Portion into a Base Rate Portion shall be madeon, and only on, the last day of an Interest Period for such LIBOR Portion andthat no Base Rate Portion may be converted into a LIBOR Portion after theoccurrence and during the continuance of an Event of Default.  The Borrowers shall request such a conversionby an irrevocable written notice to the Administrative Agent in the form of ExhibitD, appropriately completed (a “Notice of Term Loan Conversion”),which specifies, among other things:

 

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(i)            The Portion of the Term LoanBorrowing which is to be converted;

 

(ii)           The amount and Type of each Portion ofthe Term Loan Borrowing into which it is to be converted;

 

(iii)          If any Portion of the Term LoanBorrowing is to be converted into a LIBOR Portion, the initial Interest Periodselected by the Borrowers for such Portion in accordance with Section2.02(e); and

 

(iv)          The date of therequested conversion, which shall be a Business Day.

 

TheBorrowers shall give each Notice of Term Loan Conversion to the AdministrativeAgent not later than 11:00 a.m. at least three (3) Business Days before thedate of the requested conversion.  EachNotice of Term Loan Conversion shall be delivered by first-class mail orfacsimile to the Administrative Agent at the office or to the facsimile numberand during the hours specified in Section 8.01.  The Administrative Agent shall promptlynotify each Lender of the contents of each Notice of Term Loan Conversion.

 

(e)           LIBOR Portion Interest Periods.

 

(i)            The initial and each subsequentInterest Period selected by the Borrowers for a LIBOR Portion of the Term LoanBorrowing shall be one (1), two (2), three (3) or six (6) months; provided,however, that (A) any Interest Period which would otherwise end on a daywhich is not a Business Day shall be extended to the next succeeding BusinessDay unless such next Business Day falls in another calendar month, in whichcase such Interest Period shall end on the immediately preceding Business Day;(B) any Interest Period which begins on the last Business Day of a calendarmonth (or on a day for which there is no numerically corresponding day in thecalendar month at the end of such Interest Period) shall end on the lastBusiness Day of a calendar; (C) no Interest Period shall end after a Term LoanInstallment Date unless, after giving effect to such Interest Period, theaggregate principal amount of the Base Rate Portion and all LIBOR Portions havingInterest Periods ending on or prior to such Term Loan Installment Date equalsor exceeds the principal payment due on such Term Loan Installment Date; (D) noInterest Period shall end after the Term Loan Maturity Date; and (E) no LIBORPortion of the Term Loan Borrowing shall be continued for an additionalInterest Period after the occurrence and during the continuance of an Event ofDefault.

 

(ii)           The Borrowers shall notify theAdministrative Agent by an irrevocable written notice in the form of ExhibitE, appropriately completed (a “Notice of Term Loan Interest PeriodSelection”), not later than 11:00 a.m. at least three (3) Business Daysprior to the last day of each Interest Period for a LIBOR Portion of the TermLoan Borrowing of the Interest Period selected by the Borrowers for the nextsucceeding Interest Period for such Portion. Each Notice of Term Loan Interest Period Selection shall be given byfirst-class mail or facsimile to the office or the facsimile number and duringthe hours specified in Section 8.01. If (A) the Borrowers fail to notify the Administrative Agent of the nextInterest Period for a LIBOR Portion of the Term Loan Borrowing in accordancewith this Section 2.02(e) or (B) an Event of Default has occurred and iscontinuing on the last day of an Interest Period for any LIBOR

 

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Portionof the Term Loan Borrowing, such LIBOR Portion shall automatically convert to aBase Rate Portion on the last day of the current Interest Period therefor.

 

(f)            Scheduled Term Loan Payments.  The Borrowers shall repay the principalamount of the Term Loans in (i) twenty-three installments of $437,500 each,payable on the last****Business Dayin each March, June, September and December, commencing on December 31, 2004and ending on June 30, 2010 and (ii) four installments of $41,234,375 each,payable on the last****Business Dayin each March, June, September and December, commencing on September 30, 2010and ending on the Term Loan Maturity Date (each date referred to in clause (i)or clause (ii), a “Term Loan Installment Date”); provided, however,that the principal payment due on the Term Loan Maturity Date shall be in theamount necessary to pay all remaining unpaid principal on the Term Loans.  The Borrowers shall pay accrued interest onthe unpaid principal amount of each Term Loan in arrears (x) in the case of aBase Rate Portion, on the last****Business Dayin each March, June, September and December, (y) in the case of a LIBORPortion, on the last day of each Interest Period (and if any such InterestPeriod is equal to or longer than three (3) months, every three (3) months) andupon prepayment (to the extent thereof); and (z) in the case of all Term Loans,at maturity.

 

(g)           Purpose.  The Borrowers shall use the proceeds of theTerm Loans, together with a portion of the proceeds of the Revolving Loans, torepay the principal amount of, and all interest accrued on, the “Term Loan”under and as defined the Existing Credit Agreement.

 

2.03.        Letters of Credit.

 

(a)           The Letter of Credit Commitment.

 

(i)            Subject to the terms and conditionsset forth herein, (A) the L/C Issuer agrees, in reliance upon the agreements ofthe other Revolving Lenders set forth in this Section 2.03, from time totime on any Business Day during the period from the Restatement Effective Dateuntil the Letter of Credit Expiration Date, to issue Letters of Credit for theaccount of any Borrower, and to amend or renew Letters of Credit previouslyissued by it, in accordance with subsection (b) below; and (B) the RevolvingLenders severally agree to participate in Letters of Credit issued for theaccount of any Borrower; provided, that the L/C Issuer shall not beobligated to make any L/C Credit Extension with respect to any Letter of Credit,and no Revolving Lender shall be obligated to participate in, any Letter ofCredit if as of the date of such L/C Credit Extension, (x) the aggregateEffective Amount of the Revolving Loans of any Revolving Lender, plussuch Lender’s Revolving Proportionate Share of the Effective Amount of all L/CObligations, plus such Lender’s Revolving Proportionate Share of theEffective Amount of all Swing Line Loans would exceed such Lender’s RevolvingLoan Commitment, or (y) the Effective Amount of the L/C Obligations wouldexceed the Letter of Credit Sublimit. Within the foregoing limits, and subject to theterms and conditions hereof, the Borrowers’ ability to obtain Letters of Creditshall be fully revolving, and accordingly any Borrower may, during theforegoing period, obtain Letters of Credit to replace Letters of Credit thathave expired or that have been drawn upon and reimbursed.  All Existing Letters of Credit shall bedeemed to have been issued pursuant hereto, and from and after the RestatementEffective Date shall be subject to and governed by the terms and conditionshereof.

 

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(ii)           The L/C Issuer shall be under noobligation to issue any Letter of Credit if:

 

(A)          any order, judgment or decree of any GovernmentalAuthority or arbitrator shall by its terms purport to enjoin or restrain theL/C Issuer from issuing such Letter of Credit, or any Requirement of Lawapplicable to the L/C Issuer or any request or directive (whether or not havingthe force of law) from any Governmental Authority with jurisdiction over theL/C Issuer (i) shall prohibit, or request that the L/C Issuer refrainfrom, the issuance of letters of credit generally or such Letter of Credit inparticular or (ii) unless agreed to be reimbursed by the Borrower,(1) shall impose upon the L/C Issuer with respect to such Letter of Creditany restriction, reserve or capital requirement (for which the L/C Issuer isnot otherwise compensated hereunder) not in effect on the Restatement EffectiveDate, or (2) shall impose upon the L/C Issuer any unreimbursed loss, costor expense which was not applicable on the Restatement Effective Date and whichthe L/C Issuer in good faith deems material to it;

 

(B)           subject to Section 2.03(b)(iii),the expiry date of such requested Letter of Credit would occur more than twelvemonths after the date of issuance or last renewal, unless the RequiredRevolving Lenders have approved such expiry date;

 

(C)           the expiry date of such requestedLetter of Credit would occur after the Letter of Credit Expiration Date, unlessall the Revolving Lenders have approved such expiry date; or

 

(D)          such Letter ofCredit is in a face amount less than $100,000, in the case of a commercialLetter of Credit, or $250,000, in the case of a standby Letter of Credit, ordenominated in a currency other than Dollars.

 

(iii)          The L/C Issuer shall be under noobligation to amend any Letter of Credit if (A) the L/C Issuer would have noobligation at such time to issue such Letter of Credit in its amended formunder the terms hereof, or (B) the beneficiary of such Letter of Credit doesnot accept the proposed amendment to such Letter of Credit.

 

(b)           Procedures for Issuance andAmendment of Letters of Credit; Evergreen Letters of Credit.

 

(i)            Each Letter of Credit shall be issuedor amended, as the case may be, upon the request of any Borrower delivered tothe L/C Issuer (with a copy to the Administrative Agent) in the form of aLetter of Credit Application, appropriately completed and signed by an authorizedofficer of such Borrower.  Such L/CApplication must be received by the L/C Issuer and the Administrative Agent notlater than 11:00 a.m., at least two Business Days (or such later date and timeas the L/C Issuer may agree in a particular instance in its sole discretion)prior to the proposed issuance date or date of amendment, as the case maybe.  In the case of a request for aninitial issuance of a Letter of Credit, such Letter of Credit Application shallspecify in form and detail satisfactory to the L/C Issuer: (A) the proposedissuance date of the requested Letter of Credit (which date shall be a BusinessDay); (B) the amount thereof; (C) the expiry date thereof; (D) the name andaddress of the beneficiary thereof; (E) the documents to be presented by suchbeneficiary in case of any drawing thereunder; (F) the full text of any 

 

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certificate to be presented bysuch beneficiary in case of any drawing thereunder; and (G) such other mattersas the L/C Issuer may require.  In thecase of a request for an amendment of any outstanding Letter of Credit, suchLetter of Credit Application shall specify in form and detail satisfactory tothe L/C Issuer (A) the Letter of Credit to be amended; (B) the proposed date ofamendment thereof (which date shall be a Business Day); (C) the nature of theproposed amendment; and (D) such other matters as the L/C Issuer may require.

 

(ii)           Promptly after receipt of any Letterof Credit Application, the L/C Issuer will confirm with the AdministrativeAgent (by telephone or in writing) that the Administrative Agent has received acopy of such Letter of Credit Application from the Borrowers and, if not, theL/C Issuer will provide the Administrative Agent with a copy thereof.  Upon receipt by the L/C Issuer ofconfirmation from the Administrative Agent that the requested issuance oramendment is permitted in accordance with the terms hereof, then, subject tothe terms and conditions hereof, the L/C Issuer shall, on the requested date,issue a Letter of Credit for the account of the Borrowers or enter into theapplicable amendment, as the case may be, in each case in accordance with theL/C Issuer’s usual and customary business practices.  Immediately upon the issuance of each Letterof Credit, each Revolving Lender shall be deemed to, and hereby irrevocably andunconditionally agrees to, purchase from the L/C Issuer a participation in suchLetter of Credit in an amount equal to the product of such Lender’s RevolvingProportionate Share times the amount of such Letter of Credit.

 

(iii)          If any Borrower so requests in anyapplicable Letter of Credit Application, the L/C Issuer may, in its sole andabsolute discretion, agree to issue a Letter of Credit that has automaticrenewal provisions (each, an “Evergreen Letter of Credit”); provided,that any such Evergreen Letter of Credit must permit the L/C Issuer to preventany such renewal at least once in each twelve-month period (commencing with thedate of issuance of such Letter of Credit) by giving prior notice to thebeneficiary thereof not later than a day (the “Nonrenewal Notice Date”)in each such twelve-month period to be agreed upon at the time such Letter ofCredit is issued.  Unless otherwisedirected by the L/C Issuer, the Borrowers shall not be required to make aspecific request to the L/C Issuer for any such renewal.  Once an Evergreen Letter of Credit has beenissued, the Lenders shall be deemed to have authorized (but may not require)the L/C Issuer to permit the renewal of such Letter of Credit at any time to adate not later than the Letter of Credit Expiration Date; provided, however,that the L/C Issuer shall not permit any such renewal if (A) the L/C Issuerwould have no obligation at such time to issue such Letter of Credit in itsrenewed form under the terms hereof, or (B) it has received notice (which maybe by telephone or in writing) on or before the Business Day immediatelypreceding the Nonrenewal Notice Date (1) from the Administrative Agent that theRequired Revolving Lenders have elected not to permit such renewal or (2) fromthe Administrative Agent, any Lender or any Borrower that one or more of theapplicable conditions specified in Section 3.02 is not then satisfied.

 

(iv)          Promptly after its delivery of anyLetter of Credit or any amendment to a Letter of Credit to an advising bankwith respect thereto or to the beneficiary thereof, the L/C Issuer will alsodeliver to the Borrowers, the Lenders with Revolving Loan Commitments and theAdministrative Agent a true and complete copy of such Letter of Credit oramendment.

 

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(c)           Drawings and Reimbursements;Funding of Participations.

 

(i)            Upon any drawing under any Letter ofCredit, the L/C Issuer shall notify the Borrowers and the Administrative Agentthereof.  Not later than 11:00 a.m. onthe date of any payment by the L/C Issuer under a Letter of Credit (each suchdate, an “Honor Date”), the Borrowers shall reimburse the L/C Issuerthrough the Administrative Agent in an amount equal to the amount of suchdrawing.  If the Borrowers fail to soreimburse the L/C Issuer by such time, the Administrative Agent shall promptlynotify each Revolving Lender of the Honor Date, the amount of the unreimburseddrawing (the “Unreimbursed Amount”), and such Lender’s RevolvingProportionate Share thereof.  In suchevent, the Borrowers shall be deemed to have requested a Revolving LoanBorrowing of Base Rate Loans to be disbursed on the Honor Date in an amountequal to the Unreimbursed Amount, without regard to the minimum and multiplesspecified in Section 2.01 for the principal amount of Base Rate Loans,but subject to the amount of the unutilized portion of the Total Revolving LoanCommitment and the conditions set forth in Section 3.02 (other than thedelivery of a Revolving Loan Notice). Any notice given by the L/C Issuer or the Administrative Agent pursuantto this Section 2.03(c)(i) may be given by telephone if immediatelyconfirmed in writing; provided, that the lack of such an immediateconfirmation shall not affect the conclusiveness or binding effect of suchnotice.

 

(ii)           Each Revolving Lender (including theLender acting as L/C Issuer) shall upon any notice pursuant to Section2.03(c)(i) make funds available to the Administrative Agent for the accountof the L/C Issuer at the Administrative Agent’s Office in an amount equal toits Revolving Proportionate Share of the Unreimbursed Amount not later than11:00 a.m. on the Business Day specified in such notice by the AdministrativeAgent, whereupon, subject to the provisions of Section 2.03(c)(iii),each Lender that so makes funds available shall be deemed to have made a BaseRate Loan to the applicable Borrower in such amount.  The Administrative Agent shall remit the fundsso received to the L/C Issuer.

 

(iii)          With respect to any Unreimbursed Amountthat is not fully repaid by the applicable Borrower or not fully refinanced bya Revolving Loan Borrowing because the conditions set forth in Section 3.02cannot be satisfied or for any other reason, such Borrower shall be deemed tohave incurred from the L/C Issuer an L/C Borrowing in the amount of theUnreimbursed Amount that is not so refinanced, which L/C Borrowing shall be dueand payable on demand (together with interest) and shall bear interest at therate applicable to Revolving Loans upon the occurrence and during thecontinuance of an Event of Default.  Insuch event, each Revolving Lender’s payment to the Administrative Agent for theaccount of the L/C Issuer pursuant to Section 2.03(c)(ii)shall be deemed payment in respect of its participation in such L/C Borrowingand shall constitute an L/C Advance from such Lender in satisfaction of itsparticipation obligation under this Section 2.03.

 

(iv)          Until eachRevolving Lender funds its Revolving Loan or L/C Advance pursuant to this Section2.03(c) to reimburse the L/C Issuer for any amount drawn under any Letterof Credit, interest in respect of such Revolving Lender’s RevolvingProportionate Share of such amount shall be solely for the account of the L/CIssuer.

 

(v)           Each Revolving Lender’s obligation tomake Revolving Loans or L/C Advances to reimburse the L/C Issuer for amountsdrawn under Letters of Credit, as 

 

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contemplatedby this Section 2.03(c), shall be absolute and unconditional and shallnot be affected by any circumstance, including (A) any set-off, counterclaim,recoupment, defense or other right which such Lender may have against the L/CIssuer, any Borrower or any other Person for any reason whatsoever; (B) theoccurrence or continuance of a Default or Event of Default, or (C) any otheroccurrence, event or condition, whether or not similar to any of theforegoing.  Any such reimbursement shallnot relieve or otherwise impair the obligation of the Borrowers to reimbursethe L/C Issuer for the amount of any payment made by the L/C Issuer under anyLetter of Credit, together with interest as provided herein.

 

(vi)          If any Revolving Lender fails to makeavailable to the Administrative Agent for the account of the L/C Issuer anyamount required to be paid by such Lender pursuant to the foregoing provisionsof this Section 2.03(c) by the time specified in Section 2.03(c)(ii),the L/C Issuer shall be entitled to recover from such Revolving Lender (actingthrough the Administrative Agent), on demand, such amount with interest thereonfor the period from the date such payment is required to the date on which suchpayment is immediately available to the L/C Issuer at a rate per annum equal tothe Federal Funds Rate from time to time in effect.  A certificate of the L/C Issuer submitted toany Revolving Lender (through the Administrative Agent) with respect to anyamounts owing under this clause (vi) shall beconclusive absent manifest error.

 

(d)           Repayment of Participations.

 

(i)            At any time after the L/C Issuer hasmade a payment under any Letter of Credit and has received from any RevolvingLender such Lender’s L/C Advance in respect of such payment in accordance with Section2.03(c), if the Administrative Agent receives for the account of the L/CIssuer any payment related to such Letter of Credit (whether directly from theBorrowers or otherwise, including proceeds of Cash Collateral applied theretoby the Administrative Agent), or any payment of interest thereon, theAdministrative Agent will distribute to such Lender its Revolving ProportionateShare thereof in the same funds as those received by the Administrative Agent.

 

(ii)           If any payment received by the AdministrativeAgent for the account of the L/C Issuer pursuant to Section 2.03(c)(i)is required to be returned, each Revolving Lender shall pay to theAdministrative Agent for the account of the L/C Issuer its RevolvingProportionate Share thereof on demand of the Administrative Agent, plusinterest thereon from the date of such demand to the date such amount isreturned by such Lender, at a rate per annum equal to the Federal Funds Ratefrom time to time in effect.

 

(e)           Obligations Absolute.  The obligation of the Borrowers to reimbursethe L/C Issuer for each drawing under each Letter of Credit, and to repay eachL/C Borrowing and each drawing under a Letter of Credit that is refinanced by aBorrowing of Revolving Loans, shall be absolute, unconditional and irrevocable,and shall be paid strictly in accordance with the terms of this Agreement underall circumstances, including the following:

 

(i)            any lack ofvalidity or enforceability of such Letter of Credit, this Agreement, or anyother agreement or instrument relating thereto;

 

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(ii)           the existence of any claim,counterclaim, set-off, defense or other right that the Borrowers may have atany time against any beneficiary or any transferee of such Letter of Credit (orany Person for whom any such beneficiary or any such transferee may be acting),the L/C Issuer or any other Person, whether in connection with this Agreement,the transactions contemplated hereby or by such Letter of Credit or anyagreement or instrument relating thereto, or any unrelated transaction;

 

(iii)          any draft, demand, certificate or otherdocument presented under such Letter of Credit proving to be forged,fraudulent, invalid or insufficient in any respect or any statement thereinbeing untrue or inaccurate in any respect; or any loss or delay in thetransmission or otherwise of any document required in order to make a drawingunder such Letter of Credit;

 

(iv)          any payment by the L/C Issuer undersuch Letter of Credit against presentation of a draft or certificate that doesnot strictly comply with the terms of such Letter of Credit to the extent notresulting from the gross negligence or willful misconduct of the L/C Issuer; orany payment made by the L/C Issuer under such Letter of Credit to any Personpurporting to be a trustee in bankruptcy, debtor-in-possession, assignee forthe benefit of creditors, liquidator, receiver or other representative of orsuccessor to any beneficiary or any transferee of such Letter of Credit,including any arising in connection with any proceeding under any Debtor ReliefLaw; or

 

(v)           any other circumstance or happeningwhatsoever, whether or not similar to any of the foregoing, including any othercircumstance that might otherwise constitute a defense available to, or adischarge of, the Borrowers to the extent such circumstance or happening doesnot result from the gross negligence or willful misconduct of the L/C Issuer.

 

TheBorrowers shall promptly examine a copy of each Letter of Credit and each amendmentthereto that is delivered to them and, in the event of any claim ofnoncompliance with the Borrowers’ instructions or other irregularity, theBorrowers will immediately notify the L/C Issuer.  The Borrowers shall be conclusively deemed tohave waived any such claim against the L/C Issuer and its correspondents unlesssuch notice is given as aforesaid.

 

(f)            Role of L/C Issuer.  Each of the Borrowers and the Lenders agreesthat, in paying any drawing under a Letter of Credit, the L/C Issuer shall not haveany responsibility to obtain any document (other than any sight draft,certificates and documents expressly required by the Letter of Credit) or toascertain or inquire as to the validity or accuracy of any such document or theauthority of the Person executing or delivering any such document.  Neither the Administrative Agent nor the L/CIssuer nor any of their respective affiliates, directors, officers, employees,agents or advisors nor any of the correspondents, participants or assignees ofthe L/C Issuer shall be liable to any Lender for (i) any action taken oromitted in connection herewith at the request or with the approval of theLenders or the Required Revolving Lenders, as applicable; (ii) any action takenor omitted in the absence of gross negligence or willful misconduct; or (iii)the due execution, effectiveness, validity or enforceability of any document orinstrument related to any Letter of Credit or Letter of CreditApplication.  The Borrowers hereby assumeall risks of the acts or omissions of any beneficiary or transferee withrespect to its use of any Letter of Credit; provided, however,that this assumption is not intended to, and

 

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shallnot, preclude the Borrowers’ pursuing such rights and remedies as they may haveagainst the beneficiary or transferee at law or under any other agreement.  Neither the Administrative Agent nor the L/CIssuer nor any of their respective affiliates, directors, officers, employees,agents or advisors nor any of the correspondents, participants or assignees ofthe L/C Issuer shall be liable or responsible for any of the matters describedin clauses (i) through (v) of Section 2.03(e); provided, however,that anything in such clauses to the contrary notwithstanding, the Borrowersmay have a claim against the L/C Issuer, and the L/C Issuer may be liable tothe Borrowers, to the extent, but only to the extent, of any direct, as opposedto consequential or exemplary, damages suffered by the Borrowers which the Borrowersprove were caused by the L/C Issuer’s willful misconduct or gross negligence orthe L/C Issuer’s willful failure to pay under any Letter of Credit after thepresentation to it by the beneficiary of a sight draft and certificate(s)strictly complying with the terms and conditions of a Letter of Credit.  In furtherance and not in limitation of theforegoing, the L/C Issuer may accept documents that appear on their face to bein order, without responsibility for further investigation, regardless of anynotice or information to the contrary, and the L/C Issuer shall not beresponsible for the validity or sufficiency of any instrument transferring orassigning or purporting to transfer or assign a Letter of Credit or the rightsor benefits thereunder or proceeds thereof, in whole or in part, which mayprove to be invalid or ineffective for any reason.

 

(g)           Cash Collateral.  Upon the request of the Administrative Agent,(i) if the L/C Issuer has honored any full or partial drawing request under anyLetter of Credit and such drawing has resulted in an L/C Borrowing, or (ii) if,as of the Letter of Credit Expiration Date, any Letter of Credit may for anyreason remain outstanding and partially or wholly undrawn, the Borrowers shallimmediately Cash Collateralize the Obligations in an amount equal to the thenEffective Amount of the L/C Obligations.

 

(h)           Applicability of ISP98 and UCP.  Unless otherwise expressly agreed by the L/CIssuer and the Borrowers when a Letter of Credit is issued (including any such agreementapplicable to an Existing Letter of Credit), (i) the rules of the “InternationalStandby Practices 1998” published by the Institute of International Banking Law& Practice (or such later version thereof as may be in effect at the timeof issuance) shall apply to each standby Letter of Credit, and (ii) the rulesof the Uniform Customs and Practice for Documentary Credits, as most recentlypublished by the International Chamber of Commerce (the “ICC”) at thetime of issuance (including the ICC decision published by the Commission onBanking Technique and Practice on April 6, 1998 regarding the European singlecurrency (euro)) shall apply to each commercial Letter of Credit.

 

(i)            Letter of Credit Fees.  The Borrowers shall pay to the AdministrativeAgent for the account of each Revolving Lender in accordance with its RevolvingProportionate Share a Letter of Credit fee for each Letter of Credit equal tothe Applicable Margin for LIBOR Loans times the actual daily maximumamount available to be drawn under each such Letter of Credit.  Such fee for each Letter of Credit shall bedue and payable on the last Business Day of each March, June, September andDecember, commencing with the first such date to occur after the issuance ofsuch Letter of Credit, and on the Letter of Credit Expiration Date.  If there is any change in the ApplicableMargin for LIBOR Loans during any quarter, the actual daily amount of eachLetter of Credit shall be computed and multiplied by the Applicable Margin forLIBOR

 

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Loansseparately for each period during such quarter that such Applicable Margin forLIBOR Loans was in effect.

 

(j)            Fronting Fee and Documentary andProcessing Charges Payable to L/C Issuer. The Borrowers shall pay directly to the L/C Issuer for its own account afronting fee in an amount with respect to each Letter of Credit equal to 1/4 of1% of the amount of such Letter of Credit, due and payable upon each L/C CreditExtension with respect to such Letter of Credit; provided, that in thecase of an increase in the amount of a Letter of Credit after the issuancethereof, such fronting fee shall be payable only on the increased amountthereof.  In addition, the Borrowersshall pay directly to the L/C Issuer for its own account the customaryissuance, presentation, amendment and other processing fees, and other standardcosts and charges, of the L/C Issuer relating to letters of credit as from timeto time in effect.  Such fees and chargesare due and payable on demand and are nonrefundable.

 

(k)           Conflict with Letter of CreditApplication.  In the event of anyconflict between the terms hereof and the terms of any Letter of CreditApplication, the terms hereof shall control.

 

(l)            Trade Bank as L/C Issuer.  The parties hereto acknowledge and agreethat, at its option, Wells Fargo, as L/C Issuer may arrange for Letters ofCredit to be issued by Trade Bank as agent for Wells Fargo.  All parties hereto understand and agree thatto the extent any Letters of Credit are issued by Trade Bank as agent for WellsFargo, (i) Trade Bank is agent only to Wells Fargo and not to the Borrowers andhas no obligations to the Borrowers, (ii) the Letters of Credit issued by TradeBank will be deemed Letters of Credit issued by the L/C Issuer for all purposeshereunder and (iii) any of the obligations performed or rights exercisedpursuant to or in connection with the issuance of any Letter of Credit by TradeBank shall be deemed obligations performed or rights exercised by Wells Fargo asL/C Issuer.  To the extent that the L/CIssuer is required to provide any notices to, or take any other actions for thebenefit of, the Administrative Agent hereunder, with respect to any Letter ofCredit issued by Trade Bank, no such notice or action shall be required.

 

2.04.        Swing Line.

 

(a)           The Swing Line.  Subject to the terms and conditions set forthherein, the Swing Line Lender agrees to make loans (each such loan, a “SwingLine Loan”) to the Borrowers from time to time on any Business Day during theperiod from the Restatement Effective Date to the Revolving Loan Maturity Datein an aggregate amount not to exceed at any time outstanding the amount of theSwing Line Sublimit, notwithstanding the fact that such Swing Line Loans, whenaggregated with the Effective Amount of Revolving Loans of the Swing LineLender in its capacity as a Lender of Revolving Loans, may exceed the amount ofsuch Lender’s Commitment; provided, however, that after givingeffect to any Swing Line Loan (i) the aggregate Effective Amount of theRevolving Loans of any Lender, plus such Lender’s RevolvingProportionate Share of the Effective Amount of all L/C Obligations, plussuch Lender’s Revolving Proportionate Share of the Effective Amount of allSwing Line Loans shall not exceed such Lender’s Revolving Loan Commitment and(ii) the aggregate Effective Amount of all Revolving Loans made by all theRevolving Lenders at any time outstanding plus the Effective Amount ofall L/C Obligations and Swing Line Loans at any time outstanding shall not

 

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exceed the Total Revolving LoanCommitment at such time, and provided, further, that the SwingLine Lender shall not make any Swing Line Loan to refinance an outstandingSwing Line Loan.  Within the foregoing limits, and subject to the other terms and conditionshereof, the Borrowers may borrow under this Section 2.04, prepayunder Section 2.07, and reborrow under this Section 2.04.  Immediately upon the making of a Swing LineLoan, each Lender shall be deemed to, and hereby irrevocably andunconditionally agrees to, purchase from the Swing Line Lender a riskparticipation in such Swing Line Loan in an amount equal to the product of suchLender’s Revolving Proportionate Share times the amount of such SwingLine Loan.

