Exhibit
4.1


 


FIRST AMENDED AND RESTATED MULTI-YEAR CREDIT AGREEMENT


a/k/a the “Bolt-On Credit Agreement”


 


dated as of


 


August 12, 2003


 


among


 


PARK PLACE ENTERTAINMENT CORPORATION


 


The Lenders, Co-Documentation Agents, and Syndication
Agent Referred to Herein


 


and


 


BANK OF AMERICA, N.A.


 


as Administrative Agent


 












 


BANC OF AMERICA SECURITIES LLC.


 


and


 


J.P. MORGAN SECURITIES INC.


 


Joint Lead Arrangers and Joint Book Managers


 

















 


Table of Contents


 


	
  ARTICLE I

  	
  DEFINITIONS

  
	
  1.01

  	
  Definitions

  
	
  1.02

  	
  Accounting Terms
  and Determinations

  
	
  1.03

  	
  Types of Borrowings

  
	
  ARTICLE II

  	
  THE CREDITS

  
	
  2.01

  	
  Commitments to Lend

  
	
  2.02

  	
  Notice of Borrowings

  
	
  2.03

  	
  [Intentionally Omitted]

  
	
  2.04

  	
  Swing Line Loans

  
	
  2.05

  	
  Conversion
  and Continuation of Committed Loans

  
	
  2.06

  	
  Notice to Lenders;
  Funding of Loans

  
	
  2.07

  	
  Notes

  
	
  2.08

  	
  Interest Rates

  
	
  2.09

  	
  Amendment Fees

  
	
  2.10

  	
  Facility Fees

  
	
  2.11

  	
  Letter of Credit Fees

  
	
  2.12

  	
  Optional
  Termination or Reduction of Commitments by the Borrower

  
	
  2.13

  	
  Optional
  Termination of Commitments by the Lenders

  
	
  2.14

  	
  Scheduled
  Termination of Commitments

  
	
  2.15

  	
  Extensions of the
  Termination Date

  
	
  2.16

  	
  Optional Prepayments

  
	
  2.17

  	
  General Provisions
  as to Payments

  
	
  2.18

  	
  Funding Losses

  
	
  2.19

  	
  Computation of
  Interest and Fees

  
	
  2.20

  	
  Withholding Tax Exemption

  
	
  2.21

  	
  Letters of Credit

  
	
  2.22

  	
  Regulation D Compensation

  
	
  2.23

  	
  Increased
  Commitments; Additional Lenders

  
	
  2.24

  	
  Mandatory
  Termination or Reduction of Commitments

  
	
  ARTICLE III

  	
  CONDITIONS

  



 


i

















 


	
  3.01

  	
  Borrowings
  and Issuances of Letters of Credit

  
	
  3.02

  	
  Effectiveness

  
	
  ARTICLE IV

  	
  REPRESENTATIONS
  AND WARRANTIES

  
	
  4.01

  	
  Corporate Existence and
  Power

  
	
  4.02

  	
  Corporate
  and Governmental Authorization; Contravention

  
	
  4.03

  	
  Binding Effect

  
	
  4.04

  	
  Financial Information

  
	
  4.05

  	
  Litigation

  
	
  4.06

  	
  Compliance with ERISA

  
	
  4.07

  	
  Taxes

  
	
  4.08

  	
  Significant Subsidiaries

  
	
  4.09

  	
  Not an Investment Company

  
	
  4.10

  	
  Environmental Matters

  
	
  4.11

  	
  Full Disclosure

  
	
  4.12

  	
  Solvency

  
	
  4.13

  	
  Gaming Laws

  
	
  4.14

  	
  Tax Shelter Regulations

  
	
  ARTICLE V

  	
  COVENANTS

  
	
  5.01

  	
  Information

  
	
  5.02

  	
  Maintenance of
  Property; Insurance

  
	
  5.03

  	
  Conduct
  of Business and Maintenance of Existence

  
	
  5.04

  	
  Compliance with Laws

  
	
  5.05

  	
  Inspection of Property, Books
  and Records

  
	
  5.06

  	
  Negative Pledge

  
	
  5.07

  	
  Consolidations, Mergers and Sales of
  Assets

  
	
  5.08

  	
  Hostile Tender Offers

  
	
  5.09

  	
  Use of Proceeds

  
	
  5.10

  	
  Leverage Ratio

  
	
  5.11

  	
  Interest Coverage Ratio

  
	
  ARTICLE VI

  	
  DEFAULTS

  



 


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  6.01

  	
  Events of Default

  
	
  6.02

  	
  Notice of Default

  
	
  6.03

  	
  Cash
  Cover

  
	
  ARTICLE VII

  	
  THE  ADMINISTRATIVE AGENT

  
	
  7.01

  	
  Appointment
  and Authorization of Administrative Agent

  
	
  7.02

  	
  Delegation of Duties

  
	
  7.03

  	
  Liability of
  Administrative Agent

  
	
  7.04

  	
  Reliance by
  Administrative Agent

  
	
  7.05

  	
  Notice of Default

  
	
  7.06

  	
  Credit Decision; Disclosure of
  Information by Administrative Agent

  
	
  7.07

  	
  Indemnification
  of Administrative Agent

  
	
  7.08

  	
  Administrative
  Agent in its Individual Capacity

  
	
  7.09

  	
  Successor Administrative
  Agent

  
	
  7.10

  	
  Administrative
  Agent May File Proofs of Claim

  
	
  7.11

  	
  Other Agents;
  Arrangers and Managers

  
	
  ARTICLE VIII

  	
  CHANGE IN
  CIRCUMSTANCES

  
	
  8.01

  	
  Basis
  for Determining Interest Rate Inadequate or Unfair

  
	
  8.02

  	
  Illegality

  
	
  8.03

  	
  Increased Cost and
  Reduced Return

  
	
  8.04

  	
  Base
  Rate Loans Substituted for Affected Euro-Dollar Loans

  
	
  ARTICLE IX

  	
  MISCELLANEOUS

  
	
  9.01

  	
  Notices

  
	
  9.02

  	
  No
  Waivers

  
	
  9.03

  	
  Expenses;
  Documentary Taxes; Indemnification

  
	
  9.04

  	
  Amendments and Waivers

  
	
  9.05

  	
  Successors and Assigns

  
	
  9.06

  	
  Collateral

  
	
  9.07

  	
  California
  Law; Submission to Jurisdiction

  
	
  9.08

  	
  Counterparts; Integration

  
	
  9.09

  	
  Several Obligations

  



 


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  9.10

  	
  Sharing of Set-Offs

  
	
  9.11

  	
  WAIVER OF JURY TRIAL

  
	
  9.12

  	
  Confidentiality

  



 


	
  Schedule:

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  Schedule 1

  	
  –

  	
  Pricing Schedule

  
	
   

  	
   

  	
   

  
	
  List of Exhibits:

  	
   

  
	
   

  	
   

  	
   

  
	
  Exhibit A

  	
  –

  	
  Form of Compliance
  Certificate

  
	
  Exhibit B-1

  	
  –

  	
  Form of Term Note

  
	
  Exhibit B-2

  	
  –

  	
  Form of Revolving Note

  
	
  Exhibit C

  	
  –

  	
  Form of Pricing
  Certificate

  
	
  Exhibit D

  	
  –

  	
  Form of Notice of
  Borrowings

  
	
  Exhibit E

  	
  –

  	
  Form of Extension
  Agreement

  
	
  Exhibit F

  	
  –

  	
  Form of Opinion of
  Gibson, Dunn & Crutcher, LLP

  
	
  Exhibit G

  	
  –

  	
  Form of Assignment and
  Assumption Agreement

  



 


iv

















 


FIRST AMENDED AND RESTATED


MULTI-YEAR CREDIT AGREEMENT


a/k/a the “Bolt-On Credit Agreement”


 


FIRST AMENDED AND RESTATED MULTI-YEAR CREDIT AGREEMENT
dated as of August 12, 2003, among PARK PLACE ENTERTAINMENT CORPORATION,
the Lenders listed on the signature pages hereto, The Bank of Nova Scotia, as
Syndication Agent, Societe Generale, Wachovia Bank, National Association,
JPMorgan Chase Bank and Deutsche Bank Trust Company Americas, as
Co-Documentation Agents, and Bank of America, N.A., as Administrative Agent.


 


RECITALS


 


A.                                   Borrower
has heretofore entered into a Five-Year Credit Agreement dated as of  December 31, 1998 among the Borrower,
the lenders referred to therein, and Bank of America, N.A., as Administrative
Agent (as at any time amended, the “Five Year Credit Agreement”), the scheduled
maturity of which is December 31, 2003.


 


B.                                     The
Lenders party to this agreement are those of the lenders under the Five Year
Credit Agreement which are willing to currently commit to extend credit
facilities to the Borrower for an additional two year period commencing on the
date of the termination or scheduled maturity of the credit facilities under
the Five Year Credit Agreement.


 


C.                                     Pursuant
to that certain Multi-Year Credit Agreement dated as of August 23, 2001
among Borrower, various lenders, Societe Generale, as Syndication Agent,
Bankers Trust Company, The Bank of New York and First Union National Bank, as
Co-Documentation Agents, and Bank of America, N.A., as Administrative Agent, as
amended (as so amended, the “Existing Multi-Year Credit Agreement”), certain
Lenders provided credit facilities to the Borrower.


 


D.                                    Pursuant
to the terms hereof, the Borrower, the Lenders and the Administrative Agent
wish to amend and restate the Existing Multi-Year Credit Agreement in its
entirety and to provide credit facilities hereunder that will become available
to the Borrower on the Availability Date described herein concurrently with the
maturity of the credit facilities made available under the Five Year Credit
Agreement (but which will in no way be deemed duplicative of the credit
commitments under the Five Year Credit Agreement during the period ending on
the Availability Date).


 


The parties hereto agree that the Existing Multi-Year
Credit Agreement shall be amended and restated in its entirety as follows:


 


ARTICLE I


 


DEFINITIONS


 


1.01                           Definitions. 
The following terms, as used herein, have the following meanings:


 


“Additional Lender” has the meaning set forth in
Section 2.23.


 

















 


“Administrative Agent” means Bank of America, N.A. in
its capacity as administrative agent for the Lenders hereunder, and its
successors in such capacity.


 


“Administrative Questionnaire” means, with respect to
each Lender, an administrative questionnaire in the form prepared by the
Administrative Agent and submitted to the Administrative Agent (with a copy to
the Borrower) duly completed by such Lender.


 


“Affiliate” means, as to any Person, any other Person
which directly or indirectly controls, or is under common control with, or is
controlled by, such Person.  As used in
this definition, “control” (and the correlative terms, “controlled by” and
“under common control with”) shall mean possession, directly or indirectly, of
power to direct or cause the direction of management or policies (whether
through ownership of securities or partnership or other ownership interests, by
contract or otherwise); provided that, in any event, any Person that
owns, directly or indirectly, 5% or more of the securities having ordinary
voting power for the election of directors or other governing body of a
corporation that has more than 100 record holders of such securities, or 5% or
more of the partnership or other ownership interests of any other Person that
has more than 100 record holders of such interests, will be deemed to control
such corporation or other Person.


 


“Agent-Related Persons” means the Administrative
Agent, together with its Affiliates (including, in the case of Bank of America
in its capacity as the Administrative Agent, Banc of America Securities LLC),
and the officers, directors, employees, agents and attorneys-in-fact of such
Persons and Affiliates.


 


“Agents” mean, collectively, the Administrative Agent,
the Syndication Agent, and the Co-Documentation Agents, and “Agent” means any
of them.


 


“Applicable Lending Office” means, with respect to any
Lender, (i) in the case of its Base Rate Loans, its Domestic Lending
Office and (ii) in the case of its Euro-Dollar Loans, its Euro-Dollar
Lending Office.


 


“Approved Fund” has the meaning set forth in
Section 9.05(g).


 


“Assignment Agreement” means an Assignment and
Assumption substantially in the form of Exhibit G.


 


“Attorney Costs” means and includes all reasonable
fees, expenses and disbursements of any law firm engaged to represent, or other
external counsel to, the Administrative Agent (or, if the context clearly so
requires, any Lender or any Indemnitee) in connection herewith or the
transactions contemplated hereby.


 


“Authorized Officer” means any of the controller, the
treasurer or the chief financial officer of the Borrower.


 


“Availability Date” means the earlier of (a) the date
upon which the credit facilities under the Five Year Credit Facility are
voluntarily terminated by the Borrower in accordance with their terms, and (b)
December 31, 2003.


 


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“Bank of America” means Bank of America, N.A., its
successors and assigns.


 


“Base Rate” means, as of any date of determination,
the rate per annum (rounded upwards, if necessary, to the next 1/100 of 1%)
equal to the higher of (a) the Reference Rate in effect on such
date (calculated on the basis of a year of 365 or 366 days and the actual
number of days elapsed) and (b) the Federal Funds Rate in effect on such
date (calculated on the basis of a year of 360 days and the actual number
of days elapsed) plus 1⁄2 of 1% (50 basis points).


 


“Base Rate Loan” means a Committed Loan made or to be
made by a Lender as a Base Rate Loan in accordance with the applicable Notice
of Borrowing or pursuant to Article VIII.


 


“Base Rate Margin” has the meaning set forth on
Schedule 1.


 


“Benefit Arrangement” means at any time an employee
benefit plan within the meaning of Section 3(3) of ERISA which is not a
Plan or a Multiemployer Plan and which is maintained or otherwise contributed
to by any member of the ERISA Group.


 


“Borrower” means Park Place Entertainment Corporation,
a Delaware corporation, and its successors.


 


“Borrowing” means the aggregation of Loans of one or
more Lenders to be made to the Borrower pursuant to Article II on a single
date and, in the case of Borrowings consisting of Euro-Dollar Loans, for a
single Interest Period.


 


“Change of Control” means the occurrence of a Rating
Decline in connection with any of the following events: (i) upon any
merger or consolidation of the Borrower with or into any person or any sale,
transfer or other conveyance, whether direct or indirect, of all or
substantially all of the assets of the Borrower, on a consolidated basis, in
one transaction or a series of related transactions, if, immediately after
giving effect to such transaction, any person or group of persons (within the
meaning of Section 13 or 14 of the Securities Exchange Act of 1934, as
amended) is or becomes the beneficial owner (within the meaning of Rule 13d-3
promulgated by the Securities and Exchange Commission under said Act) of
securities representing a majority of the total voting power of the aggregate
outstanding securities of the transferee or surviving entity normally entitled
to vote in the election of directors, managers, or trustees, as applicable, of
the transferee or surviving entity, (ii) when any person or group of persons
(within the meaning of Section 13 or 14 of the Securities Exchange Act of
1934, as amended) is or becomes the beneficial owner (within the meaning of
Rule 13d-3 promulgated by The Securities and-Exchange Commission under said
Act) of securities representing a majority of total voting power of the
aggregate outstanding securities of the Borrower normally entitled to vote in
the election of directors of the Borrower, (iii) when, during any period
of 12 consecutive calendar months, individuals who were directors of the
Borrower on the first day of such period (together with any new directors whose
election by the board of directors of the Borrower or whose nomination for
election by the stockholders of the Borrower was approved by a vote of a
majority of the directors then still in office who were either directors at the
beginning of such period or whose election or nomination for election was
previously so approved) cease for any reason to constitute a majority of the
board of directors of the Borrower, or (iv) the sale or disposition,
whether directly or indirectly, by the Borrower of all or substantially all of
its assets.


 


3

















 


“Co-Documentation Agents” means Societe Generale,
Wachovia Bank, National Association, JPMorgan Chase Bank and Deutsche Bank
Trust Company Americas, each in its capacity as documentation agent for the
Lenders hereunder.  The capacity of the
Documentation Agents is titular in nature, and the Documentation Agents shall
have no obligations or liabilities under the Loan Documents by reason of acting
in such capacity.


 


“Commitment” means for each Lender, such Lender’s
Revolving Commitment and/or Term Loan Commitment.


 


“Commitments” means the Revolving Commitments and the
Term Loan Commitments.


 


“Committed Loan” means a Loan made or to be made by a
Lender pursuant to Section 2.01.


 


“Compliance Certificate” means a certificate,
substantially in the form of Exhibit A, properly completed and
signed by an Authorized Officer.


 


“Consolidated Debt” means at any date the Debt of the
Borrower and its Consolidated Subsidiaries, determined on a consolidated basis
as of such date, provided that Consolidated Debt shall exclude any Debt
of the Borrower or a Subsidiary as to which cash and cash equivalents sufficient
to provide for payment in full of such Debt at its scheduled maturity or at an
earlier date at which it shall have been or may be called for redemption shall
have been irrevocably deposited in trust for the benefit of the holders of such
Debt or a representative of such holders, which deposit shall have resulted in
the legal or in-substance defeasance thereof.


 


“Consolidated EBITDA” means, for any period,
Consolidated Net Income for such period before (i) income taxes,
(ii) interest expense, (iii) depreciation and amortization,
(iv) minority interest, (v) extraordinary losses or gains,
(vi) Pre-Opening Expenses, and
(vii) nonrecurring non-cash charges, provided that, in calculating
“Consolidated EBITDA”:


 


(a)                                  the
operating results of each New Project which commences operations and records
not less than one full fiscal quarter’s operations during the relevant period
shall be annualized; and


 


(b)                                 Consolidated
EBITDA shall be adjusted, on a pro forma basis, to include the operating
results of each resort or casino property acquired by the Borrower and its
Consolidated Subsidiaries during the relevant period and to exclude the
operating results of each resort or casino property sold or otherwise disposed
of by the Borrower and its Subsidiaries, or whose operations are discontinued
during the relevant period.


 


“Consolidated Interest Expense” means, for any period,
net interest expense of the Borrower and its Consolidated Subsidiaries for such
period, determined in accordance with generally accepted accounting principles,
provided that in calculating “Consolidated Interest Expense” for any
period, the interest expenses of the Borrower and its Consolidated Subsidiaries
shall be adjusted for any acquisition or disposition of any resort or casino
property acquired or sold or otherwise disposed of by the Borrower and its
Subsidiaries during the relevant period, on a pro forma basis, utilizing a
reasonable methodology which shall be (i) proposed by the Borrower, (ii)
consented to by the Administrative Agent at the time of such calculation, which


 


4

















 


consent shall not be unreasonably withheld, and (iii)
not objected to in writing by the Required Lenders within the ten Domestic
Business Days following notice of such methodology.


 


“Consolidated Net Income” means, for any period, the
consolidated net income of the Borrower and its Consolidated Subsidiaries for
such period.


 


“Consolidated Net Tangible Assets” means the total
amount of assets of the Borrower and its Consolidated Subsidiaries, after
deducting therefrom (a) all current liabilities of the Borrower and its
Consolidated Subsidiaries (excluding (i) the current portion of long term
indebtedness, (ii) inter-company liabilities, and (iii) any liabilities
which are by their terms renewable or extendable at the option of  the obligor thereon to a time more than
twelve months from the time as of which the amount thereof is being computed),
and (b) all goodwill, trade names, trademarks, patents, unamortized debt
discount and expense and other like intangibles, all as set forth on the latest
consolidated balance sheet of the Borrower prepared in accordance with
generally accepted accounting principles.


 


“Consolidated Subsidiary” means at any date any
Subsidiary or other entity the accounts of which would be consolidated with
those of the Borrower in its consolidated financial statements as of such date.


 


“Covered Subsidiary” means at any time any Subsidiary
of the Borrower that has consolidated assets in an amount greater than $5,000,000.


 


“Debt” of any Person means at any date, without
duplication, (i) all obligations of such Person for borrowed money,
(ii) all obligations of such Person evidenced by bonds, debentures, notes
or other similar instruments, (iii) all obligations of such Person to pay
the deferred purchase price of property or services, except trade accounts
payable arising in the ordinary course of business, (iv) all obligations
of such Person as lessee which are capitalized in accordance with generally
accepted accounting principles, (v) all indebtedness or other obligations
secured by a contractual Lien on any asset of such Person, whether or not such
indebtedness or other obligations are otherwise an obligation of such Person,
and (vi) all Guarantees made by such Person (including by way of provision
of letters of credit or other contingent obligations) with respect to
indebtedness or other obligations of any other Person which constitute “Debt”
of a type or class described in clauses (i) through (v) of this definition.