 

(b)           Borrowing Procedures.  Each Swing Line Borrowing shall be made uponthe Borrowers’ irrevocable notice to the Swing Line Lender and theAdministrative Agent, which may be given by telephone. Each such notice must bereceived by the Swing Line Lender and the Administrative Agent not later than11:00 a.m., on the requested borrowing date, and shall specify (i) the amountto be borrowed, which amount shall be a minimum of $100,000, and (ii) therequested borrowing date, which date shall be a Business Day.  Each such telephonic notice must be confirmedpromptly by delivery to the Swing Line Lender and the Administrative Agent of awritten Notice of Swing Line Borrowing, appropriately completed and signed byan authorized officer of the Borrowers. Promptly after receipt by the Swing Line Lender of any telephonic Noticeof Swing Line Borrowing, the Swing Line Lender will confirm with theAdministrative Agent (by telephone or in writing) that the Administrative Agenthas also received such Notice of Swing Line Borrowing and, if not, the SwingLine Lender will notify the Administrative Agent (by telephone or in writing)of the contents thereof.  Unless theSwing Line Lender has received notice (by telephone or in writing) from theAdministrative Agent (including at the request of any Lender) prior to 12:00noon, on the date of the proposed Swing Line Borrowing (A) directing the SwingLine Lender not to make such Swing Line Loan as a result of the limitations setforth in the first proviso to the first sentence of Section 2.04(a), or(B) that one or more of the applicable conditions specified in Section 3.02is not then satisfied, then, subject to the terms and conditions hereof, theSwing Line Lender will, not later than 1:00 p.m., on the borrowing datespecified in such Notice of Swing Line Borrowing, make the amount of its SwingLine Loan available to the applicable Borrower at its office by crediting theaccount of such Borrower on the books of the Swing Line Lender in immediatelyavailable funds.

 

(c)           Refinancing of Swing Line Loans.

 

(i)            The Swing Line Lender at any time inits sole and absolute discretion may request, on behalf of the Borrowers (whichhereby irrevocably requests the Swing Line Lender to act on its behalf), thateach Revolving Lender make a Base Rate Loan in an amount equal to suchRevolving Lender’s Revolving Proportionate Share of the amount of Swing LineLoans then outstanding.  Such requestshall be made in accordance with the requirements of Section 2.01,without regard to the minimum and multiples specified therein for the principalamount of Base Rate Loans, but subject to the unutilized portion of the TotalRevolving Loan Commitment and the conditions set forth in Section 3.02.  The Swing Line Lender shall furnish theBorrowers with a copy of the applicable Revolving Loan Notice promptly afterdelivering such notice to the Administrative Agent.  Each Revolving Lender shall make an amountequal to its Revolving Proportionate Share of the amount specified in such RevolvingLoan Notice available to the Administrative Agent in immediately availablefunds for the account of the Swing Line Lender at the Administrative Agent’sOffice not later than

 

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12:00 noon,on the day specified in such Revolving Loan Notice, whereupon, subject to Section 2.04(c)(ii),each Revolving Lender that so makes funds available shall be deemed to havemade a Base Rate Loan to the Borrowers in such amount.  The Administrative Agent shall remit thefunds so received to the Swing Line Lender.

 

(ii)           If for any reason any Revolving LoanBorrowing cannot be requested in accordance with Section 2.04(c)(i) orany Swing Line Loan cannot be refinanced by such a Revolving Loan Borrowing,the Revolving Loan Notice submitted by the Swing Line Lender shall be deemed tobe a request by the Swing Line Lender that each of the Revolving Lenders fundits participation in the relevant Swing Line Loan and each Lender’s payment tothe Administrative Agent for the account of the Swing Line Lender pursuant to Section2.04(c)(i) shall be deemed payment in respect of such participation.

 

(iii)          If any Revolving Lender fails to makeavailable to the Administrative Agent for the account of the Swing Line Lenderany amount required to be paid by such Lender pursuant to the foregoingprovisions of this Section 2.04(c) by the time specified in Section 2.04(c)(i),the Swing Line Lender shall be entitled to recover from such Lender (actingthrough the Administrative Agent), on demand, such amount with interest thereonfor the period from the date such payment is required to the date on which suchpayment is immediately available to the Swing Line Lender at a rate per annumequal to the Federal Funds Rate from time to time in effect.  A certificate of the Swing Line Lendersubmitted to any Lender (through the Administrative Agent) with respect to anyamounts owing under this clause (iii) shall be conclusive absent manifesterror.

 

(iv)          Each Revolving Lender’s obligation tomake Revolving Loans or to purchase and fund participations in Swing Line Loanspursuant to this Section 2.04(c) shall be absolute and unconditional andshall not be affected by any circumstance, including (A) any set-off,counterclaim, recoupment, defense or other right which such Lender may haveagainst the Swing Line Lender, any Borrower or any other Person for any reasonwhatsoever, (B) the occurrence or continuance of a Default or Event of Default,or (C) any other occurrence, event or condition, whether or not similar to anyof the foregoing.  Any such purchase ofparticipations shall not relieve or otherwise impair the obligation of theBorrowers to repay Swing Line Loans, together with interest as provided herein.

 

(d)           Repayment of Participations.

 

(i)            At any time after any RevolvingLender has purchased and funded a participation in a Swing Line Loan, if theSwing Line Lender receives any payment on account of such Swing Line Loan, theSwing Line Lender will distribute to such Revolving Lender its RevolvingProportionate Share of such payment (appropriately adjusted, in the case ofinterest payments, to reflect the period of time during which such RevolvingLender’s participation was outstanding and funded) in the same funds as thosereceived by the Swing Line Lender.

 

(ii)           If any payment received by the SwingLine Lender in respect of principal or interest on any Swing Line Loan isrequired to be returned by the Swing Line Lender, each Revolving Lender shallpay to the Swing Line Lender its Revolving Proportionate Share thereof ondemand of the Administrative Agent, plus interest thereon from the date of such

 

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demand to the date such amount isreturned, at a rate per annum equal to the Federal Funds Rate.  The Administrative Agent will make suchdemand upon the request of the Swing Line Lender.

 

(e)           Interest for Account of Swing LineLender.  Each Swing Line Loan shallbear interest on the outstanding principal amount thereof from the applicableborrowing date at a rate *per annum* equalto the Base Rate minus one percent (1.00%).  The Swing Line Lender shall be responsiblefor invoicing the Borrowers for interest on the Swing Line Loans.  Until each Revolving Lender funds its Base RateLoan or participation pursuant to this Section 2.04 to refinancesuch Revolving Lender’s Revolving Proportionate Share of any Swing Line Loan,interest in respect of such Revolving Proportionate Share shall be solely forthe account of the Swing Line Lender. The Borrowers shall pay accrued interest on the unpaid principal amountof each Swing Line Loan upon prepayment (to the extent thereof) and atmaturity.

 

(f)            Payments Directly to Swing LineLender.  The Borrowers shall make allpayments of principal and interest in respect of the Swing Line Loans directlyto the Swing Line Lender.

 

2.05.        Amount Limitations, Commitment Reductions,Etc.

 

(a)           Total Revolving Loan Commitment;Total Term Loan Commitment.  TheEffective Amount of all Revolving Loans, L/C Obligations and Swing Line Loansoutstanding at any time shall not exceed the Total Revolving Loan Commitment atsuch time, and the aggregate principal amount of all Term Loans made on theRestatement Effective Date shall not exceed the Total Term Loan Commitment onthe date thereof.

 

(b)           Optional Reduction or Cancellationof Commitments.  The Borrowers may,upon five (5) Business Days written notice to the Administrative Agent,permanently reduce the Total Revolving Loan Commitment by the amount of FiveMillion Dollars ($5,000,000) or an integral multiple of One Million Dollars($1,000,000) in excess thereof or cancel the Total Revolving Loan Commitment inits entirety; provided, however, that:

 

(i)            The Borrowers may not reduce theTotal Revolving Loan Commitment prior to the Revolving Loan Maturity Date, if,after giving effect to such reduction, the Effective Amount of all RevolvingLoans, L/C Obligations and Swing Line Loans then outstanding would exceed theTotal Revolving Loan Commitment; and

 

(ii)           The Borrowers may not cancel the TotalRevolving Loan Commitment prior to the Revolving Loan Maturity Date, if, aftergiving effect to such cancellation, any Revolving Loan would then remainoutstanding.

 

(c)           Mandatory Reduction or Terminationof Commitments.

 

(i)            On each date upon which a mandatoryprepayment of the Term Loans pursuant to clause (iii), (iv), (v) or (vi) of Section 2.07(c)is required which exceeds in amount the Effective Amount of the Term Loansoutstanding at such time (or would be required if any Term Loans were thenoutstanding), then the Total Revolving Loan Commitment shall be permanentlyreduced by the amount, if any, by which the amount required to be appliedpursuant to said clauses (determined as if an unlimited amount of TermLoans were actually outstanding) 

 

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exceeds the aggregate principalamount of the Term Loans then outstanding (whether or not any Revolving Loans,Swing Line Loans or L/C Obligations shall then be outstanding).

 

(ii)           The Total Revolving Loan Commitmentshall be automatically reduced to zero on the Revolving Loan Maturity Date.

 

(iii)          The Total Term Loan Commitment shall beautomatically reduced to zero at the close of business on the RestatementEffective Date.

 

(d)           Effect of Commitment Reductions.  From the effective date of any reduction ofthe Total Revolving Loan Commitment, the Commitment Fees payable pursuant to Section2.06(b) shall be computed on the basis of the Total Revolving LoanCommitment as so reduced.  Once reducedor cancelled, the Total Revolving Loan Commitment may not be increased orreinstated without the prior written consent of all Lenders.  Any reduction of the Total Revolving LoanCommitment pursuant to Section 2.05(b) shall be applied ratably toreduce each Lender’s Revolving Loan Commitment in accordance with clause (i) ofSection 2.11(a).

 

2.06.        Fees.

 

(a)           Administrative Agent’s Fee.  The Borrowers shall pay to the AdministrativeAgent, for its own account, agent’s fees and other compensation in the amountsand at the times set forth in the Administrative Agent’s Fee Letter.

 

(b)           Commitment Fees.  The Borrowers shall pay to the AdministrativeAgent, for the ratable benefit of the Revolving Lenders as provided in clause(v) of Section 2.11(a), commitment fees (collectively, the “CommitmentFees”) equal to the Commitment Fee Percentage of the daily average UnusedCommitment for the period beginning on the date of this Agreement and ending onthe Revolving Loan Maturity Date.  TheBorrowers shall pay the Commitment Fees in arrears on the last Business Day ineach March, June, September and December (commencing September 30, 2004 for the3-month period ending on such date) and on the Revolving Loan Maturity Date (orif the Total Revolving Commitment is cancelled on a date prior to the RevolvingLoan Maturity Date, on such prior date). For the avoidance of doubt, Swing Line Loans, while consideredoutstanding for purposes of testing availability, do not constitute usage forpurposes of calculating the Unused Commitment when determining the CommitmentFees.

 

2.07.        Prepayments.

 

(a)           Terms of All Prepayments.  Upon the prepayment of any Loan (whether suchprepayment is an optional prepayment under Section 2.07(b), a mandatoryprepayment required by Section 2.07(c) or a mandatory prepaymentrequired by any other provision of this Agreement or the other CreditDocuments, including a prepayment upon acceleration), the Borrowers shall payto the Lender that made such Loan (i) all accrued interest (if such prepaymentis the prepayment of a LIBOR Loan or of a LIBOR Portion) and fees to the dateof such prepayment on the amount prepaid and (ii) if such prepayment is theprepayment of a LIBOR Loan or of a LIBOR Portion on a day other than the lastday of an Interest Period for such LIBOR Loan or such LIBOR Portion, allamounts payable to such Lender pursuant to Section 2.14.

 

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(b)                                 OptionalPrepayments.

 

(i)                                   Attheir option, the Borrowers may, upon one (1) Business Day’s notice to theAdministrative Agent in the case of Base Rate Loans or Base Rate Portions orthree (3) Business Days’ notice to the Administrative Agent in the case ofLIBOR Loans or LIBOR Portions, prepay the Loans in any Borrowing in part, in aminimum principal amount of (A) in the case of Base Rate Loans or Base RatePortions, $1,000,000 or an integral multiple of $100,000 in excess thereof, or(B) in the case of LIBOR Loans or LIBOR Portions, $5,000,000 or an integralmultiple of $1,000,000 in excess thereof, or in whole.  Each such notice shall specify the date andamount of such prepayment.  If suchnotice is given by the Borrowers, the Borrowers shall make such prepayment andthe payment amount specified in such notice shall be due and payable on thedate specified therein.  If no Event ofDefault has occurred and is continuing, (A) all prepayments under this Section2.07(b) which are applied to reduce the principal amount of the Loans shallbe applied to the Loans as directed by the Borrowers and (B) if the Borrowersfail to direct the application of any such principal prepayments, suchprincipal prepayments shall be applied first to the payment of the then outstandingSwing Line Loans, then to the payment of the then outstanding Revolving Loans,then to the payment of the then outstanding Term Loans and then to CashCollateralize the Obligations in an amount equal to the L/C Obligations andshall in each case, to the extent possible, be first applied to prepay BaseRate Portions and then if any funds remain, to prepay LIBOR Portions.  If an Event of Default has occurred and iscontinuing, all prepayments under this Section 2.07(b) shall be appliedas set forth in Section 2.08(c).

 

(ii)                                Attheir option, the Borrowers may, upon notice to the Swing Line Lender (with acopy to the Administrative Agent), at any time or from time to time,voluntarily prepay Swing Line Loans in whole or in part without premium or penalty;provided, that (A) such notice must be received by the Swing Line Lenderand the Administrative Agent not later than 1:00 p.m., on the date of theprepayment, and (B) any such prepayment shall be in a minimum principal amountof $100,000.  Each such notice shallspecify the date and amount of such prepayment. If such notice is given by the Borrowers, the Borrowers shall make suchprepayment and the payment amount specified in such notice shall be due andpayable on the date specified therein.

 

(c)                                MandatoryPrepayments.  The Borrowers shallprepay the Loans as follows:

 

(i)                                   If,at any time, the Effective Amount of all Revolving Loans, Swing Line Loans andL/C Obligations then outstanding exceeds the Total Revolving Loan Commitment atsuch time, the Borrowers shall immediately (A) prepay the Swing Line Loans tothe extent Swing Line Loans in a sufficient amount are then outstanding, (B)prepay the Revolving Loans to the extent Revolving Loans in a sufficient amountare then outstanding, and (C) otherwise, Cash Collateralize the L/CObligations, in an aggregate principal amount equal to such excess.

 

(ii)                                TheBorrowers shall repay each Swing Line Loan on the earlier to occur of (i) thedate five Business Days after such Loan is made and (ii) the Revolving LoanMaturity Date.

 

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(iii)                             Iffor Argosy’s fiscal year ending December 31, 2004 or any fiscal yearthereafter, Designated Asset Sale Proceeds exceed $10,000,000****or if during the term of this Agreement, Designated AssetSale Proceeds exceed $50,000,000, the Borrowers shall, immediately after thecompletion of each sale or other disposition which results in such an excess,prepay the outstanding Term Loans in an aggregate principal amount equal to onehundred percent (100%) of such excess. Notwithstanding the foregoing, the Borrowers shall not be required tomake a prepayment pursuant to this clause (iii) with respect to any sale (a “RelevantSale”) if any Borrower advises the Administrative Agent in writing at thetime the Net Proceeds from such Relevant Sale are received that they intend toreinvest all or any portion of such Net Proceeds in assets useful to thebusiness of Argosy or a Subsidiary to the extent that the acquisition of suchassets occurs within 180 days from the date on which such Relevant Sale isconsummated; provided, that the Net Proceeds arising from any sale orother disposition of the capital stock or assets of any Subsidiary after theoccurrence of a Trigger Event must be applied to immediately prepay the TermLoans and may not be so reinvested, if the effect of such sale or otherdisposition is to cause a Reverse Trigger Event.  If, at any time after the occurrence of aRelevant Sale and prior to the acquisition of the related assets, the 180-dayperiod provided in clause (A) or (B) of the preceding sentence shall elapsewithout execution of the related purchase contract (in the case of said clause(A)) or the occurrence of the related acquisition (in the case of said clause (B))or a Default shall occur, then the Borrowers shall immediately prepay the Loansin the amount and in the manner described in the first sentence of this clause(iii).

 

(iv)                            If,at any time after the Restatement Effective Date, any Loan Party issues or sellsany Indebtedness for borrowed money (including Indebtedness evidenced by notes,bonds, debentures or other similar instruments but excluding any PermittedIndebtedness described in Section 5.02(a)(iv), (vii), (viii),(xii) or (xiii), the Borrowers shall, immediately after suchissuance or sale, prepay the outstanding Term Loans in an aggregate principalamount equal to one hundred percent (100%) of the Net Proceeds of suchIndebtedness.

 

(v)                               If,at any time after the Restatement Effective Date, any Loan Party issues orsells any Equity Securities yielding Net Proceeds in an aggregate amount inexcess of $25,000,000 during the term of this Agreement (other than NetProceeds from (x) the issuance and exercise of stock options granted toofficers and employees of any Loan Party in the ordinary course of business and(y) the exercise of warrants issued by Argosy and existing on the RestatementEffective Date), the Borrowers shall, immediately after such issuance or sale,prepay the outstanding Term Loans in an aggregate principal amount equal tofifty percent (50%) of the Net Proceeds of such Equity Securities.

 

(vi)                            If,at any time after the Restatement Effective Date, any Loan Party receivesproceeds of insurance, a condemnation award or other compensation in respect ofany event described in Section 8.16(a) in excess of $25,000,000, theBorrowers shall immediately prepay the outstanding Term Loans in an aggregateprincipal amount equal to one hundred percent (100%) of such proceeds, exceptas otherwise provided in Section 8.16(b).

 

(vii)                         TheBorrowers shall deliver to the Administrative Agent, at the time of eachprepayment required under this Section 2.07(c), a certificate signed bythe chief financial officer of Argosy setting forth in reasonable detail thecalculation of the amount of such prepayment. Each notice of prepayment shall specify the Type and principal amount ofeach

 

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Loan (or portion thereof) to be prepaid.  In the event that the Borrowers shallsubsequently determine that the amount required to have been prepaid wasgreater than the amount set forth in such certificate, the Borrowers shallpromptly make an additional prepayment of the Loans (and/or, if applicable, theRevolving Loan Commitments shall be permanently reduced) in an amount equal tothe amount of such excess, and the Borrowers shall concurrently therewithdeliver to the Administrative Agent a certificate signed by the chief financialofficer of Argosy demonstrating the derivation of the additional amountresulting in such excess.

 

(viii)                      Ifan Event of Default has occurred and is continuing, all prepayments under this Section2.07(c) shall be applied as set forth in Section 2.08(c).

 

(d)                               Applicationof Term Loan Prepayments.  Allprepayments which are applied to reduce the principal amount of the Term Loansshall reduce the aggregate principal amount payable by the Borrowers on thethen remaining Term Loan Installment Dates on a pro rata basis.  Without modifying the order of application ofTerm Loan prepayments set forth in the preceding sentence, all such prepaymentsshall, to the extent possible, be first applied to prepay Base Rate Portionsand then if any funds remain, to prepay LIBOR Portions.

 

2.08.                      Other Payment Terms.

 

(a)                                Placeand Manner.  All payments to be madeby the Borrowers under this Agreement or any other Credit Document shall bemade without condition or deduction for any counterclaim, defense, recoupmentor setoff.  The Borrowers shall make allpayments due to each Lender or the Administrative Agent under this Agreement orany other Credit Document by payments to the Administrative Agent at theAdministrative Agent’s office located at the address specified in Section8.01, with each payment due to a Lender to be for the account of suchLender and such Lender’s Applicable Lending Office.  The Borrowers shall make all payments underthis Agreement or any other Credit Document in lawful money of the UnitedStates and in same day or immediately available funds not later than 11:00 a.m.on the date due.  The AdministrativeAgent shall promptly disburse to each Lender each payment received by theAdministrative Agent for the account of such Lender.

 

(b)                               Date.  Whenever any payment due hereunder shall falldue on a day other than a Business Day, such payment shall be made on the nextsucceeding Business Day, and such extension of time shall be included in thecomputation of interest or fees, as the case may be.

 

(c)                                Applicationof Payments.  Unless an Event ofDefault shall have occurred and be continuing and except as expressly otherwiseprovided in this Agreement, all payments hereunder shall be applied toprincipal, interest, fees, costs and expenses as directed by theBorrowers.  While an Event of Default hasoccurred and is continuing, all payments hereunder shall be applied as follows:

 

First,to the payment of the unpaid fees, costs and expenses of the AdministrativeAgent then due and payable under this Agreement;

 

Second,to accrued interest then due and payable under this Agreement and the otherCredit Documents;

 

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Third,to reduce the principal amount of the outstanding Loans and L/C Borrowings andto Cash Collateralize the remaining L/C Obligations on a pro rata basis betweenthe Revolving Lenders and the Term Lenders in accordance with the thenoutstanding principal amount of the Loans and L/C Obligations (with the portionallocated to the Revolving Lenders to be applied first to repay the Swing LineLoans in full, second to repay the Revolving Loans in full and then to CashCollateralize the Obligations in an amount equal to the then Effective Amountof all L/C Obligations); and

 

Finally,to the payment of any other amounts due and payable under this Agreement.

 

(d)                               Failureto Pay the Administrative Agent. Unless the Administrative Agent shall have received notice from theBorrowers at least one (1) Business Day prior to the date on which any paymentis due to the Lenders hereunder that the Borrowers will not make such paymentin full, the Administrative Agent shall be entitled to assume that theBorrowers have made or will make such payment in full to the AdministrativeAgent on such date and the Administrative Agent may, in reliance upon suchassumption, cause to be paid to the Lenders on such due date an amount equal tothe amount then due such Lenders.  If andto the extent the Borrowers shall not have so made such payment in full to theAdministrative Agent, each such Lender shall repay to the Administrative Agentforthwith on demand such amount distributed to such Lender together withinterest thereon, for each day from the date such amount is distributed to suchLender until the date such Lender repays such amount to the AdministrativeAgent, at a *per annum* rate equal to (i) the FederalFunds Rate for the first three (3) days and (ii) the rate applicable to BaseRate Loans thereafter.  A certificate ofthe Administrative Agent submitted to any Lender with respect to any amountowing by such Lender under this Section 2.08(d) shall constitute *prima facie* evidence of such amount.

 

2.09.                      Loan Accounts; Notes.

 

(a)                                LoanAccounts.  The obligation of theBorrowers to repay the Loans made to it by each Lender and to pay interestthereon at the rates provided herein shall be evidenced by an account oraccounts maintained by such Lender on its books (individually, a “LoanAccount”), except that any Lender may request that its Loans be evidencedby a note or notes pursuant to Section 2.09(b) and Section 2.09(c).  Each Lender shall record in its Loan Accounts(i) the date and amount of each Loan made by such Lender, (ii) the interestrates applicable to each such Loan and each Portion thereof and the effectivedates of all changes thereto, (iii) the Interest Period for each LIBOR Loan andLIBOR Portion, (iv) the date and amount of each principal and interest paymenton each Loan and Portion and (v) such other information as such Lender maydetermine is necessary for the computation of principal and interest payable toit by the Borrowers hereunder; provided, however, that anyfailure by a Lender to make, or any error by any Lender in making, any suchnotation shall not affect the Borrowers’ Obligations.  The Loan Accounts shall constitute *prima facie* evidence of the matters noted therein.  In addition to the Loan Accounts, each Lenderand the Administrative Agent shall maintain in accordance with its usualpractice accounts or records evidencing the purchases and sales by such Lenderof participations in Letters of Credit and Swing Line Loans.  In the event of any conflict between theaccounts and records maintained by the Administrative Agent and the accountsand records 

 

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of any Lender in respect of suchmatters, the accounts and records of the Administrative Agent shall control.

 

(b)                               RevolvingLoan Notes.  If any Lender sorequests, such Lender’s Revolving Loans shall be evidenced by a promissory notein the form of Exhibit G (individually, a “Revolving Loan Note”) whichnote shall be (i) payable to the order of such Lender, (ii) in the amount ofsuch Lender’s Revolving Loan Commitment, (iii) dated the Restatement EffectiveDate and (iv) otherwise appropriately completed.  Each Borrower authorizes each Lender to recordon the schedule annexed to such Lender’s Revolving Loan Note the date andamount of each Revolving Loan made by such Lender and of each payment orprepayment of principal thereon made by such Borrower, and agrees that all suchnotations shall constitute *prima facie*evidence of the matters noted; provided, however, that anyfailure by a Lender to make, or any error by any Lender in making, any suchnotation shall not affect the Borrowers’ Obligations.  Each Borrower further authorizes each Lenderto attach to and make a part of such Lender’s Revolving Loan Note continuationsof the schedule attached thereto as necessary. If, because any Lender designates separate Applicable Lending Officesfor Base Rate Loans and LIBOR Loans, such Lender requests that separatepromissory notes be executed to evidence separately such Loans, then each suchnote shall be in the form of Exhibit G, *mutatismutandis* to reflect such division, and shall be (w) payable to theorder of such Lender, (x) in the amount of such Lender’s Commitment, (y) datedthe Restatement Effective Date and (z) otherwise appropriately completed.  Such notes shall, collectively, constitute aRevolving Loan Note.

 

(c)                                TermLoan Notes.  If any Lender sorequests, such Lender’s Term Loan shall be evidenced by a promissory note inthe form of Exhibit H (individually, a “Term Loan Note”) whichnote shall be (i) payable to the order of such Lender, (ii) in the amount ofsuch Lender’s Term Loan, (iii) dated the Restatement Effective Date and(iv) otherwise appropriately completed. If, because any Lender designates separate Applicable Lending Officesfor Base Rate Portions and LIBOR Portions, such Lender requests that separatepromissory notes be executed to evidence separately such Portions, then eachsuch note shall be in the form of Exhibit H, *mutatismutandis* to reflect such division, and shall be (w) payable to theorder of such Lender, (x) in the amount of such Lender’s Term Loan, (y) datedthe Restatement Effective Date and (z) otherwise appropriately completed.  Such notes shall, collectively, constitute aTerm Loan Note.

 

(d)                               SwingLine Notes.  The Swing Line Lender’sSwing Line Loans shall be evidenced by a promissory note in the form of Exhibit I(individually, a “Swing Line Note”) which note shall be (i) payable tothe order of the Swing Line Lender, (ii) in the amount of the Swing Line Lender’sSwing Line Loans, (iii) dated the Restatement Effective Date and(iv) otherwise appropriately completed.

 

2.10.                      Loan Funding.

 

(a)                                LenderFunding and Disbursement to the Borrowers. Each Lender shall, before 9:00 a.m. on the date of each Borrowing, makeavailable to the Administrative Agent at the Administrative Agent’s officespecified in Section 8.01, in same day or immediately available funds,such Lender’s Revolving Proportionate Share or Term Proportionate Share, as thecase may be, of such Borrowing.  Afterthe Administrative Agent’s receipt of such funds and

 

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uponsatisfaction of the applicable conditions set forth in Section 3.02(and, if such Borrowing is the initial Credit Extension, Section 3.01),the Administrative Agent shall promptly make all funds so received available tothe Borrowers in like funds as received by the Administrative Agent either by(i) crediting the account of the Borrowers on the books of Wells Fargo with theamount of such funds or (ii) wire transfer of such funds, in each case inaccordance with instructions provided to the Administrative Agent by theBorrowers; provided, however, that if, on the date of theBorrowing there are Swing Line Loans and/or L/C Borrowings outstanding, thenthe proceeds of such Borrowing shall be applied, first, to the paymentin full of any such L/C Borrowings, second, to the payment in full ofany such Swing Line Loans, and third, to the Borrowers as providedabove.

 

(b)                               LenderFailure to Fund.  Unless theAdministrative Agent shall have received notice from a Lender prior to the dateof any Borrowing that such Lender will not make available to the AdministrativeAgent such Lender’s Revolving Proportionate Share or Term Proportionate Share,as the case may be, of such Borrowing, the Administrative Agent shall beentitled to assume that such Lender has made or will make such portionavailable to the Administrative Agent on the date of such Borrowing inaccordance with Section 2.10(a), and the Administrative Agent may onsuch date, in reliance upon such assumption, disburse or otherwise credit tothe Borrowers a corresponding amount.  Ifany Lender does not make the amount of its such Lender’s RevolvingProportionate Share or Term Proportionate Share, as the case may be, of anyBorrowing available to the Administrative Agent on or prior to the date of suchBorrowing, such Lender shall pay to the Administrative Agent, on demand,interest which shall accrue on such amount from the date of such Borrowinguntil such amount is paid to the Administrative Agent at rates equal to (i) thedaily Federal Funds Rate during the period from the date of such Borrowing throughthe third Business Day thereafter and (ii) the rate applicable to Base RateLoans thereafter.  A certificate of theAdministrative Agent submitted to any Lender with respect to any amount owingby such Lender under this Section 2.10(b) shall constitute *prima facie* evidence of such amount.  If the amount of any Lender’s RevolvingProportionate Share or Term Proportionate Share, as the case may be, of anyBorrowing is not paid to the Administrative Agent by such Lender within three(3) Business Days after the date of such Borrowing, the Borrowers shall repaysuch amount to the Administrative Agent, on demand, together with interestthereon, for each day from the date such amount was disbursed to the Borrowersuntil the date such amount is repaid to the Administrative Agent, at theinterest rate applicable at the time to the Loans comprising such Borrowing.

 

(c)                                Lenders’Obligations Several.  The failure ofany Lender to make the Loan to be made by it as part of any Borrowing or tofund participations in Letters of Credit and Swing Line Loans shall not relieveany other Lender of its obligation hereunder to make its Loan as part of suchBorrowing or fund its participations in Letters of Credit and Swing Line Loans,but no Lender shall be obligated in any way to make any Loan or fund anyparticipation in Letters of Credit or Swing Line Loans which another Lender hasfailed or refused to make or otherwise be in any way responsible for thefailure or refusal of any other Lender to make any Loan required to be made bysuch other Lender on the date of any Borrowing or to fund any participationrequired to be funded by such other Lender.

 

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2.11.                      Pro Rata Treatment.

 

(a)                                Borrowings,Commitment Reductions, Etc.  Exceptas otherwise provided herein:

 

(i)                                   EachRevolving Borrowing and reduction of the Total Revolving Loan Commitment shallbe made or shared among the Lenders *pro rata*according to their respective Revolving Proportionate Shares;

 

(ii)                                TheTerm Loan Borrowing shall be made or shared among the Lenders *pro rata* according to their respective Term ProportionateShares;

 

(iii)                             Eachpayment of principal on Loans in any Borrowing shall be shared among theLenders which made or funded the Loans in such Borrowing *pro rata*according to the respective unpaid principal amounts of such Loans then owed tosuch Lenders;

 

(iv)                            Eachpayment of interest on Loans in any Borrowing shall be shared among the Lenderswhich made or funded the Loans in such Borrowing *pro rata*according to (A) the respective unpaid principal amounts of such Loans so madeor funded by such Lenders and (B) the dates on which such Lenders so made orfunded such Loans;

 

(v)                               Eachpayment of Commitment Fees shall be shared among the Revolving Lenders (exceptfor Defaulting Lenders) *pro rata*according to (A) their respective Revolving Proportionate Shares and (B) in thecase of each Lender which becomes a Lender hereunder after the date hereof, thedate upon which such Lender so became a Lender;

 

(vi)                            Eachpayment of interest (other than interest on Loans) shall be shared among theLenders and the Administrative Agent owed the amount upon which such interestaccrues *pro rata* according to (A) the respectiveamounts so owed such Lenders and the Administrative Agent and (B) the dates onwhich such amounts became owing to such Lenders and the Administrative Agent;and

 

(vii)                         Allother payments under this Agreement and the other Credit Documents shall be forthe benefit of the Person or Persons specified.

 

(b)                               Sharingof Payments, Etc.  If any Lendershall obtain any payment (whether voluntary, involuntary, through the exerciseof any right of setoff, or otherwise) on account of the Loans made by it, orthe participations in L/C Obligations or in Swing Line Loans held by it, inexcess of the payments to which it is entitled on account of the Loans and theL/C Obligations obtained by all Lenders entitled to such payments, such Lendershall forthwith purchase from the other Lenders such participations in the Loansand/or participations in L/C Obligations or in Swing Line Loans as shall benecessary to cause such purchasing Lender to share the excess payment ratablywith each of them; provided, however, that if all or any portionof such excess payment is thereafter recovered from such purchasing Lender,such purchase shall be rescinded and each other Lender shall repay to thepurchasing Lender the purchase price to the extent of such recovery togetherwith an amount equal to such other Lender’s ratable share (according to theproportion of (i) the amount of such other Lender’s required repayment to (ii)the total amount so recovered from the purchasing Lender) of any interest orother amount paid 

 

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or payable by the purchasingLender in respect of the total amount so recovered.  Each Borrower agrees that any Lender sopurchasing a participation from another Lender pursuant to this Section2.11(b) may, to the fullest extent permitted by law, exercise all its rightsof payment (including the right of setoff) with respect to such participationas fully as if such Lender were the direct creditor of such Borrower in theamount of such participation.

 

2.12.                      Change of Circumstances.

 

(a)                                Inabilityto Determine Rates.  If, on or beforethe first day of any Interest Period for any LIBOR Loan or LIBOR Portion, (i)any Lender shall advise the Administrative Agent that the LIBOR Rate for suchInterest Period cannot be adequately and reasonably determined due to theunavailability of funds in or other circumstances affecting the Londoninterbank market or (ii) any Lender shall advise the Administrative Agent thatthe rate of interest for such Loan or Portion, as the case may be, does notadequately and fairly reflect the cost to such Lender of making or maintainingsuch LIBOR Loan or LIBOR Portion, the Administrative Agent shall immediatelygive notice of such condition to the Borrowers and the other Lenders.  After the giving of any such notice and untilthe Administrative Agent shall otherwise notify the Borrowers that thecircumstances giving rise to such condition no longer exist, Borrowers’ rightto request the making of, conversion to or a new Interest Period for LIBORLoans or LIBOR Portions shall be suspended. Any LIBOR Loans or LIBOR Portions outstanding at the commencement of anysuch suspension shall be converted at the end of the then current InterestPeriod for such LIBOR Loans or LIBOR Portions into Base Rate Loans or Base RatePortions, as the case may be, unless such suspension has then ended.

 

(b)                               Illegality.  If, after the date of this Agreement, theadoption of any Governmental Rule, any change in any Governmental Rule or theapplication or requirements thereof (whether such change occurs in accordancewith the terms of such Governmental Rule as enacted, as a result of amendmentor otherwise), any change in the interpretation or administration of anyGovernmental Rule by any Governmental Authority, or compliance by any Lenderwith any request or directive (whether or not having the force of law) of anyGovernmental Authority (a “Change of Law”) shall make it unlawful orimpossible for any Lender to make or maintain any LIBOR Loan or LIBOR Portion,such Lender shall immediately notify the Administrative Agent and the Borrowersof such Change of Law.  Upon receipt ofsuch notice, (i) the Borrowers’ right to request the making of, conversion toor a new Interest Period for LIBOR Loans or LIBOR Portions shall be terminated,and (ii) the Borrowers shall, at the request of such Lender, either (A)pursuant to Section 2.01(d) or Section 2.02(d), as the case maybe, convert any such then outstanding LIBOR Loans or LIBOR Portions into BaseRate Loans or Base Rate Portions, as the case may be, at the end of the currentInterest Period for such LIBOR Loans or LIBOR Portions or (B) immediately repayor convert any such LIBOR Loans or LIBOR Portions if such Lender shall notifythe Borrowers that such Lender may not lawfully continue to fund and maintainsuch LIBOR Loans or LIBOR Portions.  Anyconversion or prepayment of LIBOR Loans or LIBOR Portions made pursuant to thepreceding sentence prior to the last day of an Interest Period for such LIBORLoans or LIBOR Portions shall be deemed a prepayment thereof for purposes of Section2.14.  After any Lender notifies theAdministrative Agent and the Borrowers of such a Change of Law and until suchLender notifies the Administrative Agent and the Borrowers that it is no longerunlawful or impossible for such Lender to make or maintain a LIBOR Loan orLIBOR Portion, all Revolving Loans and all

 

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Portionsof the Term Loan of such Lender shall be Base Rate Loans and Base RatePortions, respectively.

 

(c)                                IncreasedCosts.  If, after the date of thisAgreement, any Change of Law (other than any Change of Law relating to Taxes orOther Taxes addressed in Section 2.13):

 

(i)                                   Shallimpose, modify or hold applicable any reserve (excluding any ReserveRequirement or other reserve to the extent included in the calculation of theLIBOR Rate for any Loans or Portions), special deposit or similar requirementagainst assets held by, deposits or other liabilities in or for the account of,advances or loans by, or any other acquisition of funds by any Lender for anyLIBOR Loan or LIBOR Portion; or

 

(ii)                                Shallimpose on any Lender any other condition related to any LIBOR Loan or LIBORPortion or such Lender’s Commitments;

 

andthe effect of any of the foregoing is to increase the cost to such Lender of making,renewing, or maintaining any such LIBOR Loan or LIBOR Portion or itsCommitments or to reduce any amount receivable by such Lender hereunder; thenthe Borrowers shall from time to time, within ten (10) Business Days afterdemand by such Lender, pay to such Lender additional amounts sufficient toreimburse such Lender for such increased costs or to compensate such Lender forsuch reduced amounts; provided, however, that the Borrowers shallhave no obligation to make any payment to any demanding party under this Section2.12(c) on account of any such increased costs or reduced amounts unlessthe Borrowers receive notice of such increased costs or reduced amounts fromthe demanding party within six (6) months after they are incurred orrealized.  A certificate setting forth inreasonable detail the amount of such increased costs or reduced amounts,submitted by such Lender to the Borrowers shall be conclusive absent manifesterror.  The obligations of the Borrowersunder this Section 2.12(c) shall survive the payment and performance ofthe Obligations and the termination of this Agreement.

 

(d)                               CapitalRequirements.  If, after the date ofthis Agreement, any Lender determines that (i) any Change of Law affects theamount of capital required or expected to be maintained by such Lender or anyPerson controlling such Lender (a “Capital Adequacy Requirement”) and(ii) the amount of capital maintained by such Lender or such Person which isattributable to or based upon the Loans, the Commitments or this Agreement mustbe increased as a result of such Capital Adequacy Requirement (taking intoaccount such Lender’s or such Person’s policies with respect to capitaladequacy), the Borrowers shall pay to such Lender or such Person, within ten(10) Business Days after demand of such Lender, such amounts as such Lender orsuch Person shall determine are necessary to compensate such Lender or suchPerson for the increased costs to such Lender or such Person of such increasedcapital; provided, however, that the Borrowers shall have noobligation to make any payment to any demanding party under this Section2.12(d) on account of any such increased costs unless the Borrowers receivenotice of such increased costs from the demanding party within six (6) monthsafter they are incurred or realized.  Acertificate setting forth in reasonable detail the amount of such increasedcosts, submitted by any Lender to the Borrowers shall be conclusive absentmanifest error.  The obligations of theBorrowers under this Section 2.12(d) shall survive the payment andperformance of the Obligations and the termination of this Agreement.

 

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(e)                                Mitigation.  Any Lender which becomes aware of (i) anyChange of Law which will make it unlawful or impossible for such Lender to makeor maintain any LIBOR Loan or LIBOR Portion or (ii) any Change of Law or otherevent or condition which will obligate the Borrowers to pay any amount pursuantto Section 2.12(c) or Section 2.12(d) shall notify the Borrowersand the Administrative Agent thereof as promptly as practical.  If any Lender has given notice of any suchChange of Law or other event or condition and thereafter becomes aware thatsuch Change of Law or other event or condition has ceased to exist, such Lendershall notify the Borrowers and the Administrative Agent thereof as promptly aspractical.  Each Lender affected by anyChange of Law which makes it unlawful or impossible for such Lender to make ormaintain any LIBOR Loan or LIBOR Portion or to which the Borrowers areobligated to pay any amount pursuant to Section 2.12(c) or Section2.12(d) shall use reasonable commercial efforts (including changing thejurisdiction of its Applicable Lending Office) to avoid the effect of suchChange of Law or to avoid or materially reduce any amounts which the Borrowersare obligated to pay pursuant to Section 2.12(c) or Section 2.12(d)if, in the reasonable opinion of such Lender, such efforts would not bedisadvantageous to such Lender.

 

2.13.                      Taxes on Payments.

 

(a)                                Exceptas otherwise expressly provided in this Section 2.13, any and allpayments by the Borrowers in respect of principal or interest on any Loan, fee,or other Obligation or other amount due to any Lender under this Agreement orany other Credit Document shall be made free and clear of, and withoutdeduction for, any and all present or future United States federal, state orlocal and foreign taxes, levies, imposts, deductions, charges or withholdings,and all liabilities with respect thereto, including withholding taxes imposedby the United States, any jurisdiction under the laws of which any Borrower isorganized, and other jurisdiction or any political subdivision thereof, butexcluding net income taxes and franchise taxes in lieu of net income taxesimposed on the Administrative Agent or any Lender (all such nonexcluded taxes,levies, imposts, deductions, charges, withholdings and liabilities beingreferred to herein as “Taxes”). If the Borrowers shall be required by law to deduct any Taxes from or inrespect of any sum payable hereunder to any Lender, then (i) subject to thelast sentence of Section 2.13(f), the sum payable shall be increased by theamount necessary so that after making all required deductions (includingdeductions applicable to additional sums payable under this Section 2.13)such Lender shall receive an amount equal to the sum it would have received hadno such deductions been made, (ii) the Borrowers shall make all requireddeductions and (iii) the Borrowers shall pay the full amount deducted to therelevant taxing authority or other Governmental Authority in accordance withapplicable law.

 

(b)                               Inaddition, the Borrowers agree to pay any present or future stamp or documentarytaxes or any other excise or property taxes, charges or similar levies thatarise from any payment made hereunder or from the execution, delivery orregistration of, or otherwise with respect to, this Agreement or any otherCredit Document (hereinafter referred to as “Other Taxes”).

 

(c)                                Subjectto the last sentence of Section 2.13(f), the Borrowers will indemnifythe Administrative Agent and each Lender for the full amount of Taxes or OtherTaxes (including any Taxes or Other Taxes imposed by any jurisdiction onamounts payable under this Section 2.13) paid by such Lender, and anyliability (including penalties, interest and

 

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expenses) arising therefrom orwith respect thereto, whether or not such Taxes or Other Taxes were correctlyor legally asserted.  Suchindemnification shall be made within 30 days following the date such Lendermakes written demand therefor accompanied by documentation evidencing paymentof such Taxes or Other Taxes.

 

(d)                               Within30 days after the date of any payment of Taxes or Other Taxes withheldhereunder (and, with respect to any Taxes or Other Taxes not so withheld, tothe extent available), the Borrowers will furnish to the Administrative Agent,at its address set forth in Section 8.01, the original or a certifiedcopy of a receipt evidencing payment thereof.

 

(e)                                Withoutprejudice to the survival of any other agreement contained herein, theagreements and obligations contained in this Section 2.13 shall survivethe payment in full of all principal, interest and other Obligations hereunderand the termination of all Commitments hereunder; provided, that the Borrowersshall have no obligation to make any payment under Section 2.13(a), (b) or (c)on account of any Taxes unless the Borrowers receive notice of such Tax within sixmonths after the date that the applicable Lender became aware of such Tax.

 

(f)                                  EachLender that is organized under the laws of a jurisdiction outside the UnitedStates of America agrees that if and to the extent it is legally able to do so,it shall deliver to the Borrowers and the Administrative Agent, on or beforethe first date of any payment by the Borrowers hereunder, such certificates,documents or other evidence, as required by the Internal Revenue Code orTreasury Regulations issued pursuant thereto, including Internal RevenueService Form W-8BEN or W-8ECI (as applicable to it) and any other certificateor statement or exemption required by Treasury Regulation section 1.1441-1(a)or section 1.1441-6(c) or any subsequent version thereof, properly completedand duly executed by such Lender establishing that such payment is (i) notsubject to withholding under the Internal Revenue Code because such payment iseffectively connected with the conduct by such Lender of a trade or business inthe United States of America or (ii) totally exempt from United Stateswithholding tax under a provision of an applicable tax treaty.  Each Lender that has delivered suchcertificate or form shall, upon such certificate or form’s obsolescence,expiration or invalidity or upon the Borrowers’ reasonable request, replace orupdate such certificate or form as necessary. Within 30 days after the reasonable request of the Borrowers or theAdministrative Agent, each Lender that is not a foreign Lender shall deliver tothe Borrowers and the Administrative Agent one or more Internal Revenue ServiceForm W-9.  Each Lender shall promptlynotify the Borrowers and the Administrative Agent upon the obsolescence,expiration or invalidity of any form previously delivered by such Lenderpursuant to this paragraph.  A Lendershall not be entitled to any additional amounts under Section 2.13(a) orto any indemnification under Section 2.13(c) with respect to any Tax (y)that is in effect and would apply to amounts payable (i) to an initial Lenderas of the Restatement Effective Date, (ii) to a Lender at the time such Lenderbecomes a party to this Agreement by assignment or (iii) to a Lender thatdesignates a new Applicable Lending Office at any time after the RestatementEffective Date, except to the extent that (I) in the case of a Lender whobecomes a Lender by assignment (regardless of whether such assignment is from aLender under clause (i) or (ii) above), the assignor of such Lender at the timeof assignment, or (II) in the case of a designation of a new Applicable LendingOffice, such Lender immediately prior to such designation, would have beenentitled to receive additional amounts or indemnity from the Borrowers withrespect to any Tax pursuant to Section 2.13(a) or

 

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Section2.13(c), or (z) that is attributableto such Lender’s failure to comply with this Section 2.13(f) or Section2.13(g).

 

(g)                               EachLender that is entitled to an exemption from or reduction of non-U.S.withholding tax or other tax under the law of the jurisdiction in which anyBorrower is located, or any treaty to which such jurisdiction is a party, withrespect to any payments under this Agreement shall, deliver to the Borrowersand the Administrative Agent, at the time or times prescribed by applicable lawor reasonably requested by the Borrowers, such properly completed and executeddocumentation prescribed by applicable law as will permit such payments to bemade without withholding or other Tax or at a reduced rate, providedthat such Lender is legally entitled to complete, execute and deliver suchdocumentation and, in such Lender’s sole judgment, such completion, executionor delivery would not materially prejudice the legal position of such Lender orbe contrary to its internal policies.

 

(h)                               Ifa Borrower pays an amount under this Section 2.13, and theAdministrative Agent or applicable Lender determines in its sole discretionthat it has received a refund of such Tax or a credit against Taxes otherwisepayable, the Administrative Agent or applicable Lender shall pay to theapplicable Borrower the amount of such refund or credit (but only to the extentof indemnity payments made, or additional amounts paid, by a Borrower underthis Section 2.13 giving rise to such refund or credit), net of allout-of-pocket expenses of the Administrative Agent or such Lender and withoutinterest (other than interest received from the relevant Governmental Authoritywith respect to such refund or credit, net of taxes).  If the Administrative Agent or the applicableLender is later required to repay (or otherwise loses the benefit of) therefund or credit to the applicable taxing authority, such repayment shall betreated as a Tax subject to indemnification under Section 2.13(c).  This paragraph shall not be construed torequire the Administrative Agent or any Lender to make available its taxreturns (or any other information relating to its taxes which it deemsconfidential) to the Borrower or any other Person.

 

2.14.                      Funding Loss Indemnification.  If the Borrowers shall (a) repay, prepay orconvert any LIBOR Loan or LIBOR Portion on any day other than the last day ofan Interest Period therefor (whether a scheduled payment, an optionalprepayment or conversion, a mandatory prepayment or conversion, a payment uponacceleration or otherwise), (b) fail to borrow any LIBOR Loan or LIBOR Portionfor which a Notice of Borrowing has been delivered to the Administrative Agent(whether as a result of the failure to satisfy any applicable conditions orotherwise) or (c) fail to convert any Revolving Loans into LIBOR Loans or anyPortion of the Term Loan Borrowing into a LIBOR Portion in accordance with aNotice of Conversion delivered to the Administrative Agent (whether as a resultof the failure to satisfy any applicable conditions or otherwise), theBorrowers shall, within five (5) Business Days after demand by any Lender,reimburse such Lender for and hold such Lender harmless from all costs andlosses incurred by such Lender as a result of such repayment, prepayment,conversion or failure.  Each Borrowerunderstands that such costs and losses may include, without limitation, lossesincurred by a Lender as a result of funding and other contracts entered into bysuch Lender to fund a LIBOR Loan or LIBOR Portion.  Each Lender demanding payment under this Section2.14 shall deliver to the Borrowers, with a copy to the AdministrativeAgent, a certificate setting forth the amount of costs and losses for whichdemand is made, which certificate shall set forth in reasonable detail thecalculation of the amount demanded.  Sucha certificate so delivered to the

 

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Borrowersshall be conclusive absent manifest error. The obligations of the Borrowers under this Section 2.14 shallsurvive the payment and performance of the Obligations and the termination ofthis Agreement.

 

2.15.                      Security.

 

(a)                                SecurityDocuments.  The Obligations shall besecured by the Security Documents.  Solong as the terms thereof are in compliance with this Agreement, each LenderRate Protection Agreement shall be secured by the Lien of the SecurityDocuments (a) on a *pari passu*basis with the Obligations owing to the Lenders to the extent of the associatedTermination Value, and (b) to the extent of any excess, on a basis whichis in all respects subordinated to all other Obligations.

 

(b)                               FurtherAssurances.  Each Borrower shalldeliver, and shall cause each Guarantor to deliver, to the Administrative Agentsuch additional mortgages, deeds of trust, security agreements, pledgeagreements, lessor consents and estoppels (containing appropriate mortgagee andthe Lender protection language) and other instruments, agreements,certificates, opinions and documents (including Uniform Commercial Codefinancing statements and fixture filings, landlord waivers and after theoccurrence and during the continuance of an Event of Default, controlagreements) as the Administrative Agent may reasonably request to:

 

(i)                                   Grant,perfect, maintain, protect and evidence security interests in favor of theAdministrative Agent, for the benefit of the Administrative Agent and theLenders, in any or all present and future real and personal property of theBorrowers and the Guarantors prior to the Liens or other interests of anyPerson, except for Permitted Liens; and

 

(ii)                                Otherwiseestablish, maintain, protect and evidence the rights provided to theAdministrative Agent, for the benefit of the Administrative Agents and theLenders, pursuant to the Security Documents.

 

EachBorrower shall fully cooperate with the Administrative Agent and the Lendersand perform all additional acts reasonably requested by the AdministrativeAgent or any Lender to effect the purposes of this Section2.15.

 

2.16.                      Replacement of the Lenders.  If (a) any Lender shall become a DefaultingLender more than one (1) time in a period of twelve (12) consecutive months,(b) any Lender shall continue as a Defaulting Lender for more than five (5)Business Days at any time, (c) any Lender shall suspend its obligation to makeor maintain LIBOR Loans or LIBOR Portions pursuant to Section 2.12(b)for a reason which is not applicable to any other Lender, (d) any Lender shalldemand any payment under Section 2.12(c), 2.12(d) or 2.13(a)for a reason which is not applicable to any other Lender (unless all Lenders towhich such reason is applicable are so replaced) or (e) any Borrower shallreceive a notice from any applicable Governmental Authority that a Lender is nolonger qualified or suitable to make Loans to such Borrower under theapplicable Gaming Laws (and such Lender is notified by such Borrower and theAdministrative Agent in writing of such disqualification), including becausesuch Lender has been denied a license, qualification or finding of suitabilityor has failed to deliver information required under the applicable Gaming Laws,then the Administrative Agent may (or upon the written request of 

 

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theBorrowers, shall) replace such Lender (the “affected Lender”), or causesuch affected Lender to be replaced, with another lender (the “replacementLender”) satisfying the requirements of an Assignee Lender under Section8.05(c), by having the affected Lender sell and assign all of its rightsand obligations under this Agreement and the other Credit Documents (includingfor purposes of this Section 2.16, participations in L/C Obligations andin Swing Line Loans) to the replacement Lender pursuant to Section 8.05(c);provided, however, that neither the Administrative Agent nor anyLender shall have any obligation to identify or locate a replacement Lender forthe Borrowers.  Upon receipt by anyaffected Lender of a written notice from the Administrative Agent stating thatthe Administrative Agent is exercising the replacement right set forth in this Section2.16, such affected Lender shall sell and assign all of its rights andobligations under this Agreement and the other Credit Documents (including forpurposes of this Section 2.16, participations in L/C Obligations and inSwing Line Loans) to the replacement Lender pursuant to an Assignment Agreementand Section 8.05(c) for a purchase price equal to the sum of theprincipal amount of the affected Lender’s Loans so sold and assigned, all accruedand unpaid interest thereon and its ratable share of all fees to which it isentitled.

 

2.17.                      Increases of the Total RevolvingLoan Commitment.

 

(a)        TheBorrowers may at any time increase the then effective amount of the TotalRevolving Loan Commitment; provided that (i) prior to the date of theproposed increase, the Borrowers shall not have voluntarily decreased the TotalRevolving Loan Commitment, (ii) the Total Revolving Loan Commitment can only beincreased one time pursuant to this Section 2.17, and such increaseshall not exceed $200,000,000, (iii) no Default or Event of Default shallhave occurred and be continuing or shall occur as a result of the increase inthe Total Revolving Loan Commitment, (iv) all approvals or exemptions requiredunder any applicable Gaming Laws shall have been obtained if any such approvalsor exemptions are necessary prior to the effectiveness of the increase in theTotal Revolving Loan Commitment, (v) on the Increase Effective Date (as definedbelow), the Loan Parties shall indicate to the Administrative Agent whether theborrowing of a Revolving Loan which, when combined with the Revolving Loans,Swing Line Loans and L/C Obligations outstanding on such date exceeds$500,000,000, would constitute “Senior Indebtedness” and “Designated SeniorIndebtedness” under, and as defined in, each of the 2001 Senior SubordinatedIndenture and the 2004 Senior Subordinated Indenture and comparable treatmentunder all other documents, instruments and agreements evidencing other SubordinatedIndebtedness (to the extent applicable) as well as provide information insupport thereof and (vi) the Loan Parties shall have executed and deliveredsuch documents and instruments (including documents relating to any realproperty collateral and ship/vessel collateral and title insuranceendorsements) and taken such other actions as may be reasonably requested bythe Administrative Agent in connection with the increase in the Total RevolvingLoan Commitment.  Any request under this Section 2.17shall be submitted by the Borrowers to the Administrative Agent (which shallpromptly forward copies to each of the Lenders), specify the proposed effectivedate and amount of such increase and be accompanied by a certificate of anauthorized officer stating that no Default or Event of Default exists or willoccur as a result of such increase.  TheAdministrative Agent (after consulting with the Borrowers) may also specify anyfees offered to those Lenders (the “Increasing Lenders”) which agree toincrease the amount of their Revolving Loan Commitments, which fees may bevariable based upon the amount by which any such Lender is willing to increasethe amount of

 

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itsRevolving Loan Commitment; no Lender which is not an Increasing Lender shall beentitled to receive any such fees.  NoLender shall have any obligation, express or implied, to offer to increase theamount of its Revolving Loan Commitment. Only the consent of each Increasing Lender shall be required for anincrease in the amount of the Revolving Loan Commitments pursuant to this Section 2.17(a).  No Lender which elects not to increase theamount of its Revolving Loan Commitment may be replaced in respect of itsexisting Term Loans or Revolving Loan Commitment as a result thereof withoutsuch Lender’s consent.

 

(b)                               EachIncreasing Lender shall, as soon as practicable after the Borrowers havesubmitted their request under Section 2.17(a), specify the amount of theproposed increase in its Revolving Loan Commitment which they are willing tooffer.  The Borrowers may accept some orall of the offered amounts (provided that the Borrowers must accept not lessthan each such Increasing Lender’s pro rata share of the total increase in theRevolving Loan Commitment, if offered by such Increasing Lender) or designatenew lenders who qualify as Eligible Assignees and which are reasonablyacceptable to the Administrative Agent as additional Lenders hereunder inaccordance with this Section 2.17(b) (each such new lender being a “NewLender”), which New Lender may assume all or a portion of the increase inthe amount of the Total Revolving Loan Commitment.  The Administrative Agent may agree to assistthe Borrowers in identifying new lenders who qualify as Eligible Assignees.  The Borrowers may pay a fee to theAdministrative Agent solely for the account of the Administrative Agent inconnection with services provided in connection with any increase provided inthis Section 2.17.  Subject to thelimitations set forth above, the Borrowers and the Administrative Agent shallhave discretion jointly to adjust the allocation of the increased aggregateprincipal amount of the Revolving Loan Commitments among Increasing Lenders andNew Lenders.

 

(c)                                EachNew Lender designated by the Borrowers and reasonably acceptable to theAdministrative Agent shall become an additional party hereto as a New Lenderconcurrently with the effectiveness of the proposed increase in the amount ofthe Revolving Loan Commitments upon its execution of an instrument of joinder(which may contain such modifications to this Agreement and terms andconditions relating thereto as may be necessary to ensure that such RevolvingLoan Commitments are treated as Revolving Loan Commitments for all purposes underthe Loan Documents), in each case in form and substance reasonably satisfactoryto the Administrative Agent.  Each NewLender which is not incorporated under the laws of the United States of Americaor a state thereof shall, within three (3) Business Days of becoming a Lenderunder this Agreement, deliver to the Borrowers and the Administrative Agent twoduly completed copies of United States Internal Revenue Service Form W-8BEN orW-8ECI (or successor applicable form), as the case may be.

 

(d)                               Subjectto the foregoing, any increase in the Total Revolving Loan Commitment requestedby the Borrowers shall be effective as of the date agreed to by the Borrowersand the Administrative Agent (the “Increase Effective Date”) and shallbe in the principal amount equal to (i) the amount which the Increasing Lendersare willing to assume as increases to the amount of their Revolving LoanCommitments, plus (ii) the amount offered by the New Lenders with respect tothe Revolving Loan Commitments, in either case, as adjusted by the Borrowersand the Administrative Agent pursuant to this Section 2.17 andsubject to the limitations contained in this Section 2.17.

 

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(e)                                Onor prior to the Increase Effective Date, the Administrative Agent shall notifyeach Lender of the amount required to be paid by or to such Lender so that theRevolving Loans held by the Lenders on the Increase Effective Date (aftergiving effect to any new Revolving Loans made on such date) shall be held byeach Lender pro rata in accordance with the Revolving Loan Commitments of theLenders as of the Increase Effective Date. Each Lender which is required to reduce the amount of Revolving Loansheld by it (each such Lender, a “Decreasing Lender”) shall irrevocablyassign, without recourse or warranty of any kind whatsoever (except that eachDecreasing Lender warrants that it is the legal and beneficial owner of theRevolving Loans assigned by it under this Section 2.17(e) and thatsuch Revolving Loans are held by such Decreasing Lender free and clear ofadverse claims), to each Increasing Lender and New Lender, and each IncreasingLender and New Lender shall irrevocably acquire from the Decreasing Lenders, aportion of the principal amount of the Revolving Loans of each DecreasingLender (collectively, the “Acquired Portion”) outstanding on theIncrease Effective Date (before giving effect to any new Revolving Loans madeon such date) in an amount such that the principal amount of the RevolvingLoans held by each Increasing Lender, New Lender and Decreasing Lender as ofthe Increase Effective Date shall be held in accordance with each such Lender’sRevolving Proportionate Share (if any) as of such date.  Such assignment and acquisition shall beeffective on the Increase Effective Date automatically and without any actionrequired on the part of any party other than the payment by the IncreasingLenders and New Lenders to the Administrative Agent for the account of theDecreasing Lenders of an aggregate amount equal to the Acquired Portion, whichamount shall be allocated and paid by the Administrative Agent at or before12:00 p.m. on the Increase Effective Date to the Decreasing Lenders *pro rata* based upon the respective reductions in theprincipal amount of the Revolving Loans held by such Lenders on the IncreaseEffective Date (before giving effect to any new Revolving Loans made on suchdate).  Each of the Administrative Agentand each Lender shall adjust its records accordingly to reflect the payment ofthe Acquired Portion.  The payment to bemade in respect of the Acquired Portion shall be made by the Increasing Lendersand New Lenders to the Administrative Agent in Dollars in immediately availablefunds at or before 11:00 a.m. on the Increase Effective Date, such paymentto be made by the Increasing Lenders and New Lenders *pro rata*based upon the respective increases in the amount of the Revolving LoanCommitments held by such Lenders on the Increase Effective Date.