 


“Default” means any condition or event which
constitutes an Event of Default or which with the giving of notice or lapse of
time or both would, unless cured or waived, become an Event of Default.


 


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


 


“Domestic Business Day” means any day except a
Saturday, Sunday or other day on which commercial banks in New York City
or Los Angeles are authorized or required by law to close.


 


“Domestic Lending Office” means, as to each Lender,
its office located at its address set forth in its Administrative Questionnaire
(or identified in its Administrative Questionnaire as its


 


5

















 


Domestic Lending Office) or such other office as such
Lender may hereafter designate as its Domestic Lending Office by notice to the
Borrower and the Administrative Agent.


 


“Effective Date” means the date this Agreement becomes
effective in accordance with Section 3.02.


 


“Eligible Assignee” means (a) a Lender; (b) an
Affiliate of a Lender; (c) an Approved Fund; and (d) any other Person (other
than a natural person) approved by (i) the Administrative Agent and (ii) unless
an Event of Default has occurred and is continuing, the Borrower (each such
approval not to be unreasonably withheld or delayed); provided that
notwithstanding the foregoing, “Eligible Assignee” shall not include the
Borrower or any of the Borrower’s Affiliates or Subsidiaries.


 


“Environmental Laws” means any and all statutes,
regulations, permits, licenses or other governmental restrictions relating to
the environment or to releases of petroleum or petroleum products, chemicals or
toxic or hazardous substances or wastes into the environment.


 


“ERISA” means the Employee Retirement Income Security
Act of 1974, as amended, or any successor statute.


 


“ERISA Group” means the Borrower, any Subsidiary and
all members of a controlled group of corporations and all trades or businesses
(whether or not incorporated) under common control which, together with the
Borrower or any Subsidiary, are treated as a single employer under
Section 414 of the Internal Revenue Code.


 


“Euro-Dollar Business Day” means any Domestic Business
Day on which commercial banks are open for international business (including
dealings in Dollar deposits) in London.


 


“Euro-Dollar Lending office” means, as to each Lender,
its office, branch or affiliate located at its address set forth in its
Administrative Questionnaire (or identified in its Administrative Questionnaire
as its Euro-Dollar Lending Office) or such other office, branch or affiliate of
such Lender as it may hereafter designate as its Euro-Dollar Lending Office by
notice to the Borrower and the Administrative Agent.


 


“Euro-Dollar Loan” means a Committed Loan made or to
be made by a Lender as a Euro-Dollar Loan in accordance with the applicable
Notice of Borrowing.


 


“Euro-Dollar Margin” has the meaning set forth on
Schedule 1.


 


“Euro-Dollar Rate” means for any Interest Period with
respect to any Euro-Dollar Loan:


 


(a)                                  the
rate per annum equal to the rate determined by the Administrative Agent to be
the offered rate that appears on the page of the Telerate screen (or any
successor thereto) that displays an average British Bankers Association
Interest Settlement Rate for deposits in Dollars (for delivery on the first day
of such Interest Period) with a term equivalent to such Interest Period,
determined as of approximately 11:00 a.m. (London time) two Euro-Dollar
Business Days prior to the first day of such Interest Period, or


 


6

















 


(b)                                 if
the rate referenced in the preceding clause (a) does not appear on such page or
service or such page or service shall not be available, the rate per annum
equal to the rate determined by the Administrative Agent to be the offered rate
on such other page or other service that displays an average British Bankers
Association Interest Settlement Rate for deposits in Dollars (for delivery on
the first day of such Interest Period) with a term equivalent to such Interest
Period, determined as of approximately 11:00 a.m. (London time) two Euro-Dollar
Business Days prior to the first day of such Interest Period, or


 


(c)                                  if
the rates referenced in the preceding clauses (a) and (b) are not available,
the rate per annum determined by the Administrative Agent as the rate of
interest at which deposits in Dollars for delivery on the first day of such
Interest Period in same day funds in the approximate amount of the Euro-Dollar
Loan being made, continued or converted by Bank of America and with a term
equivalent to such Interest Period would be offered by Bank of America’s London
Branch to major banks in the London interbank eurodollar market at their
request at approximately 4:00 p.m. (London time) two Euro-Dollar Business Days
prior to the first day of such Interest Period.


 


“Euro-Dollar Reserve Percentage” means for any day
that percentage (expressed as a decimal) which is in effect on such day, as
prescribed by the Board of Governors of the Federal Reserve System (or any
successor) for determining the maximum reserve requirement for a member bank of
the Federal Reserve System with deposits exceeding five billion Dollars in
respect of “eurocurrency liabilities” (or in respect of any other category of
liabilities which includes deposits by reference to which the interest rate on
Euro-Dollar Loans is determined or any category of extensions of credit or
other assets which includes loans by a non-United States office of any bank to
United States residents).


 


“Event of Default” has the meaning set forth in
Section 6.01.


 


“Facility Fee Rate” has the meaning set forth in
Section 2.10.


 


“Federal Funds Rate” means, for any day, the rate per
annum equal to the weighted average of the rates on overnight Federal funds
transactions with members of the Federal Reserve System arranged by Federal
funds brokers on such day, as published by the Federal Reserve Bank of
New York on the Domestic Business Day next succeeding such day; provided
that (a) if such day is not a Domestic Business Day, the Federal Funds
Rate for such day shall be such rate on such transactions on the next preceding
Domestic Business Day as so published on the next succeeding Domestic Business
Day, and (b) if no such rate is so published on such next succeeding
Domestic Business Day, the Federal Funds Rate for such day shall be the average
rate (rounded upward, if necessary, to a whole multiple of 1/100 of 1%) charged
to Bank of America on such day on such transactions as determined by the
Administrative Agent.


 


“Five Year Credit Agreement” means the Five-Year
Credit Agreement dated as of December 31, 1998 among the Borrower, the
lenders referred to therein, and Bank of America, N.A., as administrative
agent, as amended by an Amendment No. 1 thereto dated as of August 31,
1999, an Amendment No. 2 thereto dated as of August 28, 2000, an Amendment
No. 3 thereto dated as of August 23, 2001, an Amendment No. 4 thereto
dated as of November 5, 2001,


 


7

















 


an Amendment No. 5 thereto dated as of August 22,
2002 and an Amendment No. 6 thereto of even date herewith, and as at any time
hereafter amended.


 


“Gaming Board” means, collectively, (a) the Nevada
Gaming Commission, (b) the Nevada State Gaming Control Board, (c) the New
Jersey Casino Control Commission, (d) the New Jersey Division of Gaming
Enforcement (e) the Mississippi Gaming Commission, and (f) any other
Governmental Agency that holds regulatory, licensing or permit authority over
gambling, gaming or casino activities conducted by the Borrower or its
Subsidiaries within its jurisdiction.


 


“Gaming Laws” means all laws pursuant to which any
Gaming Board possesses regulatory, licensing or permit authority over gambling,
gaming or casino activities conducted by the Borrower or its Subsidiaries
within its jurisdiction.


 


“Governmental Agency” means (a) any international,
foreign, federal, state, county or municipal government, or political
subdivision thereof, (b) any governmental or quasi-governmental agency,
authority, board, bureau, commission, department, instrumentality or public
body (including any Gaming Board) or (c) any court or administrative tribunal
of competent jurisdiction.


 


“Granting Lender” has the meaning set forth in
Section 9.05(h).


 


“Guarantee” by any Person means any obligation, contingent
or otherwise, of such Person directly or indirectly guaranteeing any Debt of
any other Person and, without limiting the generality of the foregoing, any
obligation, direct or indirect, contingent or otherwise, of such Person
(i) to purchase or pay (or advance or supply funds for the purchase or
payment of) such Debt (whether arising by virtue of partnership arrangements,
by agreement to keep-well, to purchase assets, goods, securities or services,
to take-or-pay, or to maintain financial statement conditions or otherwise) or
(ii) entered into for the purpose of assuring in any other manner the
holder of such Debt of the payment thereof or to protect such holder against
loss in respect thereof (in whole or in part), including by way of provision of
letters of credit or other contingent obligations with respect thereto,
provided that the term Guarantee shall not include (x) endorsements for
collection or deposit in the ordinary course of business or
(y) performance or completion guarantees. 
The term “Guarantee” used as a verb has a corresponding meaning.


 


“Increased Commitment” has the meaning set forth in
Section 2.23.


 


“Indemnitee” has the meaning set forth in
Section 9.03(b).


 


“Interest Coverage Ratio” means, as of each date of
determination, the ratio of (a) Consolidated EBITDA for the four fiscal
quarters ending on that date, to (b) Consolidated Interest Expense for the same
period.


 


“Interest Period” means, with respect to each
Euro-Dollar Borrowing, the period commencing on the date of such Borrowing and
ending one week or 1, 2, 3 or 6 months thereafter, as the Borrower may elect in
the applicable Notice of Borrowing or Notice of Conversion/Continuation;
provided that:


 


8

















 


(a)                                  any
Interest Period which would otherwise end on a day which is not a Euro-Dollar
Business Day shall be extended to the next succeeding Euro-Dollar Business Day
unless such Euro-Dollar Business Day falls in another calendar month, in which
case such Interest Period shall end on the next preceding Euro-Dollar Business
Day;


 


(b)                                 any
Interest Period which begins on the last Euro-Dollar Business Day in a calendar
month (or on a day for which there is no numerically corresponding day in the
calendar month at the end of such Interest Period) shall, subject to clause
(a)(iii) below, end on the last Euro-Dollar Business Day in the calendar month
which is the last calendar month which commences in such Interest Period; and


 


(c)                                  any
Interest Period which would otherwise end after the Termination Date shall end
on the Termination Date, or, if such date is not a Euro-Dollar Business Day,
then on the next preceding Euro-Dollar Business Day.


 


“Internal Revenue Code” means the Internal Revenue
Code of 1986, as amended, or any successor statute.


 


“Investment Grade” means (i) with respect to
S&P, a rating of BBB- or higher, and (ii) with respect to Moody’s, a
rating of Baa3 or higher.


 


“Issuing Lender” means Bank of America, in its
capacity as issuer of a Letter of Credit hereunder.


 


“Joint Lead Arrangers and Joint Book Managers” means
Banc of America Securities LLC and J.P. Morgan Securities Inc.  Following the date of this Agreement, the
Joint Lead Arrangers and Joint Book Managers shall have no obligations or liabilities
under the Loan Documents.


 


“LC Fee Rate” has the meaning set forth in
Section 2.11.


 


“Lender” means each lender listed on the signature
pages hereof and each Lender which accepts an assignment pursuant to
Section 9.05, and their respective successors and shall include, as the
context may require, the Issuing Lender in its capacity as Issuing Lender.


 


“Letter of Credit” means a letter of credit to be
issued hereunder by the Issuing Lender in accordance with Section 2.21.


 


“Letter of Credit Commitment” means the lesser of
(x) $250,000,000 and (y) the aggregate Commitments.


 


“Letter of Credit Liabilities” means, for any Lender
and at any time, such Lender’s ratable participation in the sum of (x) the
amounts then owing by the Borrower in respect of amounts drawn under Letters of
Credit and (y) the aggregate amount then available for drawing under all
Letters of Credit.


 


9

















 


“Leverage Ratio” means, as of any date of
determination, the ratio of (a) Consolidated Debt on such date to (b)
Consolidated EBITDA for the period of four consecutive fiscal quarters ending
on such date.


 


“License Revocation” means the revocation, failure to
renew or suspension of, or the appointment of a receiver, supervisor or similar
official with respect to, any casino, gambling or gaming license issued by any
Gaming Board covering any casino or gaming facility of Borrower and its
Subsidiaries.


 


“Lien” means, with respect to any asset, any mortgage,
lien, pledge, charge, security interest or encumbrance of any kind in respect
of such asset.  For the purposes of this
Agreement, the Borrower or any Subsidiary shall be deemed to own subject to a
Lien any asset which it has acquired or holds subject to the interest of a
vendor or lessor under any conditional sale agreement, capital lease or other
title retention agreement relating to such asset.


 


“Loan” means a Base Rate Loan or a Euro-Dollar Loan
and “Loans” means Base Rate Loans or Euro-Dollar Loans or any combination of
the foregoing.


 


“Loan Documents” means this Agreement, the Notes and
each other instrument, document or agreement now or hereafter executed by the
parties in furtherance of this Agreement.


 


“Margin Adjustment” has the meaning set forth in the
Schedule 1.


 


“Material Plan” means at any time a Plan or Plans
having aggregate Unfunded Liabilities in excess of $25,000,000.


 


“Moody’s” means Moody’s Investors Service, Inc., and
its successors.


 


“Multiemployer Plan” means at any time an employee
pension benefit plan within the meaning of Section 4001(a)(3) of ERISA to
which any member of the ERISA Group is then making or accruing an obligation to
make contributions or has within the preceding five plan years made
contributions, including for these purposes any Person which ceased to be a
member of the ERISA Group during such five year period.


 


“New Project” means each new hotel - casino, casino or
resort project (as opposed to any project which consists of an extension or
redevelopment of an operating hotel, casino or resort) having a development and
construction budget in excess of $25,000,000 which hereafter receives a
certificate of completion or occupancy and all relevant gaming and other
licenses, and in fact commences operations.


 


“Non-Recourse Debt” means Debt in respect of which the
recourse of the holder of such Debt is limited to the assets securing such Debt
and such Debt does not constitute the general obligation of the Borrower or any
Subsidiary.


 


“Notes” means promissory notes of the Borrower,
substantially in the form of Exhibit B hereto, evidencing the obligation
of the Borrower to repay the Loans, and “Note” means any one of such promissory
notes issued hereunder.


 


10

















 


“Notice of Borrowing” means a Notice of Borrowing (as
defined in Section 2.02).


 


“Notice of Conversion/Continuation” has the meaning
set forth in Section 2.05.


 


“Notice of Issuance” has the meaning set forth in
Section 2.21 (b) .


 


“Parent” means, with respect to any Lender, any Person
controlling such Lender.


 


“Participant” has the meaning set forth in
Section 9.05(d).


 


“PBGC” means the Pension Benefit Guaranty Corporation
or any entity succeeding to any or all of its functions under ERISA.


 


“Person” means an individual, a corporation, a
partnership, an association, a trust or any other entity or organization,
including a government or political subdivision or an agency or instrumentality
thereof.


 


“Plan” means at any time an employee pension benefit
plan (other than a Multiemployer Plan) which is covered by Title IV of ERISA or
subject to the minimum funding standards under Section 412 of the Internal
Revenue Code and either (i) is maintained, or contributed to, by any
member of the ERISA Group for employees of any member of the ERISA Group or
(ii) has at any time within the preceding five years been maintained, or
contributed to, by any Person which was at such time a member of the ERISA
Group for employees of any Person which was at such time a member of the ERISA
Group.


 


“Pre-Opening Expenses” means, with respect to any
fiscal period, the amount of expenses (other  than Consolidated
Interest Expense) incurred with respect to capital projects which are
classified as “pre-opening expenses” on the applicable financial statements of
the Borrower and its Subsidiaries for such period, prepared in accordance with
generally accepted accounting principles.


 


“Pricing Certificate” means a Pricing Certificate
substantially in the form of Exhibit C hereto, properly completed and
signed by an Authorized Officer of the Borrower.


 


“Pricing Period” means (a) the period beginning on the
Availability Date and ending on the last day of  the next succeeding February, May, August, or November, and (b)
each subsequent period of three months beginning on the first day of each
March, June, September and December and ending on the last day of the
succeeding May, August, November and February.


 


“Pro Rata Share” means, with respect to any Commitment
of a Lender at any time, a fraction (expressed as a percentage, carried out to
the ninth decimal place), the numerator of which is the amount of the
respective Commitment of such Lender at such time and the denominator of which
is the amount of the aggregate amount of such Commitments at such time.


 


“Public Notice” means, without limitation, any filing
or report made in accordance with the requirements of the Securities and
Exchange Commission (or any successor), any press


 


11

















 


release or public announcement made by the Borrower or
any written notice the Borrower gives to the Administrative-Agent or the
Lenders.


 


“Rating Agencies” means S&P and Moody’s.


 


“Rating Decline” means the occurrence on any date on
or within 90 days after the date of the first Public Notice of (i) the
occurrence of an event described in clauses (i)-(iv) of the definition of
“Change of Control” or (ii) the intention by the Borrower to effect such
an event (which 90-day period shall be extended so long as the rating of the
senior debt of the Borrower is under publicly announced consideration for
possible downgrade by any of the Rating Agencies) of a decrease in the rating
of the senior debt of the Borrower by any of the Rating Agencies to below
Investment Grade.


 


“Reference Rate” means the rate of interest publicly
announced from time to time by Bank of America as its “prime rate” or the
similar prime rate or reference rate announced by any successor Administrative
Agent.  Bank of America’s prime rate is
a rate set by Bank of America based upon various factors including Bank of America’s
costs and desired return, general economic conditions and other factors, and is
used as a reference point for pricing some loans, which may be priced at,
above, or below such announced rate. 
Any change in the Reference Rate announced by Bank of America or any
successor Administrative Agent shall take effect at the opening of business on
the day specified in the public announcement of such change.


 


“Register” has the meaning set forth in
Section 9.05(c).


 


“Regulation U” means Regulation U of the Board of
Governors of the Federal Reserve System, as in effect from time to time.


 


“Required Lenders” means at any time Lenders having at
least 51% of the aggregate amount of the Commitments or, if the Commitments
shall have been terminated, holding at least 51% of the sum of the aggregate
unpaid principal amount of the Loans and the aggregate amount of Letter of
Credit Liabilities.


 


“Revolving Commitment” means, as to each Revolving
Lender, the commitment of that Lender to make Loans and to participate in
Letters of Credit and Swing Line Loans, in each case as such amount may be
reduced from time to time pursuant to Section 2.12, 2.13, 2.14 or 2.24, or
increased pursuant to Section 2.23. 
As of the Effective Date, the aggregate amount of the Revolving
Commitments under this Agreement is $1,044,441,860 and the respective Pro Rata
Shares of the Revolving Lenders with respect to the Revolving Commitment are
set forth in the records of the Administrative Agent.  As of the Effective Date, each Revolving Lender has made a
Revolving Commitment which is equal to the amount of the Revolving Note issued
to that Lender on the Effective Date.


 


“Revolving Credit Period” means the period from and
including the Availability Date to but not including the Termination Date.


 


“Revolving Lender” means each Lender that holds a
Revolving Commitment.


 


12

















 


“Revolving Loan” means each Loan made by a Revolving
Lender under the Revolving Commitment.


 


“Revolving Note” means the promissory note made by the
Borrower to a Revolving Lender evidencing that Lender’s Pro Rata Share of the
Revolving Commitment, substantially in the form of Exhibit B-2, either as
originally executed or as the same may from time to time be supplemented,
modified, amended, renewed, extended or supplanted.


 


“S&P” means Standard & Poor’s, a division
of The McGraw Hill Companies, and its successors.


 


“Significant Subsidiary” means each Subsidiary of the
Borrower at any time having (i) at least 10% of the total consolidated
assets of the Borrower and its Subsidiaries (determined as of the last day of
the most recent fiscal quarter of the Borrower) or (ii) at least 10% of
the consolidated revenues of the Borrower and its Subsidiaries for the fiscal
year of the Borrower then most recently ended.