 

(f)                                  Tothe extent any of the Revolving Loans acquired by the Increasing Lenders andNew Lenders from the Decreasing Lenders pursuant to Section 2.17(e)above are LIBOR Loans and the Increase Effective Date is not the last day of anInterest Period for such Loans, the Decreasing Lenders shall be entitled tocompensation from the Borrowers as provided in Section 2.14 (as ifthe Borrowers had prepaid such Loans in an amount equal to the Acquired Portionon the Increase Effective Date).

 

**ARTICLEIII****.****CONDITIONS PRECEDENT.**

 

3.01.                      Initial Conditions Precedent.  The effectiveness of the amendment andrestatement of the Existing Credit Agreement and the obligations of the Lendersto make the Loans comprising the initial Borrowing are subject to receipt bythe Administrative Agent, on or prior to the Restatement Effective Date, ofeach item listed below, each in form and substance satisfactory to theAdministrative Agent, and with sufficient copies for the Administrative Agentand each Lender:

 

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(a)                                PrincipalCredit Documents.

 

(i)                                   ThisAgreement, duly executed by each Borrower, each Lender and the AdministrativeAgent;

 

(ii)                                ARevolving Loan Note payable to each Lender requesting such a note, each dulyexecuted by the Borrowers;

 

(iii)                             ATerm Loan Note payable to each Lender requesting such a note, each dulyexecuted by the Borrowers;

 

(iv)                            ASwing Line Note payable to the Swing Line Lender in the principal amount of theSwing Line Sublimit, duly executed by the Borrowers;

 

(v) **                             **Amendments to each of the ExistingAssignments in form and substance satisfactory to the AdministrativeAgent, duly executed by each Loan Party which is a party to the ExistingAssignments, as well as any additional assignment agreements required by theAdministrative Agent, each duly executed by the Loan Parties party thereto andin form and substance satisfactory to the Administrative Agent;

 

(vi) **                          **Amendments to each of the Existing Mortgagesin form and substance satisfactory to the Administrative Agent, duly executedby each Loan Party which is a party to the Existing Mortgages, as well as anyadditional mortgages required by the Administrative Agent, each duly executedby the Loan Parties party thereto and in form and substance satisfactory to theAdministrative Agent;

 

(vii)                         Amendmentsto each of the Existing Security Agreements in form and substance satisfactoryto the Administrative Agent, duly executed by each Loan Party which is a partyto the Existing Security Agreements, as well as any additional securityagreements required by the Administrative Agent, each duly executed by the LoanParties party thereto and in form and substance satisfactory to theAdministrative Agent;

 

(viii)                      Amendments to the each of the Existing ShipMortgages in form and substance satisfactory to the AdministrativeAgent, duly executed by each Loan Party which is a party to the Existing ShipMortgages, as well as any additional ship mortgages required by theAdministrative Agent, each duly executed by the Loan Parties party thereto andin form and substance satisfactory to the Administrative Agent;

 

(ix)                              Eachof the Cash Collateral Pledge Agreement and the Trademark Security Agreement inform and substance satisfactory to the Administrative Agent, duly executed byeach Loan Party which is a party thereto; and

 

(x)                                 TheEnvironmental Indemnity, duly executed by each Loan Party.

 

(b)                               OrganizationalDocuments.

 

(i)                                   Thecertificate of incorporation, articles of incorporation, certificate of limitedpartnership, articles of organization or comparable document of each 

 

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Borrower,certified as of a recent date prior to the Restatement Effective Date by theSecretary of State (or comparable official) of its jurisdiction ofincorporation or formation;

 

(ii)                                Acertificate of good standing (or comparable certificate) for each Borrower,certified as of a recent date prior to the Restatement Effective Date by theSecretary of State (or comparable official) of its jurisdiction ofincorporation or formation;

 

(iii)                             Acertificate of the Secretary or an Assistant Secretary of each Borrower, datedthe Restatement Effective Date, certifying (a) that attached thereto is a trueand correct copy of the bylaws, partnership agreement or limited liabilitycompany agreement of such Borrower as in effect on the Restatement EffectiveDate; (b) that attached thereto are true and correct copies of resolutions dulyadopted by the board of directors or other governing body of such Borrower andcontinuing in effect, which authorize the execution, delivery and performanceby such Borrower of this Agreement and the other Credit Documents executed orto be executed by such Borrower and the consummation of the transactionscontemplated hereby and thereby; and (c) that there are no proceedings for thedissolution or liquidation of such Borrower;

 

(iv)                            Acertificate of the Secretary or an Assistant Secretary of each Borrower, datedthe Restatement Effective Date, certifying the incumbency, signatures andauthority of the officers of such Borrower authorized to execute, deliver andperform this Agreement, the other Credit Documents and all other documents,instruments or agreements related thereto executed or to be executed by suchBorrower; and

 

(v)                               Certificatesof good standing (or comparable certificates) for each Borrower, certified asof a recent date prior to the Restatement Effective Date by the Secretary ofState (or comparable official) of each state in which such Borrower isqualified to do business.

 

(c)                                CollateralDocuments.

 

(i)                                   SuchUniform Commercial Code financing statements and fixture filings (appropriatelycompleted and executed) for filing in such jurisdictions as the AdministrativeAgent may request to perfect the Liens granted to the Administrative Agent inthis Agreement, the Security Documents and the other Credit Documents;

 

(ii)                                SuchUniform Commercial Code termination statements (appropriately completed andexecuted) for filing in such jurisdictions as the Administrative Agent mayrequest to terminate any financing statement evidencing Liens of other Personsin the Collateral which are prior to the Liens granted to the AdministrativeAgent in this Agreement, the Security Documents and the other Credit Documents,except for any such prior Liens which are expressly permitted by this Agreementto be prior;

 

(iii)                             UniformCommercial Code search certificates from the jurisdictions in which UniformCommercial Code financing statements are to be filed pursuant to subsection(d)(i) above reflecting no other financing statements or filings whichevidence Liens of other Persons in the Collateral which are prior to the Liensgranted to the Administrative Agent in this Agreement, the Security Documentsand the other Credit Documents, except for any such prior Liens (a) which areexpressly permitted by this Agreement to be prior or (b) for 

 

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which the Administrative Agenthas received a termination statement pursuant to subsection (d)(ii)above;

 

(iv)                            Thestock certificates representing all of the outstanding capital stock of eachLoan Party pledged to the Administrative Agent pursuant to the SecurityDocuments and existing on the Restatement Effective Date, together with undatedstock powers duly executed by the appropriate Loan Party in blank and attachedthereto;

 

(v)                               Appropriatedocuments for filing with the United States Patent and Trademark Office and allother filings necessary to perfect the security interests granted to theAdministrative Agent by the Security Documents, all appropriately completed andduly executed by each Loan Party and, where appropriate, notarized;

 

(vi)                            AnALTA standard coverage Lender’s policy of title insurance (or a commitmenttherefor) insuring the validity and priority of the Existing Mortgages (subjectonly to such exceptions as the Administrative Agent may approve), in suchamounts and with such endorsements as the Administrative Agent may require,issued by a title insurer acceptable to the Administrative Agent, together withsuch policies of co-insurance or re-insurance (or commitments therefor) as theAdministrative Agent may require;

 

(vii)                         Eachtitle policy insuring the Administrative Agent’s Lien on the real propertysubject to the Existing Mortgages shall be endorsed with CLTA Form 110.5or other appropriate endorsements including, without limitation, revised tie-inendorsements, for the purpose of assuring continuing coverage of the CreditDocuments insured thereunder, together with such policies of co-insurance orre-insurance (or commitments therefor) as the Administrative Agent may require;

 

(viii)                      Preliminarytitle reports or lot book guarantees issued by a title insurer acceptable tothe Administrative Agent with respect to all real property owned by theBorrowers;

 

(ix)                              Anofficer’s certificate of the Borrowers certifying that each Loan Partypossesses all material environmental permits necessary for the conduct of itsbusiness, together with copies of all such permits;

 

(x)                                 Anabstract of title for each United States Coast Guard registered Vessel;

 

(xi)                              Suchother documents, instruments and agreements as the Administrative Agent mayreasonably request to establish and perfect the Liens granted in thisAgreement, the Security Documents and the other Credit Documents; and

 

(xii)                           Suchother evidence as the Administrative Agent may request to establish that theLiens granted in this Agreement, the Security Documents and the other CreditDocuments are perfected and prior to the Liens of other Persons in theCollateral, except for any Permitted Liens.

 

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(d)                               Opinions.  Favorable written opinions from each of thefollowing counsel for the Loan Parties, each dated the Restatement EffectiveDate, addressed to the Administrative Agent for the benefit of theAdministrative Agent and the Lenders, covering such legal matters as theAdministrative Agent may reasonably request and otherwise in form and substancesatisfactory to the Administrative Agent:

 

(i)                                   Winston& Strawn, special counsel for the Loan Parties;

 

(ii)                                Barnesand Thornburg, Indiana counsel for the Loan Parties;

 

(iii)                             Nyemaster,Goode, Voigts, West, Hansell & O’Brien, Iowa counsel for the Loan Parties;

 

(iv)                            Taylor,Porter, Brooks & Phillips, LLP, Louisiana counsel for the Loan Parties;

 

(v)                              Brantley& Associates, Louisiana regulatory counsel for the Loan Parties;

 

(vi)                            Shook,Hardy & Bacon, LLP, Missouri counsel for the Loan Parties; and

 

(vii)                         OrrickHerrington & Sutcliffe, LLP, maritime counsel for the Loan Parties.

 

(e)                                OtherItems.

 

(i)                                   Aduly completed and timely delivered Notice of Revolving Loan Borrowing;

 

(ii)                                Originalcertificates of insurance, loss payable and mortgagee endorsements naming theAdministrative Agent as mortgagee, loss payee and additional insured, asrequired by Section 5.01(d) of this Agreement;

 

(iii) **                           **Evidencethat****there shall not have occurred sinceDecember 31, 2003 any event or circumstance that has resulted or couldreasonably be expected to result in a material adverse effect on the condition(financial or otherwise), business, operations, assets or properties of Argosyand its Subsidiaries (taken as a whole);

 

(iv) **                          **Evidencethat (x) the Indebtedness outstanding hereunder on the RestatementEffective Date (after giving effect to all Loans to be incurred on such date)shall be permitted under all documents, instruments and agreements evidencingSubordinated Indebtedness, and the Borrowers shall have delivered to theAdministrative Agent an officer’s certificate demonstrating compliance withsuch sections and (y) all actions necessary for the Loans hereunder toconstitute “Senior Indebtedness” and “Designated Senior Indebtedness” under,and as defined in, the 2001 Senior Subordinated Indenture and the 2004 SeniorSubordinated Indenture and comparable treatment under all other documents,instruments and

 

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agreements evidencing otherSubordinated Indebtedness (to the extent applicable) shall have been taken;

 

(v) **                             **Evidencethat no material disruption of or a material adverse change in conditions inthe financial, banking or capital markets shall have occurred which WellsFargo, in its sole discretion, deems material in connection with its ability tosyndicate the Commitments and the Loans;

 

(vi) **                          **Evidencethat there shall not exist any pending or threatened action, suit,investigation or proceeding, which, if adversely determined, could materiallyand adversely affect the Loan Parties, any transaction contemplated hereby orthe ability of any Loan Party to perform its obligations under the CreditDocuments or the ability of the Lenders to exercise their rights thereunder;

 

(vii) **                       **Acertificate of the president or chief financial officer of the Borrowers, addressed to the Administrative Agent and datedthe Restatement Effective Date, certifying that:

 

(A)                            Therepresentations and warranties set forth in Article IV and in the otherCredit Documents are true and correct in all material respects as of such date(except for such representations and warranties made as of a specified date,which shall be true as of such date); and

 

(B)                              NoDefault has occurred and is continuing as of such date.

 

(viii)                      TheBorrowers shall have paid all interest, fees and expenses payable to theAdministrative Agent and the Lenders on or prior to the Restatement EffectiveDate (including (A) all interest, fees and expenses accrued under theExisting Credit Agreement through the Restatement Effective Date and(B) all fees payable to the Administrative Agent pursuant to theAdministrative Agent’s Fee Letter);

 

(ix)                              TheBorrowers shall have paid all fees and expenses of counsel to theAdministrative Agent and any title company(ies)through the Restatement Effective Date;

 

(x)                                Copiesof the Transfer Agreement and any amendments thereto and each document andinstrument delivered in connection therewith, in each case duly executed byeach party thereto;

 

(xi)                              TheBorrowers shall have delivered a true and correct copy of: (i) each of theDevelopment Agreements and all amendments and modifications thereto, and (ii)all leases of any portion of the real property occupied or operated by theBorrowers in Baton Rouge, Louisiana, and all amendments and modificationsthereto (collectively, the “Baton Rouge Leases”), and

 

(xii)                           Suchother evidence as the Administrative Agent or any Lender may reasonably requestto establish the accuracy and completeness of the representations andwarranties and the compliance with the terms and conditions contained in thisAgreement and the other Credit Documents.

 

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3.02.                      Conditions Precedent to each CreditEvent.  The occurrence of eachCredit Event (including the initial****Borrowing) issubject to the further conditions that:

 

(a)                                EachBorrower shall have delivered to the Administrative Agent and, if applicable,the L/C Issuer or the Swing Line Lender, the Notice of Borrowing, Letter ofCredit Application, Notice of Conversion or Notice of Interest PeriodSelection, as the case may be, for such Credit Event in accordance with thisAgreement; and

 

(b)                               Onthe date such Credit Event is to occur and after giving effect to such CreditEvent, the following shall be true and correct:

 

(i)                                   Therepresentations and warranties of the Loan Parties set forth in Article IVand in the other Credit Documents are true and correct in all material respectsas if made on such date (except for representations and warranties expresslymade as of a specified date, which shall be true as of such date);

 

(ii)                                NoDefault has occurred and is continuing or will result from such Credit Event;and

 

(iii)                             Allof the Credit Documents are in full force and effect.

 

(c)                                TheIndebtedness outstanding hereunder on the date of such Credit Event (aftergiving effect to the incurrence and funding of the Indebtedness in respect ofsuch Credit Event) shall (A) be permitted (whether pursuant to an incurrencetest or otherwise) under all documents, instruments and agreements evidencingSubordinated Indebtedness and (B) constitute “Senior indebtedness” and “DesignatedSenior Indebtedness” under, and as defined in, the 2001 Senior SubordinatedIndenture and the 2004 Senior Subordinated Indenture and comparable treatmentunder all other documents, instruments or agreements evidencing SubordinatedIndebtedness (to the extent applicable). From and after the occurrence of any increase in the Total RevolvingLoan Commitment pursuant to Section 2.17 hereof, with respect to eachCredit Event in which, after giving effect thereto, the aggregate amount ofRevolving Loans, L/C Obligations and Swing Line Loans then outstanding exceeds$500,000,000, at the Administrative Agent’s request, the Borrowers shall havedelivered to the Administrative Agent an officer’s certificate demonstratingcompliance with such sections.

 

Thesubmission by each Borrower to the Administrative Agent of each Notice ofBorrowing, each Letter of Credit Application, each Notice of Conversion (otherthan a notice for a conversion to a Base Rate Loan or a Base Rate Portion) andeach Notice of Interest Period Selection shall be deemed to be a representationand warranty by such Borrower that each of the statements set forth above inthis Section 3.02(c) is true and correct as of the date of such notice.

 

3.03.                      Covenant to Deliver.  Each Borrower agrees (not as a condition butas a covenant) to deliver to the Administrative Agent each item required to bedelivered to the Administrative Agent as a condition to the occurrence of anyCredit Event if such Credit Event occurs. Each Borrower expressly agrees that the occurrence of any such CreditEvent prior to the receipt by the Administrative Agent of any such item shallnot constitute a waiver by the Administrative Agent or any Lender of suchBorrowers’ obligation to deliver such item.

 

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**ARTICLEIV****.****REPRESENTATIONS AND WARRANTIES.**

 

4.01.                      Borrowers’ Representations andWarranties.  In order to inducethe Administrative Agent and the Lenders to enter into this Agreement, eachBorrower hereby represents and warrants to the Administrative Agent and theLenders as follows:

 

(a)                                DueIncorporation, Qualification, etc. Each Loan Party (i) is a corporation, partnership or limited liabilitycompany duly organized, validly existing and in good standing under the laws ofits jurisdiction of incorporation or formation; (ii) has the power andauthority to own, lease and operate its properties and carry on its business asnow conducted; and (iii) is duly qualified, licensed to do business and in goodstanding as a foreign corporation, partnership or limited liability company, asapplicable, in each jurisdiction where its ownership, lease or operation ofproperty or the conduct of its business requires such qualification or licenseand where the failure to be so qualified or licensed is reasonably likely tohave a Material Adverse Effect.

 

(b)                               Authority.  The execution, delivery and performance byeach Loan Party of each Credit Document executed, or to be executed, by suchLoan Party and the consummation of the transactions contemplated thereby (i)are within the power of such Loan Party and (ii) have been duly authorized byall necessary actions on the part of such Loan Party.

 

(c)                                Enforceability.  Each Credit Document executed, or to beexecuted, by each Loan Party has been, or will be, duly executed and deliveredby such Loan Party and constitutes, or will constitute, a legal, valid andbinding obligation of such Loan Party, enforceable against such Loan Party inaccordance with its terms, except as limited by bankruptcy, insolvency or otherlaws of general application relating to or affecting the enforcement ofcreditors’ rights generally and general principles of equity.

 

(d)                               Non-Contravention.  The execution and delivery by each Loan Partyof the Credit Documents executed by such Loan Party and the performance andconsummation of the transactions contemplated thereby do not (i) violate anyprovision of, or result in the breach or the acceleration of, or entitle anyother Person to accelerate (whether after the giving of notice or lapse of timeor both), any Contractual Obligation of such Loan Party, where such breach orviolation could reasonably be expected to result in a Material Adverse Effect;(ii) result in the creation or imposition of any Lien (or the obligation tocreate or impose any Lien) upon any property, asset or revenue of such LoanParty (except such Liens as may be created in favor of the Administrative Agentfor the benefit of itself and the Lenders pursuant to this Agreement or theother Credit Documents) or (iii) violate any provision of any existing law,rule, regulation, order, writ, injunction or decree of any court orGovernmental Authority to which it is subject, where such breach couldreasonably be expected to result in a Material Adverse Effect.

 

(e)                                Approvals.

 

(i)                                   Noconsent, approval, order or authorization of, or registration, declaration orfiling with, any Governmental Authority or other Person (including theshareholders of any Person) is required in connection with the execution anddelivery of the Credit Documents executed by any Loan Party or the performanceor consummation of the 

 

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transactions contemplatedthereby, except for those which have been made or obtained and are in fullforce and effect.

 

(ii)                                Theexecution, delivery and performance by the Loan Parties of the Credit Documentsto which they are parties and the consummation of the transactions contemplatedby the Credit Documents do not and will not result in any License Revocation.

 

(iii)                             AllGaming Licenses and other Governmental Authorizations have been duly obtainedand are in full force and effect without any known conflict with the rights ofothers and, other than the terms of the Transfer Agreement, free from anyunduly burdensome restrictions, except where any such failure to obtain suchGaming Licenses or Governmental Authorizations or any such conflict orrestriction could not reasonably be expected to have, either individually or inthe aggregate, a Material Adverse Effect. None of the Loan Parties has received any written notice or otherwritten communications from any Gaming Authority or other GovernmentalAuthority regarding (A) any revocation, withdrawal, suspension, termination ormodification of, or the imposition of any material conditions with respect to,any Gaming License, or (B) any other limitations on the conduct of business byany Loan Party, except where any such revocation, withdrawal, suspension,termination, modification, imposition or limitation could not reasonably beexpected to have, either individually or in the aggregate, a Material AdverseEffect.

 

(iv)                            NoGovernmental Authorization is required for either (x) the pledge or grant byany Loan Party of the Liens purported to be created in favor of theAdministrative Agent in connection herewith or any other Credit Document or (y)the exercise by Administrative Agent of any rights or remedies in respect ofany Collateral (whether specifically granted or created pursuant to any of theSecurity Documents or created or provided for by any Governmental Rule), exceptfor (1) such Governmental Authorizations that have been obtained and are infull force and effect and fully disclosed to Administrative Agent in writing,(2) filings or recordings contemplated in connection with this Agreement or anySecurity Document and (3) those which may be required by Gaming Laws inconnection with the foreclosure and disposition of any Equity Securitiespledged under the Security Documents.

 

(f)                                  NoViolation or Default.  No Loan Partyis in violation of or in default with respect to (i) any Requirement of Lawapplicable to such Person or (ii) any Contractual Obligation of such Person(nor is there any waiver in effect which, if not in effect, would result insuch a violation or default), where, in each case, such violation or default isreasonably likely to have a Material Adverse Effect.  Without limiting the generality of theforegoing, no Loan Party (A) has violated any Environmental Laws, (B) has anyliability under any Environmental Laws or (C) has received notice or othercommunication of an investigation or is under investigation by any GovernmentalAuthority having authority to enforce Environmental Laws, where such violation,liability or investigation is reasonably likely to have a Material AdverseEffect.  No Default has occurred and iscontinuing.

 

(g)                               Litigation.  Except as set forth in Schedule 4.01(g),to the actual knowledge of the Borrowers, no actions (including derivativeactions), suits, proceedings or investigations are pending or threatenedagainst any Loan Party at law or in equity in any court or before any otherGovernmental Authority which (i) could reasonably be expected to have a

 

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MaterialAdverse Effect or (ii) seek to enjoin, either directly or indirectly, theexecution, delivery or performance by any Loan Party of the Credit Documents orthe transactions contemplated thereby.

 

(h)                               Title;Possession Under Leases; Intercompany Notes.  The Loan Parties own and have good andmarketable title, or a valid leasehold interest in, all their respectiveproperties and assets as reflected in the most recent Financial Statementsdelivered to the Administrative Agent (except those assets and propertiesdisposed of in the ordinary course of business or otherwise in compliance withthis Agreement since the date of such Financial Statements) and all respectiveassets and properties acquired by the Loan Parties since such date (exceptthose disposed of in the ordinary course of business or otherwise in compliancewith this Agreement).  Such assets andproperties are subject to no Lien, except for Permitted Liens.  Each of the Loan Parties has complied withall material obligations under all material leases to which it is a party andenjoys peaceful and undisturbed possession under such leases.  Schedule 4.01(h) sets forth thenames of the payor, payee, face amount and unpaid principal balance (as of theRestatement Effective Date) of each of the Intercompany Notes.

 

(i)                                   FinancialStatements.  The Financial Statementsof the Loan Parties which have been delivered to the Administrative Agent, (i)are in accordance with the books and records of the Loan Parties, which havebeen maintained in accordance with good business practice; (ii) have beenprepared in conformity with GAAP subject, in the case of any unauditedFinancial Statements, to normal year-end audit adjustments and the absence offootnotes thereto; and (iii) fairly present in all material respects thefinancial conditions and results of operations of the Loan Parties as of thedate thereof and for the period covered thereby.  No Loan Party has any Contingent Obligations,liability for taxes or other outstanding obligations which, in any such case,are material in the aggregate, except as disclosed in the audited FinancialStatements dated December 31, 2003, furnished by Argosy to the AdministrativeAgent prior to the date hereof, or in the Financial Statements delivered to theAdministrative Agent pursuant to clause (i) or (ii) of Section 5.01(a).

 

(j)                                   Creation,Perfection and Priority of Liens.  Asof the Restatement Effective Date, (i) the execution and delivery of theSecurity Documents by the Loan Parties, together with (A) the filing of anyUniform Commercial Code financing statements and the recording of the U.S.Patent and Trademark Office filings delivered to the Administrative Agent forfiling and recording, respectively (but not yet filed or recorded), and therecording of any mortgages or ship mortgages and amendments to existingmortgages and ship mortgages delivered to the Administrative Agent forrecording (but not yet recorded), (B) the delivery to the Administrative Agentof any Equity Securities not delivered to the Administrative Agent at the timeof execution and delivery of the applicable Security Document (all of whichEquity Securities have been so delivered) and (C) the registration ofunregistered copyrights in the U.S. Copyright Office and the recording ofevidence of the security interest against such registrations herein, areeffective to create in favor of the Administrative Agent for the benefit ofitself and the Lenders, as security for the Obligations, a valid and perfectedfirst priority Lien on all of the Collateral as of the Restatement EffectiveDate (subject only to Permitted Liens), and (ii) all filings and other actionsnecessary or desirable to perfect and maintain the perfection and firstpriority status of such Liens have been duly made or taken and remain in fullforce and effect, other than (A) the filing of any Uniform Commercial Codefinancing statements and U.S. Patent 

 

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andTrademark Office filings delivered to the Administrative Agent for filing (butnot yet filed), (B) the recording of any mortgages and ship mortgages andamendments to existing mortgages and ship mortgages delivered to theAdministrative Agent for recording (but not yet recorded) and (C) theregistration of unregistered copyrights in the U.S. Copyright Office and therecording of evidence of the security interest against such registrationscreated by the Security Documents.

 

(k)                                NoAgreements to Sell Assets; Etc.  NoLoan Party has any legal obligation, absolute or contingent, to any Person tosell the assets of any Loan Party (except as permitted by Section 5.02(c)),or to effect any merger, consolidation or other reorganization of any LoanParty (except as permitted by Section 5.02(d)) or to enter into anyagreement with respect thereto except the Transfer Agreement and the documentsand instruments delivered in connection therewith.

 

(l)                                   EmployeeBenefit Plans.

 

(i)                                   Basedupon the latest valuation of each Employee Benefit Plan (x) that is subject toTitle IV of ERISA and (y) that any Borrower or any ERISA Affiliate maintains orcontributes to, or has any obligation under (which occurred within twelvemonths of the date of this representation), the aggregate benefit liabilitiesof all such Plans within the meaning of Section 4001 of ERISA did notexceed the aggregate value of the assets of all such Plans by more than$10,000,000.  Neither any Borrower nor anyERISA Affiliate has any liability with respect to any post-retirement benefitunder any Employee Benefit Plan which is a welfare plan (as defined in Section3(1) of ERISA), other than liability for health plan continuation coveragedescribed in Section 4980B of the IRC or Part 6 of Title I(B) of ERISA, whichliability for health plan contribution coverage is not reasonably likely tohave a Material Adverse Effect.

 

(ii)                                EachEmployee Benefit Plan complies, in both form and operation, in all materialrespects, with its terms, ERISA and the IRC, and no condition exists or eventhas occurred with respect to any such Plan which could reasonably be expectedto result in the incurrence by any Borrower or ERISA Affiliate of any materialliability, fine or penalty.  EachEmployee Benefit Plan, related trust agreement, arrangement and commitment ofany Borrower or any ERISA Affiliate is legally valid and binding and in fullforce and effect.  No Employee BenefitPlan is being audited or investigated by any government agency or is subject toany pending or, to any Borrower’s knowledge, threatened claim or suit.  None of the Borrowers and the ERISAAffiliates nor any fiduciary of any Employee Benefit Plan has engaged in anon-exempt prohibited transaction under section 406 of ERISA or section 4975 ofthe IRC.

 

(iii)                             Exceptas set forth on Schedule 4.01(l), none of the Borrowers and theERISA Affiliates contributes to or has any material contingent obligations toany Multiemployer Plan.  None of theBorrowers and the ERISA Affiliates has incurred any material liability(including secondary liability) to any Multiemployer Plan as a result of acomplete or partial withdrawal from such Multiemployer Plan under Section 4201of ERISA or as a result of a sale of assets described in Section 4204 of ERISA.  None of the Borrowers and the ERISAAffiliates has been notified that any Multiemployer Plan is in reorganizationor insolvent under and within the meaning of Section 4241 or Section 4245 ofERISA or that any Multiemployer Plan intends to terminate or has been terminatedunder Section 4041A of ERISA.

 

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(m)                             OtherRegulations.  No Loan Party issubject to regulation under the Investment Company Act of 1940, the PublicUtility Holding Company Act of 1935, the Federal Power Act, the InterstateCommerce Act, any state public utilities code or to any other Governmental Rulelimiting its ability to incur indebtedness, other than applicable provisions ofGaming Laws.

 

(n)                               Patentand Other Rights.  The Loan Partiesown, license or otherwise have the full right to use, under validly existingagreements, all material patents, licenses, trademarks, trade names, tradesecrets, service marks, copyrights and all rights with respect thereto, whichare required to conduct their businesses as now conducted, except where thefailure to own, license or otherwise have the full right to use could notreasonably be expected to result in a Material Adverse Effect.  Each of the patents, trademarks, trade names,service marks and copyrights owned by any Loan Party as of the RestatementEffective Date which is registered with any Governmental Authority is set forthon Schedule 4.01(n).

 

(o)                               GovernmentalCharges.  The Loan Parties have filedor caused to be filed all federal and other material tax returns which arerequired to be filed by them.  The LoanParties have paid, or made provision for the payment of, all material taxes andother material Governmental Charges which have or may have become due pursuantto said returns or otherwise, except such Governmental Charges, if any, whichare being contested in good faith and as to which adequate reserves (determinedin accordance with GAAP) have been provided.

 

(p)                               MarginStock.  No Borrower owns any MarginStock which, in the aggregate, would constitute a substantial part of theassets of such Borrower, and no proceeds of any Loan will be used to purchaseor carry, directly or indirectly, any Margin Stock or to extend credit,directly or indirectly, to any Person for the purpose of purchasing or carryingany Margin Stock.

 

(q)                               Subsidiaries,Etc.  Schedule 4.01(q) (assupplemented by the Borrowers quarterly in a written notice to theAdministrative Agent) sets forth as of the Restatement Effective Date each ofthe Subsidiaries of Argosy, whether such Subsidiary is a Restricted Subsidiaryor an Unrestricted Subsidiaries, its jurisdiction of organization, the classesof its Equity Securities, the number of shares of each such class issued andoutstanding, the percentages of shares of each such class owned by each holderthereof and a description of each New Venture owned in whole or part by eachsuch Subsidiary.

 

(r)                                  LaborMatters.  Except as set forth in Schedule4.01(r), (i) there are no disputes presently subject to grievanceprocedure, arbitration or litigation under any of the collective bargainingagreements, employment contracts or employee welfare or incentive plans towhich any Loan Party is a party which alone or in the aggregate couldreasonably be expected to have a Material Adverse Effect and (ii) there are nostrikes, lockouts, work stoppages or slowdowns, or, to the knowledge of theBorrowers, jurisdictional disputes or organizing activities occurring orthreatened which, alone or in the aggregate, could reasonably be expected tohave a Material Adverse Effect.

 

(s)                                NoMaterial Adverse Effect.  SinceDecember 31, 2003, no event has occurred and no condition exists which isreasonably likely to have a Material Adverse Effect.

 

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(t)                                  Accuracyof Information Furnished.  The CreditDocuments and the other certificates, statements and information (excludingprojections) furnished by the Loan Parties to the Administrative Agent and theLenders in connection with the Credit Documents and the transactionscontemplated thereby, taken as a whole, do not contain any untrue statement ofa material fact and do not omit to state any material fact necessary to makethe statements therein, in light of the circumstances under which they weremade, not misleading.  All projectionsfurnished by the Loan Parties to the Administrative Agent and the Lenders inconnection with the Credit Documents and the transactions contemplated therebyhave been based upon reasonable assumptions and represent, as of their respectivedates of presentations, the Loan Parties’ best estimates of the futureperformance of the Loan Parties.

 

(u)                               SubordinatedIndentures.

 

(i)                                   TheBorrowers are permitted under all documents, instruments and agreementsevidencing Subordinated Indebtedness to incur and permit to remain outstandingthe Term Loans.  The Borrowers arepermitted under all documents, instruments and agreements evidencingSubordinated Indebtedness to borrow and re-borrow Revolving Loans.

 

(ii)                                AllLoans and L/C Obligations outstanding hereunder constitute “Senior Indebtedness”and “Designated Senior Indebtedness” under (and as defined in) the 2001 SeniorSubordinated Indenture and the 2004 Senior Subordinated Indenture andcomparable treatment under all other documents, instruments and agreementsevidencing any other Subordinated Indebtedness outstanding (to the extentapplicable).

 

(iii)                             Allof the Term Loans (A) have been incurred under (I) eitherSection 4.07(a)(i) of the 2001 Senior Subordinated Indenture or theinterest coverage ratio test set forth in first paragraph ofSection 4.07(a) of the 2001 Senior Subordinated Indenture and(II) Section 4.07(a)(i) of the 2004 Senior Subordinated Indenture orthe interest coverage ratio test set forth in first paragraph of Section 4.07(a)of the 2004 Senior Subordinated Indenture and (B) are permitted to remainoutstanding under the applicable provisions of all documents, instruments oragreements evidencing other Subordinated Indebtedness outstanding.

 

(iv)                            DevelopmentAgreements.  The Borrowers havedelivered true, correct and complete copies of the Development Agreements andall modifications and amendments thereto (if any) to the Administrative Agent,as in effect on the Restatement Effective Date. As of the Restatement Effective Date (A) none of the DevelopmentAgreements have been terminated and they are all in full force and effect, (B)no Borrower is in default in the observance or performance of any of itsrespective material obligations under the Development Agreements and (C) eachBorrower has done all things required to be done to keep unimpaired itsrespective rights thereunder.

 

(v) Baton Rouge Leases.  The Borrowers have delivered true, correctand complete copies of the Baton Rouge Leases and all modifications and amendmentsthereto (if any) to the Administrative Agent, as in effect on the RestatementEffective Date.  As of the RestatementEffective Date, the Baton Rouge Leases: (i) have not been terminated andare all in full force and effect; (ii) are not subject to any default in theobservance or performance of any material obligation of any lessor or lesseethereunder; and (iii) the applicable Borrower party

 

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theretohas done all things required to be done to keep unimpaired its respectiverights thereunder.

 

**ARTICLE V. COVENANTS****.**

 

5.01.                      Affirmative Covenants.  Until the termination of this Agreement andthe satisfaction in full by the Borrowers of all Obligations, each Borrowerwill comply, and will cause compliance, with the following affirmativecovenants, unless the Required Lenders shall otherwise consent in writing:

 

(a)                                FinancialStatements, Reports, etc.  TheBorrowers shall furnish to the Administrative Agent, with sufficient copies foreach Lender, the following, each in such form and such detail as theAdministrative Agent or the Required Lenders shall reasonably request:

 

(i)                                   Assoon as available and in no event later than forty-five (45) days after thelast day of each of the first three fiscal quarters of each fiscal year ofArgosy, a copy of the Financial Statements of Argosy and its Subsidiariesprepared on a consolidated basis for such quarter and for the fiscal year todate, certified by the president or chief financial officer of Argosy to presentfairly in all material respects the financial condition, results of operationsand other information reflected therein and to have been prepared in accordancewith GAAP (subject to normal year-end audit adjustments);

 

(ii)                                Assoon as available and in no event later than one hundred twenty (120) daysafter the close of each fiscal year of Argosy, (A) copies of the auditedFinancial Statements of Argosy and its Subsidiaries prepared on a consolidatedbasis for such year, audited by independent certified public accountants ofrecognized national standing acceptable to the Administrative Agent, (B) copiesof the unqualified opinions (or qualified opinions reasonably acceptable to theAdministrative Agent and the Required Lenders) and, to the extent delivered, managementletters delivered by such accountants in connection with all such FinancialStatements and (C) certificates of such accountants to the Administrative Agentstating that in making the examination necessary for their opinion they havereviewed this Agreement and have obtained no knowledge of any Default which hasoccurred and is continuing, or if, in the opinion of such accountants, aDefault has occurred and is continuing, a statement as to the nature thereof;

 

(iii)                             Contemporaneouslywith the quarterly and year-end Financial Statements required by the foregoingclauses (i) and (ii), a compliance certificate of the president or chieffinancial officer or treasurer of Argosy (a “Compliance Certificate”)which (A) states that no Default has occurred and is continuing, or, if anysuch Default has occurred and is continuing, a statement as to the naturethereof and what action the Borrowers propose to take with respect thereto; (B)sets forth, for the quarter or year covered by such Financial Statements or asof the last day of such quarter or year (as the case may be), the calculationof the financial ratios and tests provided in Section 5.03;

 

(iv)                            Assoon as available and in no event later than forty-five (45) days after thelast day of each fiscal quarter of Argosy, a certificate of the chief financialofficer or

 

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treasurerof Argosy (a “Pricing Certificate”) which sets forth the calculation ofthe Total Funded Debt to EBITDA Ratio as of such date;

 

(v)                               Assoon as possible and in no event later than five (5) Business Days after anyofficer of any Loan Party knows of the occurrence or existence of (A) anyReportable Event under any Employee Benefit Plan or Multiemployer Plan whichcould result in a Material Adverse Effect, (B) any actual or threatenedlitigation, suits, claims or disputes against any Loan Party involvingpotential monetary damages payable by any Loan Party of $10,000,000 or more(alone or in the aggregate), (C) any other event or condition which isreasonably likely to have a Material Adverse Effect, or (D) any Default, thestatement of the president or chief financial officer or treasurer of Argosysetting forth details of such event, condition or Default and the action whichArgosy proposes to take with respect thereto;

 

(vi)                            Ifrequested by the Administrative Agent or any Lender, as soon as available andin no event later than five (5) Business Days after they are sent, madeavailable or filed, copies of (A) all registration statements and reports filedby Argosy or any of its Subsidiaries with any securities exchange or the UnitedStates Securities and Exchange Commission (including all 10-Q, 10-K and 8-Qreports), (B) all reports, proxy statements and financial statements sent or madeavailable by Argosy or any of its Subsidiaries to its security holders, and (C)all press releases and other similar public announcements concerning anymaterial developments in the business of Argosy or any of its Subsidiaries madeavailable by Argosy or any of its Subsidiaries to the public generally;

 

(vii)                         Assoon as available, and in any event not later than forty-five (45) days afterthe commencement of each fiscal year of Argosy, the budget and projectedfinancial statements of the Loan Parties for such fiscal year, including, ineach case, projected balance sheets, statements of income and retained earningsand statements of cash flow of the Loan Parties, all in reasonable detail andin any event to include projected Capital Expenditures and quarterlyprojections of the Borrowers’ compliance with each of the covenants set forthin Section 5.03 of this Agreement;

 

(viii)                      Assoon as possible and in no event later than ten (10) days prior to theacquisition by any Loan Party of any leasehold or ownership interest in realproperty with a fair market value of $10,000,000 or more, a written supplementto Schedule 4.01(h);

 

(ix)                              Assoon as possible and in no event later than five (5) Business Days after thereceipt thereof by Argosy or any of its Subsidiaries, copies of any and allmaterial notices and other material adverse communications from anyGovernmental Authority with respect to any Loan Party or any Gaming Facilityand promptly upon the request of the Administrative Agent or any Lender, copiesof any and all periodic or special reports filed by any Loan Party with anyGaming Authority or other Governmental Authority with respect to any GamingFacility;

 

(x)                                 Assoon as possible and in no event later than five (5) Business Days after thereceipt thereof by Argosy or any of its Subsidiaries, a copy of any notice,summons, citations or other written communications concerning any actual,alleged, suspected or

 

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threatenedmaterial violation of any Environmental Law, or any material liability ofArgosy or any of its Subsidiaries for Environmental Damages; and

 

(xi)                              Suchother instruments, agreements, certificates, opinions, statements, documentsand information relating to the operations or condition (financial orotherwise) of Argosy or its Subsidiaries, and compliance by the Borrowers withthe terms of this Agreement and the other Credit Documents as theAdministrative Agent or any Lender may from time to time reasonably request.

 

(b)                               Booksand Records.  The Loan Parties shallat all times keep proper books of record and account in which full, true andcorrect entries will be made of their transactions in accordance with GAAP.

 

(c)                                Inspections.  The Loan Parties shall permit theAdministrative Agent and each Lender, or any agent or representative thereof,upon reasonable notice and during normal business hours, to visit and inspectany of the properties and offices of the Loan Parties, to conduct audits of anyor all of the Collateral at Argosy’s expense, to examine the books and recordsof the Loan Parties and make copies thereof, and to discuss the affairs,finances and business of the Loan Parties with, and to be advised as to thesame by, their officers, auditors and accountants, all at such times andintervals as the Administrative Agent or any Lender may reasonablyrequest.  If no Event of Default hasoccurred and is continuing, the first such inspection, audit and examination bythe Administrative Agent during any fiscal year shall be at the Borrowers’expense and all other inspections, audits and examinations conducted by theAdministrative Agent and the Lenders during such time shall be at the expenseof the Person conducting such inspection, audit or examination.  If an Event of Default has occurred and iscontinuing, any such inspection, audit and examination shall be at theBorrowers’ expense.

 

(d)                               Insurance.  The Loan Parties shall:

 

(i)                                   Carryand maintain insurance during the term of this Agreement of the types and inthe amounts customarily carried from time to time by others engaged insubstantially the same business as such Person and operating in the samegeographic area as such Person, including, but not limited to, fire, publicliability, property damage and worker’s compensation;

 

(ii)                                Furnishto each Lender, upon written request, full information as to the insurancecarried;

 

(iii)                             Carryand maintain each policy for such insurance with (A) a company which is rated Aor better by A.M. Best and Company at the time such policy is placed and at thetime of each annual renewal thereof or (B) any other insurer which isreasonably satisfactory to the Administrative Agent; and

 

(iv)                            Obtainand maintain endorsements reasonably acceptable to the Administrative Agent forsuch insurance naming the Administrative Agent as an additional insured and aslender’s loss payee;

 

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provided, however, that ifany Loan Party shall fail to maintain insurance in accordance with this Section5.01(d), or if any Loan Party shall fail to provide the requiredendorsements with respect thereto, the Administrative Agent shall have theright (but shall be under no obligation) to procure such insurance and eachBorrower agrees to reimburse the Administrative Agent for all costs andexpenses of procuring such insurance.

 

(e)                                GovernmentalCharges and Other Indebtedness.  EachLoan Party shall promptly pay and discharge when due (i) all material taxes andother material Governmental Charges prior to the date upon which penaltiesaccrue thereon, (ii) all Indebtedness which, if unpaid, could become a Lienupon the property of such Loan Party which is not a Permitted Lien and (iii)subject to any subordination provisions applicable thereto, all otherIndebtedness which in each case, if unpaid when due, is reasonably likely tohave a Material Adverse Effect, except such Indebtedness as may in good faithbe contested or disputed, or for which arrangements for deferred payment havebeen made, provided that in each such case appropriate reserves are maintainedin accordance with GAAP.

 

(f)                                  Useof Proceeds.  The Borrowers shall usethe proceeds of the Loans only for the respective purposes set forth in Section2.01(g) and Section 2.02(g). No Borrower shall use any part of the proceeds of any Loan, directly orindirectly, for the purpose of purchasing or carrying any Margin Stock or forthe purpose of purchasing or carrying or trading in any securities under suchcircumstances as to involve such Borrower, any Lender or the AdministrativeAgent in a violation of Regulations T, U or X issued by the Federal ReserveBoard.

 

(g)                               GeneralBusiness Operations.  Each of theLoan Parties shall (i) preserve and maintain its corporate, partnership orlimited liability company existence, as the case may be, and all of the rights,privileges and franchises reasonably necessary to the conduct of its business,(ii) conduct its business activities in compliance with all Requirements of Lawand Contractual Obligations applicable to such Person and (iii) keep allproperty useful and necessary in its business in good working order andcondition, ordinary wear and tear excepted, except, in each case, where anyfailure is not reasonably likely to have a Material Adverse Effect.

 

(h)                               Compliancewith Laws; Maintenance of Gaming and Liquor Licenses.

 

(i)                                 Compliancewith Laws.  Each Loan Party shallcomply with the requirements of all applicable laws, rules, regulations andorders of any Governmental Authority (including all Environmental Laws, GamingLaws, the Americans with Disabilities Act of 1990 and the Fair HousingAmendments Act of 1988), noncompliance with which could reasonably be expectedto have, individually or in the aggregate, a Material Adverse Effect.

 

(ii)                                Maintenanceof Licenses.  Each Loan Party shallmaintain (i) such valid Gaming Licenses in all jurisdictions as may benecessary to operate each of its Gaming Facilities, the absence of which couldreasonably be expected to result in a Material Adverse Effect, and (ii) allliquor licenses and registrations as may be necessary to sell alcoholicbeverages from and in its Gaming Facilities. Each Loan Party shall notify the Administrative

 

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Agentpromptly upon the revocation or non-renewal of any such Gaming License, liquorlicense or registration.

 

(i)                                   AdditionalCollateral.

 

(i)                                   Ifat any time from and after the Restatement Effective Date any Loan Partyacquires any fee interest in real property or any leasehold interest in realproperty which, in either case, has a fair market value in excess of$10,000,000, such Loan Party shall deliver to the Administrative Agent, at itsown expense, as soon as possible all documentation and information in form andsubstance reasonably satisfactory to the Administrative Agent (including anyenvironmental reports) to assist the Administrative Agent in obtaining deeds oftrust or mortgages on such additional real property and ALTA policies of titleinsurance, with such endorsements as the Administrative Agent may reasonablyrequire, issued by a company and in form and substance satisfactory to theAdministrative Agent, in an amount equal to the principal amount of the sum ofthe Total Revolving Loan Commitment and the Total Term Loan Commitment (as ofthe Restatement Effective Date), insuring the Administrative Agent’s Lien onsuch additional real property Collateral to be of first priority, subject onlyto such exceptions as the Administrative Agent shall approve in its discretion,with all costs thereof to be paid by such Loan Party.

 

(ii)                                Ifat any time from and after the Restatement Effective Date any Loan Partyacquires any vessel, such Loan Party shall deliver to the Administrative Agent,at its own expense, as soon as possible, but in any event not later than thirty(30) days after such acquisition, all documentation and information in form andsubstance reasonably satisfactory to the Administrative Agent to assist theAdministrative Agent in obtaining a mortgage on such additional vessel, subjectonly to such exceptions as the Administrative Agent shall approve in itsdiscretion, with all costs thereof to be paid by such Loan Party.

 

(j)                                   NewSubsidiaries.  Each Borrower shall,at its own expense prior to the acquisition or formation of any direct or indirectSubsidiary of such Borrower after the date hereof:

 

(i)                                   Notifythe Administrative Agent of such event;

 

(ii)                                Ifsuch Subsidiary is required by the provisions of this Agreement to bedesignated as a Restricted Subsidiary (or if the Borrowers choose to designatesuch Subsidiary as a Restricted Subsidiary), cause such Restricted Subsidiaryto execute and deliver to the Administrative Agent one or more joinderagreements and such other documents as the Administrative Agent deems necessaryto include such Subsidiary as a Borrower (or Guarantor, as applicable);

 

(iii)                             Ifsuch Subsidiary is required by the provisions of this Agreement to bedesignated as a Restricted Subsidiary (or if the Borrowers choose to designatesuch Subsidiary as a Restricted Subsidiary), amend the Security Documents asappropriate in light of such event to pledge the Equity Securities of suchPerson to the Administrative Agent for the benefit of itself and the Lendersand execute and deliver all documents or instruments required thereunder orappropriate to perfect the security interest created thereby;

 

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(iv)                            Ifsuch Subsidiary is required by the provisions of this Agreement to bedesignated as a Restricted Subsidiary (or if the Borrowers choose to designatesuch Subsidiary as a Restricted Subsidiary), promptly upon obtaining theapproval of any necessary Governmental Authority, deliver to the AdministrativeAgent all stock certificates and other instruments added to the Collateralthereby free and clear of all Liens, accompanied by undated stock powers orother instruments of transfer executed in blank;

 

(v)                               Ifsuch Subsidiary is required by the provisions of this Agreement to bedesignated as a Restricted Subsidiary (or if the Borrowers choose to designatesuch Subsidiary as a Restricted Subsidiary), cause such Subsidiary to execute apledge and security agreement, mortgage and/or ship mortgage or other securityagreement in form and substance satisfactory to the Administrative Agent; and

 

(vi) If such Subsidiaryis required by the provisions of this Agreement to be designated as aRestricted Subsidiary (or if the Borrowers choose to designate such Subsidiaryas a Restricted Subsidiary), cause each document (including each UniformCommercial Code financing statement and each filing with respect tointellectual property owned by each Person that becomes a direct or indirectRestricted Subsidiary of any Borrower after the date hereof) required by law orreasonably requested by the Administrative Agent to be filed, registered orrecorded in order to create in favor of the Administrative Agent for thebenefit of itself and the Lenders a valid, legal and perfected first-prioritysecurity interest in and lien on the Collateral subject to the SecurityDocuments to be so filed, registered or recorded and evidence thereof deliveredto the Administrative Agent;

 

provided, however, that inthe case of any Subsidiary which is the owner of a Casino or the holder of aGaming License, Argosy shall use its best efforts to cause all necessaryGovernmental Authorities to consent to the pledge of the Equity Securities ofsuch Subsidiary to the Administrative Agent for the benefit of itself and theLenders as soon as reasonably practicable.

 

(k)                                Appraisals.  During the existence of an Event of Defaultor upon the written request of any Lender acting pursuant to any Requirement ofLaw, each Borrower agrees that the Administrative Agent may, at the expense ofsuch Borrower, commission an appraisal of any property (i) to which any LoanParty holds legal title and (ii) which is encumbered by any mortgage or deed oftrust in favor of the Administrative Agent.

 

(l)                                   Designationof Senior Debt.  The Borrowers shallcause all Loans and L/C Obligations outstanding hereunder from time to time to(I) constitute “Designated Senior Indebtedness” under (and as defined in) the2001 Senior Subordinated Indenture and the 2004 Senior Subordinated Indentureor (II) be treated similarly under any other documents, instruments oragreements evidencing other Subordinated Indebtedness (to the extentapplicable).

 

(m)                             Manager.  If a Trigger Event occurs, Argosy shall causethe Manager (as defined in the Transfer Agreement) to immediately become aRestricted Subsidiary and meet the requirements set forth in Section 5.01(j).

 

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5.02.                      Negative Covenants.  Until the termination of this Agreement andthe satisfaction in full by the Borrowers of all Obligations, each Borrowerwill comply, and will cause compliance, with the following negative covenants,unless the Required Lenders shall otherwise consent in writing:

 

(a)                                Indebtedness.  None of the Loan Parties shall create, incur,assume or permit to exist any Indebtedness except for the following (“PermittedIndebtedness”):

 

(i)                                   Indebtednessof the Loan Parties under the Credit Documents;

 

(ii)                                Indebtednessof the Loan Parties listed in Schedule 5.02(a) and existing on thedate of this Agreement;

 

(iii)                             Indebtednessevidenced by the 2001 Senior Subordinated Notes and the 2004 SeniorSubordinated Notes;

 

(iv)                            Indebtednessconsisting of senior unsecured notes, the proceeds of which are used solely torefinance Subordinated Indebtedness existing on the Restatement Effective Date,so long as (A) no Default or Event of Default exists before and after givingeffect to the incurrence of such Indebtedness and (B) the Borrowers are in proforma compliance with each of the covenants set forth in Section 5.03after giving effect to the incurrence of such Indebtedness;

 

(v)                               Indebtednessof the Loan Parties arising from the endorsement of instruments for collectionin the ordinary course of their businesses;

 

(vi)                            Indebtednessof the Loan Parties under Rate Protection Agreements, provided that all suchRate Protection Agreements are entered into in connection with bona fidehedging operations and not for speculation;

 

(vii)                         Indebtednessof the Loan Parties under purchase money loans and Capital Leases incurred bythem to finance their acquisition of real property, fixtures or equipmentprovided that the aggregate amount of such Indebtedness outstanding at any timedoes not exceed $25,000,000;

 

(viii)                      Indebtednessof the Loan Parties that is subordinated to the Obligations, provided that (A)the covenants and events of default contained in the indenture, note purchaseagreement or other document relating to such Indebtedness are no morerestrictive in any material respect on any Loan Party than the comparableprovisions of the 2001 Senior Subordinated Indenture, (B) the subordinationprovisions contained in the indenture, note purchase agreement or otherdocument relating to such Indebtedness are comparable in all material respectsto those contained in the 2001 Senior Subordinated Indenture and (C) noprincipal payment in respect of such Indebtedness is scheduled to be paid priorto 366 days after the Term Loan Maturity Date (as of the date of incurrence);

 

(ix)                              Indebtednessof the Loan Parties with respect to surety, appeal, indemnity, performance orother similar bonds in the ordinary course of business (including

 

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suretyor similar bonds issued in connection with the stay of a proceeding of the typedescribed in Section 6.01(h));

 

(x)                                 Indebtednessof any Loan Party owing to any other Loan Party;

 

(xi)                              Indebtednessconsisting of Contingent Obligations (including Guaranty Obligations);

 

(xii)                           Indebtednessof the Borrowers under initial or successive refinancings of any Indebtednesspermitted by clause (ii), (iii), (iv), (viii) or (ix) above, provided that (A)the principal amount of any such refinancing does not exceed the principalamount of the Indebtedness being refinanced, (B) the material terms andprovisions of any such refinancing (including redemption, prepayment, defaultand subordination provisions but excluding interest rate, fees and otherpricing provisions) are no less favorable to the applicable Borrowers (or tothe Lenders in the case of the subordination provisions) than those of theIndebtedness being refinanced and (C) no portion of the principal amount ofsuch Indebtedness is required to be repaid on a date prior to the date which issix months after the Term Loan Maturity Date; and

 

(xiii)                        OtherIndebtedness of the Loan Parties in an aggregate principal amount not exceeding$25,000,000 at any time outstanding.

 

(b)                               Liens.  No Loan Party shall create, incur, assume orpermit to exist any Lien on or with respect to any of its assets or property ofany character, whether now owned or hereafter acquired, except for thefollowing (“Permitted Liens”):

 

(i)                                   Liensin favor of the Administrative Agent on behalf of the Lenders securing theObligations;

 

(ii)                                Lienslisted in Schedule 5.02(b) and existing on the date of this Agreement;

 

(iii)                             Liensfor taxes or other Governmental Charges not at the time delinquent orthereafter payable without penalty or being contested in good faith, providedthat adequate reserves for the payment thereof have been established inaccordance with GAAP;

 

(iv)                            Liensof carriers, warehousemen, mechanics, materialmen, vendors, and landlords andother similar Liens imposed by law incurred in the ordinary course of business,provided that adequate reserves for the payment thereof have been establishedin accordance with GAAP;

 

(v)                               Depositsunder workers’ compensation, unemployment insurance and social security laws orto secure the performance of bids, tenders, contracts (other than for therepayment of borrowed money) or leases, or to secure statutory obligations ofsurety or appeal bonds or to secure indemnity, performance or other similarbonds in the ordinary course of business;

 

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(vi)                            Zoningrestrictions, easements, rights-of-way, title irregularities and other similarencumbrances, which do not materially detract from the value of the propertysubject thereto or interfere with the ordinary conduct of the business of anyLoan Party;

 

(vii)                         Lienson any property or assets acquired, or on the property or assets of any Personsacquired, by any Loan Party after the date of this Agreement pursuant to Section5.02(d), provided that (A) such Liens exist at the time such property orassets or such Persons are so acquired and (B) such Liens were not created incontemplation of such acquisitions;

 

(viii)                      JudgmentLiens, provided that such Liens do not constitute an Event of Default under Section6.01(h);

 

(ix)                              Lienssecuring Indebtedness which constitutes Permitted Indebtedness under clause(vii) of Section 5.02(a), provided that, in each case, such Lien (A)covers only those assets financed by such Permitted Indebtedness, and (B)secures only such Permitted Indebtedness;

 

(x)                                 Liensincurred in connection with the extension, renewal or refinancing of theIndebtedness secured by the Liens described in clause (ii) or (ix) above,provided that any extension, renewal or replacement Lien (A) is limited to theproperty covered by the existing Lien and (B) secures Indebtedness which is nogreater in amount and has material terms no less favorable to the Lenders thanthe Indebtedness secured by the existing Lien;

 

(xi)                              Areciprocal servitude (easement), operating and management agreement referred toas the Common Areas Agreement in the Baton Rouge Hotel Management Agreement betweenCentroplex and Sheraton Operating Corporation;

 

(xii)                           Lienscreated by the Transfer Agreement and the documents and instruments deliveredin connection therewith; and

 

(xiii)                        OtherLiens, provided that the aggregate amount of Indebtedness or other obligationssecured by such other Liens does not exceed $10,000,000 at any time;

 

provided, however, that theforegoing exceptions shall not permit any Lien in any Equity Securities issuedby any Loan Party and owned by any Loan Party, except for Liens in favor of theAdministrative Agent securing the Obligations.

 

(c)                                AssetDispositions.  No Loan Party shallsell, lease, transfer or otherwise dispose of any of its assets or property,whether now owned or hereafter acquired, except for the following:

 

(i)                                   Salesby the Loan Parties of inventory in the ordinary course of their businesses;

 

(ii)                                Salesby the Loan Parties of surplus, damaged, worn or obsolete equipment in theordinary course of their businesses;

 

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(iii)                             Salesor other dispositions by any Loan Party of Investments permitted by clause(iii) of Section 5.02(e); provided that no Default shall have occurredand be continuing;

 

(iv)                            Salesor other dispositions of assets and property by any Borrower to any otherBorrower;

 

(v)                               Salesor other dispositions of assets and property by any Borrower to any RestrictedSubsidiary;

 

(vi)                            Salesor other dispositions of assets and property by any Loan Party to anyUnrestricted Subsidiary, provided that the terms of any such sales or otherdispositions by such Loan Party are no less favorable to such Loan Party thanwould prevail in the market for similar transactions between unaffiliatedparties dealing at arm’s length;

 

(vii)                         Transferof the capital stock of Empress Casino Joliet to the Trustee (as defined in theTransfer Agreement) pursuant to the terms of the Transfer Agreement and anysale or other disposition of any Subsidiary which has the effect of a causing aReverse Trigger Event; and

 

(viii)                      Othersales, leases, transfers and disposals of assets and property, provided thatthe aggregate fair market value of all such assets and property so sold,leased, transferred or disposed of during the term of this Agreement does notexceed 15% of Net Worth, determined at the time of each such sale, lease,transfer or other disposition.

 

(d)                               Mergers,Acquisitions, Etc.  No Loan Partyshall consolidate with or merge into any other Person or permit any otherPerson to merge into it, acquire any Person as a new Subsidiary or acquire allor substantially all of the assets of any other Person, except for thefollowing:

 

(i)                                   Argosyand the other Loan Parties****may merge witheach other, provided that (A) no Event of Default exists prior to, or wouldresult after giving effect to, any such merger and (B) in any such mergerinvolving Argosy, Argosy is the surviving Person;

 

(ii)                                AnyUnrestricted Subsidiary may merge with and into any Loan Party, provided that(A) no Event of Default exists prior to, or would result after giving effectto, any such merger, and (B) a Loan Party is the surviving Person; and

 

(iii)                             Acquisitionsby any Loan Party of any Person as a new Subsidiary or of all or substantiallyall of the assets of any other Person, provided that no Event of Default existsprior to, or would result after giving effect to, any such acquisition.