 


“Solvent” as to any Person shall mean that (a) the sum
of the assets of such Person, both at a fair valuation and at present fair
saleable value, exceeds its liabilities, including its probable liability in
respect of contingent liabilities, (b) such Person will have sufficient capital
with which to conduct its business as presently conducted and as proposed to be
conducted and (c) such Person has not incurred debts, and does not intend to
incur debts, beyond its ability to pay such debts as they mature.  For purposes of this definition, “debt”
means any liability on a claim, and “claim” means (x) a right to payment,
whether or not such right is reduced to judgment, liquidated, unliquidated,
fixed, contingent, matured, unmatured, disputed, undisputed, legal, equitable,
secured, or unsecured, or (y) a right to an equitable remedy for breach of
performance if such breach gives rise to a payment, whether or not such right
to an equitable remedy is reduced to judgment, fixed, contingent, matured,
unmatured, disputed, undisputed, secured or unsecured.  With respect to any such contingent
liabilities, such liabilities shall be computed at the amount which, in light
of all the facts and circumstances existing at the time, represents the amount
which can reasonably be expected to become an actual or matured liability.


 


“SPC” has the meaning set forth in
Section 9.05(h).


 


“Subsidiary” means any corporation or other entity of
which securities or other ownership interests having ordinary voting power to
elect a majority of the board of directors or other persons performing similar
functions are at the time directly or indirectly owned by the Borrower.


 


“Swing Line” means the revolving line of credit
established by the Swing Line Lender in favor of Borrower pursuant to
Section 2.04.


 


“Swing Line Documents” means the promissory note and
any other documents executed by Borrower in favor of the Swing Line Lender
in connection with the Swing Line.


 


“Swing Line Loans” means Loans made by the
Swing Line Lender to Borrower pursuant to Section 2.04.


 


13

















 


“Swing Line Lender” means, when acting in such
capacity, Bank of America, its successors and assigns.


 


“Swing Line Outstandings” means, as of any date of
determination, the aggregate principal indebtedness of the Borrower on all
Swing Line Loans then outstanding.


 


“Syndication Agent” means The Bank of Nova Scotia in
its capacity as syndication agent for the Lenders hereunder.  The capacity of the Syndication Agent is
titular in nature, and the Syndication Agent shall have no obligations or
liabilities under the Loan Documents by reason of acting in such capacity.


 


“Term Loan” has the meaning set forth in
Section 2.01(a).


 


“Term Loan Commitment” means, as to each Term Loan
Lender, the commitment of that Lender to make its Term Loan.  As of the Effective Date, the Term Loan
Commitment is $696,294,574 and the respective Pro Rata Shares of the Lenders
with respect to the Term Loan Commitment are set forth in the records of the
Administrative Agent.


 


“Term Loan Lender” means each Lender that holds Term
Loan and/or a Term Loan Commitment.


 


“Term Note” means the promissory note made by the
Borrower to a Term Loan Lender evidencing that Lender’s Pro Rata Share of the
Term Loan Commitment, substantially in the form of Exhibit B-1, either as
originally executed or as the same may from time to time be supplemented,
modified, amended, renewed, extended or supplanted.


 


“Termination Date” means the date which is two years
following the Availability Date (but in any event not later than
December 31, 2005), or such later date to which the Revolving Credit
Period shall have been extended pursuant to Section 2.15, or, if such day
is not a Euro-Dollar Business Day, the next preceding Euro-Dollar Business Day.


 


“Unfunded Liabilities” means, with respect to any Plan
at any time, the amount (if any) by which (i) the value of all benefit
liabilities under such Plan, determined on a plan termination basis using the
assumptions prescribed by the PBGC for purposes of Section 4044 of ERISA,
exceeds (ii) the fair market value of all Plan assets allocable to such
liabilities under Title IV of ERISA (excluding any accrued but unpaid
contributions), all determined as of the then most recent valuation date for
such Plan, but only to the extent that such excess represents a potential
liability of a member of the ERISA Group to the PBGC or any other Person under
Title IV of ERISA.


 


1.02                           Accounting Terms and Determinations.  Unless otherwise specified herein, all
accounting terms used herein shall be interpreted, all accounting
determinations hereunder shall be made, and all financial statements required
to be delivered hereunder shall be prepared, in accordance with generally
accepted accounting principles as in effect from time to time, applied on a basis
consistent (except for changes concurred in by the Borrower’s independent
public accountants and disclosed in such financial statements) with the most
recent audited consolidated financial statements of the Borrower and its
Consolidated Subsidiaries delivered to the Lenders; provided that, if the
Borrower notifies the Administrative Agent that the Borrower wishes to


 


14

















 


amend any covenant in Article V to eliminate the
effect of any change in generally accepted accounting principles on the
operation of such covenant (or if the Administrative Agent notifies the
Borrower that the Required Lenders wish to amend Article V for such
purpose), then the Borrower’s compliance with such covenant shall be determined
on the basis of generally accepted accounting principles in effect immediately
before the relevant change in generally accepted accounting principles became
effective, until either such notice is withdrawn or such covenant is amended in
a manner satisfactory to the Borrower and the Required Lenders.


 


1.03                           Types of Borrowings.  Borrowings are classified for purposes of
this Agreement either by reference to the pricing of Loans comprising such
Borrowing (e.g., a “Euro-Dollar Borrowing” is a Borrowing comprised of
Euro-Dollar Loans) or by reference to the provisions of Article II under
which participation therein is determined (i.e., a “Committed Borrowing”
is a Borrowing under Section 2.01 in which all Lenders participate in
proportion to their commitments).


 


ARTICLE II


 


THE CREDITS


 


2.01                           Commitments to Lend.


 


(a)                                  Subject
to the terms and conditions set forth in this Agreement, each Term Loan Lender
severally agrees to lend to the Borrower its Pro Rata Share of the Term Loan
Commitment (each individually, a “Term Loan” and, collectively, the “Term
Loans”).  The Term Loans shall be
made by the Term Loan Lenders in a single Borrowing on the Availability Date,
whereupon the Term Loan Commitment shall terminate.  The Term Loans shall be made by the Term Loan Lenders simultaneously
and proportionately to their respective Pro Rata Shares, it being understood
that no Term Loan Lender shall be responsible for any failure by any other Term
Loan Lender to perform its obligation to make any Term Loan hereunder nor shall
the Term Loan Commitment of any Term Loan Lender be increased or decreased as a
result of any such failure.  Once
repaid, Term Loans may not be reborrowed.


 


(b)                                 During
the Revolving Credit Period each Revolving Lender severally agrees, on the
terms and conditions set forth in this Agreement, to lend to the Borrower
pursuant to this Section from time to time amounts such that (a) the
aggregate outstanding principal amount of such Lender’s Revolving Loans and
such Lender’s Pro Rata Share of outstanding Swing Line Loans and Letter of
Credit Liabilities at any one time outstanding shall not exceed the amount of
such Lender’s Revolving Commitment, and (b) the aggregate principal outstanding
amount of all Revolving Loans and Swing Line Loans plus the Letter of Credit Liabilities
shall not exceed the aggregate Revolving Commitments.  Each Borrowing under this Section shall be in an aggregate
principal amount of $10,000,000 or any larger multiple of $1,000,000; and each
Borrowing of Revolving Loans shall be made from the several Revolving Lenders
ratably in proportion to their respective Pro Rata Shares of the Revolving
Commitment.  Within the foregoing
limits, the Borrower may borrow under this Section, repay, or to the extent permitted
by Section 2.16, prepay Revolving Loans and reborrow at any time on or
prior to the


 


15

















 


Termination Date under this Section.  The Revolving Loans shall mature, and the
principal amount thereof shall be due and payable, on the Termination Date.


 


2.02                           Notice of Borrowings.  The Borrower shall give the Administrative
Agent notice (a “Notice of Borrowing”), substantially in the form of Exhibit
D hereto, not later than 8:30 A.M. (California local time) on
(y) the date of each Base Rate Borrowing and (z) the third
Euro-Dollar Business Day before each Euro-Dollar Borrowing, specifying:


 


(a)                                  the
date of such Borrowing, which shall be a Domestic Business Day in the case of a
Base Rate Borrowing or a Euro-Dollar Business Day in the case of a Euro-Dollar
Borrowing;


 


(b)                                 the
aggregate amount of such Borrowing;


 


(c)                                  whether
the Loans comprising such Borrowing are to be Base Rate Loans or Euro-Dollar
Loans; and


 


(d)                                 in
the case of a Euro-Dollar Borrowing, the duration of the Interest Period
applicable thereto, subject to the provisions of the definition of Interest
Period.


 


Not more than twelve Committed Borrowings which are
Euro-Dollar Borrowings having different Interest Periods shall be outstanding
at any time.


 


2.03                           [Intentionally Omitted].


 


2.04                           Swing Line Loans.


 


(a)                                  The
Swing Line Lender shall from time to time from the Availability Date
through the day prior to the Termination Date make Swing Line Loans in
Dollars to Borrower in such amounts as Borrower may request, provided
that (i) after giving effect to such Swing Line Loan, (A) the
aggregate Swing Line Outstandings shall not exceed $15,000,000 and (B) the
aggregate principal outstanding amount of all Revolving Loans and Swing Line
Loans plus the Letter of Credit Liabilities shall not exceed the aggregate
Revolving Commitments, (ii) without the consent of all of the Revolving
Lenders, no Swing Line Loan may be made during the continuation of any Default
or Event of Default and (iii) the Swing Line Lender has not given at least
twenty-four hours prior notice to Borrower that availability under the Swing
Line is suspended or terminated. 
Borrower may borrow, repay and reborrow under this Section.  Unless notified to the contrary by the Swing
Line Lender, borrowings under the Swing Line may be made in amounts which are
integral multiples of $1,000,000 upon telephonic request by a Responsible
Official of Borrower made to the Administrative Agent not later than
1:00 P.M. (California local time), on the Domestic Business Day of the
requested Swing Line Loan (which telephonic request shall be promptly confirmed
in writing by telecopier).  Promptly
after receipt of such a request for a Swing Line Loan, the Administrative Agent
shall provide telephonic verification to the Swing Line Lender that the
requested Swing Line Loan is in conformity with this Section.  Unless the Swing Line Lender otherwise
agrees, each repayment of a Swing Line Loan shall be in an amount which is an
integral multiple of $1,000,000.  If
Borrower instructs the Swing Line Lender


 


16

















 


to debit its demand deposit account at the Swing Line
Lender in the amount of any payment with respect to a Swing Line Loan, or the
Swing Line Lender otherwise receives repayment, after 3:00 p.m.
(California local time), on a Domestic Business Day, such payment shall be
deemed received on the next Domestic Business Day.  The Swing Line Lender shall promptly notify the Administrative
Agent of the Swing Loan Outstandings each time there is a change therein.


 


(b)                                 The
Swing Line Lender shall be responsible for submitting invoices to Borrower for
such interest.  The interest payable on
Swing Line Loans shall be solely for the account of the Swing Line Lender
unless and until the Banks fund their participations therein pursuant to
clause (d) of this Section.


 


(c)                                  The
Swing Line Loans shall be payable on demand made by the Swing Line Lender and
in any event on the Termination Date.


 


(d)                                 Upon
the making of a Swing Line Loan, each Revolving Lender shall be deemed to have
purchased from the Swing Line Lender a participation therein in an amount equal
to that Lender’s Pro Rata Share of the Revolving Commitment of such Swing Line
Loan.  Upon demand made by the Swing
Line Lender, each Revolving Lender shall, according to its Pro Rata Share of
the Revolving Commitment, promptly provide to the Swing Line Lender its
purchase price therefor in an amount equal to its participation therein.  The obligation of each Revolving Lender to
so provide its purchase price to the Swing Line Lender shall be absolute and
unconditional and shall not be affected by the occurrence of a Default or Event
of Default.  Each Revolving Lender that
has provided to the Swing Line Lender the purchase price due for its participation
in Swing Line Loans shall thereupon acquire a pro rata participation, to the
extent of such payment, in the claim of the Swing Line Lender against Borrower
for principal and interest and shall share, in accordance with that pro rata
participation, in any principal payment made by Borrower with respect to such
claim and in any interest payment made by Borrower (but only with respect to
periods subsequent to the date such Lender paid the Swing Line Lender its
purchase price) with respect to such claim.


 


(e)                                  In
the event that the Swing Line Outstandings are in excess of $10,000,000 on
three consecutive Domestic Business Days then, on the next Domestic
Business Day (unless Borrower has made other arrangements acceptable to the
Swing Line Lender to reduce the Swing Line Outstandings below $10,000,000),
Borrower shall request a Borrowing of Revolving Loans in an amount sufficient
to reduce the Swing Line Outstandings below $10,000,000.  In addition, upon any demand for payment of
the Swing Line Outstandings by the Swing Line Lender (unless Borrower has made
other arrangements acceptable to the Swing Line Lender to reduce the Swing Line
Outstandings to $0), Borrower shall request a Borrowing of Revolving Loans in
an amount sufficient to repay all Swing Line Outstandings (and, for this
purpose, the limitations as to the minimum amounts of Base Rate Borrowings set
forth in Section 2.01(b) shall not apply).  In each case, the Administrative Agent shall automatically
provide the responsive Loans made by each Revolving Lender to the Swing Line
Lender (which the Swing Line Lender shall then apply to the Swing Line
Outstandings).  In the event that
Borrower fails to request a Borrowing within the time


 


17

















 


specified by Section 2.02 on any such date, the
Administrative Agent may, but shall not be required to, without notice to or
the consent of Borrower, cause Revolving Loans to be made by the Revolving
Lenders under their Revolving Commitments in amounts which are sufficient to
reduce the Swing Line Outstandings as required above.  The conditions precedent set forth in Section 3.01 shall not
apply to Revolving Loans to be made by the Revolving Lenders pursuant to the
three preceding sentences.  The proceeds
of such Revolving Loans shall be paid directly to the Swing Line Lender for
application to the Swing Line Outstandings.


 


2.05                           Conversion and Continuation of
Committed Loans.  Subject to the
provisions of this Article II governing the making of Euro-Dollar Loans,
Borrower shall have the option at any time (i) to convert all or any part
of its outstanding Committed Loans equal to $10,000,000 and integral multiples
of $1,000,000 in excess of that amount from Loans bearing interest at a rate
determined by reference to one basis to Committed Loans bearing interest at a
rate determined by reference to an alternative basis or (ii) upon the
expiration of any Interest Period applicable to a Euro-Dollar Loan, to continue
all or any portion of such Loan equal to $1,000,000 and integral multiples of
$100,000 in excess of that amount as a Euro-Dollar Loan; provided,  however,
that a Euro-Dollar Loan may only be converted into a Base Rate Loan on the
expiration date of an Interest Period applicable thereto.


 


Borrower shall deliver, to the Administrative Agent,
notice of any such conversion or continuation, substantially in the form of Exhibit D
(each a “Notice of Conversion/Continuation”), no later than 8:30 A.M.
(California local time) at least one Domestic Business Day in advance of the
proposed conversion date (in the case of a conversion to a Base Rate Loan) and
at least three Euro-Dollar Business Days in advance of the proposed
conversion/continuation date (in the case of a conversion to, or a continuation
of, a Euro-Dollar Loan).  A Notice of
Conversion/Continuation shall specify (i) the proposed
conversion/continuation date (which shall be a Domestic Business Day in the
case of Base Rate Loans and a Euro-Dollar Business Day, in the case of
conversion to or continuation of Euro-Dollar Loans), (ii) the amount and
type of the Loan to be converted/continued, (iii) the nature of the
proposed conversion/continuation, (iv) in the case of a conversion to, or
a continuation of, a Euro-Dollar Loan, the requested Interest Period, and
(v) in the case of a conversion to, or a continuation of, a Euro-Dollar
Loan, that no Default or Event of Default has occurred and is continuing.


 


2.06                           Notice to Lenders; Funding of Loans.


 


(a)                                  Upon
receipt of a Notice of Borrowing, the Administrative Agent shall promptly
notify each Lender of the contents thereof and of such Lender’s share (if any)
of such Borrowing and such Notice of Borrowing shall not thereafter be
revocable by the Borrower.


 


(b)                                 Not
later than 11:00 A.M. (California local time) on the date of each
Borrowing, if such Borrowing is to be made in Dollars, each Lender
participating therein shall (except as provided in subsection (c) of this
Section) make available its share of such Borrowing in Dollars, in federal or
other funds immediately available to the Administrative Agent at its address
referred to in Section 9.01. 
Unless the


 


18

















 


Administrative Agent determines that any applicable
condition specified in Article III has not been satisfied, the
Administrative Agent will make the funds so received from the Lenders available
to the Borrower at the Administrative Agent’s aforesaid address or place.


 


(c)                                  If
any Lender makes a new Loan hereunder on a day on which the Borrower is to
repay all or any part of an outstanding Loan from such Lender, such Lender
shall apply the proceeds of its new Loan to make such repayment and only an
amount equal to the difference (if any) between the amount being borrowed and
the amount being repaid shall be made available by such Lender to the
Administrative Agent as provided in subsection (b), or remitted by the
Borrower to the Administrative Agent as provided in Section 2.17, as the
case may be.


 


(d)                                 Unless
the Administrative Agent shall have received notice from a Lender prior to the
date of any Borrowing that such Lender will not make available to the
Administrative Agent such Lender’s share of such Borrowing, the Administrative
Agent may assume that such Lender has made such share available to the
Administrative Agent on the date of such Borrowing in accordance with
subsections (b) and (c) of this Section 2.06 and the Administrative
Agent may, in reliance upon such assumption, make available to the Borrower on
such date a corresponding amount.  If
and to the extent that such Lender shall not have so made such share available
to the Administrative Agent, such Lender and the Borrower severally agree to
repay to the Administrative Agent forthwith on demand such corresponding amount
together with interest thereon, for each day from the date such amount is made
available to the Borrower until the date such amount is repaid to the
Administrative Agent, at (i) in the case of the Borrower, a rate per annum
equal to the higher of the Federal Funds Rate and the interest rate applicable
thereto pursuant to Section 2.08 and (ii) in the case of such Lender,
the Federal Funds Rate.  If such Lender
shall repay to the Administrative Agent such corresponding amount, such amount
so repaid shall constitute such Lender’s Loan included in such Borrowing for
purposes of this Agreement.  If the
Borrower pays interest under this subsection (d) at the Federal Funds Rate
and the Federal Funds Rate is higher than the interest rate applicable thereto
pursuant to Section 2.08, the applicable Lender shall pay the Borrower the
difference between such rates.


 


2.07                           Notes.


 


(a)                                  The
Term Loans and the Revolving Loans of each Lender shall each be evidenced by a
single Note, substantially in the form of Exhibits B-1 and B-2
hereto, payable to the order of such Lender for the account of its Applicable
Lending Office in an amount equal to the aggregate unpaid principal amount of
such Lender’s Term Loan and Revolving Commitment, respectively.


 


(b)                                 Upon
receipt of each Lender’s Notes pursuant to Section 3.02(b), the
Administrative Agent shall forward such Notes to such Lender.  Each Lender shall record the date, amount,
type and maturity of each Loan made by it and the date and amount of each
payment of principal made by the Borrower with respect thereto, and may, if
such Lender so elects in connection with any transfer or enforcement of its
Notes, endorse on


 


19

















 


the schedule forming
a part thereof appropriate notations to evidence the foregoing information with
respect to each such Loan then outstanding; provided that the failure of any
Lender to make any such recordation or endorsement shall not affect the
obligations of the Borrower hereunder or under the Notes.  Each Lender is hereby irrevocably authorized
by the Borrower so to endorse its Notes and to attach to and make a part of its
Note a continuation of any such schedule as and when required.


 


2.08                           Interest Rates.


 


(a)                                  Each
Base Rate Loan shall bear interest on the outstanding principal amount thereof,
for each day from the date such Loan is made until it becomes due, at a rate
per annum equal to the Base Rate for such day plus any applicable Base
Rate Margin.  Such interest shall be
payable on the last Domestic Business Day of each calendar quarter in arrears
and on the Termination Date.  Any overdue
principal of or interest on any Base Rate Loan shall, at the option of the
Required Lenders, bear interest, payable on demand, for each day until paid at
a rate per annum equal to the sum of the Base Rate plus any applicable
Base Rate Margin plus 2% per annum.