 

(e)                                Investments.  None of the Loan Parties shall make anyInvestment except for Investments in the following:

 

(i)                                   Investmentsby the Loan Parties in cash and Cash Equivalents;

 

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(ii)                                Investmentsby the Loan Parties in other Loan Parties and in Persons which become LoanParties on or substantially contemporaneously with the date of such Investment;

 

(iii)                             Investmentsby the Loan Parties in Non-Gaming Subsidiaries which are not RestrictedSubsidiaries and Non-Gaming New Ventures in an amount which, when added to allother Investments in such Non-Gaming Subsidiaries and Non-Gaming New Venturesmade during the term of this Agreement, does not exceed $25,000,000 in theaggregate;

 

(iv)                            Investmentsby the Loan Parties in Gaming Subsidiaries which are not RestrictedSubsidiaries and Gaming New Ventures in an amount which, when added to allother Investments in such Gaming Subsidiaries and Gaming New Ventures duringthe term of this Agreement, does not exceed $200,000,000 in the aggregate; provided,however; that (A) to the extent that any such Gaming Subsidiary orGaming New Venture which has received an Investment pursuant to this clause(iv) when it was not a Restricted Subsidiary thereafter becomes a RestrictedSubsidiary, the amount of any Investment made during the term of this Agreementin such Gaming Subsidiary or Gaming New Venture shall be added back to thebasket in this clause (iv) when such Person becomes a Restricted Subsidiary and(B) to the extent that any Loan Party receives any amount, on account of a saleof some or all of the Equity Securities of a Gaming Subsidiary that is not aRestricted Subsidiary or Gaming New Venture, the net proceeds received therefrom attributable to an Investment madepursuant to this clause (iv) during the term of this Agreement shall be addedback to the basket in this clause (iv).

 

(v)                               Investmentsconsisting of loans to employees, officers and directors in the ordinary courseof business in an aggregate amount not exceeding $500,000 at any one timeoutstanding;

 

provided, that, notwithstanding theforegoing, in no event shall the Loan Parties make any Investment in EmpressCasino Joliet after the occurrence of a Trigger Event and prior to theoccurrence of a Reverse Trigger Event.

 

(f)                                  Changein Business.  No Loan Party shallengage, either directly or indirectly through Affiliates, in any businesssubstantially different from the business in which the Loan Parties are engagedon the Restatement Effective Date and businesses reasonably relatedthereto.  The parties hereto agree thatfor purposes of this Section 5.02(f), the ownership and operation ofracetracks and the conduct of pari-mutuel wagering and gaming activities atsuch racetracks shall be deemed businesses which are not substantiallydifferent from the businesses in which the Loan Parties are engaged on theRestatement Effective Date.

 

(g)                               Paymentsof Indebtedness, Etc.  No Loan Partyshall (i) except as otherwise provided herein, prepay, redeem, purchase,defease or otherwise satisfy in any manner prior to the scheduled paymentthereof any Subordinated Indebtedness; (ii) amend, modify or otherwise changethe terms of any document, instrument or agreement evidencing SubordinatedIndebtedness in a manner which materially and adversely affects the Borrowers;or (iii) amend, modify or otherwise change any of the subordination or otherprovisions of any document, instrument or agreement evidencing SubordinatedIndebtedness in a manner which adversely affects the material rights of theAdministrative Agent and the Lenders.

 

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(h)                               ERISA.  No Loan Party shall (A) adopt or institute anyEmployee Benefit Plan that is subject to Title IV of ERISA, (B) take any actionwhich will result in the partial or complete withdrawal, within the meanings ofSections 4203 and 4205 of ERISA, from a Multiemployer Plan, (C) engage orpermit any Person to engage in any non-exempt prohibited transaction underSection 406 of ERISA or Section 4975 of the IRC involving any Employee BenefitPlan or Multiemployer Plan which could reasonably be expected to subject anyLoan Party or any ERISA Affiliate to any tax, penalty or other liabilityincluding a liability to indemnify, (D) incur or allow to exist any accumulatedfunding deficiency (within the meaning of Section 412 of the IRC or Section 302of ERISA), (E) fail to make full payment when due of all amounts due ascontributions to any Employee Benefit Plan or Multiemployer Plan, (F) fail tocomply with the requirements of Section 4980B of the IRC or Part 6 of TitleI(B) of ERISA, or (G) adopt any amendment to any Employee Benefit Plan whichcould reasonably be expected to require the posting of security pursuant toSection 401(a)(29) of the IRC, where singly or cumulatively, the above would bereasonably likely to have a Material Adverse Effect.

 

(i)                                   TransactionsWith Affiliates.  No Loan Party shallenter into any Contractual Obligation with any Affiliate (other than any otherLoan Party) or engage in any other transaction with any Affiliate (other thanany other Loan Party) except (i) upon terms at least as favorable to suchLoan Party as an arms-length transaction with unaffiliated Persons,(ii) Contractual Obligations and transactions in each case otherwisepermitted hereunder and (iii) the transactions contemplated by theTransfer Agreement.

 

(j)                                   AccountingChanges.  No Loan Party shall change(i) its fiscal year (currently January 1 through December 31) or (ii) itsaccounting practices except as required or permitted by GAAP.

 

(k)                                Amendmentsof Material Agreements.  No LoanParty shall agree to amend, modify, supplement or replace any MaterialAgreement or any document executed and delivered in connection therewith, inany respect that would materially and adversely affect any right or interest ofthe Administrative Agent and the Lenders or any Borrower’s ability to pay andperform the Obligations.

 

(l)                                   Manager.  Argosy shall not permit the Manager (asdefined in the Transfer Agreement) to create, incur, assume or permit to existany Indebtedness or create, incur, assume or permit to exist any Lien on orwith respect to any of its assets or property of any character, whether nowowned or hereafter acquired, other than Liens in favor of the AdministrativeAgent to secure the Obligations.

 

(m)                             Amendmentof Transfer Agreement.  Argosy shallnot amend, modify, or waive any term or provision of the Transfer Agreement orany document or instrument delivered in connection therewith in any respect orconsent to any release of a party therefrom, or agree to amend, modify, orwaive any term or provision of the Transfer Agreement or any document orinstrument delivered in connection therewith or waive any rights thereunder inany respect or agree to consent to any release of a party therefrom; except ineach case for amendments or modifications made solely to correct ministerialerrors.

 

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(n)                               Registrationof Vessels.  No Borrower shall bepermitted to register a Vessel with the United States Coast Guard withoutproviding prior written notice to the Administrative Agent thereof.

 

5.03.                      Financial Covenants.  Until the termination of this Agreement andthe satisfaction in full by the Borrowers of all Obligations, each Borrowerwill comply, and will cause compliance, with the following financial covenants,unless Required Lenders shall otherwise consent in writing:

 

(a)                                TotalFunded Debt to EBITDA Ratio.  TheBorrowers shall not permit the Total Funded Debt to EBITDA Ratio at any time tobe greater than the following amounts for the respective periods set forthbelow:

 
| **Period**                                                 | ** ** | **Total Funded Debt to  EBITDA Ratio** |
|------------------------------------------------------------|------------|----------------------------------------|
| ** **                                                 | ** ** | ** **                             |
| Restatement  Effective Date to and including June 30, 2007 |       | 4.75:1.00                              |
|                                                       |       |                                   |
| July 1, 2007 and  thereafter                               |       | 4.50:1.00                              |

 

(b)                               SeniorFunded Debt to EBITDA Ratio.  TheBorrowers shall not permit the Senior Funded Debt to EBITDA Ratio at any timeto be greater than 3.50:1:00.

 

(c)                                FixedCharge Coverage Ratio.  The Borrowersshall not permit the Fixed Charge Coverage Ratio as at the end of any fiscalquarter to be less than 1.50:1.00.

 

(d)                               MinimumNet Worth.  The Borrowers shall notpermit their Net Worth on any date of determination (such date to be referredto herein as a “Determination Date”) which occurs after June 30, 2004****(such date to be referred to herein as the “Base Date”)to be less than the sum on such Determination Date of the following:

 

(i)                                   $290,000,000;plus

 

(ii)                                Seventy-fivepercent (75%) of the sum of Argosy’s consolidated quarterly net income(ignoring any quarterly losses) after taxes for each fiscal quarter of Argosyending after the Base Date through and including the fiscal quarter ending on(if the Determination Date is the last day of a fiscal quarter) or immediatelyprior to (if the Determination Date is not the last day of a fiscal quarter)the Determination Date; plus

 

(iii)                             Fiftypercent (50%) of the Net Proceeds of all Equity Securities issued by the LoanParties during the period commencing on the Base Date and ending on theDetermination Date; minus

 

(iv)                            Non-recurringfees incurred in connection with the negotiation, execution and delivery ofthis Agreement and the other Credit Documents and other Permitted Indebtedness.

 

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(e)                                MinimumMaintenance Capital Expenditures. The Borrowers shall make Maintenance Capital Expenditures in anaggregate amount of not less than $25,000,000 in each fiscal year of Argosy.

 

(f)                                  MinimumSubordinated Debt.  The Borrowersshall maintain at all times Subordinated Indebtedness in an aggregate principalamount of not less than $350,000,000.

 

**ARTICLE VI. DEFAULT**.

 

6.01.                      Events of Default.  The occurrence or existence of any one ormore of the following shall constitute an “Event of Default” hereunder:

 

(a)                                Non-Payment.  Any Borrower shall (i) fail to pay when dueany principal of any Loan or any L/C Obligation, (ii) fail to pay within five(5) days after the same becomes due, any interest required under the terms ofthis Agreement or any of the other Credit Documents, or (iii) fail to pay afterthe same becomes due any fees or other amounts required under the terms of thisAgreement or any of the other Credit Documents and such failure shall continuefor five (5) Business Days after the earlier of (A) any Borrower’s writtenacknowledgement of such failure and (B) the Administrative Agent’s writtennotice to the Borrowers of such failure; or

 

(b)                               SpecificDefaults.  Any Borrower shall fail toobserve or perform any covenant, obligation, condition or agreement set forthin Section 5.01(a)(v)(D), Section 5.02 or Section 5.03;or

 

(c)                                OtherDefaults.  Any default shall occurunder any Security Document and such default shall continue beyond any periodof grace provided with respect thereto; or any Loan Party shall fail to observeor perform any other covenant, obligation, condition or agreement contained inthis Agreement or any other Credit Document and such failure shall continue forthirty (30) days after the Administrative Agent’s written notice to theBorrowers of such failure; or

 

(d)                               Representationsand Warranties.  Any representation,warranty, certificate, information or other statement (financial or otherwise)made or furnished by or on behalf of any Loan Party to the Administrative Agentor any Lender in or in connection with this Agreement or any of the otherCredit Documents, or as an inducement to the Administrative Agent or any Lenderto enter into this Agreement, shall be false, incorrect, incomplete ormisleading in any material respect when made or furnished; or

 

(e)                                Cross-Default.  (i) Any Loan Party shall fail to make anypayment on account of any Indebtedness of such Person (other than the Obligations)when due (whether at scheduled maturity, by required prepayment, uponacceleration or otherwise) and such failure shall continue beyond any period ofgrace provided with respect thereto, if the amount of such Indebtedness,together with the amount of all other Indebtedness for which a Loan Party hasfailed make such a payment, exceeds $15,000,000 or if the effect of suchfailure is to cause, or permit the holder or holders thereof to cause,Indebtedness of the Loan Parties (other than the Obligations) in an aggregateamount exceeding $15,000,000 to become redeemable, due or otherwise payable(whether at scheduled maturity, by required prepayment, upon acceleration or

 

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otherwise)and/or to be secured by cash collateral, (ii) any Loan Party shall otherwisefail to observe or perform any agreement, term or condition contained in anyagreement or instrument relating to any Subordinated Indebtedness of suchPerson, or any other event shall occur or condition shall exist, if the effectof such failure, event or condition is to cause, or permit the holder orholders thereof to cause, such Subordinated Indebtedness to become redeemable,due or otherwise payable (whether at scheduled maturity, by required prepayment,upon acceleration or otherwise) and/or to be secured by cash collateral, (iii)any Loan Party shall otherwise fail to observe or perform any agreement, termor condition contained in any agreement or instrument relating to anyIndebtedness of such Person (other than the Obligations), or any other eventshall occur or condition shall exist, if the effect of such failure, event orcondition is to cause, or permit the holder or holders thereof to cause,Indebtedness of the Loan Parties (other than the Obligations) in an aggregateamount exceeding $15,000,000 to become redeemable, due or otherwise payable(whether at scheduled maturity, by required prepayment, upon acceleration orotherwise) and/or to be secured by cash collateral or (iv) the holder of anyLien in any amount, shall commence foreclosure of such Lien upon property ofany Loan Party having a value in excess of $15,000,000 and such foreclosureshall continue against such property to a date less than thirty (30) days priorto the date of the proposed foreclosure sale; or

 

(f)                                  Insolvency;Voluntary Proceedings.  Any LoanParty shall (i) apply for or consent to the appointment of a receiver, trustee,liquidator or custodian of itself or of all or a substantial part of itsproperty, (ii) be unable, or admit in writing its inability, to pay its debtsgenerally as they mature, (iii) make a general assignment for the benefit ofits or any of its creditors, (iv) be dissolved or liquidated in full or inpart, (v) become insolvent (as such term may be defined or interpreted underany applicable statute), or (vi) commence a voluntary case or other proceedingseeking liquidation, reorganization or other relief with respect to itself orits debts under any bankruptcy, insolvency or other similar law now or hereafterin effect or consent to any such relief or to the appointment of or takingpossession of its property by any official in an involuntary case or otherproceeding commenced against it; or

 

(g)                               InvoluntaryProceedings.  Proceedings for theappointment of a receiver, trustee, liquidator or custodian of any Loan Partyor of all or a substantial part of the property thereof, or an involuntary caseor other proceedings seeking liquidation, reorganization or other relief withrespect to any Loan Party or the debts thereof under any bankruptcy, insolvencyor other similar law now or hereafter in effect shall be commenced and an orderfor relief entered or such proceeding shall not be dismissed or dischargedwithin ninety (90) days of commencement; or

 

(h)                               Judgments.  (i) One or more judgments, orders, decrees orarbitration awards requiring any Loan Party to pay (A) $5,000,000 or more inany single case or (B) an aggregate amount of $15,000,000 or more (in each caseexclusive of amounts covered by insurance issued by a solvent insurer which isnot an Affiliate of any Loan Party) shall be rendered against any Loan Party inconnection with any single or related series of transactions, incidents orcircumstances and the same shall not be satisfied, vacated or stayed for aperiod of sixty (60) consecutive days; (ii) any judgment, writ, assessment,warrant of attachment, tax lien or execution or similar process shall be issuedor levied against a substantial part of the property of any Loan Party and thesame shall not be released, stayed, vacated or otherwise dismissed within ten(10) days after issue or levy; or (iii) any other judgments, orders, decrees,arbitration

 

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awards,writs, assessments, warrants of attachment, tax liens or executions or similarprocesses which, alone or in the aggregate, are reasonably likely to have aMaterial Adverse Effect are rendered, issued or levied; or

 

(i)                                   CreditDocuments.  Any Credit Document orany material term thereof shall cease to be, or be asserted by any Loan Partynot to be, a legal, valid and binding obligation of such Loan Party enforceablein accordance with its terms; or

 

(j)                                   SecurityDocuments.  Any Lien relating to amaterial part of the Collateral intended to be created by any Security Documentshall at any time be invalidated, subordinated or otherwise cease to be in fullforce and effect, for whatever reason, or any security interest purported to becreated by any Security Document shall cease to be, or shall be asserted by anyLoan Party not to be, a valid, first priority (except as expressly otherwiseprovided in this Agreement or such Security Document) perfected Lien in theCollateral covered thereby, or any Loan Party (other than Argosy) shall issue,create or permit to be outstanding any Equity Securities which shall not besubject to a first priority perfected Lien under the Security Documents; or

 

(k)                                EmployeeBenefit Plans.  Any Reportable Eventwhich the Administrative Agent reasonably believes in good faith constitutesgrounds for the termination of any Employee Benefit Plan subject to Title IV ofERISA by the PBGC or for the appointment of a trustee by the PBGC to administerany such Employee Benefit Plan shall occur and be continuing for a period of thirty(30) days or more after notice thereof is provided to the Borrowers by theAdministrative Agent, or any Employee Benefit Plan shall be terminated withinthe meaning of Title IV of ERISA or a trustee shall be appointed by the PBGC toadminister any Employee Benefit Plan and, in any such case, such termination orappointment is reasonably likely to result in liability to any Borrower inexcess of $10,000,000 or which is reasonably likely to have a Material AdverseEffect; or

 

(l)                                   Changeof Control.  Any Change of Controlshall occur; or

 

(m)                             Lossof Gaming Licenses/Failure to Maintain Gaming Activities.  The occurrence of a License Revocation in anyjurisdiction in which any Loan Party owns or operates a Gaming Facility,provided that such License Revocation continues for at least ten (10)consecutive days; or

 

(n)                               InvoluntaryDissolution or Split Up.  Any order,judgment or decree shall be entered against any Borrower decreeing itsinvoluntary dissolution or split up and such order shall remain undischargedand unstayed for a period in excess of sixty (60) days; or

 

(o)                               TriggerEvent.  A Trigger Event shall occur.

 

6.02.                      Remedies.  Atany time after the occurrence and during the continuance of any Event ofDefault (other than an Event of Default referred to in Section 6.01(f)(other than Section 6.01(f)(v))or 6.01(g)), the AdministrativeAgent may or shall, upon instructions from the Required Lenders, by writtennotice to the Borrowers, (a) terminate the Commitments, any obligation of theL/C Issuer to make L/C Credit Extensions and the obligations of the Lenders tomake Loans, (b) require that the Borrowers Cash Collateralize the Obligationsin an amount

 

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equalto the then Effective Amount of the L/C Obligations; and/or (c) declare alloutstanding Obligations payable by the Borrowers to be immediately due andpayable without presentment, demand, protest or any other notice of any kind,all of which are hereby expressly waived, anything contained herein or in theNotes to the contrary notwithstanding. Upon the occurrence or existence of any Event of Default described in Section6.01(f) (other than Section 6.01(f)(v)) or 6.01(g),immediately and without notice, (1) the Commitments, any obligation of the L/CIssuer to make L/C Credit Extensions and the obligations of the Lenders to makeLoans shall automatically terminate, (2) the obligation of the Borrowers toCash Collateralize the Obligations in an amount equal to the then EffectiveAmount of the L/C Obligations shall automatically become effective and (3) alloutstanding Obligations payable by the Borrowers hereunder shall automaticallybecome immediately due and payable, without presentment, demand, protest or anyother notice of any kind, all of which are hereby expressly waived, anythingcontained herein or in the Notes to the contrary notwithstanding.  In addition to the foregoing remedies, uponthe occurrence or existence of any Event of Default, the Administrative Agentmay exercise any other right, power or remedy available to it under any of theCredit Documents or otherwise by law, either by suit in equity or by action atlaw, or both.

 

6.03.                      Effect of Reverse Trigger Event.  An Event of Default arising under Section 6.01(p)shall be deemed to no longer be continuing upon the occurrence of a ReverseTrigger Event.

 

**ARTICLE VII.**                                        **THE ADMINISTRATIVE AGENT AND RELATIONS AMONG THELENDERS**.

 

7.01.                      Appointment,Powers and Immunities.

 

(a)                                EachLender hereby appoints and authorizes the Administrative Agent to act as itsagent hereunder and under the other Credit Documents with such powers as areexpressly delegated to the Administrative Agent by the terms of this Agreementand the other Credit Documents, together with such other powers as are reasonablyincidental thereto.  Each Lender herebyauthorizes the Administrative Agent to take such action on its behalf under theprovisions of this Agreement and the other Credit Documents and to exercisesuch powers as are set forth herein or therein, together with such other powersas are reasonably incidental thereto, including execution and filing of aCorporate Securities and Finance Compliance Affidavit with the Missouri GamingCommission pursuant to 11 CSR 45-10.040 and other regulatory requirementsof any Gaming Authority consistent with the intents and purposes of thisAgreement.  Neither the DocumentationAgent nor the Syndication Agent shall have any duties or responsibilities orany liabilities under this Agreement or any other Credit Document.  The Administrative Agent shall not have anyduties or responsibilities except those expressly set forth in this Agreementor in any other Credit Document, be a trustee for any Lender or have anyfiduciary duty to any Lender. Notwithstanding anything to the contrary contained herein theAdministrative Agent shall not be required to take any action which is contraryto this Agreement or any other Credit Document or any applicable GovernmentalRule.  Neither the Administrative Agentnor any Lender shall be responsible to any other Lender for any recitals,statements, representations or warranties made by any Loan Party contained inthis Agreement or in any other Credit Document, for the value, validity,effectiveness, genuineness, enforceability or sufficiency of this Agreement orany other Credit Document or for any failure by any Loan

 

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Partyto perform its obligations hereunder or thereunder.  The Administrative Agent may employ agentsand attorneys-in-fact and shall not be responsible to any Lender for thenegligence or misconduct of any such agents or attorneys-in-fact selected by itwith reasonable care.  Neither theAdministrative Agent nor any of its directors, officers, employees, agents oradvisors shall be responsible to any Lender for any action taken or omitted tobe taken by it or them hereunder or under any other Credit Document or inconnection herewith or therewith, except for its or their own gross negligenceor willful misconduct.  Except as otherwiseprovided under this Agreement, the Administrative Agent shall take such actionwith respect to the Credit Documents as shall be directed by the RequiredLenders.

 

(b)                               TheL/C Issuer shall act on behalf of the Lenders with respect to any Letters ofCredit issued by it and the documents associated therewith until such time (andexcept for so long) as the Administrative Agent may agree at the request of theRequired Lenders to act for the L/C Issuer with respect thereto; provided,however, that the L/C Issuer shall have all of the benefits andimmunities (i) provided to the Administrative Agent in this Article VIIwith respect to any acts taken or omissions suffered by the L/C Issuer inconnection with Letters of Credit issued by it or proposed to be issued by itand the application and agreements for letters of credit pertaining to theLetters of Credit as fully as if the term “Administrative Agent” as used inthis Article VII included the L/C Issuer with respect to such acts oromissions, and (ii) as additionally provided herein with respect to theL/C Issuer.

 

7.02.                      Reliance by the Administrative Agent.  The Administrative Agent shall be entitled torely upon any certificate, notice or other document (including any cable,telegram, facsimile or telex) believed by it in good faith to be genuine andcorrect and to have been signed or sent by or on behalf of the proper Person orPersons, and upon advice and statements of legal counsel, independentaccountants and other experts selected by the Administrative Agent withreasonable care.  As to any other mattersnot expressly provided for by this Agreement, the Administrative Agent shallnot be required to take any action or exercise any discretion, but shall berequired to act or to refrain from acting upon instructions of the RequiredLenders and shall in all cases be fully protected by the Lenders in acting, orin refraining from acting, hereunder or under any other Credit Document inaccordance with the instructions of the Required Lenders, and such instructionsof the Required Lenders and any action taken or failure to act pursuant theretoshall be binding on all of the Lenders.

 

7.03.                      Defaults.  TheAdministrative Agent shall not be deemed to have knowledge or notice of theoccurrence of any Default unless the Administrative Agent has received awritten notice from a Lender or a Borrower, referring to this Agreement,describing such Default and stating that such notice is a “Notice of Default”.  If the Administrative Agent receives such anotice of the occurrence of a Default, the Administrative Agent shall giveprompt notice thereof to the Lenders. The Administrative Agent shall take such action with respect to suchDefault as shall be reasonably directed by the Required Lenders; provided,however, that until the Administrative Agent shall have received suchdirections, the Administrative Agent may (but shall not be obligated to) takesuch action, or refrain from taking such action, with respect to such Defaultas it shall deem advisable in the best interest of the Lenders.  Notwithstanding anything in the contrarycontained herein, the order and manner in which the Lenders’ rights andremedies are to be exercised (including, without limitation, the enforcement byany Lender of its Note) shall be determined by the Requisite Lenders in theirsole discretion.

 

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7.04.                      Indemnification.  Without limiting the Obligations of theBorrowers hereunder, each Lender agrees to indemnify the Administrative Agent,ratably in accordance with its Proportionate Share, for any and allliabilities, obligations, losses, damages, penalties, actions, judgments,suits, costs, expenses or disbursements of any kind or nature whatsoever whichmay at any time be imposed on, incurred by or asserted against theAdministrative Agent in any way relating to or arising out of this Agreement orany documents contemplated by or referred to herein or therein or thetransactions contemplated hereby or thereby or the enforcement of any of theterms hereof or thereof; provided, however, that no Lender shallbe liable for any of the foregoing to the extent they arise from theAdministrative Agent’s gross negligence or willful misconduct.  The Administrative Agent shall be fullyjustified in refusing to take or in continuing to take any action hereunderunless it shall first be indemnified to its satisfaction by the Lenders againstany and all liability and expense which may be incurred by it by reason oftaking or continuing to take any such action. The obligations of each Lender under this Section 7.04 shallsurvive the payment and performance of the Obligations, the termination of thisAgreement and any Lender ceasing to be a party to this Agreement (with respectto events which occurred prior to the time such Lender ceased to be a Lenderhereunder).

 

7.05.                      Non-Reliance. Each Lender represents that it has, independently and without relianceon the Administrative Agent, or any other Lender, and based on such documentsand information as it has deemed appropriate, made its own appraisal of thebusiness, prospects, management, financial condition and affairs of the LoanParties and its own decision to enter into this Agreement and agrees that itwill, independently and without reliance upon the Administrative Agent or anyother Lender, and based on such documents and information as it shall deemappropriate at the time, continue to make its own appraisals and decisions intaking or not taking action under this Agreement.  Neither the Administrative Agent nor any ofits affiliates nor any of their respective directors, officers, employees,agents or advisors shall (a) be required to keep any Lender informed as to theperformance or observance by any Loan Party of the obligations under thisAgreement or any other document referred to or provided for herein or to makeinquiry of, or to inspect the properties or books of any Loan Party; (b) haveany duty or responsibility to provide any Lender with any credit or otherinformation concerning any Loan Party which may come into the possession of theAdministrative Agent, except for notices, reports and other documents andinformation expressly required to be furnished to the Lenders by theAdministrative Agent hereunder; or (c) be responsible to any Lender for (i) anyrecital, statement, representation or warranty made by any Loan Party or anyofficer, employee or agent of any Loan Party in this Agreement or in any of theother Credit Documents, (ii) the value, validity, effectiveness, genuineness,enforceability or sufficiency of this Agreement or any Credit Document, (iii)the value or sufficiency of the Collateral or the validity or perfection of anyof the liens or security interests intended to be created by the CreditDocuments, or (iv) any failure by any Loan Party to perform its obligationsunder this Agreement or any other Credit Document.

 

7.06.                      Resignation or Removal of theAdministrative Agent.  TheAdministrative Agent may resign at any time by giving thirty (30) days priorwritten notice thereof to the Borrowers and the Lenders, and the AdministrativeAgent may be removed at any time with or without cause by the RequiredLenders.  Upon any such resignation orremoval, the Required Lenders shall have the right to appoint a successorAdministrative Agent, which successor Administrative Agent shall be reasonablyacceptable to the Borrowers; provided, however, that theBorrowers

 

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shallhave no right to approve a successor Administrative Agent if an Event of Defaulthas occurred and is continuing.  Upon theacceptance of any appointment as the Administrative Agent hereunder by asuccessor Administrative Agent, such successor Administrative Agent shallthereupon succeed to and become vested with all the rights, powers, privilegesand duties of the retiring Administrative Agent, and the retiringAdministrative Agent shall be discharged from the duties and obligationsthereafter arising hereunder.  After anyretiring Administrative Agent’s resignation or removal hereunder as theAdministrative Agent, the provisions of this Article VII shall continuein effect for its benefit in respect of any actions taken or omitted to betaken by it while it was acting as the Administrative Agent.  Notwithstanding the foregoing, however, WellsFargo may not be removed as Administrative Agent at the request of the RequiredLenders unless Wells Fargo shall also simultaneously be replaced and fullyreleased as “L/C Issuer” and “Swing Line Lender” hereunder pursuant todocumentation in form and substance reasonably satisfactory to Wells Fargo.

 

7.07.                      Authorization. The Lenders hereby irrevocably authorize the Administrative Agent, atits option and in its discretion, to (a) execute and deliver suchdocuments, instruments and agreements as the Administrative Agent may deemnecessary to release any Collateral which the Borrowers are permitted to sell,lease or otherwise transfer pursuant to the terms of the Credit Documents(excluding releases in connection with any disposition referred to in clause(iv) or (v) of Section 5.02(c) unless, upon giving effect to suchdisposition, the assets or property that are the subject of such dispositionshall continue to be Collateral), (b) tosubordinate a Lien on any property granted to or held by the AdministrativeAgent under any Loan Document to the holder of any Lien on such property thatis permitted by Section 5.02(b)(vii), (ix) or (x), (c) torelease any Guarantor from its obligations under the Guaranty if such Personceases to be a Subsidiary as a result of a transaction permitted hereunder and (d) take such actions as theAdministrative Agent deems necessary to enable Argosy and its Subsidiaries tocomply with the terms of the Transfer Agreement including (i) the delivery,after the occurrence of a Trigger Event, of the stock certificates issued byEmpress Casino Joliet for reissuance in the name of the Trustee (as defined inthe Transfer Agreement) and (ii) after the occurrence of a Trigger Event, therelease of a Subsidiary of Argosy as a co-borrower hereunder upon the sale orother disposition of the capital stock or assets of such Subsidiary if theeffect of such sale or other disposition is to cause a Reverse Trigger Event; provided,that Argosy shall deliver a certificate stating that the purchase of suchcapital stock or assets was conditioned upon the release of such Borrower’sobligations under the Credit Documents and provided, further,that in no event shall any such release be effective until the AdministrativeAgent has received all of the Net Proceeds of such sale or other dispositionfor application in accordance with Section 2.07(c)(iii).