 


(b)                                 Each
Euro-Dollar Loan shall bear interest on the outstanding principal amount
thereof, for each day during the Interest Period applicable thereto, at a rate
per annum equal to the sum of (a) the Euro-Dollar Margin for such day plus (b)
the applicable Euro-Dollar Rate for such Interest Period.  Such interest shall be payable for each
Interest Period on the last day thereof and, if such Interest Period is longer
than three months, at intervals of three months after the first day thereof.


 


(c)                                  Any
overdue principal of or interest on any Euro-Dollar Loan shall, at the option
of the Required Lenders, bear interest, payable on demand, for each day until
paid at a rate per annum equal to the sum of 2% plus the Euro-Dollar Margin for
such day plus the quotient obtained (rounded upwards, if necessary, to the next
higher 1/100 of 1%) by dividing (i) the average (rounded upward, if
necessary, to the next higher 1/16 of 1%) of the respective rates per annum at
which one day (or, if such amount due remains unpaid more than three
Euro-Dollar Business Days, then for such period of time not longer than 6
months as the Administrative Agent may elect) deposits in Dollars in an amount
approximately equal to such overdue payment due to the Administrative Agent are
offered to the Administrative Agent in the London interbank market for the
applicable period determined as provided above by (ii) 1.00 minus the
Euro-Dollar Reserve Percentage (or, if the circumstances described in clause
(a) or (b) of Section 8.01 shall exist, at a rate per annum equal to the
sum of 2% plus the rate applicable to Base Rate Loans for such day).


 


(d)                                 Swing
Line Loans shall bear interest at a fluctuating rate per annum equal to the
Base Rate plus any applicable Base Rate Margin.  Interest on the Swing Line Loans shall be
payable on such dates, not more frequent than monthly, as may be specified by
the Swing Line Lender and in any event on the Termination Date.


 


20

















 


Any overdue principal of or interest on any Swing Line
Loan shall bear interest, payable on demand, for each day until paid at a rate
per annum equal to the sum of the Base Rate plus any applicable Base
Rate Margin plus 2% per annum for such day.


 


(e)                                  The
Administrative Agent shall determine in accordance with the provisions of this
Agreement each interest rate applicable to the Loans hereunder.  The Administrative Agent shall give prompt
notice to the Borrower and the participating Lenders of each rate of interest
so determined, and its determination thereof shall be conclusive in the absence
of manifest error.


 


2.09                           Amendment Fees. 
On the date upon which this Agreement is executed, the Borrower shall
pay to the Administrative Agent for the account of each consenting Lender
non-refundable amendment fees in the amounts set forth in the term sheet for
this Agreement posted on Intralinks by the Joint Lead Arrangers and Joint Book
Managers.


 


2.10                           Facility Fees. 
The Borrower shall pay to the Administrative Agent for the account of
the Lenders ratably facility fees at the Facility Fee Rate determined daily in
accordance with the Schedule 1 (the “Facility Fee Rate”).  Such facility fee shall accrue from and
including the Availability Date to but excluding the Termination Date (or
earlier date of termination of the Commitments in their entirety), on the daily
aggregate amount of the Commitments (whether used or unused).  Facility fees shall be payable quarterly in
arrears on the first day of each March, June, September and
December following the Availability Date and upon the date of termination
of the Commitments in their entirety, and are non-refundable.


 


2.11                           Letter of Credit Fees.  The Borrower shall pay to the Administrative
Agent (i) for the account of the Revolving Lenders ratably a Letter of
Credit fee accruing daily on the aggregate amount then available for drawing
under all Letters of Credit at a rate per annum determined in accordance with
the Schedule 1 (the “LC Fee Rate”) and (ii) for the account of the
Issuing Lender a Letter of Credit fronting fee accruing daily on the aggregate
amount then available for drawing under all Letters of Credit issued by the
Issuing Lender at a rate per annum set forth in a letter agreement between the
Borrower and the Issuing Lender.  Letter
of Credit fees shall payable quarterly in arrears on the first day of each
March, June, September and December following the Availability Date
and upon the date of termination of the Commitments in their entirety and are
non-refundable.


 


2.12                           Optional Termination or Reduction
of Commitments by the Borrower. 
During the Revolving Credit Period, the Borrower may, upon at least five
Domestic Business Days’ notice to the Administrative Agent, (i) terminate
the Revolving Commitments at any time, if no Revolving Loans, Swing Line Loans
or Letter of Credit Liabilities are outstanding at such time or
(ii) ratably and permanently reduce from time to time by an aggregate
amount of $25,000,000 or any larger amount in multiples of $1,000,000, the
aggregate amount of the Revolving Commitments in excess of the sum of the
aggregate outstanding principal balance of the Revolving Loans, the Swing Line
Loans and the aggregate amount of Letter of Credit Liabilities.


 


2.13                           Optional Termination of Commitments
by the Lenders.  Following the
occurrence of a Change of Control, the Required Lenders may in their sole and
absolute discretion elect, during the sixty day period immediately subsequent
to the later of (a) such occurrence and (b) the


 


21

















 


earlier
of (i) receipt of the Borrower’s written notice to the Administrative
Agent of such occurrence and (ii) if no such notice has been received by
the Administrative Agent, the date upon which the Administrative Agent and the
Lenders have actual knowledge thereof, to terminate all of the
Commitments.  In any such case the
Commitments shall be terminated effective on the date which is sixty days
subsequent to the date of written notice from the Administrative Agent to the
Borrower thereof, and (i) to the extent that there is then any Debt evidenced
by the Notes, the same shall be immediately due and payable, and (ii) to the
extent that any Letters of Credit are then outstanding, Borrower shall provide
cash collateral for the same.  In
addition thereto, in the event that the lenders under the Five Year Credit
Agreement elect to terminate the lending commitments under the Five Year Credit
Agreement as a result of a “Change of Control” as defined therein, the
Commitments of the Lenders hereunder shall (except as to any Lender to the
extent that such Lender otherwise expressly agrees with Borrower in writing) be
concurrently terminated.


 


2.14                           Scheduled Termination of Commitments.  The Commitments shall terminate on the
Termination Date and any Loans then outstanding (together with accrued interest
thereon) shall be due and payable on such date.


 


2.15                           Extensions of the Termination Date.  The Termination Date may be extended, in the
manner set forth in this Section, for a period of up to two years after the
date on which the Termination Date would otherwise have occurred.  If the Borrower wishes to extend the
Termination Date, it shall give written notice to that effect to the
Administrative Agent not less than 90 days nor more than 150 days following the
delivery to the Administrative Agent of the audited annual financial statements
of Borrower in accordance with Section 5.01(b), whereupon the
Administrative Agent shall notify each of the Lenders of such notice.  Each Lender will respond to such request,
whether affirmatively or negatively, within 30 days (the “Response Date”).  So long as Lenders having Commitment(s)
totaling not less than 66 2/3% of the aggregate amount of the Commitment(s)
shall have responded affirmatively to such a request, then, subject to receipt
by the Administrative Agent of counterparts of an Extension Agreement in
substantially the form of Exhibit E duly completed and signed by
the Borrower and each of the affirmatively responding Lenders, the Termination
Date shall be extended for a period of up to two years to the date stated in
such Extension Agreement provided, however, that, with respect to
any Lender or Lenders that respond negatively or fail to timely respond to such
request (each non-responding Lender being conclusively deemed to refuse to
consent to the extension), the Termination Date in effect immediately prior to
such extension shall continue in effect, and the Commitments(s) of such
Lender(s) shall terminate on the Termination Date in effect immediately prior
to such extension, and the Loans made by such Lender(s) shall be repaid in
full, together with accrued and unpaid interest thereon and all other amounts
owing hereunder with respect thereto, on such date; provided, further,
that the Borrower shall, for a period of 60 days following the Response Date,
have the right, with the assistance of the Administrative Agent, to seek a
substitute financial institution(s) (which may be one or more of the Lenders)
to assume the Commitment(s) of such non-extending Lender(s).  Not later than the third Domestic Business
Day prior to the end of the 60-day period referred to in the further proviso to
the preceding sentence, the Borrower may, by notice to the Lenders through the
Administrative Agent, but shall not be required to, (i) terminate, effective
on the third Domestic Business Day after the giving of such notice, the
Commitment(s) of such non-extending Lender(s), and, if the Borrower elects to
terminate such Commitments, the Loans made by such Lender(s) shall be


 


22

















 


repaid in full, together with accrued and unpaid
interest thereon and all other amounts owing hereunder with respect thereto, on
such date; or (ii) designate one or more new financial institutions
reasonably acceptable to the Administrative Agent to assume the Commitment(s)
of such non-extending Lender(s), whereupon the aggregate amount of such
Commitment(s) shall be assumed by such substitute financial institution(s) and
such non-extending Lender(s) shall assign its or their Commitment(s) to such
new financial institution(s) and sell its or their Loans and its participation
interests in all outstanding Letters of Credit to such financial
institution(s), at a price equal to the outstanding principal amount of such
Loans plus accrued and unpaid interest thereon and other amounts due and owing
hereunder with respect thereto, pursuant to documentation in substantially the
form of Exhibit G hereto.


 


2.16                           Optional Prepayments.


 


(a)                                  Subject
in the case of any Euro-Dollar Borrowing to Section 2.18, the Borrower
may, upon at least one Domestic Business Day’s notice to the Administrative
Agent, prepay any Base Rate Borrowing or upon at least three Euro-Dollar
Business Days’ notice to the Administrative Agent, with respect to any
Euro-Dollar Borrowing, prepay any Euro-Dollar Borrowing, in each case in whole
at any time, or from time to time in part in amounts aggregating $10,000,000 or
any larger multiple of $1,000,000, by paying the principal amount to be prepaid
together with accrued interest thereon to the date of prepayment.  Each such optional prepayment shall be
applied to prepay ratably the Loans of the several Lenders included in such
Borrowing.


 


(b)                                 Upon
receipt of a notice of prepayment pursuant to this Section, the Administrative
Agent shall promptly notify each applicable Lender of the contents thereof and
of such Lender’s Pro Rata Share (if any) of such prepayment and such notice
shall not thereafter be revocable by the Borrower.


 


2.17                           General Provisions as to Payments.


 


(a)                                  The
Borrower shall make each payment of principal of, and interest on, Loans and
Letters of Credit Liabilities and of fees hereunder, in Dollars not later than
11:00 A.M. (California local time) on the date when due, in Federal or other
immediately available funds, to the Administrative Agent at its address
referred to in Section 9.01, without offset or counterclaim. The
Administrative Agent will promptly distribute to each Lender its ratable share
of each such payment received by the Administrative Agent for the account of
the Lenders, in Dollars and in the type of funds received by the Administrative
Agent.  Whenever any payment of
principal of, or interest on, the Base Rate Loans or Letters of Credit
Liabilities or of fees shall be due on a day which is not a Domestic Business
Day, the date for payment thereof shall be extended to the next succeeding
Domestic Business Day.  Whenever any
payment of principal of, or interest on, the Euro-Dollar Loans shall be due on
a day which is not a Euro-Dollar Business Day, the date for payment thereof
shall be extended to the next succeeding Euro-Dollar Business Day unless such
Euro-Dollar Business Day falls in another calendar month, in which case the
date for payment thereof shall be the next preceding Euro-Dollar Business Day.  If the date for any payment of principal is
extended by operation of law or otherwise, interest thereon shall be payable
for such extended time.


 


23

















 


(b)                                 Unless
the Administrative Agent shall have received notice from the Borrower prior to
the date on which any payment is due to the Lenders hereunder that the Borrower
will not make such payment in full, the Administrative Agent may assume that
the Borrower has made such payment in full to the Administrative Agent on such
date and the Administrative Agent may, in reliance upon such assumption, cause
to be distributed to each Lender on such due date an amount equal to the amount
then due such Lender.  If and to the
extent that the Borrower shall not have so made such payment, each Lender shall
repay to the Administrative Agent forthwith on demand such amount distributed
to such Lender together with interest thereon, for each day from the date such
amount is distributed to such Lender until the date such Lender repays such
amount to the Administrative Agent, at the Federal Funds Rate.


 


2.18                           Funding Losses. 
If the Borrower makes any payment of principal with respect to any
Euro-Dollar Loan (pursuant to Article VI or VIII or otherwise) on any day
other than the last day of the Interest Period applicable thereto (or the last
day of an applicable period fixed pursuant to Section 2.08(d)), or if the
Borrower fails to borrow any Euro-Dollar Loans after notice has been given to
any Lender in accordance with section 2.06(a), the Borrower shall
reimburse each Lender within 15 days after demand for any resulting loss or
expense incurred by it (or by an existing or prospective participant in the
related Loan), including (without limitation) any loss incurred in obtaining,
liquidating or employing deposits from third parties, but excluding loss of
margin for the period after any such payment or failure to borrow, provided
that such Lender shall have delivered to the Borrower a certificate as to the
amount of such loss or expense, which certificate shall be conclusive in the
absence of manifest error.


 


2.19                           Computation of Interest and Fees.  Interest based on the Reference Rate and all
fees hereunder shall be computed on the basis of a year of 365 days (or 366
days in a leap year) and paid for the actual number of days elapsed (including
the first day but excluding the last day). All other interest shall be computed
on the basis of a year of 360 days and paid for the actual number of days
elapsed (including the first day but excluding the last day).


 


2.20                           Withholding Tax Exemption.  At least five Domestic Business Days prior
to the first date on which interest or fees are payable hereunder for the
account of any Lender, each Lender that is not incorporated under the laws of
the United States of America or a state thereof agrees that it will deliver to
each of the Borrower and the Administrative Agent two duly completed copies of
United States Internal Revenue Service Form W-8 ECI, certifying in either case
that such Lender is entitled to receive payments under this Agreement and the
Notes without deduction or withholding of any United States federal income
taxes.


 


Each Lender which so delivers a Form W-8 ECI further
undertakes to deliver to each of the Borrower and the Administrative Agent two
additional copies of such form (or a successor form) on or before the date that
such form expires or becomes obsolete or after the occurrence of any event
requiring a change in the most recent form so delivered by it, and such
amendments thereto or extensions or renewals thereof as may be reasonably
requested by the Borrower or the Administrative Agent, in each case certifying
that such Lender is entitled to receive payments under this Agreement and the
Notes without deduction or withholding of any United States federal income
taxes, unless an event (including without limitation any change in treaty, law
or regulation) has occurred prior to the date on which any such delivery would
otherwise be


 


24

















 


required which renders all such forms inapplicable or
which would prevent such Lender from duly completing and delivering any such
form with respect to it and such Lender advises the Borrower and the
Administrative Agent that it is not capable of receiving payments without any
deduction or withholding of United States federal income tax.


 


2.21                           Letters of Credit.


 


(a)                                  Subject
to the terms and conditions hereof, the Issuing Lender agrees to issue Letters
of Credit hereunder from time to time before the tenth day before the
Termination Date upon the request of the Borrower; provided that,
immediately after each Letter of Credit is issued, (i) the aggregate
amount of the Letter of Credit Liabilities shall not exceed the Letter of
Credit Commitment and (ii) the aggregate amount of the Letter of Credit
Liabilities plus the aggregate outstanding amount of all Revolving Loans and
Swing Line Loans shall not exceed the aggregate amount of the Revolving
Commitments.  Upon the date of issuance
of a Letter of Credit, the Issuing Lender shall be deemed, without further
action by any party hereto, to have sold to each Revolving Lender, and each
Revolving Lender shall be deemed, without further action by any party hereto,
to have purchased from the Issuing Lender, a participation in such Letter of
Credit and the related Letter of Credit Liabilities in its Pro Rata Share of
the Revolving Commitments.  On the
Availability Date, each letter of credit issued by Bank of America as issuing
lender for the Lenders under the Five Year Credit Agreement shall be deemed
re-issued as a Letter of Credit hereunder without further action by the
parties, and the Revolving Lenders hereunder shall thereupon acquire ratable
risk participations therein in accordance with this Section.


 


(b)                                 The
Borrower shall give the Issuing Lender notice at least five days prior to the
requested issuance of a Letter of Credit specifying the date such Letter of
Credit is to be issued, and describing the terms of such Letter of Credit and
the nature of the transactions to be supported thereby (such notice, including
any such notice given in connection with the extension of a Letter of Credit, a
“Notice of Issuance”) and shall concurrently submit to the Issuing Bank a
letter of credit application on the Issuing Bank’s then standard form for the
issuance of letters of credit.  Upon
receipt of a Notice of Issuance, the Issuing Lender shall promptly notify the
Administrative Agent, and the Administrative Agent shall promptly notify each Revolving
Lender of the contents thereof and of the amount of such Revolving Lender’s
participation in such Letter of Credit. 
The issuance by the Issuing Lender of each Letter of Credit shall, in
addition to the conditions precedent set forth in Article III, be subject
to the conditions precedent that such Letter of Credit shall be in such form
and contain such terms as shall be satisfactory to the Issuing Lender and that
the Borrower shall have executed and delivered such other instruments and
agreements relating to such Letter of Credit as the Issuing Lender shall have
reasonably requested.  The Borrower
shall also pay to the Issuing Lender for its own account issuance, drawing,
amendment and extension charges in the amounts and at the times as agreed between
the Borrower and the Issuing Lender.  The extension or renewal of any Letter of Credit shall be deemed
to be an issuance of such Letter of Credit, and if any Letter of Credit
contains a provision pursuant to which it is deemed to be extended unless notice
of termination is given by the Issuing Lender, the Issuing Lender shall timely
give such notice of termination unless it has theretofore timely received a
Notice


 


25

















 


of Issuance and the other
conditions to issuance of a Letter of Credit have also theretofore been met
with respect to such extension.  No
Letter of Credit shall have a term extending or be so extendible beyond the
fifth Domestic Business Day preceding the Termination Date.


 


(c)                                  Upon
receipt from the beneficiary of any Letter of Credit of any notice of a drawing
under such Letter of Credit, the Issuing Lender shall notify the Administrative
Agent and the Administrative Agent shall promptly notify the Borrower and each
other Revolving Lender as to the amount to be paid as a result of such demand
or drawing and the payment date.  The
Borrower shall be irrevocably and unconditionally obligated forthwith to
reimburse the Issuing Lender for any amounts paid by the Issuing Lender upon
any drawing under any Letter of Credit, without presentment, demand, protest or
other formalities of any kind.  All such
amounts paid by the Issuing Lender and remaining unpaid by the Borrower shall
bear interest, payable on demand, for each day until paid at a rate per annum
equal to the sum of 2% plus the rate applicable to Base Rate Loans for such
day.  In addition, each Revolving Lender
will pay to the Administrative Agent, for the account of the Issuing Lender,
immediately upon the Issuing Lender’s demand at any time during the period
commencing after such drawing until reimbursement therefor in full by the
Borrower, an amount equal to such Revolving Lender’s Pro Rata Share of such
drawing together with interest on such amount for each day from the date of the
Issuing Lender’s demand for such payment (or, if such demand is made after 9:00
A.M. (California local time) on such date, from the next succeeding Domestic
Business Day) to the date of payment by such Revolving Lender of such amount at
a rate of interest per annum equal to the Federal Funds Rate.  The Issuing Lender will promptly pay to each
Revolving Lender ratably all amounts received from the Borrower for application
in payment of its reimbursement obligations in respect of any Letter of Credit,
but only to the extent such Revolving Lender has made payment to the Issuing
Lender in respect of such Letter of Credit pursuant hereto.


 


(d)                                 The
obligations of the Borrower and each Revolving Lender under subsection (c)
above shall be absolute, unconditional and irrevocable, and shall be performed
strictly in accordance with the terms of this Agreement, under all
circumstances whatsoever, including without limitation the following
circumstances:


 


(i)                                     any
lack of validity or enforceability of this Agreement or any Letter of Credit or
any document related hereto or thereto;


 


(ii)                                  any
amendment, waiver of or any consent to departure from all or any of the
provisions of this Agreement, any Letter of Credit or any document related
hereto or thereto;


 


(iii)                               the
use which may be made of the Letter of Credit by, or any acts or omission of, a
beneficiary of a Letter of Credit (or any Person for whom the beneficiary may
be acting);


 


(iv)                              the
existence of any claim, set-off, defense or other rights that the Borrower may
have at any time against a beneficiary of a Letter of Credit (or any


 


26

















 


Person for whom the
beneficiary may be acting), the Revolving Lenders (including the Issuing
Lender) or any other Person, whether in connection with this Agreement or the
Letter of Credit or any document related hereto or thereto or any unrelated
transaction;


 


(v)                                 any
statement or any other document presented under a Letter of Credit proving to
be forged, fraudulent or invalid in any respect or any statement therein being
untrue or inaccurate in any respect whatsoever;


 


(vi)                              payment
under a Letter of Credit to the beneficiary of such Letter of Credit against
presentation to the Issuing Lender of a draft or certificate that does not
comply with the terms of the Letter of Credit; or


 


(vii)                           any
other act or omission to act or delay of any kind by any Revolving Lender
(including the Issuing Lender), the Administrative Agent or any other Person or
any other event or circumstance whatsoever that might, but for the provisions
of this subsection (vii), constitute a legal or equitable discharge of the
Borrower’s or the Lender’s obligations hereunder.


 


(e)                                  The
Borrower hereby indemnifies and holds harmless each Revolving Lender (including
the Issuing Lender) and the Administrative Agent from and against any and all
claims, damages, losses, liabilities, costs or expenses which such Revolving
Lender or the Administrative Agent may incur (including, without limitation,
any claims, damages, losses, liabilities, costs or expenses which the Issuing
Lender may incur by reason of or in connection with the failure of any other
Revolving Lender to fulfill or comply with its obligations to the Issuing
Lender hereunder (but nothing herein contained shall affect any rights the
Borrower may have against such defaulting Revolving Lender)), and none of the
Revolving Lenders (including the Issuing Lender) nor the Administrative Agent
nor any of their officers or directors or employees or agents shall be liable
or responsible, by reason of or in connection with the execution and delivery
or transfer of or payment or failure to pay under any Letter of Credit,
including without limitation any of the circumstances enumerated in
subsection (d) above, as well as (i) any error, omission,
interruption or delay in transmission or delivery of any messages, by mail,
cable, telegraph, telex or otherwise, (ii) any error in interpretation of
technical terms, (iii) any loss or delay in the transmission of any
document required in order to make a drawing under a Letter of Credit,
(iv) any consequences arising from causes beyond the control of the
Issuing Lender, including without limitation any government acts, or any other
circumstances whatsoever in making or failing to make payment under such Letter
of Credit; provided that the Borrower shall not be required to indemnify
the Issuing Lender for any claims, damages, losses, liabilities, costs or
expenses, and the Borrower shall have a claim for direct (but not
consequential) damage suffered by it, to the extent found by a court of
competent jurisdiction to have been caused by (x) the willful misconduct
or gross negligence of the Issuing Lender in determining whether a request
presented under any Letter of Credit complied with the terms of such Letter of
Credit or (y) the Issuing Lender’s failure to pay under any Letter of
Credit after the presentation to it of a request strictly complying with the
terms and conditions of the Letter of Credit. 
Nothing in this subsection (e) is intended to limit the
obligations of the


 


27

















 


Borrower under any other
provision of this Agreement.  To the
extent the Borrower does not indemnify the Issuing Lender as required by this
subsection, the Revolving Lenders agree to do so ratably in accordance with
their Revolving Commitments.


 


2.22                           Regulation D Compensation.  Each Lender may require the Borrower to pay,
contemporaneously with each payment of interest on the Euro-Dollar Loans,
additional interest on the related Euro-Dollar Loan of such Lender at a rate
per annum determined by such Lender up to but not exceeding the excess of (i)
(A) the applicable Euro-Dollar Rate divided by (B) one minus the
Euro-Dollar Reserve Percentage over (ii) the applicable Euro-Dollar
Rate.  Any Lender wishing to require
payment of such additional interest (x) shall so notify the Borrower and
the Agent, in which case such additional interest on the Euro-Dollar Loans of
such Lender shall be payable to such Lender at the place indicated in such
notice with respect to each Interest Period commencing at least three
Euro-Dollar Business Days after the giving of such notice and (y) shall
notify the Borrower at least five Euro-Dollar Business Days prior to each date
on which interest is payable on the Euro-Dollar Loans of the amount then due it
under this Section.


 


2.23                           Increased Commitments; Additional
Lenders.


 


(a)                                  At
any time and from time to time, the Borrower may, upon at least 30 days notice
to the Administrative Agent (or such shorter prior notice as the Administrative
Agent may agree to accept), propose to increase the aggregate amount of the
Commitments by an aggregate amount which does not result in the Commitments,
when aggregated with the principal amount of Borrower’s then existing senior
short term bank credit facilities, being in excess of $4,125,000,000 (the
amount of any such increase of the Commitments being referred to as the
“Increased Commitments”).  If the
Borrower elects to increase the Commitments pursuant to this Section 2.23,
any such increase shall be made ratably between the aggregate amount of the
Revolving Commitments and aggregate amount of the Term Loans or Term Loan
Commitments then outstanding.  For the
avoidance of doubt, no Lender shall be obligated to increase its Revolving Commitments
or Term Loan Commitments.


 


(b)                                 The
Borrower may designate any Lender party to this Agreement (with the consent of
such Lender, which may be given or withheld in its sole discretion) or another
Person which qualifies as an Eligible Assignee (which may be, but need not be,
one or more of the existing Lenders), which at the time agrees to (i) in the
case of any such Person that is an existing Lender, increase its Commitments
and (ii) in the case of any other such Person (an “Additional Lender”), become
a party to this Agreement. The sum of the increases in the Commitments of the
existing Lenders pursuant to this subsection (b) plus the Commitments of
the Additional Lenders shall not in the aggregate exceed the unsubscribed
amount of the Increased Commitments.


 


(c)                                  An
increase in the aggregate amount of the Commitments pursuant to this
Section 2.23 shall become effective upon the receipt by the Administrative
Agent of an agreement in form and substance satisfactory to the Administrative
Agent signed by the Borrower, by each Additional Lender and by each other
Lender whose Commitments are to be increased, setting forth the new Commitments
of such Lenders and setting forth the agreement of each Additional Lender to
become a party to this Agreement and to be


 


28

















 


bound by all the terms
and provisions hereof, together with such evidence of appropriate corporate
authorization on the part of the Borrower with respect to the Increased
Commitments and such opinions of counsel for the Borrower with respect to the
Increased Commitments as the Administrative Agent may reasonably request.


 


2.24                           Mandatory Termination or Reduction
of Commitments.  In the event
the Borrower exercises its rights under Section 2.12 of the Five Year
Credit Agreement to voluntarily reduce the amount of the Commitments thereunder
(but does not wholly terminate the credit commitments under the Five Year
Credit Agreement), then the aggregate principal amount of the Commitments
of  each of the Lenders hereunder shall
be concurrently reduced to an amount which is equal to the remaining principal
amount of the commitments of that Lender under the Five Year Credit
Agreement.  In the event that the
Borrower exercises its rights under Section 2.12 of the Five Year Credit
Agreement or under any other provision of the Five Year Credit Agreement to
terminate the commitment of any one or more of the Lenders thereunder, then the
Commitment of that Lender under this Agreement shall be concurrently and  automatically terminated.


 


ARTICLE III


 


CONDITIONS


 


3.01                           Borrowings and Issuances of Letters
of Credit.  The obligation of
any Lender to make a Loan on the occasion of any Borrowing, the obligation of
the Issuing Lender to issue (or renew or extend the term of) any Letter of
Credit and the obligation of the Swing Line Lender to make any Swing Line Loan
are each subject to the satisfaction of the following conditions:


 


(a)                                  receipt
by the Administrative Agent of a Notice of Borrowing as required by
Section 2.02 or 2.03, or receipt by the Issuing Lender of a Notice of
Issuance as required by Section 2.21(b), as the case may be;


 


(b)                                 immediately
after any Borrowing of Revolving Loans or Swing Line Loans or issuance of a
Letter of Credit, the sum of the aggregate outstanding principal amount of
Revolving Loans and Swing Line Loans and the aggregate amount of Letter of
Credit Liabilities will not exceed the aggregate amount of the Revolving
Commitments;


 


(c)                                  immediately
before and after any Borrowing or issuance of a Letter of Credit, no Default or
Event of Default shall have occurred and be continuing;


 


(d)                                 the
representations and warranties of the Borrower contained in this Agreement
(except the representations and warranties set forth in Section 4.04 and
Section 4.05, in each case as to any matter which has theretofore been
disclosed in writing by the Borrower to the Lenders) shall be true on and as of
the date of such Borrowing or issuance of such Letter of Credit;


 


(e)                                  in
the case of an issuance of a Letter of Credit, immediately after such issuance
of a Letter of Credit, the aggregate amount of the Letter of Credit Liabilities
shall not exceed the Letter of Credit Commitment;


 


29

















 


(f)                                    in
the case of the Borrowing of Term Loans made on the Availability Date, the principal
amount of such Loans will not exceed the Term Loan Commitment;


 


(g)                                 in
the case of the making of the initial Loans and the issuance of the initial
Letters of Credit hereunder, no Default or Event of Default shall have occurred
and remain continuing under the Five Year Credit Agreement; and


 


(h)                                 unless
all of the Lenders otherwise consent in their sole and absolute discretion, no
Loan, Letter of Credit or other credit accommodations will in any event be
available hereunder prior to the Availability Date (and then, only concurrently
with the termination of the commitments under the Five Year Credit Agreement
and the repayment in full of all obligations thereunder).


 


Each Borrowing and issuance of a Letter of Credit
hereunder shall be deemed to be a representation and warranty by the Borrower
on the date of such Borrowing or issuance as to the facts specified in clauses
(b), (c), (d), (e) and (f) of this Section, as applicable.


 


3.02                           Effectiveness. 
This agreement shall become effective on the date (the “Effective Date”)
that each of the following conditions shall have been satisfied (or waived in
accordance with Section 9.04):


 


(a)                                  receipt
by the Administrative Agent of counterparts hereof signed by each of the
Borrower, the Administrative Agent and the Required Lenders (or, in the case of
any party as to which an executed counterpart shall not have been received,
receipt by the Administrative Agent in form satisfactory to it of telegraphic,
telex or other written confirmation from such party of execution of a
counterpart hereof by such party);


 


(b)                                 receipt
by the Administrative Agent for the account of each Lender of a duly executed
Note dated on or before the Effective Date complying with the provisions of
Section 2.07 and of the Swing Line Documents;


 


(c)                                  receipt
by the Administrative Agent of an opinion of Gibson, Dunn & Crutcher, LLP,
substantially in the form of Exhibit F;


 


(d)                                 receipt
by the Administrative Agent of all documents it may reasonably request relating
to the existence of the Borrower, the corporate authority for and the validity
of this Agreement and the Notes, and any other matters relevant hereto, all in
form and substance satisfactory to the Administrative Agents; and


 


(e)                                  the
Borrower shall have concurrently entered into the proposed Amendment No. 6 to
the Five Year Credit Agreement and the proposed Short Term Credit Agreement,
substantially in the form previously distributed to the Lenders.


 


The Administrative Agent shall promptly notify the
Borrower, the Administrative Agent and each Lender of the effectiveness of this
Agreement, and such notice shall be conclusive and binding on all parties
hereto.


 


30

















 


ARTICLE IV


 


REPRESENTATIONS
AND WARRANTIES


 


The Borrower represents and warrants that:


 


4.01                           Corporate Existence and Power.  The Borrower (a) is a corporation duly
incorporated, validly existing and in good standing under the laws of Delaware,
(b) has all corporate powers and authority and all material governmental
licenses (including, without limitation, any such license issued by a Gaming
Board), authorizations, consents and approvals required to own its property and
assets and carry on its business as now conducted and (c) is duly qualified as
a foreign corporation and in good standing in each jurisdiction where the
ownership, leasing and operation of its property or the conduct of its business
requires such qualification.


 


4.02                           Corporate and Governmental
Authorization; Contravention. 
The execution, delivery and performance by the Borrower of this
Agreement and the Notes are within the Borrower’s corporate powers, have been
duly authorized by all necessary corporate action, require no action by or in
respect of, or filing with, any Governmental 
Agency and do not contravene, or constitute a default under, any
provision of applicable law or regulation or of the certificate of
incorporation or by-laws of the Borrower or of any agreement, judgment,
injunction, order, decree or other instrument binding upon the Borrower or
result in the creation or imposition of any Lien on any asset of the Borrower
or any of its Subsidiaries.


 


4.03                           Binding Effect. 
This Agreement constitutes a valid and binding agreement of the Borrower
and the Notes, when executed and delivered in accordance with this Agreement,
will constitute valid and binding obligations of the Borrower, in each case
enforceable in accordance with their respective terms.


 


4.04                           Financial Information.  Since December 31, 2002, there has been
no material adverse change in the business, financial position, results of
operations or prospects of the Borrower and its Consolidated Subsidiaries,
considered as a whole.


 


4.05                           Litigation. 
Except as disclosed in the Borrower’s form 10-K report for the year
ended December 31, 2002 or in its 10-Q report for the quarter ended
March 31, 2003, there is no 
action, suit or proceeding pending against, or to the knowledge of the
Borrower threatened against or affecting, the Borrower or any of its
Subsidiaries before any court or arbitrator or any governmental body, agency or
official in which there is a reasonable possibility of an adverse decision
which could materially adversely affect the business, consolidated financial
position or consolidated results of operations of the Borrower and its
Consolidated Subsidiaries or which in any manner draws into question the
validity or enforceability of this Agreement or the Notes.  Without limiting the generality of the
foregoing, with respect to those litigation matters described above as reported
in the Borrower’s aforementioned form 10-K or 10-Q reports, (a) the
disclosure contained therein was accurate as of the date thereof, and
(b) since such date there has been no material adverse development.


 


4.06                           Compliance with ERISA.  Each member of the ERISA Group has fulfilled
its obligations under the minimum funding standards of ERISA and the Internal
Revenue Code with


 


31

















 


respect to each Plan and is in compliance in all
material respects with the presently applicable provisions of ERISA and the
Internal Revenue Code with respect to each Plan.  No member of the ERISA Group has (i) sought a waiver of the
minimum funding standard under Section 412 of the Internal Revenue Code in
respect of any Plan, (ii) failed to make any contribution or payment to
any Plan or Multiemployer Plan or in respect of any Benefit Arrangement, or
made any amendment to any Plan or Benefit Arrangement, which has resulted or
could result in the imposition of a Lien or the posting of a bond or other security
under ERISA or the Internal Revenue Code or (iii) incurred any liability
under Title IV or ERISA other than a liability to the PBGC for premiums under
Section 4007 of ERISA.


 


4.07                           Taxes.  The
Borrower and its Significant Subsidiaries have filed all United States Federal
income tax returns and other material tax returns which are required to be
filed by them and have paid or agreed to settlements of all taxes due pursuant
to such returns or pursuant to any assessment received by the Borrower or any
Subsidiary, except for such taxes, if any, as are being contested in good faith
and as to which adequate reserves have been provided.  The charges, accruals and reserves on the books of the Borrower
and its Significant Subsidiaries in respect of taxes or other governmental
charges are, in the opinion of the Borrower, adequate.


 


4.08                           Significant Subsidiaries.  Each of the Significant Subsidiaries (a)
is  duly formed, validly existing and in
good standing under the laws of its jurisdiction of formation, (b) has all
corporate or other powers and authority and all material governmental licenses
(including, without limitation, any such license issued by a Gaming Board),
authorizations, consents and approvals required to own its property and assets
and carry on its business as now conducted and (c) is duly qualified and in
good standing in each jurisdiction where the ownership, leasing and operation
of its property or the conduct of its business requires such qualification, and
the failure to be so qualified would have a material adverse effect on the
Borrower and its Subsidiaries.


 


4.09                           Not an Investment Company.  The Borrower is not an “investment company”
within the meaning of the Investment Company Act of 1940, as amended.


 


4.10                           Environmental Matters.  The Borrower has reasonably concluded that
Environmental Laws are unlikely to have a material adverse effect on the
business, financial position, results of operations or prospects of the
Borrower and its Consolidated Subsidiaries, considered as a whole.


 


4.11                           Full Disclosure.  All information heretofore furnished by the Borrower to the
Agents or to any Lender for purposes of or in connection with this Agreement or
any transaction contemplated hereby is, and all such information hereafter
furnished by the Borrower to the Administrative Agent or any Lender will be,
taken as a whole, true and accurate in all material respects on the date as of
which such information is stated or certified. 
The Borrower has disclosed to the Lenders in writing or by means of its
filings with the Securities and Exchange Commission any and all facts which
materially and adversely affect or may affect (to the extent the Borrower can
now reasonably foresee), the business, operations or financial position of the
Borrower and its Consolidated Subsidiaries, taken as a whole, or the ability of
the Borrower to perform its obligations under this Agreement.  With respect to any projections or forecasts
provided, such projections or forecasts represent, as of the date thereof,
management’s best


 


32

















 


estimates based on reasonable assumptions and all
available information, but are subject to the uncertainty inherent in all
projections and forecasts.


 


4.12                           Solvency.  As
of  the Effective Date, the Borrower and
its Significant Subsidiaries are, on a consolidated basis, Solvent.


 


4.13                           Gaming Laws. 
The Borrower and its Subsidiaries are in material compliance with all
applicable Gaming Laws.


 


4.14                           Tax Shelter Regulations.  The Borrower does not intend to treat the Loans
as being a “reportable transaction” (within the meaning of Treasury Regulation
Section 1.6011-4).  In the event
the Borrower determines to take any action inconsistent with such intention, it
will promptly notify the Administrative Agent thereof.  If the Borrower notifies the Administrative
Agent, the Borrower acknowledges that one or more of the Lenders may treat its
Loans as part of a transaction that is subject to Treasury Regulation
Section 301.6112-1, and such Lender or Lenders, as applicable, will
maintain the lists and other records required by such Treasury Regulation.