 

Withoutthe consent of any Lender, the Loan Parties and the Administrative Agent may(in their respective sole discretion, or shall, to the extent required by anyLoan Document) enter into any amendment, modification or waiver of any LoanDocument, or enter into any new agreement or instrument, to effect thegranting, perfection, protection, expansion or enhancement of any securityinterest in any Collateral or additional property to become Collateral for thebenefit of the Administrative Agent and the Lenders, or as required by locallaw to give effect to, or protect any security interest for the benefit of theAdministrative Agent and the Lenders, in any property or so that the securityinterests therein comply with applicable law.

 

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7.08.                      The Administrative Agent in itsIndividual Capacity.  TheAdministrative Agent and its affiliates may make loans to, issue letters ofcredit for the account of, accept deposits from and generally engage in anykind of banking or other business with Argosy and its Subsidiaries andaffiliates as though the Administrative Agent were not the AdministrativeAgent, L/C Issuer or Swing Line Lender hereunder.  With respect to Loans, if any, made by theAdministrative Agent in its capacity as a Lender, the Administrative Agent inits capacity as a Lender shall have the same rights and powers under thisAgreement and the other Credit Documents as any other Lender and may exercisethe same as though it were not the Administrative Agent, L/C Issuer or SwingLine Lender, and the terms “Lender” or “Lenders” shall include theAdministrative Agent in its capacity as a Lender.

 

**ARTICLE VIII.**            **MISCELLANEOUS**.

 

8.01.                      Notices.

 

(a)                                Exceptas otherwise provided herein, all notices, requests, demands, consents,instructions or other communications to or upon the Borrowers, any Lender orthe Administrative Agent under this Agreement or the other Credit Documentsshall be in writing and faxed, mailed or delivered, if to the Borrowers or tothe Administrative Agent, the L/C Issuer or the Swing Line Lender, at its ortheir respective facsimile number or address set forth below or, if to anyLender, at the address or facsimile number specified for such Lender in theRegister maintained by the Administrative Agent (or to such other facsimilenumber or address for any party as indicated in any notice given by that partyto the other parties).  All such noticesand communications shall be effective (a) when sent by an overnight courierservice of recognized standing, on the second Business Day following thedeposit with such service; (b) when mailed, first class postage prepaidand addressed as aforesaid through the United States Postal Service, uponreceipt; (c) when delivered by hand, upon delivery; and (d) when faxed, uponconfirmation of receipt; provided, however, that any noticedelivered to the Administrative Agent, the L/C Issuer or the Swing Line Lenderunder Article II shall not be effective until actually received by such Person.

 
| The Administrative Agent,  the L/C Issuer and the  Swing Line Lender: | Wells Fargo Bank, National Association      |
|-----------------------------------------------------------------------|---------------------------------------------|
|                                                                  | 5340 Kietzke, Suite 201  Reno, Nevada 89511 |
|                                                                  | Tel. No: (775) 689-6008                     |
|                                                                  | Fax No. (775) 689-6029                      |
|                                                                  | Attention: Casey Potter                     |
|                                                                  |                                        |
| The  Borrowers:                                                       | c/o  Argosy Gaming Company                  |
|                                                                  | 219 Piasa Street  Alton, Illinois 62002     |
|                                                                  | Attention: Dale Black                       |
|                                                                  | Tel. No. (618) 474-7500                     |
|                                                                  | Fax No. (618) 474-7636                      |

 

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Each Notice of Borrowing, Notice of Conversion andNotice of Interest Period Selection shall be given by the Borrowers to theAdministrative Agent’s office located at the address referred to above duringthe Administrative Agent’s normal business hours; provided, however,that any such notice received by the Administrative Agent after 11:00 a.m. onany Business Day shall be deemed received by the Administrative Agent on thenext Business Day.  In any case wherethis Agreement authorizes notices, requests, demands or other communications bythe Borrowers to the Administrative Agent or any Lender to be made by telephoneor facsimile, the Administrative Agent or any Lender may conclusively presumethat anyone purporting to be a person designated in any incumbency certificateor other similar document received by the Administrative Agent or a Lender issuch a person.

 

(b)                               TheBorrowers agree that the Administrative Agent may make any material deliveredby the Borrowers to the Administrative Agent, as well as any amendments,waivers, consents, and other written information, documents, instruments andother materials relating to the Borrowers, any of their respectiveSubsidiaries, or any other materials or matters relating to this Agreement, theNotes or any of the transactions contemplated hereby (collectively, the “Communications”)available to the Lenders by posting such notices on an electronic deliverysystem (which may be provided by the Administrative Agent, an Affiliate of theAdministrative Agent, or any Person that is not an Affiliate of theAdministrative Agent), such as IntraLinks, or a substantially similarelectronic system (the “Platform”). Each Borrower acknowledges that (i) the distribution of material throughan electronic medium is not necessarily secure and that there areconfidentiality and other risks associated with such distribution, (ii) thePlatform is provided “as is” and “as available” and (iii) neither theAdministrative Agent nor any of its Affiliates warrants the accuracy,completeness, timeliness, sufficiency, or sequencing of the Communicationsposted on the Platform.  TheAdministrative Agent and its Affiliates expressly disclaim with respect to thePlatform any liability for errors in transmission, incorrect or incompletedownloading, delays in posting or delivery, or problems accessing theCommunications posted on the Platform and any liability for any losses, costs,expenses or liabilities that may be suffered or incurred in connection with thePlatform.  No warranty of any kind,express, implied or statutory, including, without limitation, any warranty ofmerchantability, fitness for a particular purpose, non-infringement of thirdparty rights or freedom from viruses or other code defects, is made by theAdministrative Agent or any of its Affiliates in connection with the Platform.

 

(c)                                Each Lender agrees that notice to it (as providedin the next sentence) (a “Notice”) specifying that any Communication hasbeen posted to the Platform shall for purposes of this Agreement constituteeffective delivery to such Lender of such information, documents or othermaterials comprising such Communication. Each Lender agrees (i) to notify, on or before the date such Lender becomesa party to this Agreement, the Administrative Agent in writing of such Lender’se-mail address to which a Notice may be sent (and from time to time thereafterto ensure that the Administrative Agent has on record an effective e-mailaddress for such Lender) and (ii) that any Notice may be sent to such e-mailaddress.

 

8.02.                      Expenses.  TheBorrowers shall pay on demand, whether or not any Loan is made hereunder, (a)all reasonable fees and expenses, including reasonable attorneys’ fees andexpenses, incurred by the Administrative Agent in connection with thesyndication of the facilities provided hereunder, the preparation, negotiation,execution and delivery of, and the

 

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exercise of its duties under, this Agreement and theother Credit Documents, and the preparation, negotiation, execution anddelivery of amendments and waivers hereunder and thereunder and (b) allreasonable fees and expenses, including reasonable attorneys’ fees andexpenses, incurred by counsel to the Administrative Agent and the Lenders(subject to the limitation of one additional law firm representing the Lenderscollectively) in the enforcement or attempted enforcement of any of theObligations or in preserving any of the Administrative Agent’s, the SyndicationAgent’s, the Documentation Agent’ or the Lenders’ rights and remedies(including all such fees and expenses incurred in connection with any “workout”or restructuring affecting the Credit Documents or the Obligations or anybankruptcy or similar proceeding involving any Loan Party).  As used herein, the term “reasonableattorneys’ fees and expenses” shall include, without limitation, allocablecosts and expenses of the Administrative Agent’s in-house legal counsel andstaff.  The obligations of the Borrowersunder this Section 8.02 shall survive the payment and performanceof the Obligations and the termination of this Agreement.

 

8.03.                      Indemnification.  To the fullest extent permitted by law, eachBorrower agrees to protect, indemnify, defend and hold harmless theAdministrative Agent, the Syndication Agent, the Documentation Agent, the L/CIssuer, the Swing Line Lender, the Lenders and their Affiliates and theirrespective directors, officers, employees, agents, trustees and advisors(collectively, “Indemnitees”) from and against any and all liabilities,losses, damages or expenses of any kind or nature and from any suits, claims ordemands (including in respect of or for reasonable attorney’s fees and otherexpenses) arising on account of or in connection with any matter or thing oraction or failure to act by Indemnitees, or any of them, arising out of orrelating to (a) the Credit Documents or any transaction contemplated thereby,including any use by any Borrower of any proceeds of the Loans, (b) anyEnvironmental Damages and (c) any claims for brokerage fees or commissions inconnection with the Credit Documents or any transaction contemplated thereby,except to the extent such liability arises from the willful misconduct or grossnegligence of such Indemnitee.  Uponreceiving knowledge of any suit, claim or demand asserted by a third party thatthe Administrative Agent or any Lender believes is covered by this indemnity,the Administrative Agent or such Lender shall give the Borrowers notice of thematter and an opportunity to defend it, at the Borrowers’ sole cost andexpense, with legal counsel satisfactory to the Administrative Agent or suchLender, as the case may be.  Any failureor delay of the Administrative Agent or any Lender to notify the Borrowers ofany such suit, claim or demand shall not relieve any Borrower of itsobligations under this Section 8.03 but shall reduce suchobligations to the extent of any increase in those obligations caused solely byany such failure or delay which is unreasonable.  The obligations of the Borrowers under this Section 8.03shall survive the payment and performance of the Obligations and thetermination of this Agreement.

 

8.04.                      Waivers; Amendments.  Any term, covenant, agreement or condition ofthis Agreement or any other Credit Document may be amended or waived, and anyconsent under this Agreement or any other Credit Document may be given, if suchamendment, waiver or consent is in writing and is signed by the Borrowers andthe Required Lenders or the Administrative Agent on behalf of the RequiredLenders with the written approval of the Required Lenders; provided, however,that:

 

(a)                                Anyamendment, waiver or consent which would (i) amend this Section 8.04or Section 2.11, (ii) amend the definition of “Required Class Lenders”,“Required

 

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Lenders”,“Required Revolving Lenders” or “Required Term Lenders”, or modify in any othermanner the number or percentage of the Lenders required to make anydeterminations or to waive any rights under, or to modify any provision of,this Agreement or (iii) except for any release of Collateral in connection witha disposition authorized by Section 5.02(c) (other than any dispositionreferred to in clause (iv) or (v) thereof unless, upon giving effect to suchdisposition, the assets or property that are the subject of such dispositionshall continue to be Collateral) or other release of Collateral expressly authorizedby Section 7.07, release any substantial part of the Collateral, releaseany Borrower from the Credit Agreement or release any Guarantor from theGuaranty, must be in writing and signed or approved in writing by all Lenders;

 

(b)                               Anyamendment, waiver or consent which would (i) increase the Total Revolving LoanCommitment, (ii) extend the Revolving Loan Maturity Date, (iii) reduce theprincipal of or interest on any Revolving Loan or L/C Borrowing or any fees orother amounts payable for the account of the Revolving Lenders hereunder or(iv) extend any date fixed for any payment of the principal of or interest onany Revolving Loans or any fees or other amounts payable for the account of theRevolving Lenders, must be in writing and signed or approved in writing by allRevolving Lenders;

 

(c)                                Anyamendment, waiver or consent which would (i) increase the Total Term LoanCommitment, (ii) extend the Term Loan Maturity Date, (iii) reduce the principalof or interest on any Term Loan or any fees or other amounts payable for theaccount of the Term Lenders hereunder or (iv) extend any date fixed for anypayment of the principal of or interest on any Term Loans or any fees or otheramounts payable for the account of the Term Lenders, must be in writing and signedor approved in writing by all Term Lenders;

 

(d)                               Anyamendment, waiver or consent which would increase the interest on any RevolvingLoan or L/C Obligation or any fees or other amounts payable for the account ofthe Revolving Lenders hereunder, must be in writing and signed or approved inwriting by the Required Class Lenders;

 

(e)                                Anyamendment, waiver or consent which would (i) accelerate the Term Loan MaturityDate, (ii) increase the interest on any Term Loan or any fees or other amountspayable for the account of the Term Lenders hereunder or (iii) accelerate anydate fixed for any payment of the principal of or interest on any Term Loans orany fees or other amounts payable for the account of the Term Lenders, must bein writing and signed or approved in writing by the Required Class Lenders;

 

(f)                                  Anyamendment, modification, termination or waiver of any provision of Section2.05 or 2.07 must be in writing and signed by the Required ClassLenders;

 

(g)                               Anyamendment, waiver or consent which increases or decreases the ProportionateShare of any Lender must be in writing and signed by such Lender;

 

(h)                               Anyamendment, waiver or consent which affects the rights or duties of the SwingLine Lender under this Agreement must be in writing and signed by the SwingLine Lender;

 

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(i)                                   Anyamendment, waiver or consent which affects the rights or duties of the L/CIssuer under this Agreement or any Letter of Credit Application relating to anyLetter of Credit issued or to be issued by it must be in writing and signed bythe L/C Issuer; and

 

(j)                                   Anyamendment, waiver or consent which affects the rights or obligations of theAdministrative Agent must be in writing and signed by the Administrative Agent.

 

No failure or delay by the Administrative Agent or anyLender in exercising any right under this Agreement or any other CreditDocument shall operate as a waiver thereof or of any other right hereunder orthereunder nor shall any single or partial exercise of any such right precludeany other further exercise thereof or of any other right hereunder orthereunder.  Unless otherwise specifiedin such waiver or consent, a waiver or consent given hereunder shall beeffective only in the specific instance and for the specific purpose for whichgiven.

 

In the event that (i) a Lender shall not enter into orshall not consent to any proposed amendment, waiver or other modification ofany provision of this Agreement or any other Loan Document governed by Section8.04(a), (b) or (c), (ii) such Lender’s consent is necessaryfor such amendment, waiver or modification to become effective, and (iii) atleast 50% of the Lenders whose consent is required to effectuate suchamendment, waiver or modification have in fact consented thereto, then,provided that no Event of Default then exists, notwithstanding the provisionsof Section 2.11 to the contrary, the Borrowers may (A) prepay allObligations (including, with respect to a Letter of Credit, cashcollateralization of an interest therein) outstanding to any such nonconsentingLender and eliminate any such Lender’s Commitment and (B) concurrently withsuch prepayment or within ten Business Days thereafter, obtain new Term Loansor new Revolving Loan Commitments, as applicable, either from then-currentLenders and/or new Lenders, in an amount which, when added to the aggregateamount of Term Loans or Revolving Loan Commitments, as applicable, provided bythe remainder of the existing Lenders at such time, is equal to the aggregateamount of Term Loans and/or the Total Revolving Loan Commitment, as applicable,that was outstanding at the time of the prepayment provided for in clause (A)above (after giving effect to any repayments, prepayments or commitmentreductions since the prepayment provided for in clause (A) above).  In connection therewith, the AdministrativeAgent is authorized to adjust the Proportionate Share of each Lender asnecessary to reflect the prepayment and, if applicable, additional Term Loansor Revolving Loan Commitments.  AnyLender providing additional Term Loans or an additional Revolving LoanCommitment shall be a “Lender” for all purposes hereunder and such Term Loansor Revolving Loan Commitments, as applicable, shall be Term Loans or RevolvingLoan Commitments for all purposes hereunder.

 

8.05.                      Successors and Assigns.

 

(a)                                BindingEffect.  This Agreement and the otherCredit Documents shall be binding upon and inure to the benefit of theBorrowers, the Lenders, the Administrative Agent, all future holders of theNotes and their respective successors and permitted assigns, except that noBorrower may assign or transfer any of its rights or obligations under anyCredit Document without the prior written consent of the Administrative Agentand each Lender.

 

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(b)                               Participations.  Any Lender may, without notice to or consentof the Administrative Agent or the Borrower, at any time sell to one or morebanks or other financial institutions (“Participants”) participatinginterests in any Loan owing to such Lender, any Note held by such Lender, anyCommitment of such Lender or any other interest of such Lender under thisAgreement and the other Credit Documents (including for purposes of thissubsection (b), participations in L/C Obligations and in Swing LineLoans).  In the event of any such sale bya Lender of participating interests, such Lender’s obligations under thisAgreement shall remain unchanged, such Lender shall remain solely responsiblefor the performance thereof, such Lender shall remain the holder of its Notesfor all purposes under this Agreement and the Borrowers and the AdministrativeAgent shall continue to deal solely and directly with such Lender in connectionwith such Lender’s rights and obligations under this Agreement.  Any agreement pursuant to which any such saleis effected may require the selling Lender to obtain the consent of theParticipant in order for such Lender to agree in writing to any amendment,waiver or consent of a type specified in Section 8.04(a), (b), (c),(d), (e), (f) or (g) but may not otherwise requirethe selling Lender to obtain the consent of such Participant to any otheramendment, waiver or consent hereunder. Each****Borrower agrees that if amountsoutstanding under this Agreement and the other Credit Documents are not paidwhen due (whether upon acceleration or otherwise), each Participant shall, tothe fullest extent permitted by law, be deemed to have the right of setoff inrespect of its participating interest in amounts owing under this Agreement andany other Credit Documents to the same extent as if the amount of itsparticipating interest were owing directly to it as a Lender under thisAgreement or any other Credit Documents; provided, however, that(i) no Participant shall exercise any rights under this sentence without theconsent of the Administrative Agent, (ii) no Participant shall have any rightsunder this sentence which are greater than those of the selling Lender and(iii) such rights of setoff shall be subject to the obligation of suchParticipant to share the payment so obtained with all of the Lenders asprovided in Section 2.11(b).  EachBorrower also agrees that each Participant shall be entitled to the benefits ofSections 2.12, 2.13 and 2.14**tothe same extent as if it were a Lender and had acquired its interest byassignment pursuant to subsection (c) of this Section on the date of theparticipation; provided, that a Participant shall not be entitled toreceive any greater payment under Section 2.12 or 2.13**than the applicable Lender would have been entitled toreceive with respect to the participation sold to such Participant and theParticipant shall not be entitled to the benefits of Section 2.13 unlessit complies with the provisions of Section 2.13(f) and (g) as ifit were a Lender by assignment.

 

(c)                                Assignments.  Any Lender may, at any time, sell and assignto any Lender or any Person which has represented that it is an EligibleAssignee (individually, an “Assignee Lender”) all or a portion of itsrights and obligations under this Agreement and the other Credit Documents(including for purposes of this subsection (c), participations in L/CObligations and in Swing Line Loans) (such a sale and assignment to be referredto herein as an “Assignment”) pursuant to an assignment agreementsubstantially in the form (other than in the case of Assignments of Term Loansby Wells Fargo) of Exhibit J (an “Assignment Agreement”),executed by Assignee Lender and such assignor Lender (an “Assignor Lender”)and delivered to the Administrative Agent for its acceptance and recording inthe Register; provided, however, that:

 

(i)                                   EachAssignee Lender taking an assignment from a Revolving Lender shall provideappropriate assurances and indemnities (which may include letters of

 

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credit)to the L/C Issuer and the Swing Line Lender as each may reasonably require withrespect to any continuing obligation to purchase participation interests in anyL/C Obligations or any Swing Line Loans then outstanding;

 

(ii)                                Withoutthe written consent of the Administrative Agent and, if no Event of Default hasoccurred and is continuing, the Borrowers (which consent of the AdministrativeAgent and the Borrowers shall not be unreasonably withheld or delayed), noRevolving Lender may make any Assignment to any Assignee Lender which is not,immediately prior to such Assignment, a Lender hereunder or an Affiliatethereof;

 

(iii)                             Withoutthe written consent of the Administrative Agent (which consent shall not beunreasonably withheld or delayed), no Term Lender may make any Assignment toany Assignee Lender which is not, immediately prior to such Assignment, aLender hereunder, an Affiliate thereof or an Approved Fund; and

 

(iv)                            Withoutthe written consent of the Administrative Agent and, if no Default has occurredand is continuing, the Borrowers (which consent of the Administrative Agent andthe Borrowers shall not be unreasonably withheld or delayed), each Assignmentshall be in an aggregate amount of not less than (A) in the case of anAssignment of any Revolving Loan or Revolving Loan Commitment, $5,000,000 (orsuch lesser amount as shall constitute the aggregate amount of the RevolvingLoan Commitment, Revolving Loans, Swing Line Loans an participations therein,Letters of Credit and participations therein and other Obligations of theAssignor Lender) and (B) in the case of an Assignment of any Term Loan,$1,000,000 (or (x) such lesser amount as shall constitute the aggregateamount of the Term Loan and other Obligations of the Assignor Lender or(y) such lesser amount as otherwise shall have been agreed upon by theAdministrative Agent).

 

TheAdministrative Agent shall be under no obligation to determine whether a Personwhich represents that it is an Eligible Assignee is in fact an EligibleAssignee.

 

Upon such execution, delivery, acceptance andrecording of each Assignment Agreement, from and after the Assignment EffectiveDate determined pursuant to such Assignment Agreement, (A) each AssigneeLender thereunder shall be a Lender hereunder with Commitments and Loans as setforth on Attachment 1 to such Assignment Agreement and shall have the rights,duties and obligations of such a Lender under this Agreement and the otherCredit Documents, and (B) the Assignor Lender thereunder shall be a Lenderwith Commitments and Loans as set forth on Attachment 1 to such AssignmentAgreement, or, if the Commitments and Loans of the Assignor Lender has beenreduced to $0, the Assignor Lender shall cease to be a Lender and to have anyobligation to make any Loan; provided, however, that any such Assignor Lenderwhich ceases to be a Lender shall continue to be entitled to the benefits ofany provision of this Agreement which by its terms survives the termination ofthis Agreement.  Each AssignmentAgreement shall be deemed to adjust the then-current Revolving Loan Commitmentor outstanding Revolving Loans or Term Loans, as applicable, to the extent, andonly to the extent, necessary to reflect the addition of each Assignee Lender,the deletion of each Assignor Lender which reduces its Commitments and Loans to$0 and the resulting adjustment of Commitments and Loans arising from thepurchase by each Assignee Lender of all or a portion of the rights and obligationsof an Assignor Lender under this Agreement and the other Credit Documents.  On or prior to the

 

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Assignment Effective Date determined pursuant to eachAssignment Agreement, each Borrower, at its own expense, shall execute anddeliver to the Administrative Agent, in exchange for the surrendered RevolvingLoan Note or Term Loan Note, if any, of the Assignor Lender thereunder, a newRevolving Loan Note or Term Loan Note to the order of each Assignee Lenderthereunder that requests such a note (with each new Revolving Loan Note to bein an amount equal to the Revolving Loan Commitment assumed by such AssigneeLender and each new Term Loan Note to be in the original principal amount ofthe Term Loan then held by such Assignee Lender) and, if the Assignor Lender iscontinuing as a Lender hereunder, a new Revolving Loan Note or Term Loan Noteto the order of the Assignor Lender if so requested by such Assignor Lender(with the new Revolving Loan Note to be in an amount equal to the RevolvingLoan Commitment retained by it and the new Term Loan Note to be in the originalprincipal amount of the Term Loan retained by it).  Each such new Revolving Loan Note and TermLoan Note shall be dated the Restatement Effective Date, and each such new Noteshall otherwise be in the form of the Note replaced thereby.  The Notes surrendered by the Assignor Lendershall be returned by the Administrative Agent to the Borrowers marked “replaced”.  Each Assignee Lender which was not previouslya Lender hereunder and which is not incorporated under the laws of the UnitedStates of America or a state thereof shall, within three (3) Business Days ofbecoming a Lender, deliver to the Borrowers and the Administrative Agent twoduly completed copies of United States Internal Revenue Service Form W-8BEN orW-8ECI (or successor applicable form), as the case may be, certifying in eachcase that such Lender is entitled to receive payments under this Agreementwithout deduction or withholding of any United States federal incometaxes.  Each Assignee Lender that is nota foreign Lender shall deliver, if reasonably requested by the AdministrativeAgent or a Borrower, two duly completed copies of United States InternalRevenue Service Form W-9.

 

Notwithstanding anything to the contrary containedherein, if at any time Wells Fargo assigns all of its Commitments and Loanspursuant to subsection (c) above, Wells Fargo shall, upon 30 days’ notice tothe Borrowers and the Lenders, resign as L/C Issuer and Swing Line Lender.  In the event of any such resignation as L/CIssuer and Swing Line Lender, the Borrowers shall be entitled to appoint fromamong the Lenders a successor L/C Issuer and Swing Line Lender hereunder(subject to the consent of such appointed Lender); provided, however,that no failure by the Borrowers to appoint any such successor shall affect theresignation of Wells Fargo as L/C Issuer and Swing Line Lender, as the case maybe.  Wells Fargo shall retain all therights and obligations of the L/C Issuer hereunder with respect to all Lettersof Credit outstanding as of the effective date of its resignation as L/C Issuer(which Letters of Credit have not been replaced by Letters of Credit issued bythe successor L/C Issuer) and all L/C Obligations with respect thereto(including the right to require the Lenders to make Base Rate Revolving Loansor fund participations in Unreimbursed Amounts pursuant to Section 2.03(c)).  Wells Fargo shall retain all the rights ofthe Swing Line Lender provided for hereunder with respect to Swing Line Loansmade by it and outstanding as of the effective date of such termination (whichSwing Line Loans have not been assigned to the successor Swing Line Lender),including the right to require the Lenders to make Base Rate Revolving Loans orfund participations in outstanding Swing Line Loans pursuant to Section2.04(c).

 

(d)                               Register.  The Administrative Agent shall maintain atits address referred to in Section 8.01 a copy of each AssignmentAgreement delivered to it and a register (the “Register”) for therecordation of the names and addresses of the Lenders and the Commitments

 

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orLoans of each Lender from time to time. The entries in the Register shall be conclusive in the absence ofmanifest error, and the Borrowers, the Administrative Agent and the Lenders maytreat each Person whose name is recorded in the Register as the owner of theLoans recorded therein for all purposes of this Agreement.  The Register shall be available forinspection by any Borrower and the L/C Issuer at any reasonable time and fromtime to time upon reasonable prior notice. In addition, at any time that a request for a consent for a material orsubstantive change to the Credit Documents is pending, any Lender wishing toconsult with other Lenders in connection therewith may request and receive fromthe Administrative Agent a copy of the Register.  No Assignment shall be effective unless recordedin the Register.

 

(e)                                Registration.  Upon its receipt of an Assignment Agreementexecuted by an Assignor Lender and an Assignee Lender (and, to the extentrequired by Section 8.05(c), by the Borrowers and theAdministrative Agent) together with payment to the Administrative Agent byAssignor Lender of a registration and processing fee of $3,500 (except that nosuch fee shall be payable in the case of an assignee which is a Lender, anAffiliate thereof or an Approved Fund and, in the case of assignments on thesame day by a Lender to more than one Fund managed or advised by the sameinvestment advisor and which are not then Lenders, only a single $3,500 feeshall be payable for all such assignments by such Lender to such Funds), theAdministrative Agent shall (i) promptly accept such Assignment Agreement and(ii) on the Assignment Effective Date determined pursuant thereto recordthe information contained therein in the Register and give notice of suchacceptance and recordation to the Lenders and the Borrowers.  The Administrative Agent shall, upon requestof the Borrowers, prepare and deliver to the Borrowers a copy of the Registercontaining the names, addresses and respective Commitments or Loans of allLenders then parties hereto.

 

(f)                                  Confidentiality.  Subject to Section 8.10, the AdministrativeAgent and the Lenders may disclose the Credit Documents and any financial orother information relating to Argosy and its Subsidiaries to each other or toany potential Participant or Assignee Lender.

 

(g)                               Pledgesto Federal Reserve Banks, Etc..  Notwithstanding any other provision of thisAgreement, any Lender may, without the consent of the Borrowers or theAdministrative Agent, at any time pledge or assign all or a portion of itsrights under this Agreement and the other Credit Documents to a Federal ReserveBank.  In addition, in the case of anyLender that is a Fund, such Lender may, without the consent of the Borrowers orthe Administrative Agent, pledge or assign all or a portion of its rights underthis Agreement and the other Credit Documents to any trustee for, or any otherrepresentative of, holders of obligations owed or securities issued by suchLender as security for such obligations or securities; provided that anyforeclosure or similar action by such trustee or representative shall besubject to the provisions of this Section 8.05 concerningassignments.  No such pledge orassignment referred to in this clause (g) shall relieve the pledging orassigning Lender from its obligations under this Agreement and the other CreditDocuments.

 

(h)                               Assignmentsby Wells Fargo.  Notwithstanding anyprovision in this Section 8.05 to the contrary, no Assignment of TermLoans by Wells Fargo shall be subject to the requirements set forth in clause(iii) of the proviso to Section 8.05(c), and no registration orprocessing fee shall be payable in connection with any such Assignment by WellsFargo.

 

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8.06.                      Setoff; Security Interest.

 

(a)                                Setoff.  In addition to any rights and remedies of theLenders provided by law, each Lender shall have the right, with the priorconsent of the Administrative Agent but without prior notice to or consent ofany Borrower, any such notice and consent being expressly waived by suchBorrower to the extent permitted by applicable law, upon the occurrence andduring the continuance of an Event of Default, to set-off and apply against theObligations any amount owing from such Lender to any Borrower.  The aforesaid right of set-off may beexercised by such Lender against any Borrower or against any trustee inbankruptcy, debtor in possession, assignee for the benefit of creditors,receiver or execution, judgment or attachment creditor of such Borrower oragainst anyone else claiming through or against such Borrower or such trusteein bankruptcy, debtor in possession, assignee for the benefit of creditors,receiver, or execution, judgment or attachment creditor, notwithstanding thefact that such right of set-off may not have been exercised by such Lender atany prior time.  Each Lender agreespromptly to notify the Borrowers after any such set-off and application made bysuch Lender; provided, that the failure to give such notice shall notaffect the validity of such set-off and application.