 


ARTICLE V


 


COVENANTS


 


The Borrower agrees that, so long as any Lender has
any Commitment hereunder or any amount payable under any Note or any Letter of
Credit Liability remains unpaid:


 


5.01                           Information. 
The Borrower will deliver to the Administrative Agent (who shall
promptly distribute the same to the Lenders or advise the Lenders thereof):


 


(a)                                  as
soon as available and in any event within 90 days after the end of each fiscal
year of the Borrower, the consolidated balance sheet of the Borrower and its
Consolidated Subsidiaries as of the end of such fiscal year and the related
consolidated statements of income and cash flows for such fiscal year, setting
forth in each case in comparative form the figures as of the end of and for the
previous fiscal year, all reported on in a manner acceptable to the Securities
and Exchange Commission by Deloitte & Touche or other independent public
accountants of nationally recognized standing;


 


(b)                                 as
soon as available and in any event within 60 days after the end of each of the
first three quarters of each fiscal year of the Borrower, the consolidated
balance sheet of the Borrower and its Consolidated Subsidiaries as of the end
of such quarter and the related consolidated statements of income and cash
flows for such quarter and for the portion of the Borrower’s fiscal year ended
at the end of such quarter, setting forth in the case of such statements of
income and cash flows in comparative form the figures for the corresponding
quarter and the corresponding portion of the Borrower’s previous fiscal year,
all certified (subject to normal year-end adjustments) as to fairness of
presentation, generally accepted accounting principles and consistency by an
Authorized Officer;


 


(c)                                  simultaneously
with the delivery of each set of financial statements referred to in clauses
(a) and (b) above, a Compliance Certificate (i) setting forth in


 


33

















 


reasonable detail the calculations required to
establish whether the Borrower was in compliance with the requirements of
Sections 5.06, 5.10 and 5.11 on the date of such financial statements, and
(ii) stating whether any Default exists on the date of such Compliance
Certificate and, if any Default then exists, setting forth the details thereof
and the action which the Borrower is taking or proposes to take with respect
thereto;


 


(d)                                 simultaneously
with the delivery of each set of financial statements referred to in clause (a)
above, a statement of the firm of independent public accountants which reported
on such statements (i) whether anything has come to their attention to
cause them to believe that any Default existed on the date of such statements
and (ii) confirming the calculations set forth in the officer’s
certificate delivered simultaneously therewith;


 


(e)                                  as
soon as available and in any event not later than the last day of
February of each year, a completed Pricing Certificate as of
December 31 of the prior year;


 


(f)                                    within
five Domestic Business Days of any officer of the Borrower obtaining knowledge
of any Default, if such Default is then continuing, a certificate of an
Authorized Officer setting forth the details thereof and the action which the
Borrower is taking or proposes to take with respect thereto;


 


(g)                                 promptly
upon the mailing thereof to the shareholders of the Borrower generally, copies
of all financial statements, reports and proxy statements so mailed;


 


(h)                                 promptly
upon the filing thereof, copies of all registration statements (other than the
exhibits thereto and any registration statements on Form S-8 or its equivalent)
and reports on Forms 10-K, 10-Q and 8-K (or their equivalents) which the
Borrower shall have filed with the Securities and Exchange Commission;


 


(i)                                     if
and when any member of the ERISA Group (i) gives or is required to give
notice to the PBGC of any “reportable event” (as defined in Section 4043
of ERISA) with respect to any Plan which might constitute grounds for a
termination of such Plan under Title IV of ERISA, or knows that the plan
administrator of any Plan has given or is required to give notice of any such
reportable event, a copy of the notice of such reportable event given or
required to be given to the PBGC; (ii) receives notice of complete or
partial withdrawal liability under Title IV of ERISA or notice that any
Multiemployer Plan is in reorganization, is insolvent or has been terminated, a
copy of such notice; (iii) receives notice from the PBGC under Title IV of
ERISA of an intent to terminate, impose liability (other than for premiums
under Section 4007 of ERISA) in respect of, or appoint a trustee to
administer, any Plan, a copy of such notice; (iv) applies for a waiver of
the minimum funding standard under Section 412 of the Internal Revenue
Code, a copy of such application; (v) gives notice of intent to terminate
any Plan under Section 4041(c) of ERISA, a copy of such notice and other
information filed with the PBGC; (vi) gives notice of withdrawal from any
Plan pursuant to Section 4063 of ERISA, a copy of such notice; or
(vii) fails to make any payment or contribution to any Plan or
Multiemployer Plan or in respect of any Benefit Arrangement or makes any


 


34

















 


amendment to any Plan or
Benefit Arrangement which has resulted or could result in the imposition of a
Lien or the posting of a bond or other security, a certificate of the chief
financial officer or the chief accounting officer of the Borrower setting forth
details as to such occurrence and action, if any, which the Borrower or
applicable member of the ERISA Group is required or proposes to take;


 


(j)                                     forthwith,
notice of any change of which the Borrower becomes aware in the rating by
S&P or Moody’s, of the Borrower’s outstanding senior unsecured long-term
debt securities;


 


(k)                                  promptly
after the Borrower has notified the Administrative Agent of any intention by
the Borrower to treat the Loans as being a “reportable transaction” (within the
meaning of Treasury Regulation Section 1.6011-4) a duly completed copy of
IRS Form 8886 or any successor form; and


 


(l)                                     from
time to time such additional information regarding the financial position or
business of the Borrower and its subsidiaries as the Administrative Agent, at
the request of any Lender, may reasonably request.


 


5.02                           Maintenance of Property; Insurance.


 


(a)                                  The
Borrower will keep, and will cause each Significant Subsidiary to keep, all
property useful and necessary in its business in good working order and
condition, ordinary wear and tear excepted, except where failure to do so would
not have a material adverse effect on the business, financial position, results
of operations or prospects of the Borrower and its Consolidated Subsidiaries,
considered as a whole.


 


(b)                                 The
Borrower will, and will cause each of its Significant Subsidiaries to, maintain
(either in the name of the Borrower or in such Subsidiary’s own name) with
financially sound and responsible insurance companies, insurance on all their
respective properties in at least such amounts and against at least such risks
(and with such risk retention) as are usually insured against in the same
general area by companies of established repute engaged in the same or a
similar business and will furnish to the Lenders, upon request from the
Administrative Agent, information presented in reasonable detail as to the
insurance so carried.  Notwithstanding
the foregoing, the Borrower may self-insure with respect to such risks with
respect to which companies of established repute engaged in the same or similar
business in the same general area usually self-insure.


 


5.03                           Conduct of Business and Maintenance
of Existence.  The Borrower will
continue, and will cause each Significant Subsidiary to continue, to engage in
business of the same general type conducted by the Borrower and its Significant
Subsidiaries as of the Effective Date, and will preserve, renew and keep in
full force and effect, and will cause each Subsidiary to preserve, renew and
keep in full force and effect their respective corporate existence and their
respective rights, privileges and franchises necessary or desirable in the
normal conduct of business; provided that nothing in this Section 5.03
shall prohibit (i) the merger of a Subsidiary into the Borrower or the
merger or the consolidation of a Subsidiary with or into another Person if the


 


35

















 


corporation surviving such consolidation or merger is
a Subsidiary and if, in each case, after giving effect thereto, no Default
shall have occurred and be continuing or (ii) the termination of the
corporate existence of any Subsidiary if (A) the Borrower in good faith
determines that such termination is in the best interest of the Borrower and
(B) such termination is not materially disadvantageous to the Lenders.


 


5.04                           Compliance with Laws.  The Borrower will comply, and cause each
Significant Subsidiary to comply, in all material respects with all applicable
laws, ordinances, rules, regulations, and requirements of any Governmental
Agency (including, without limitation, Environmental Laws, Gaming Laws and
ERISA and, in each case, the rules and regulations thereunder) except where the
necessity of compliance therewith is contested in good faith by appropriate
proceedings.


 


5.05                           Inspection of Property, Books and
Records.  The Borrower will keep,
and will cause each Significant Subsidiary to keep, proper books of record and
account in which full, true and correct entries shall be made of all dealings
and transactions in relation to its business and activities; and will permit,
and will cause each Significant Subsidiary to permit, representatives of any
Lender at such Lender’s expense to visit and inspect any of their respective
properties, to examine and make abstracts from any of their respective books
and records and to discuss their respective affairs, finances and accounts with
their respective officers, employees and independent public accountants, all at
such reasonable times and as often as may reasonably be desired.


 


5.06                           Negative Pledge.  None of the Borrower, any Covered Subsidiary or any Significant
Subsidiary will create or assume any Lien on any asset now owned or hereafter
acquired by it, except:


 


(a)                                  Liens
existing as of the Effective Date;


 


(b)                                 any
Lien existing on any asset of any corporation at the time such corporation
becomes a Subsidiary and not created in contemplation of such event;


 


(c)                                  any
Lien on any asset securing Debt incurred or assumed for the purpose of
financing all or any part of the cost of acquiring or constructing such asset
(it being understood that, for this purpose, the acquisition of a Person is
also an acquisition of the assets of such Person); provided that the Lien
attaches to such asset concurrently with or within 180 days after the acquisition
thereof, or such longer period, not to exceed 12 months, due to the Borrower’s
inability to retain the requisite governmental approvals with respect to such
acquisition; provided further that, in the case of real estate, (i) the
Lien attaches within 12 months after the latest of the acquisition thereof, the
completion of construction thereon or the commencement of full operation
thereof and (ii) the Debt so secured does not exceed the sum of
(x) the purchase price of such real estate plus (y) the costs of such
construction;


 


(d)                                 Until
the date which is ninety days following the Effective Date, any Lien on shares
of any equity security or any warrant or option to purchase an equity security
or any security which is convertible into an equity security issued by any
Subsidiary of the


 


36

















 


Borrower that holds,
directly or indirectly through a holding company or otherwise, a license to
conduct gaming under any Gaming Law, and in the proceeds thereof; provided
that this clause shall apply only so long as the Gaming Laws of the relevant
jurisdiction provide that the creation of any restriction on the disposition of
any of such securities shall not be effective and, if such Gaming Laws at any
time cease to so provide, then this clause shall be of no further effect; and provided
further that if at any time the Borrower or any of its Subsidiaries
creates or suffers to exist a Lien covering such securities in favor of the
holder of any other Indebtedness, it will (subject to any approval required
under such Gaming Laws) concurrently grant a pari-passu Lien likewise covering
such securities in favor of the Administrative Agent for the benefit of the
Lenders;


 


(e)                                  any
Lien on any asset of any corporation or other business entity existing at the
time such corporation or other business entity is merged or consolidated with
or into the Borrower or a Subsidiary and not created in contemplation of such
event;


 


(f)                                    any
Lien existing on any asset prior to the acquisition thereof by the Borrower or
a Subsidiary and not created in contemplation of such acquisition;


 


(g)                                 any
Lien arising out of the refinancing, extension, renewal or refunding of any
Debt secured by any Lien permitted by any of the foregoing clauses of this
Section, provided that such Debt is not increased (other than to cover any
transaction costs of such refinancing, extension, renewal or refunding) and is
not secured by any additional assets;


 


(h)                                 Liens
securing Debt of a Subsidiary to the Borrower or another Subsidiary; and


 


(i)                                     Liens
not otherwise permitted by the foregoing clauses of this
Section encumbering assets of the Borrower and its Consolidated
Subsidiaries having an aggregate fair market value which is not in excess of
10% of Consolidated Net Tangible Assets (determined, in each case, by reference
to the most recent date for which the Borrower has delivered its financial
statements under Section 5.01(a)).


 


5.07                           Consolidations, Mergers and Sales of Assets.  The Borrower and its Subsidiaries will not
(i) consolidate or merge with or into any other Person or (ii) sell,
lease or otherwise transfer all or any substantial part of the assets of the
Borrower and its Subsidiaries, taken as a whole, to any other Person, or (iii)
acquire all or substantially all of the assets of, or more than 49% of the
capital stock or other equity securities of, any Person which is not engaged in
the same general lines of business as the Borrower and its Subsidiaries, if,
giving effect to such consolidation, merger, sale or acquisition, the Borrower
is not in pro forma compliance with the covenants set forth in Sections 5.10
and 5.11; provided that, notwithstanding the foregoing, the Borrower may merge
with another Person only if (A) the Borrower is the corporation surviving
such merger, and (B) immediately after giving effect to such merger, no
Default shall have occurred and be continuing.


 


5.08                           Hostile Tender Offers.  The Borrower and its Subsidiaries will not
make any offer to purchase or acquire, or prosecute, pursue or consummate a purchase
or acquisition of, 5% or more of the capital stock of any corporation or other
business entity, if the board of directors or


 


37

















 


other equivalent governing body of such corporation or
business entity has notified Borrower or its relevant Subsidiaries that it
opposes such offer or purchase and such notice has not been withdrawn or
superseded.


 


5.09                           Use of Proceeds. 
The proceeds of the Loans made under this Agreement will be used by the
Borrower for general corporate purposes, including but not limited to, on the
Availability Date, to refinance obligations then outstanding under the Five
Year Credit Agreement.  None of such
proceeds will be used, directly or indirectly, for the purpose, whether immediate,
incidental or ultimate, of buying or carrying any “margin stock” within the
meaning of Regulation U other than “margin stock” issued by the Borrower which
is retired upon purchase or for any purpose which violates Section 5.08.


 


5.10                           Leverage Ratio. 
The Leverage Ratio will not, as of the last day of any fiscal quarter of
the Borrower described in the matrix below, exceed the ratio set forth opposite
that fiscal quarter:


 


	
  Fiscal
  Quarters Ending

  	
   

  	
  Maximum Ratio

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  September 30,
  2003 through and including June 30, 2004

  	
   

  	
  5.25:1.00

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  September 30,
  2004 through and including March 31, 2005

  	
   

  	
  5.00:1.00

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  June 30,
  2005

  	
   

  	
  4.75:1.00

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  Later
  Fiscal Quarters

  	
   

  	
  4.50:1.00

  	
   

  



 


5.11                           Interest Coverage Ratio.  The Interest Coverage Ratio shall not, as of
the last day of any fiscal quarter of the Borrower, be less than 2.75:1.00.


 


ARTICLE VI


 


DEFAULTS


 


6.01                           Events of Default.  If one or more of the following events (“Events of Default”)
shall have occurred and be continuing:


 


(a)                                  the
Borrower shall fail to (i) reimburse any drawing under any Letter of Credit
when required hereunder or (ii) pay when due any principal of any Loan or Swing
Line Loan under this Agreement, or (iii) pay within five days of the due date
thereof any other interest, fees or other amount payable hereunder;


 


(b)                                 the
Borrower shall fail to observe or perform any covenant contained in
Sections 5.06 to 5.11, inclusive;


 


(c)                                  the
Borrower shall fail to observe or perform any covenant or agreement contained
in this Agreement (other than those covered by clause (a) or (b) above) for 7
days after written notice thereof has been given to the Borrower by the
Administrative


 


38

















 


Agent, which
notice shall be delivered to the Borrower by the Administrative Agent at the
request of any Lender;


 


(d)                                 any
representation, warranty, certification or statement made or deemed made by the
Borrower in this Agreement or in any certificate, financial statement or other
document delivered pursuant to this Agreement shall prove to have been
incorrect in any material respect when made (or deemed made);


 


(e)                                  the
Borrower or any Covered Subsidiary or any Significant Subsidiary shall fail to
make any payment in respect of any Debt (other than the Notes and Non-Recourse
Debt) when due or within any applicable grace period and the aggregate
principal amount of such Debt is in excess of $100,000,000;


 


(f)                                    any
event or condition shall occur which results in the acceleration of the
maturity of any Debt (other than Non-Recourse Debt) in excess of
$100,000,000 of the Borrower or any Covered Subsidiary or any Significant
Subsidiary or enables or entitles the holder of such Debt or any Person acting
on such holder’s behalf to accelerate the maturity thereof;


 


(g)                                 the
Borrower or any Significant Subsidiary shall commence a voluntary case or other
proceeding seeking liquidation, reorganization or other relief with respect to
itself or its debts under any bankruptcy, insolvency or other similar law now
or hereafter in effect or seeking the appointment of a trustee, receiver,
liquidator, custodian or other similar official of it or any substantial part
of its property, or shall consent to any such relief or to the appointment of
or taking possession by any such official in an involuntary case or other
proceeding commenced against it, or shall make a general assignment for the
benefit of creditors, or shall fail generally to pay its debts as they become
due, or shall take any corporate action to authorize any of the foregoing;


 


(h)                                 an
involuntary case or other proceeding shall be commenced against the Borrower or
any Significant Subsidiary seeking liquidation, reorganization or other relief
with respect to it or its debts under any bankruptcy, insolvency or other
similar law now or hereafter in effect or seeking the appointment of a trustee,
receiver, liquidator, custodian or other similar official of it or any
substantial part of its property, and such involuntary case or other proceeding
shall remain undismissed and unstayed for a period of 60 days; or an order for
relief shall be entered against the Borrower or any Significant Subsidiary
under the federal bankruptcy laws as now or hereafter in effect;


 


(i)                                     any
member of the ERISA Group shall fail to pay when due an amount or amounts
aggregating in excess of $5,000,000 which it shall have become liable to pay
under Title IV of ERISA; or notice of intent to terminate a Material Plan shall
be filed under Title IV of ERISA by any member of the ERISA Group, any plan
administrator or any combination of the foregoing; or the PBGC shall institute
proceedings under Title IV of ERISA to terminate, to impose liability (other
than for premiums under Section 4007 of ERISA) in respect of, or to cause
a trustee to be appointed to administer, any Material Plan; or a condition
shall exist by reason of which the PBGC would be entitled to obtain a decree
adjudicating that any Material Plan must be terminated; or there shall occur a


 


39

















 


complete or partial
withdrawal from, or a default, within the meaning of Section 4219(c)(5) of
ERISA, with respect to, one or more Multiemployer Plans which could cause one
or more members of the ERISA Group to incur a current payment obligation in
excess of $25,000,000;


 


(j)                                     a
judgment or order for the payment of money in excess of $25,000,000 shall be
rendered against the Borrower or any Subsidiary and such judgment or order
shall continue unsatisfied and unstayed for a period of 30 days; or


 


(k)                                  the
occurrence of a License Revocation with respect to a license issued to the
Borrower or any of its Subsidiaries by any Gaming Board of the States of
Mississippi, New Jersey or Nevada with respect to gaming operations at any
gaming facility accounting for five percent (5%) or more of the consolidated
gross revenues of the Borrower and its Subsidiaries that continues for thirty
calendar days;


 


then, and in every such event, the Administrative
Agent shall (i) if requested by the Required Lenders, by notice to the
Borrower terminate the Commitments and they shall thereupon terminate, and
(ii) if requested by the Required Lenders, by notice to the Borrower
declare the Loans and the Letter of Credit Liabilities (together with accrued
interest thereon) to be, and the Loans (together with accrued interest thereon)
shall thereupon become, immediately due and payable without presentment,
demand, protest or other notice of any kind, all of which are hereby waived by
the Borrower; provided that in the case of any of the Events of Default
specified in clause (g) or (h) above with respect to the Borrower, without any
notice to the Borrower or any other act by the Administrative Agent or the
Lenders, the Commitments shall thereupon terminate and the Loans and the Letter
of Credit Liabilities (together with accrued interest thereon) shall become
immediately due and payable without presentment, demand, protest or other
notice of any kind, all of which are hereby waived by the Borrower.


 


6.02                           Notice of Default.  The Administrative Agent shall give notice to the Borrower under
Section 6.01(c) promptly upon being requested to do so by any Lender and
shall thereupon notify all the Lenders thereof.


 


6.03                           Cash Cover. 
The Borrower agrees, in addition to the provisions of Section 6.01
hereof, that upon the occurrence and during the continuance of any Event of
Default, it shall, if requested by the Administrative Agent upon the
instruction of the Required Lenders, pay to the Administrative Agent an amount
in immediately available funds (which funds shall be held as collateral
pursuant to arrangements satisfactory to the Administrative Agent) equal to the
aggregate amount available for drawing under all Letters of Credit then
outstanding at such time, provided that, upon the occurrence of any Event of
Default specified in Section 6.01(g) or 6.01(h) with respect to the
Borrower or any of its Significant Subsidiaries, the Borrower shall pay such
amount forthwith without any notice or demand or any other act by the
Administrative Agent or the Lenders.


 


40

















 


ARTICLE VII


 


THE  ADMINISTRATIVE AGENT


 


7.01                           Appointment and Authorization of
Administrative Agent.


 


(a)                                  Each
Lender hereby irrevocably appoints, designates and authorizes the
Administrative Agent to take such action on its behalf under the provisions of
this Agreement and each other Loan Document and to exercise such powers and
perform such duties as are expressly delegated to it by the terms of this
Agreement or any other Loan Document, together with such powers as are reasonably
incidental thereto.  Notwithstanding any
provision to the contrary contained elsewhere herein or in any other Loan
Document, the Administrative Agent shall not have any duties or
responsibilities, except those expressly set forth herein, nor shall the Administrative
Agent have or be deemed to have any fiduciary relationship with any Lender or
participant, and no implied covenants, functions, responsibilities, duties,
obligations or liabilities shall be read into this Agreement or any other Loan
Document or otherwise exist against the Administrative Agent.  Without limiting the generality of the
foregoing sentence, the use of the term “agent” herein and in the other Loan
Documents with reference to the Administrative Agent is not intended to connote
any fiduciary or other implied (or express) obligations arising under agency
doctrine of any applicable law. 
Instead, such term is used merely as a matter of market custom, and is
intended to create or reflect only an administrative relationship between
independent contracting parties.


 


(b)                                 The
Issuing Lender shall act on behalf of the Lenders with respect to any Letters
of Credit issued by it and the documents associated therewith, and the Issuing
Lender shall have all of the benefits and immunities (i) provided to the
Administrative Agent in this Article VII with respect to any acts
taken or omissions suffered by the Issuing Lender in connection with Letters of
Credit issued by it or proposed to be issued by it and the applications and
agreements for letters of credit pertaining to such Letters of Credit as fully
as if the term “Administrative Agent” as used in this Article VII
and in the definition of “Agent-Related Person” included the Issuing Lender
with respect to such acts or omissions, and (ii) as additionally provided
herein with respect to the Issuing Lender.