 

(b)                               SecurityInterest.  As security for theObligations, each Borrower hereby grants to the Administrative Agent and eachLender, for the benefit of the Administrative Agent and all Lenders, acontinuing security interest in any and all deposit accounts or moneys of suchBorrower now or hereafter maintained with such Lender.  Each Lender shall have all of the rights of asecured party with respect to such security interest.

 

8.07.                      No Third Party Rights.  Nothing expressed in or to be implied fromthis Agreement is intended to give, or shall be construed to give, any Person,other than the parties hereto and their permitted successors and assignshereunder, any benefit or legal or equitable right, remedy or claim under or byvirtue of this Agreement or under or by virtue of any provision herein.

 

8.08.                      Partial Invalidity.  If at any time any provision of thisAgreement is or becomes illegal, invalid or unenforceable in any respect underthe law or any jurisdiction, neither the legality, validity or enforceabilityof the remaining provisions of this Agreement nor the legality, validity orenforceability of such provision under the law of any other jurisdiction shallin any way be affected or impaired thereby.

 

8.09.                      Jury Trial. EACH OF THE BORROWERS, THE LENDERS AND THE ADMINISTRATIVE AGENT, TO THEFULLEST EXTENT PERMITTED BY APPLICABLE LAW, HEREBY IRREVOCABLY WAIVES ALL RIGHTTO TRIAL BY JURY AS TO ANY ISSUE RELATING HERETO IN ANY ACTION, PROCEEDING, ORCOUNTERCLAIM ARISING OUT OF OR RELATING TO ANY CREDIT DOCUMENT.

 

8.10.                      Confidentiality.  Neither any Lender nor the AdministrativeAgent shall disclose to any Person any information with respect to any LoanParty which is furnished pursuant to this Agreement or under the other CreditDocuments, except that any Lender or the Administrative Agent may disclose anysuch information (a) to its own directors, officers, employees, auditors,counsel and other advisors and to its Affiliates; (b) to any other Lender orthe Administrative Agent; (c) which is otherwise available to the public; (d)if required or appropriate in any report,

 

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statementor testimony submitted to any Governmental Authority (which, for purposes ofthis Section 8.10, shall include the National Association ofInsurance Commissioners) having or claiming to have jurisdiction over suchLender or the Administrative Agent; (e) if required in response to any summonsor subpoena; (f) in connection with any enforcement by the Lenders and theAdministrative Agent of their rights under this Agreement or the other CreditDocuments or any litigation among the parties relating to the Credit Documentsor the transactions contemplated thereby; (g) to comply with any Requirement ofLaw applicable to such Lender or the Administrative Agent; (h) to any AssigneeLender or Participant or any prospective Assignee Lender or Participant,provided that such Assignee Lender or Participant or prospective AssigneeLender or Participant agrees to be bound by this Section 8.10;(i) to any direct or indirect contractual counterparty in any swap, hedgeor similar agreement (or to any such contractual counterparty’s professionaladvisor), so long as such contractual counterparty (or such professionaladvisor) agrees to be bound by the provisions of this Section 8.10;(j) to any nationally recognized rating agency that requires access toinformation about a Lender’s investment portfolio in connection with ratingsissued with respect to such Lender; or (k) otherwise with the priorconsent of such Loan Party; provided, however, that anydisclosure made in violation of this Agreement shall not affect the obligationsof the Loan Parties under this Agreement and the other Credit Documents.

 

8.11.                      Counterparts. This Agreement may be executed in any number of identical counterparts,any set of which signed by all the parties hereto shall be deemed to constitutea complete, executed original for all purposes.

 

8.12.                      Consent to Jurisdiction.  Each Borrower irrevocably submits to thenon-exclusive jurisdiction of the courts of the State of New York and thecourts of the United States of America located in the Southern District of NewYork and agrees that any legal action, suit or proceeding arising out of orrelating to this Agreement or any of the other Credit Documents may be broughtagainst such party in any such courts. Final judgment against any Borrower in any such action, suit orproceeding shall be conclusive and may be enforced in any other jurisdiction bysuit on the judgment, a certified or exemplified copy of which shall beconclusive evidence of the judgment, or in any other manner provided bylaw.  Nothing in this Section 8.12shall affect the right of the Administrative Agent or any Lender to commencelegal proceedings or otherwise sue any Borrower in any other appropriatejurisdiction, or concurrently in more than one jurisdiction, or to serveprocess, pleadings and other papers upon any Borrower in any manner authorizedby the laws of any such jurisdiction. Each Borrower agrees that process served either personally or byregistered mail shall, to the extent permitted by law, constitutes adequateservice of process in any such suit. Each Borrower irrevocably waives to the fullest extent permitted byapplicable law (a) any objection which it may have now or in the future to thelaying of the venue of any such action, suit or proceeding in any courtreferred to in the first sentence above; (b) any claim that any such action,suit or proceeding has been brought in an inconvenient forum; (c) its right ofremoval of any matter commenced by any other party in the courts of the Stateof New York to any court of the United States of America; (d) any immunitywhich it or its assets may have in respect of its obligations under thisAgreement or any other Credit Document from any suit, execution, attachment(whether provisional or final, in aid of execution, before judgment orotherwise) or other legal process; and (e) any right it may have to require themoving party in any suit, action or proceeding brought in any of the courtsreferred to above arising out of or in

 

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connectionwith this Agreement or any other Credit Document to post security for the costsof such Borrower or to post a bond or to take similar action.

 

8.13.                      Joint and Several Obligations.

 

(a)                                Allof the obligations of the Borrowers under this Agreement and the other CreditDocuments shall be joint and several.

 

(b)                               EachBorrower agrees that neither the Administrative Agent nor any Lender shall haveany responsibility to inquire into the apportionment, allocation or dispositionof any Borrowings or Letters of Credit as among the Borrowers.

 

(c)                                Forthe purpose of implementing the joint borrower provisions of this Agreement andeach of the Credit Documents, each Borrower hereby irrevocably appoints Argosyas its agent and attorney-in-fact for all purposes of this Agreement and eachof the Credit Documents, including the giving and receiving of notices andother communications, the making of requests for, or conversions orcontinuations of, Borrowings and/or Letters of Credit, the execution anddelivery of certificates and the receipt and allocation of disbursements fromthe Lenders.  Argosy hereby accepts suchappointment.  The Administrative Agentand each Lender may regard any notice or other communication pursuant to anyCredit Document from Argosy as a notice or communication from all Borrowers andmay give any notice or communication required or permitted to be given to anyBorrower or Borrowers hereunder to Argosy on behalf of such Borrower orBorrowers.  Each Borrower agrees thateach notice, election, representation and warranty, covenant, agreement andundertaking made on its behalf by Argosy shall be deemed for all purposes tohave been made by such Borrower and shall be binding upon and enforceableagainst such Borrower to the same extent as if the same had been made directlyby such Borrower.

 

(d)                               EachBorrower hereby waives, with respect to itself and its obligations hereunder,any right (except as shall be required by applicable statute and cannot bewaived) to require the Administrative Agent or any Lender to (i) proceedagainst any other Borrower, any guarantor or any other Person, (ii) proceedagainst or exhaust any security held from any other Borrower, any guarantor orany other Person or (iii) pursue any other remedy in the Administrative Agentor any Lender’s power whatsoever.  EachBorrower hereby waives any defense based on or arising out of any defense ofany other Borrower, any guarantor or any other Person other than payment infull of the Obligations, including any defense based on or arising out of thedisability of any other Borrower, any guarantor or any other Person, or theenforceability of the Obligations or any part thereof from any cause, or thecessation from any cause of the liability of any Borrower other than payment infull of the Obligations.  Subject to theterms of this Agreement, the Administrative Agent or any Lender may, at its election,foreclose on any security held by the Administrative Agent or any Lender by oneor more judicial or non-judicial sales, whether or not every aspect of any suchsale is commercially reasonable (to the extent such sale is permitted byapplicable law), or exercise any other right or remedy the Administrative Agentor any Lender may have against any other Borrower, any guarantor or any otherPerson, or any security, without affecting or impairing in any way theliability of any Borrower hereunder except to the extent the Obligations havebeen paid in full.  Each Borrower waivesall rights and defenses arising out of any such election of remedies by the

 

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AdministrativeAgent or any Lender, even though that election of remedies, such as a nonjudicialforeclosure with respect to security for a guaranteed obligation, has destroyedany of such Borrower’s, any other Borrower’s or any guarantor’s rights ofsubrogation and reimbursement against any other Borrower or any guarantor.

 

(e)                                EachBorrower waives any defense, right of set-off, claim or counterclaim whatsoeverand any and all other rights, benefits, protections and other defensesavailable to it now or at any time hereafter.

 

(f)                                  EachBorrower waives all rights and defenses that such Borrower may have because theObligations are secured by real property. This means, among other things:

 

(i)                                   TheAdministrative Agent or any Lender may collect from such Borrower without firstforeclosing on any real or personal property collateral pledged by suchBorrower, any other Borrower or any guarantor.

 

(ii)                                Ifthe Administrative Agent or any Lender forecloses on any real propertycollateral pledged by such Borrower or any other Borrower:

 

(A)                            Theamount of the debt may be reduced only by the price for which that collateralis sold at the foreclosure sale, even if the collateral is worth more than thesale price.

 

(B)                              TheAdministrative Agent or any Lender may collect from each Borrower even if theAdministrative Agent or any Lender, by foreclosing on the real propertycollateral, has destroyed any right such Borrower may have to collect from anyother Borrower or any guarantor.

 

This is an unconditional and irrevocable waiver of any rights anddefenses each Borrower may have because such Borrower’s debt is secured by realproperty.

 

(iii)                             EachBorrower waives all rights and defenses arising out of an election of remediesby the Administrative Agent or any Lender, even though that election ofremedies, such as a nonjudicial foreclosure with respect to security for aguaranteed obligation, has destroyed such Borrower’s rights of subrogation andreimbursement against the principal.

 

(g)                               EachBorrower assumes all responsibility for being and keeping itself informed ofeach other Borrower’s and any guarantor’s financial condition and assets, andof all other circumstances bearing upon the risk of nonpayment of theObligations and the nature, scope and extent of the risks which such Borroweror any guarantor assumes and incurs under any Credit Document, and agrees thatneither the Administrative Agent nor any Lender shall have no duty to advisesuch Borrower, any other Borrower or any guarantor of information known to theAdministrative Agent or any Lender regarding such circumstances or risks.

 

8.14.                      Assignment of Revolving Loans.  (a) On or prior to the RestatementEffective Date, the Administrative Agent shall notify each Revolving Lender ofthe amount required to be paid by or to such Revolving Lender so that theRevolving Loans held by the Revolving Lenders on the Restatement Effective Date(before giving effect to any new Revolving Loans made on

 

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suchdate) shall be held by each Revolving Lender pro rata in accordance with theRevolving Loan Commitments of the Lenders set forth in the Register maintainedby the Administrative Agent.  EachRevolving Lender which is required to reduce the amount of Revolving Loans heldby it (each such Lender, a “Decreasing Revolving Lender”) shallirrevocably assign, without recourse or warranty of any kind whatsoever (exceptthat each Decreasing Revolving Lender warrants that it is the legal andbeneficial owner of the Loans assigned by it under this Section 8.14and that such Loans are held by such Decreasing Revolving Lender free and clearof adverse claims), to each Revolving Lender which is required to increase theamount of Revolving Loans held by it (each such Lender, an “IncreasingRevolving Lender”), and each Increasing Revolving Lender shall irrevocablyacquire from the Decreasing Revolving Lenders, a portion of the principalamount of the Revolving Loans of each Decreasing Revolving Lender(collectively, the “Acquired Revolver Portion”) outstanding on theRestatement Effective Date (before giving effect to any new Revolving Loansmade on such date) in an amount such that the principal amount of the RevolvingLoans held by each Increasing Revolving Lender and each Decreasing RevolvingLender as of the Restatement Effective Date shall be held in accordance with eachsuch Lender’s Proportionate Share (if any) as of such date.  Such assignment and acquisition shall beeffective on the Restatement Effective Date automatically and without anyaction required on the part of any party other than the payment by the IncreasingRevolving Lenders to the Administrative Agent for the account of the DecreasingRevolving Lenders of an aggregate amount equal to the Acquired RevolverPortion, which amount shall be allocated and paid by the Administrative Agentat or before 12:00 p.m. on the Restatement Effective Date to the DecreasingRevolving Lenders pro rata based upon the respective reductions in theprincipal amount of the Revolving Loans held by such Revolving Lenders on theRestatement Effective Date (before giving effect to any new Revolving Loansmade on such date).  Each of theAdministrative Agent and the Lenders shall adjust its records accordingly toreflect the payment of the Acquired Revolver Portion.  The payment to be made in respect of theAcquired Revolver Portion shall be made by the Increasing Revolving Lenders tothe Administrative Agent in Dollars in immediately available funds at or before11:00 a.m. on the Restatement Effective Date, such payment to be made by theIncreasing Revolving Lenders pro rata based upon the respective increases inthe principal amount of the Revolving Loans held by such Revolving Lenders onthe Restatement Effective Date (before giving effect to any new Revolving Loansmade on such date).

 

(b)                               Tothe extent any of the Revolving Loans acquired by the Increasing RevolvingLenders from the Decreasing Revolving Lenders pursuant to Section 8.14(a)above are LIBOR Loans and the Restatement Effective Date is not the last day ofan Interest Period for such LIBOR Loans, the Decreasing Revolving Lenders shallbe entitled to compensation from the Borrowers as provided inSection 2.07(c) of the Existing Credit Agreement (as if the Borrowers hadprepaid such LIBOR Loans in an amount equal to the Acquired Revolver Portion onthe Restatement Effective Date).  Thepayment made by the Increasing Revolving Lenders in respect of the AcquiredRevolver Portion shall constitute a Loan made by the Increasing RevolvingLenders on the Restatement Effective Date, and to the extent any Loan acquiredby the Increasing Revolving Lenders on the Restatement Effective Date is aLIBOR Loan and such date is not the last day of an Interest Period for suchLIBOR Loan, such LIBOR Loan shall accrue interest at the rate then applicableto such Loan until such last day; provided, however, that theBorrowers shall compensate the Increasing Revolving Lenders for an amount equalto the amount, if any, by which the cost to the Increasing Revolving Lenders offunding the amount

 

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ofeach such Loan in the respective market for the period from such date to thelast day of the then Interest Period for such Loan exceeds such applicablerate.

 

8.15.                      Application of Gaming Laws.

 

(a)                                ThisAgreement and the other Credit Documents are subject to Gaming Laws and lawsinvolving the sale or distribution of liquor (the “Liquor Laws”).  Without limiting the foregoing, each of theAdministrative Agent and the Lenders acknowledges that (i) it is subject tobeing called forward by the Gaming Authorities or the Governmental Authoritiesenforcing the Liquor Laws, in their discretion, for licensing or a finding ofsuitability or to file or provide other information, and (ii) all rights,remedies and powers in or under this Agreement and the other Credit Documents,including with respect to the Collateral (including Equity Securities) and theownership and operation of Gaming Facilities, may be exercised only to theextent that the exercise thereof does not violate any applicable provisions ofthe Gaming Laws and Liquor Laws and only to the extent that required approvals(including prior approvals) are obtained from the requisite GovernmentalAuthorities.

 

(b)                               Eachof the Administrative Agent and the Lenders agrees to cooperate with all GamingAuthorities (or be subject to the provisions of Section 2.16) inconnection with the provision of such documents or other information as may berequested by such Gaming Authorities relating to the Loan Parties or to theCredit Documents.

 

(c)                                Ifduring the existence of an Event of Default hereunder or under any of the otherCredit Documents it shall become necessary, or in the opinion of the RequiredLenders advisable, for an agent, supervisor, receiver or other representativeof the Administrative Agent and the Lenders to become licensed under anyGovernmental Rule as a condition to receiving the benefit of any Collateralencumbered by the Security Documents or other Credit Documents or to otherwiseenforce the rights of the Administrative Agent and the Lenders under the CreditDocuments, the Borrowers hereby agree to grant such license or licenses and toexecute such further documents as may be required in connection with theevidencing of such consent.

 

8.16.                      Damages; Insurance and CondemnationProceeds.

 

(a) (i) All awardsof damages and all other compensation payable directly or indirectly by reasonof a condemnation or proposed condemnation (or transfer in lieu thereof) forpublic or private use affecting the Collateral; (ii) all other claims andawards for damages to or decrease in value of the Collateral; (iii) allproceeds of any insurance policies payable by reason of loss sustained to theCollateral or due to a business interruption; and (iv) all interest whichmay accrue on any of the foregoing, are all absolutely and irrevocably assignedto and shall be paid to the Administrative Agent for the benefit of itself andthe Lenders.  At any time that an Eventof Default shall have occurred and be continuing, (x) upon prior notice to theBorrowers, the Administrative Agent may commence, appear in, defend orprosecute any assigned claim or action, and may adjust, compromise, settle andcollect all claims and awards assigned to the Administrative Agent, provided,however, that in no event shall the Administrative Agent be responsiblefor any failure to collect any claim or award, regardless of the cause of thefailure and (y) the Administrative Agent may apply all or any insurance orcondemnation proceeds it

 

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receivesto its expenses in settling, prosecuting or defending any such claim and applythe balance to the Obligations in accordance with Section 2.08(c).

 

(b)                               Ifno Event of Default has occurred and is continuing, (i) the AdministrativeAgent shall release to the Borrowers any insurance or condemnation proceeds notexceeding $25,000,000 to be applied by the Borrowers to the restoration of theinsured damage or replacement of the condemned property and (ii) theAdministrative Agent, upon the Borrowers’ request, shall release to theBorrowers any insurance or condemnation proceeds exceeding $25,000,000, suchinsurance or condemnation proceeds to be held by the Administrative Agent to beused for repair or restoration subject to reasonable conditions on such use including,without limitation:  (i) the depositwith the Administrative Agent of such additional funds which the AdministrativeAgent determines are needed to pay all costs of the repair or restoration(including, without limitation, taxes, financing charges, insurance and rentduring the repair period); (ii) the establishment of an arrangement forlien releases and disbursement of funds acceptable to the Administrative Agent;and (iii) the delivery to the Administrative Agent of evidence reasonablyacceptable to the Administrative Agent (A) that after completion of thework the income from the applicable facility will be sufficient to pay allexpenses of such facility and (B) of the satisfaction of any additionalconditions that the Administrative Agent and the Required Lenders mayreasonably establish to protect their Lien. Each Borrower hereby acknowledges that the conditions described aboveare reasonable.  If such conditions, togetherwith any other reasonable conditions imposed by the Administrative Agent andthe Required Lenders, have not been satisfied within one hundred eighty (180)days of receipt by the Administrative Agent of such insurance or condemnationproceeds or if an Event of Default occurs and is continuing, then, at thedirection of the Required Lenders, the Administrative Agent shall apply suchinsurance or condemnation proceeds to pay the Obligations in accordance with Section 2.08(c).

 

8.17.                      Effectiveness of Restatement.  The Borrowers, the Lenders and theAdministrative Agent agree that upon the satisfaction of the conditions setforth in Section 3.01, the following transactions shall be deemedto occur automatically, without further action by any party hereto (except asset forth below):

 

(a)                                TheExisting Credit Agreement shall be deemed to be amended and restated in itsentirety in the form of this Agreement; provided, that the Lenders thatare also party to the Existing Credit Agreement shall remain entitled toindemnities under the Existing Credit Agreement which by their terms survivethe termination of the Existing Credit Agreement.

 

(b)                               TheAdministrative Agent shall, promptly after receipt of the Notes reflecting theamendments to the Existing Credit Agreement effected hereunder, cancel andreturn to the Borrowers (upon receipt from the Lenders) the promissory notesbeing replaced by such Notes.

 

EachBorrower, each Lender and the Administrative Agent agree that (i) therestatement transactions provided in the foregoing sentence shall not beeffective until the execution of this Agreement by all of the parties heretoand the satisfaction of the conditions precedent set forth in Section 3.01hereof; (ii) all terms and conditions of the Existing Credit Agreementwhich are

 

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amendedand restated by this Agreement shall remain effective until such amendment andrestatement becomes effective hereunder and thereafter shall continue to beeffective only as amended and restated by this Agreement and (iii) therepresentations, warranties and covenants set forth herein shall becomeeffective on the date on which such conditions are satisfied.

 

8.18.                      Departing Lenders.  Upon the effectiveness of this Agreement andthe payment to the Departing Lenders of the Obligations due it, (a) theDeparting Lenders shall have no further Commitment hereunder and (b) theDeparting Lenders shall cease to have any rights or duties as Lendershereunder; provided, that the Departing Lenders shall remain entitled toindemnities under the Existing Credit Agreement which by their terms survivethe termination of the Existing Credit Agreement.

 

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

 

IMPORTANT INFORMATION ABOUTPROCEDURES FOR OPENING A NEW ACCOUNT.  Tohelp the government fight the funding of terrorism and money launderingactivities, Federal law requires all Lenders to obtain, verify and recordinformation that identifies each person that opens an account, including anydeposit account, treasury management account, loan, other extension of creditor other financial services product. What this means for the Borrowers: When a Borrower opens an account, theLenders will ask for, and such Borrower shall provide to such Lenders, suchBorrower’s name, business address, taxpayer identification number and otherinformation that will allow the Lenders to identify such Borrower.  The Lenders may also ask to see such Borrower’slegal organizational documents or other identifying documents.

 

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INWITNESS WHEREOF, the Borrowers, the Lenders, the Administrative Agent, the L/CIssuer and the Swing Line Lender have caused this Agreement to be executed asof the day and year first above written.

 
|   | **BORROWERS:**                                                                                    |
|--------|---------------------------------------------------------------------------------------------------|
|   |                                                                                              |
|   |                                                                                              |
|   | ARGOSY GAMING COMPANY,                                                                            |
|   | CENTROPLEX  CENTRE CONVENTION  HOTEL, L.L.C.,                                                     |
|   | ALTON  GAMING COMPANY,                                                                            |
|   | ARGOSY  OF IOWA, INC.,                                                                            |
|   | ARGOSY  OF LOUISIANA, INC.,                                                                       |
|   | ARGOSY  OF LOUISIANA, INC., as the  general partner of CATFISH QUEEN  PARTNERSHIP IN COMMENDAM,   |
|   | JAZZ  ENTERPRISES, INC., as the partner in  commendam of CATFISH QUEEN  PARTNERSHIP IN COMMENDAM, |
|   | EMPRESS  CASINO JOLIET  CORPORATION,                                                              |
|   | THE  INDIANA GAMING COMPANY,                                                                      |
|   | THE  INDIANA GAMING COMPANY, as the  general partner of INDIANA GAMING  COMPANY, L.P.,            |
|   | INDIANA  GAMING HOLDING COMPANY,                                                                  |
|   | INDIANA  GAMING HOLDING COMPANY, as the  general partner of INDIANA  GAMING II, L.P.,             |
|   | IOWA  GAMING COMPANY,                                                                             |
|   | IOWA  GAMING COMPANY, as the general  partner of BELLE OF SIOUX CITY,  L.P.,                      |
|   | JAZZ  ENTERPRISES, INC. AND                                                                       |
|   | THE  MISSOURI GAMING COMPANY                                                                      |

 

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|   | BY:                                                                          | /s/ Dale R.  Black |
|--------|------------------------------------------------------------------------------|--------------------|
|   | Dale R. Black                                                                |
|   | Senior Vice  President and Chief Financial Officer  of Argosy Gaming Company |
|   |                                                                         |
|   | and                                                                          |
|   |                                                                         |
|   | Treasurer of                                                                 |
|   |                                                                         |
|   | Alton Gaming  Company,                                                       |
|   | Argosy of Iowa,  Inc.,                                                       |
|   | Argosy of  Louisiana, Inc.,                                                  |
|   | Empress Casino  Joliet Corporation,                                          |
|   | The Indiana  Gaming Company,                                                 |
|   | Indiana Gaming  Holding Company,                                             |
|   | Iowa Gaming  Company,                                                        |
|   | Jazz  Enterprises, Inc.,                                                     |
|   | Centroplex  Centre Convention Hotel, L.L.C.  and                             |
|   | The Missouri  Gaming Company                                                 |

 

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|   | **THE  LENDERS:**                                                                                                  |
|--------|--------------------------------------------------------------------------------------------------------------------|
|   |                                                                                                               |
|   |                                                                                                               |
|   | **WELLS  FARGO BANK, NATIONAL  ASSOCIATION, as Administrative Agent,  L/C Issuer, Swing Line Lender and a Lender** |
|   |                                                                                                               |   |
|   |                                                                                                               |   |
|   | By:                                                                                                                | /s/ Casey Potter |
|   | Name:                                                                                                              | Casey Potter |
|   | Title:                                                                                                             | Vice President |
|   |                                                                                                               |   |
|   | **LASALLE  BANK NATIONAL  ASSOCIATION, as a Lender**                                                               |
|   |                                                                                                               |
|   |                                                                                                               |
|   | By:                                                                                                                | /s/ Robert  Swanson |
|   | Name:                                                                                                              | Robert Swanson |
|   | Title:                                                                                                             | Senior Vice  President |
|   |                                                                                                               |   |
|   | **HIBERNIA  NATIONAL BANK, as a Lender**                                                                           |
|   |                                                                                                               |   |
|   |                                                                                                               |   |
|   | By:                                                                                                                | /s/ Ross S.  Wales |
|   | Name:                                                                                                              | Ross s. Wales |
|   | Title:                                                                                                             | Vice President |
|   |                                                                                                               |   |
|   | **DEUTSCHE  BANK TRUST COMPANY  AMERICAS, as a Lender**                                                            |
|   |                                                                                                               |   |
|   |                                                                                                               |   |
|   | By:                                                                                                                | /s/ Steven P.  Lapham |
|   | Name:                                                                                                              | Steven P. Lapham |
|   | Title:                                                                                                             | Managing  Director |
|        |                                                                                                                    |  |  |  |  |  |

 

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|   | **COMMERZBANK  AG — New York and  Grand Cayman Branches, as a Lender** |
|--------|-----------------------------------------------------------------------------|
|   |                                                                        |   |
|   |                                                                        |   |
|   | By:                                                                         | /s/ Werner  Schmidbauer |
|   | Name:                                                                       | Werner  Schmidbauer |
|   | Title:                                                                      | Senior Vice  President |
|   |                                                                        |   |
|   |                                                                        |   |
|   | By:                                                                         | /s/ Karla Wirth |
|   | Name:                                                                       | Werner  Schmidbauer |
|   | Title:                                                                      | Assistant Vice  President |
|   |                                                                        |   |
|   | **COMERICA  BANK, as a Lender**                                             |
|   |                                                                        |   |
|   |                                                                        |   |
|   | By:                                                                         | /s/ Eoin P.  Collins |
|   | Name:                                                                       | Eoin P. Collins |
|   | Title:                                                                      | Vice President |
|   |                                                                        |   |
|   | **THE CIT  GROUP/EQUIPMENT  FINANCING, INC., as a Lender**                  |
|   |                                                                        |   |
|   |                                                                        |   |
|   | By:                                                                         | /s/ Mark Saylor |
|   | Name:                                                                       | Mark Saylor |
|   | Title:                                                                      | Vice President |
|   |                                                                        |   |
|   |                                                                        |   |
|   | **BANK OF  SCOTLAND, as a Lender  and as a Syndication Agent**              |
|   |                                                                        |   |
|   |                                                                        |   |
|   | By:                                                                         | /s/ Amena Nabi |
|   | Name:                                                                       | Amena Nabi |
|   | Title:                                                                      | Assistant Vice  President |
|        |                                                                             |  |  |  |  |  |

 

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|   | **CALYON  NEW YORK BRANCH, as a  Lender and as a Syndication Agent** |
|--------|----------------------------------------------------------------------|
|   |                                                                 |   |
|   |                                                                 |   |
|   | By:                                                                  | /s/ F. Frank  Herrera |
|   | Name:                                                                | F. Frank Herrera |
|   | Title:                                                               | Director |
|   |                                                                 |   |
|   |                                                                 |   |
|   | By:                                                                  | /s/ Ron Moore |
|   | Name:                                                                | Ron Moore |
|   | Title:                                                               | Director |
|   |                                                                 |   |
|   | **U.S.  BANK NATIONAL ASSOCIATION, as  a Lender**                    |
|   |                                                                 |   |
|   |                                                                 |   |
|   | By:                                                                  | /s/ Brian H.  Gallagher |
|   | Name:                                                                | Brian H. Gallagher |
|   | Title:                                                               | Vice President |
|   |                                                                 |   |
|   |                                                                 |   |
|   | **NATIONAL  CITY BANK OF INDIANA, as  a Lender**                     |
|   |                                                                 |   |
|   |                                                                 |   |
|   | By:                                                                  | /s/ Mark A.  Minnick |
|   | Name:                                                                | Mark A. Minnick |
|   | Title:                                                               | Senior Vice  President |
|   |                                                                 |   |
|   |                                                                 |   |
|   | **MORGAN  STANLEY BANK, as a Lender  and as a Documentation Agent**  |
|   |                                                                 |   |
|   |                                                                 |   |
|   | By:                                                                  | /s/ Daniel  Twenge |
|   | Name:                                                                | Daniel Twenge |
|   | Title:                                                               | Vice President |
|        |                                                                      |  |  |  |

 

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