 


7.02                           Delegation of Duties.  The Administrative Agent may execute any of
its duties under this Agreement or any other Loan Document by or through
agents, employees or attorneys-in-fact and shall be entitled to advice of
counsel and other consultants or experts concerning all matters pertaining to
such duties.  The Administrative Agent
shall not be responsible for the negligence or misconduct of any agent or attorney-in-fact
that it selects in the absence of gross negligence or willful misconduct.


 


7.03                           Liability of Administrative Agent.  No Agent-Related Person shall (a) be liable
to any Lender for any action taken or omitted to be taken by any of them under
or in connection with this Agreement or any other Loan Document or the
transactions contemplated hereby (except for its own gross negligence or
willful misconduct in connection with its duties expressly set forth herein),
or (b) be responsible in any manner to any Lender or Participant for any recital,


 


41

















 


statement, representation or warranty made by the
Borrower or any officer thereof, contained herein or in any other Loan
Document, or in any certificate, report, statement or other document referred
to or provided for in, or received by the Administrative Agent under or in
connection with, this Agreement or any other Loan Document, or the validity,
effectiveness, genuineness, enforceability or sufficiency of this Agreement or
any other Loan Document, or for any failure of the Borrower or any other party
to any Loan Document to perform its obligations hereunder or thereunder.  No Agent-Related Person shall be under any
obligation to any Lender or Participant to ascertain or to inquire as to the
observance or performance of any of the agreements contained in, or conditions
of, this Agreement or any other Loan Document, or to inspect the properties,
books or records of the Borrower or any Affiliate thereof.


 


7.04                           Reliance by Administrative Agent.


 


(a)                                  The
Administrative Agent shall be entitled to rely, and shall be fully protected in
relying, upon any writing, communication, signature, resolution,
representation, notice, consent, certificate, affidavit, letter, telegram,
facsimile, telex or telephone message, electronic mail message, statement or
other document or conversation believed by it to be genuine and correct and to
have been signed, sent or made by the proper Person or Persons, and upon advice
and statements of legal counsel (including counsel to the Borrower),
independent accountants and other experts selected by the Administrative
Agent.  The Administrative Agent shall
be fully justified in failing or refusing to take any action under any Loan
Document unless it shall first receive such advice or concurrence of the
Required Lenders as it deems appropriate and, if it so requests, it shall first
be indemnified to its satisfaction by the Lenders against any and all liability
and expense which may be incurred by it by reason of taking or continuing to take
any such action.  The Administrative
Agent shall in all cases be fully protected in acting, or in refraining from
acting, under this Agreement or any other Loan Document in accordance with a
request or consent of the Required Lenders (or such greater number of Lenders
as may be expressly required hereby in any instance) and such request and any
action taken or failure to act pursuant thereto shall be binding upon all the
Lenders.


 


(b)                                 For
purposes of determining compliance with the conditions specified in
Section 3.02, each Lender that has signed this Agreement shall be deemed
to have consented to, approved or accepted or to be satisfied with, each
document or other matter required thereunder to be consented to or approved by
or acceptable or satisfactory to a Lender unless the Administrative Agent shall
have received notice from such Lender prior to the proposed Effective Date
specifying its objection thereto.


 


7.05                           Notice of Default.  The Administrative Agent shall not be deemed to have
knowledge or notice of the occurrence of any Default, except with respect to
defaults in the payment of principal, interest and fees required to be paid to
the Administrative Agent for the account of the Lenders, unless the
Administrative Agent shall have received written notice from a Lender or the
Borrower referring to this Agreement, describing such Default and stating that
such notice is a “notice of default.” 
The Administrative Agent will notify the Lenders of its receipt of any
such notice.  The Administrative Agent
shall take such action with respect to such Default as may be directed by the
Required Lenders in accordance with Article VIII; provided, however,
that unless and until the Administrative Agent has received any such direction,
the


 


42

















 


Administrative Agent may (but shall not be obligated
to) take such action, or refrain from taking such action, with respect to such
Default as it shall deem advisable or in the best interest of the Lenders.


 


7.06                           Credit Decision; Disclosure of Information by
Administrative Agent.  Each Lender
acknowledges that neither any Agent nor any Agent-Related Person has made any
representation or warranty to it, and that no act by the Administrative Agent
or any other Agent hereafter taken, including any consent to and acceptance of
any assignment or review of the affairs of the Borrower or any Affiliate
thereof, shall be deemed to constitute any representation or warranty by any
Agent or Agent-Related Person to any Lender as to any matter, including whether
such Agent or Agent-Related Persons have disclosed material information in
their possession.  Each Lender
represents to the Administrative Agent that it has, independently and without
reliance upon any Agent or Agent-Related Person and based on such documents and
information as it has deemed appropriate, made its own appraisal of and
investigation into the business, prospects, operations, property, financial and
other condition and creditworthiness of the Borrower and its Subsidiaries, and
all applicable bank or other regulatory laws relating to the transactions
contemplated hereby, and made its own decision to enter into this Agreement and
to extend credit to the Borrower hereunder. 
Each Lender also represents that it will, independently and without
reliance upon any Agent or Agent-Related Person and based on such documents and
information as it shall deem appropriate at the time, continue to make its own
credit analysis, appraisals and decisions in taking or not taking action under
this Agreement and the other Loan Documents, and to make such investigations as
it deems necessary to inform itself as to the business, prospects, operations,
property, financial and other condition and creditworthiness of the Borrower.  Except for notices, reports and other
documents expressly required to be furnished to the Lenders by the
Administrative Agent herein, neither the Administrative Agent nor any other
Agent shall have any duty or responsibility to provide any Lender with any
credit or other information concerning the business, prospects, operations,
property, financial and other condition or creditworthiness of the Borrower or
any of its Affiliates which may come into the possession of any Agent or
Agent-Related Person.


 


7.07                           Indemnification of Administrative
Agent.  Whether or not the
transactions contemplated hereby are consummated, the Lenders shall indemnify
upon demand each Agent-Related Person (to the extent not reimbursed by or on
behalf of the Borrower and without limiting the obligation of the Borrower to
do so), pro rata, and hold harmless each Agent-Related Person from and against
any and all Indemnified Liabilities incurred by it; provided, however,
that no Lender shall be liable for the payment to any Agent-Related Person of
any portion of such Indemnified Liabilities to the extent determined in a
final, nonappealable judgment by a court of competent jurisdiction to have
resulted from such Agent-Related Person’s own gross negligence or willful
misconduct; provided, however, that no action taken in accordance
with the directions of the Required Lenders shall be deemed to constitute gross
negligence or willful misconduct for purposes of this Section.  Without limitation of the foregoing, each
Lender shall reimburse the Administrative Agent upon demand for its ratable
share of any costs or out-of-pocket expenses (including Attorney Costs)
incurred by the Administrative Agent in connection with the preparation,
execution, delivery, administration, modification, amendment or enforcement
(whether through negotiations, legal proceedings or otherwise) of, or legal
advice in respect of rights or responsibilities under, this Agreement, any
other Loan Document, or any document contemplated by or referred to herein, to
the extent that the Administrative Agent is


 


43

















 


not reimbursed for such expenses by or on behalf of
the Borrower.  The undertaking in this
Section shall survive termination of the Commitments, the payment of all
other Obligations and the resignation of the Administrative Agent.


 


7.08                           Administrative Agent in its
Individual Capacity.  Bank of
America and its Affiliates may make loans to, issue letters of credit for the
account of, accept deposits from, acquire equity interests in and generally
engage in any kind of banking, trust, financial advisory, underwriting or other
business with the Borrower and its Affiliates as though Bank of America were
not the Administrative Agent or Issuing Lender hereunder and without notice to
or consent of the Lenders.  The Lenders
acknowledge that, pursuant to such activities, Bank of America or its
Affiliates may receive information regarding the Borrower or its Affiliates
(including information that may be subject to confidentiality obligations in
favor of the Borrower or such Affiliate) and acknowledge that the
Administrative Agent shall be under no obligation to provide such information
to them.  With respect to its Loans,
Bank of America shall have the same rights and powers under this Agreement as
any other Lender and may exercise such rights and powers as though it were not
the Administrative Agent, and the terms “Lender” and “Lenders” include Bank of
America in its individual capacity.


 


7.09                           Successor Administrative Agent.  The Administrative Agent may resign as
Administrative Agent upon 30 days’ notice to the Lenders; provided that any
such resignation by Bank of America shall also constitute its resignation as
Issuing Lender and Swing Line Lender. 
If the Administrative Agent resigns under this Agreement, the Required
Lenders shall appoint from among the Lenders a successor administrative agent
for the Lenders, which successor administrative agent shall be consented to by
the Borrower at all times other than during the existence of an Event of
Default (which consent of the Borrower shall not be unreasonably withheld or
delayed).  If no successor
administrative agent is appointed prior to the effective date of the
resignation of the Administrative Agent, the Administrative Agent may appoint,
after consulting with the Lenders and the Borrower, a successor administrative
agent from among the Lenders.  Upon the
acceptance of its appointment as successor administrative agent hereunder, the
Person acting as such successor administrative agent shall succeed to all the
rights, powers and duties of the retiring Administrative Agent, Issuing Lender
and Swing Line Lender and the respective terms “Administrative Agent”, “Issuing
Lender” and “Swing Line Lender” shall mean such successor administrative agent,
Issuing Lender and Swing Line Lender and the retiring Administrative Agent’s
appointment, powers and duties as Administrative Agent shall be terminated and
the retiring Issuing Lender’s and Swing Line Lender’s rights, powers and duties
as such shall be terminated, without any other or further act or deed on the
part of such retiring Issuing Lender or Swing Line Lender or any other Lender,
other than the obligation of the successor Issuing Lender to issue letters of
credit in substitution for the Letters of Credit, if any, outstanding at the
time of such succession or to make other arrangements satisfactory to the
retiring Issuing Lender to effectively assume the obligations of the retiring
Issuing Lender with respect to such Letters of Credit.  After any retiring Administrative Agent’s
resignation hereunder as Administrative Agent, the provisions of this Article VII
and Section 9.03 shall inure to its benefit as to any actions taken or
omitted to be taken by it while it was Administrative Agent under this
Agreement.  If no successor
administrative agent has accepted appointment as Administrative Agent by the
date which is 30 days following a retiring Administrative Agent’s notice of
resignation, the retiring Administrative Agent’s resignation shall nevertheless
thereupon become effective and the Lenders shall perform all of the duties of
the Administrative


 


44

















 


Agent hereunder until such time, if any, as the
Required Lenders appoint a successor agent as provided for above.


 


7.10                           Administrative Agent May File
Proofs of Claim.  In case of the
pendency of any receivership, insolvency, liquidation, bankruptcy,
reorganization, arrangement, adjustment, composition or other judicial
proceeding relative to the Borrower, the Administrative Agent (irrespective of
whether the principal of any Loan or Letter of Credit Liabilities shall then be
due and payable as herein expressed or by declaration or otherwise and
irrespective of whether the Administrative Agent shall have made any demand on
the Borrower) shall be entitled and empowered, by intervention in such
proceeding or otherwise


 


(a)                                  to
file and prove a claim for the whole amount of the principal and interest owing
and unpaid in respect of the Loans, Letter of Credit Liabilities and all other
Obligations that are owing and unpaid and to file such other documents as may
be necessary or advisable in order to have the claims of the Lenders and the
Administrative Agent (including any claim for the reasonable compensation,
expenses, disbursements and advances of the Lenders and the Administrative
Agent and their respective agents and counsel and all other amounts due the
Lenders and the Administrative Agent under Section 9.03) allowed in such
judicial proceeding; and


 


(b)                                 to
collect and receive any monies or other property payable or deliverable on any
such claims and to distribute the same;


 


and any custodian, receiver, assignee, trustee,
liquidator, sequestrator or other similar official in any such judicial
proceeding is hereby authorized by each Lender to make such payments to the
Administrative Agent and, in the event that the Administrative Agent shall
consent to the making of such payments directly to the Lenders, to pay to the
Administrative Agent any amount due for the reasonable compensation, expenses,
disbursements and advances of the Administrative Agent and its agents and
counsel, and any other amounts due the Administrative Agent under
Section 9.03.


 


Nothing contained herein shall be deemed to authorize
the Administrative Agent to authorize or consent to or accept or adopt on
behalf of any Lender any plan of reorganization, arrangement, adjustment or
composition affecting the Obligations or the rights of any Lender or to
authorize the Administrative Agent to vote in respect of the claim of any
Lender in any such proceeding.


 


7.11                           Other Agents; Arrangers and Managers.  None of the Lenders or other Persons
identified on the facing page or signature pages of this Agreement as a
“syndication agent,” “co-documentation agents,” “joint book manager,” or “joint
lead arranger” shall have any right, power, obligation, liability,
responsibility or duty under this Agreement other than, in the case of such
Lenders, those applicable to all Lenders as such.  Without limiting the foregoing, none of the Lenders or other
Persons so identified shall have or be deemed to have any fiduciary
relationship with any Lender.  Each
Lender acknowledges that it has not relied, and will not rely, on any of the
Lenders or other Persons so identified in deciding to enter into this Agreement
or in taking or not taking action hereunder. 
None of the Lenders or Agents shall be under any obligation to any other
Lender or any Participant to ascertain or to inquire as to the observance or


 


45

















 


performance of any of the agreements contained in, or
conditions of, this Agreement or any other Loan Document, or to inspect the
properties, books or records of the Borrower or any Affiliate thereof.  Each Agent and its Affiliates may make loans
to, issue letters of credit for the account of, accept deposits from, acquire
equity interests in and generally engage in any kind of banking, trust,
financial advisory, underwriting or other business with the Borrower and its
Affiliates as though such Agent were not an Agent hereunder and without notice
to or consent of the Lenders.  The
Lenders acknowledge that, pursuant to such activities, such Agent or its
Affiliates may receive information regarding the Borrower or its Affiliates
(including information that may be subject to confidentiality obligations in
favor of the Borrower or such Affiliate) and acknowledge that such Agent shall
be under no obligation to provide such information to them.  With respect to its Loans, such Agent, if
also a Lender hereunder, shall have the same rights and powers under this
Agreement as any other Lender and may exercise such rights and powers as though
it were not an Agent, and the terms “Lender” and “Lenders” include such Agent
in its individual capacity.


 


ARTICLE VIII


 


CHANGE IN CIRCUMSTANCES


 


8.01                           Basis for Determining Interest Rate
Inadequate or Unfair.  If on or
prior to the first day of any Interest Period for any Borrowing of Euro-Dollar
Loans:


 


(a)                                  the
Administrative Agent is advised by the Required Lenders that deposits in
Dollars and in the required amounts are not being offered to the Lenders in the
relevant market for such Interest Period, or


 


(b)                                 in
the case of a Committed Borrowing, Lenders having 50% or more of the aggregate
amount of the Commitments advise the Administrative Agent that the Euro-Dollar
Rate, as determined by the Administrative Agent, will not adequately and fairly
reflect the cost to such Lenders of funding their Euro-Dollar Loans for such
Interest Period,


 


the Administrative Agent shall forthwith give notice
thereof to the Borrower and the Lenders, whereupon until the Administrative
Agent notifies the Borrower that the circumstances giving rise to such
suspension no longer exist, the obligations of the Lenders to make Euro-Dollar
Loans shall be suspended.  Unless the
Borrower notifies the Administrative Agent at least two Domestic Business Days
before the date of any Borrowing of Euro-Dollar Loans for which a Notice of
Borrowing has previously been given that it elects not to borrow on such date,
such Borrowing shall instead be made as a Base Rate Borrowing.  The Administrative Agent shall promptly
notify the Lenders of any election by the Borrower pursuant to the preceding
sentence.


 


8.02                           Illegality. 
If, on or after the date of this Agreement, the adoption of any
applicable law, rule or regulation, or any change in any applicable law, rule
or regulation, or any change in the interpretation or administration thereof by
any governmental authority, central bank or comparable agency charged with the
interpretation or administration thereof, or compliance by any Lender (or its
Euro-Dollar Lending Office) with any request or directive (whether or not
having the force of law) of any such authority, central bank or comparable


 


46

















 


agency shall make it unlawful or impossible for any
Lender (or its Euro-Dollar Lending Office) to make, maintain or fund its
Euro-Dollar Loans and such Lender shall so notify the Administrative Agent, the
Administrative Agent shall forthwith give notice thereof to the other Lenders
and the Borrower, whereupon until such Lender notifies the Borrower and the
Administrative Agent that the circumstances giving rise to such suspension no
longer exist, the obligation of such Lender to make Euro-Dollar Loans shall be
suspended.  Before giving any notice to
the Administrative Agent pursuant to this Section, such Lender shall designate
a different Euro-Dollar Lending Office if such designation will avoid the need
for giving such notice and will not, in the sole judgment of such Lender, be
otherwise disadvantageous to such Lender. 
If such Lender shall determine that it may not lawfully continue to
maintain and fund any of its outstanding Euro-Dollar Loans to maturity and
shall so specify in such notice, the Borrower shall immediately prepay in full
the then outstanding principal amount of each such Euro-Dollar Loan, together
with accrued interest thereon. 
Concurrently with prepaying each such Euro-Dollar Loan, the Borrower
shall borrow a Base Rate Loan in an equal principal amount from such Lender (on
which interest and principal shall be payable contemporaneously with the
related Euro-Dollar Loans of the other Lenders), and such Lender shall make
such a Base Rate Loan.


 


8.03                           Increased Cost and Reduced Return.


 


(a)                                  If
on or after the date hereof, in the case of any Committed Loan or Letter of
Credit or any obligation to make Committed Loans or issue or participate in any
Letter of Credit, the adoption of any applicable law, rule or regulation, or
any change in any applicable law, rule or regulation, or any change in the
interpretation or administration thereof by any governmental authority, central
bank or comparable agency charged with the interpretation or administration
thereof, or compliance by any Lender (or its Applicable Lending Office) with
any request or directive (whether or not having the force of law) of any such
authority, central bank or comparable agency:


 


(i)                                     shall
subject any Lender (or its Applicable Lending Office) to any tax, duty or other
charge with respect to its Euro-Dollar Loans, its Note or its obligation to
make Euro-Dollar Loans or its obligations hereunder in respect of Letters of
Credit, or shall change the basis of taxation of payments to any Lender (or its
Applicable Lending Office) of the principal of or interest on its Euro-Dollar
Loans or any other amounts due under this Agreement in respect of its
Euro-Dollar Loans or its obligation to make Euro-Dollar Loans (except for
changes in the rate of tax on the overall net income of such Lender or its
Applicable Lending Office imposed by the jurisdiction in which such Lender’s
principal executive office or Applicable Lending Office is located); or


 


(ii)                                  shall
impose, modify or deem applicable any reserve (including, without limitation,
any such requirement imposed by the Board of Governors of the Federal Reserve
System, but excluding, with respect to any Euro-Dollar Loan any such
requirement included in an applicable Euro-Dollar Reserve Percentage), special deposit,
insurance assessment or similar requirement against assets of, deposits with or
for the account of, or credit extended by, any Lender (or its Applicable
Lending Office) or shall impose on any Lender (or its Applicable 


 


47

















 


Lending Office) or on the
United States market for certificates of deposit or the London interbank market
any other condition affecting its Euro-Dollar Loans, its Note or its obligation
to make Euro-Dollar Loans or its obligations hereunder in respect to Letters of
Credit;


 


and the result of any of the foregoing is to increase
the cost to such Lender (or its Applicable Lending Office) of making or
maintaining any Euro-Dollar Loan or of issuing or participating in any Letter
of Credit, or to reduce the amount of any sum received or receivable by such
Lender (or its Applicable Lending Office) under this Agreement or under its
Note with respect thereto, by an amount deemed by such Lender to be material,
then, within 15 days after demand by such Lender (with a copy to the
Administrative Agent), the Borrower shall pay to such Lender such additional
amount or amounts as will compensate such Lender for such increased cost or
reduction.


 


(b)                                 If,
after the date hereof, any Lender shall have determined that any applicable
law, rule or regulation regarding capital adequacy (irrespective of the actual
timing of the adoption or implementation thereof and including, without
limitation, any law or regulation adopted pursuant to the July 1988 report
of the Basle Committee on Banking Regulations and Supervisory Practices) or any
change therein, or any change in the interpretation or administration thereof
by any governmental authority, central bank or comparable agency charged with
the interpretation or administration thereof, or compliance by any Lender (or
its Applicable Lending Office) with any request or directive regarding capital
adequacy (whether or not having the force of law) of any such authority,
central bank or comparable agency, has or would have the effect of reducing the
rate of return on capital of such Lender (or its Parent) as a consequence of
such Lender’s obligations hereunder to a level below that which such Lender (or
its Parent) could have achieved but for such law, regulation, change or compliance
(taking into consideration its policies with respect to capital adequacy) by an
amount deemed by such Lender to be material, then from time to time, within 15
days after demand by such Lender (with a copy to the Administrative Agent), the
Borrower shall pay to such Lender such additional amount or amounts as will
compensate such Lender (or its Parent) for such reduction.


 


(c)                                  Each
Lender will promptly notify the Borrower and the Administrative Agent of any
event of which it has knowledge, occurring after the date hereof, which will
entitle such Lender to compensation pursuant to this Section and will
designate a different Applicable Lending Office if such designation will avoid
the need for, or reduce the amount of, such compensation and will not, in the
sole judgment of such Lender, be otherwise disadvantageous to such Lender.  A certificate of any Lender claiming
compensation under this Section and setting forth the additional amount or
amounts to be paid to it hereunder shall be conclusive in the absence of
manifest error.  In determining such
amount, such Lender may use any reasonable averaging and attribution methods.


 


8.04                           Base Rate Loans Substituted for
Affected Euro-Dollar Loans.  If
(i) the obligation of any Lender to make Euro-Dollar Loans has been
suspended pursuant to Section 8.02 or (ii) any Lender has demanded
compensation under Section 8.03(a) and the Borrower shall, by at least
five Euro-Dollar Business Days, prior notice to such Lender through the
Administrative


 


48

















 


Agent, have elected that the provisions of this
Section shall apply to such Lender, then, unless and until such Lender
notifies the Borrower that the circumstances giving rise to such suspension or
demand for compensation no longer exist:


 


(a)                                  all
Loans which would otherwise be made by such Lender as Euro-Dollar Loans shall
be made instead as Base Rate Loans (on which interest and principal shall be
payable contemporaneously with the related Euro-Dollar Loans of the other Lenders),
and


 


(b)                                 after
each of its Euro-Dollar Loans has been repaid, all payments of principal which
would otherwise be applied to repay such Euro-Dollar Loans shall be applied to
repay its Base Rate Loans instead.


 


ARTICLE IX


 


MISCELLANEOUS


 


9.01                           Notices.  Unless
otherwise expressly provided herein, all notices and other communications
provided for hereunder shall be in writing (including by facsimile
transmission).  All such written notices
shall be mailed, faxed or delivered to the applicable address, facsimile number
or (subject to subsection (d) below) electronic mail address, and all
notices and other communications expressly permitted hereunder to be given by
telephone shall be made to the applicable telephone number, as follows:


 


(a)                                  if
to the Borrower, the Administrative Agent, the Issuing Lender or the Swing Line
Lender to the address, facsimile number, electronic mail address or telephone
number specified for such Person on its signature page hereto or to such other
address, facsimile number, electronic mail address or telephone number as shall
be designated by such party in a notice to the other parties; and


 


(b)                                 if
to any other Lender, to the address, facsimile number, electronic mail address
or telephone number specified in its Administrative Questionnaire or to such
other address, facsimile number, electronic mail address or telephone number as
shall be designated by such party in a notice to the Borrower, the
Administrative Agent, the Issuing Lender and the Swing Line Lender.


 


All such notices and other communications shall be
deemed to be given or made upon the earlier to occur of (i) actual receipt by
the relevant party hereto and (ii) (A) if delivered by hand or by courier, when
signed for by or on behalf of the relevant party hereto; (B) if delivered by
mail, four Business Days after deposit in the mails, postage prepaid; (C) if
delivered by facsimile, when sent and receipt has been confirmed by telephone;
and (D) if delivered by electronic mail (which form of delivery is subject to
the provisions of subsection (c) below), when delivered; provided, however,
that notices and other communications to the Administrative Agent, the Issuing
Lender and the Swing Line Lender pursuant to Article II shall not
be effective until actually received by such Person.  In no event shall a voicemail message be effective as a notice,
communication or confirmation hereunder.


 


49

















 


(c)                                  Loan
Documents may be transmitted and/or signed by facsimile.  The effectiveness of any such documents and
signatures shall, subject to applicable law, have the same force and effect as
manually-signed originals and shall be binding on all parties hereto.  The Administrative Agent may also require that
any such documents and signatures be confirmed by a manually-signed original
thereof; provided, however, that the failure to request or deliver the same
shall not limit the effectiveness of any facsimile document or signature.


 


(d)                                 Electronic
mail and Internet and intranet websites may be used only to distribute routine
communications, such as financial statements and other information as provided
in Section 5.01, and to distribute Loan Documents for execution by the
parties thereto, and may not be used for any other purpose.


 


(e)                                  The
Administrative Agent and the Lenders shall be entitled to rely and act upon any
notices (including telephonic Notices of Borrowing) purportedly given by or on
behalf of the Borrower even if (i) such notices were not made in a manner
specified herein, were incomplete or were not preceded or followed by any other
form of notice specified herein, or (ii) the terms thereof, as understood by
the recipient, varied from any confirmation thereof.  The Borrower shall indemnify each Agent-Related Person and each
Lender from all losses, costs, expenses and liabilities resulting from the
reliance by such Person on each notice purportedly given by or on behalf of the
Borrower.  All telephonic notices to and
other communications with the Administrative Agent may be recorded by the
Administrative Agent, and each of the parties hereto hereby consents to such
recording.


 


9.02                           No Waivers. 
No failure or delay by the Administrative Agent or any Lender in
exercising any right, power or privilege hereunder or under any Note shall
operate as a waiver thereof nor shall any single or partial exercise thereof
preclude any other or further exercise thereof or the exercise of any other
right, power or privilege.  The rights
and remedies herein provided shall be cumulative and not exclusive of any
rights or remedies provided by law.


 


9.03                           Expenses; Documentary Taxes;
Indemnification.


 


(a)                                  The
Borrower agrees (a) to pay or reimburse the Administrative Agent for all
reasonable costs and expenses incurred in connection with the development,
preparation, negotiation and execution of this Agreement and the other Loan
Documents and any amendment, waiver, consent or other modification of the
provisions hereof and thereof (whether or not the transactions contemplated
hereby or thereby are consummated), and the consummation and administration of
the transactions contemplated hereby and thereby, including all Attorney Costs,
and (b) to pay or reimburse the Administrative Agent and each Lender for all
reasonable costs and expenses incurred after an Event of Default in connection
with the enforcement, attempted enforcement, or preservation of any rights or
remedies under this Agreement or the other Loan Documents (including all such
costs and expenses incurred after an Event of Default during any “workout” or restructuring
in respect of the Obligations and during any legal proceeding, including any
proceeding under any Debtor Relief Law), including all Attorney Costs.  The foregoing costs and expenses shall
include all search, filing,


 


50

















 


recording, title
insurance and appraisal charges and fees and taxes related thereto, and other
out-of-pocket expenses incurred by the Administrative Agent and the cost of
independent public accountants and other outside experts retained by the
Administrative Agent or any Lender.  All
amounts due under this Section 9.03(a) shall be payable within ten
Business Days after demand therefor. 
The agreements in this Section shall survive the termination of the
Commitments and repayment of all other Obligations.


 


(b)                                 Whether
or not the transactions contemplated hereby are consummated, the Borrower shall
indemnify and hold harmless each Agent-Related Person, each Lender and their
respective Affiliates, directors, officers, employees, counsel, agents and
attorneys-in-fact (collectively the “Indemnitees”) from and against any and all
liabilities, obligations, losses, damages, penalties, claims, demands, actions,
judgments, suits, costs, expenses and disbursements (including Attorney Costs)
of any kind or nature whatsoever which may at any time be imposed on, incurred
by or asserted against any such Indemnitee in any way relating to or arising
out of or in connection with (a) the execution, delivery, enforcement,
performance or administration of any Loan Document or any other agreement,
letter or instrument delivered in connection with the transactions contemplated
thereby or the consummation of the transactions contemplated thereby, (b) any
Commitment, Loan or Letter of Credit or the use or proposed use of the proceeds
therefrom (including any refusal by the Issuing Lender to honor a demand for
payment under a Letter of Credit if the documents presented in connection with
such demand do not strictly comply with the terms of such Letter of Credit), or
(c) any actual or prospective claim, litigation, investigation or proceeding
relating to any of the foregoing, whether based on contract, tort or any other
theory (including any investigation of, preparation for, or defense of any
pending or threatened claim, investigation, litigation or proceeding) and
regardless of whether any Indemnitee is a party thereto (all the foregoing,
collectively, the “Indemnified Liabilities”) provided that such indemnity shall
not, as to any Indemnitee, be available to the extent that such liabilities,
obligations, losses, damages, penalties, claims, demands, actions, judgments,
suits, costs, expenses or disbursements are determined by a court of competent
jurisdiction by final and nonappealable judgment to have resulted from the
gross negligence or willful misconduct of such Indemnitee.  No Indemnitee shall be liable for any
damages arising from the use by others of any information or other materials
obtained through IntraLinks or other similar information transmission systems
in connection with this Agreement, nor shall any Indemnitee have any liability
for any indirect or consequential damages relating to this Agreement or any
other Loan Document or arising out of its activities in connection herewith or
therewith (whether before or after the Effective Date).  All amounts due under this
Section 9.03(b) shall be payable within ten Business Days after demand
therefor.  The agreements in this Section shall
survive the resignation of the Administrative Agent, the replacement of any
Lender, the termination of the Commitments and the repayment, satisfaction or
discharge of all the other Obligations.


 


9.04                           Amendments and Waivers.  No amendment or waiver of any provision of
this Agreement or any other Loan Document, and no consent to any departure by
the Borrower therefrom, shall be effective unless in writing signed by the
Required Lenders and the Borrower, and acknowledged by the Administrative
Agent, and each such waiver or consent shall be


 


51

















 


effective only in the specific instance and for the
specific purpose for which given; provided, however, that no such amendment,
waiver or consent shall:


 


(a)                                  waive
any condition set forth in Section 3.02 without the written consent of
each Lender;


 


(b)                                 extend
or increase the Commitment of any Lender (or reinstate any Commitment
terminated pursuant to Section 6.01) without the written consent of such
Lender;


 


(c)                                  postpone
any date fixed by this Agreement or any other Loan Document for any scheduled
payment of principal, interest, fees or other amounts due to the Lenders (or
any of them) or waive or excuse any such payment or postpone any scheduled
reduction of the Commitments hereunder or under any other Loan Document without
the written consent of each Lender directly affected thereby;


 


(d)                                 reduce
the principal of, or the rate of interest specified herein on, any Loan or
(subject to clause (ii) of the second proviso to this Section 9.04) any
fees or other amounts payable hereunder or under any other Loan Document
without the written consent of each Lender directly affected thereby;


 


(e)                                  change
Section 9.10 in a manner that would alter the pro rata sharing of payments
required thereby without the written consent of each Lender;


 


(f)                                    amend
Section 2.23 without the written consent of the Borrower, the
Administrative Agent and Lenders holding Commitments aggregating / at least 662/3%
of the aggregate amount of the Commitments; or


 


(g)                                 change
any provision of this Section or the definition of “Required Lenders” or
any other provision hereof specifying the number or percentage of Lenders
required to amend, waive or otherwise modify any rights hereunder or make any
determination or grant any consent hereunder, without the written consent of
each Lender;


 


and, provided  further, that (i) no
amendment, waiver or consent shall, unless in writing and signed by the Issuing
Lender in addition to the Lenders required above, affect the rights or duties
of the Issuing Lender under this Agreement or any Letter of Credit application
relating to any Letter of Credit issued or to be issued by it; (ii) no
amendment, waiver or consent shall, unless in writing and signed by the Swing
Line Lender in addition to the Lenders required above, affect the rights or
duties of the Swing Line Lender under this Agreement; (iii) no amendment,
waiver or consent shall, unless in writing and signed by the Administrative
Agent in addition to the Lenders required above, affect the rights or duties of
the Administrative Agent under this Agreement or any other Loan Document; (iv)
Section 9.05(h) may not be amended, waived or otherwise modified without
the consent of each Granting Lender all or any part of whose Loans are being
funded by an SPC at the time of such amendment, waiver or other modification;
and (v) any fee letter may be amended, or rights or privileges thereunder
waived, in a writing executed only by the parties thereto.


 


52

















 


9.05                           Successors and Assigns.


 


(a)                                  The
provisions of this Agreement shall be binding upon and inure to the benefit of
the parties hereto and their respective successors and assigns permitted
hereby, except that the Borrower may not assign or otherwise transfer any of
its rights or obligations hereunder without the prior written consent of each
Lender and no Lender may assign or otherwise transfer any of its rights or
obligations hereunder except (i) to an Eligible Assignee in accordance with the
provisions of subsection (b) of this Section, (ii) by way of participation
in accordance with the provisions of subsection (d) of this Section, (iii)
by way of pledge or assignment of a security interest subject to the
restrictions of subsection (f) or (i) of this Section, or (iv) to an SPC
in accordance with the provisions of subsection (h) of this
Section (and any other attempted assignment or transfer by any party
hereto shall be null and void).  Nothing
in this Agreement, expressed or implied, shall be construed to confer upon any
Person (other than the parties hereto, their respective successors and assigns
permitted hereby, Participants to the extent provided in subsection (d) of
this Section and, to the extent expressly contemplated hereby, the
Indemnitees) any legal or equitable right, remedy or claim under or by reason
of this Agreement.  Each Lender
represents that it is not acquiring its Note with a view to the distribution
thereof within the meaning of the Securities Act of 1933, as amended.


 


(b)                                 Any
Lender may at any time assign to one or more Eligible Assignees all or a
portion of its rights and obligations under this Agreement (including all or a
portion of its Commitments and its Loans (including for purposes of this
subsection (b), participations in Letter of Credit  Liabilities and in Swing Line Loans) at the
time owing to it); provided that (i) except in the case of an assignment
of the entire remaining amount of the assigning Lender’s Commitment and Loans
at the time owing to it or in the case of an assignment to a Lender or an
Affiliate of a Lender or an Approved Fund (as defined in subsection (g) of
this Section) with respect to a Lender, the aggregate amount of the Commitment
(which for this purpose includes Loans outstanding thereunder) subject to each
such assignment, determined as of the date the Assignment Agreement with
respect to such assignment is delivered to the Administrative Agent or, if
“Trade Date” is specified in the Assignment Agreement, as of the Trade Date,
shall not be less than $1,000,000 unless each of the Administrative Agent and,
so long as no Default has occurred and is continuing, the Borrower otherwise
consents (each such consent not to be unreasonably withheld or delayed); (ii)
each partial assignment shall be made as an assignment of a proportionate part
of all the assigning Lender’s rights and obligations under this Agreement with
respect to the Loans or the Commitment assigned, except that this clause (ii)
shall not apply to rights in respect of Swing Line Loans; (iii) any assignment
of a Revolving Commitment must be approved by the Administrative Agent, the
Issuing Lender and the Swing Line Lender and, as long as no Default has
occurred and is continuing, the Borrower (each such consent not to be
unreasonably withheld or delayed) unless the Person that is the proposed
assignee is itself a Lender (whether or not the proposed assignee would
otherwise qualify as an Eligible Assignee); (iv) any assignment of Term
Loans or a Term Loan Commitment must be approved by the Administrative Agent
and, so long as no Default has occurred and is continuing, the Borrower (each
such consent not to be unreasonably withheld or delayed) unless the Person that
is the proposed assignee is itself a Lender (whether or not the proposed


 


53

















 


assignee would otherwise qualify
as an Eligible Assignee); and (v) the parties to each assignment shall execute
and deliver to the Administrative Agent an Assignment Agreement, together with
a processing and recordation fee of $3,500. 
Subject to acceptance and recording thereof by the Administrative Agent
pursuant to subsection (c) of this Section, from and after the effective
date specified in each Assignment Agreement, the Eligible Assignee thereunder
shall be a party to this Agreement and, to the extent of the interest assigned
by such Assignment Agreement, have the rights and obligations of a Lender under
this Agreement, and the assigning Lender thereunder shall, to the extent of the
interest assigned by such Assignment Agreement, be released from its
obligations under this Agreement (and, in the case of an Assignment Agreement
covering all of the assigning Lender’s rights and obligations under this
Agreement, such Lender shall cease to be a party hereto but shall continue to
be entitled to the benefits of Sections 2.15, 2.18, 8.03 and 9.03 with respect
to facts and circumstances occurring prior to the effective date of such
assignment).  Upon request, the Borrower
(at its expense) shall execute and deliver a Note to the assignee Lender.  Any assignment or transfer by a Lender of
rights or obligations under this Agreement that does not comply with this
subsection shall be treated for purposes of this Agreement as a sale by
such Lender of a participation in such rights and obligations in accordance
with subsection (d) of this Section.


 


(c)                                  The
Administrative Agent, acting solely for this purpose as an agent of the
Borrower, shall maintain at the Administrative Agent’s Office a copy of each
Assignment Agreement delivered to it and a register for the recordation of the
names and addresses of the Lenders, and the Commitments of, and principal
amounts of the Loans and Letter of Credit Liabilities owing to, each Lender
pursuant to the terms hereof from time to time (the “Register”).  The entries in the Register shall be
conclusive, and the Borrower, the Administrative Agent and the Lenders may
treat each Person whose name is recorded in the Register pursuant to the terms
hereof as a Lender hereunder for all purposes of this Agreement,
notwithstanding notice to the contrary. 
The Register shall be available for inspection by the Borrower and any
Lender, at any reasonable time and from time to time upon reasonable prior
notice.


 


(d)                                 Any
Lender may at any time, without the consent of, or notice to, the Borrower or
the Administrative Agent, sell participations to any Person (other than a
natural person, Borrower or any of Borrower’s Affiliates or Subsidiaries)
(each, a “Participant”) in all or a portion of such Lender’s rights
and/or obligations under this Agreement (including all or a portion of its
Commitment and/or Loans (including such Lender’s participations in Letter of
Credit Liabilities and/or Swing Line Loans) owing to it)); provided that
(i) such Lender’s obligations under this Agreement shall remain unchanged, (ii)
such Lender shall remain solely responsible to the other parties hereto for the
performance of such obligations and (iii) the Borrower, the Administrative
Agent and the other Lenders shall continue to deal solely and directly with
such Lender in connection with such Lender’s rights and obligations under this
Agreement.  Any agreement or instrument
pursuant to which a Lender sells such a participation shall provide that such
Lender shall retain the sole right to enforce this Agreement and to approve any
amendment, modification or waiver of any 
provision of this Agreement; provided that such agreement or
instrument may provide that such Lender will not,


 


54

















 


without the consent of
the Participant, agree to any amendment, waiver or other modification described
in subsections (c) or (d) of Section 9.04 that directly affects such
Participant.


 


(e)                                  A
Participant shall not be a Lender hereunder for any purpose except, if
the participation agreement so provides, for the purposes of Sections 2.18,
8.03 and 9.03 but only to the extent that the cost of such benefits to the
Borrower does not exceed the cost which the Borrower would have incurred in
respect of such Lender absent the participation.


 


(f)                                    Any
Lender may at any time pledge or assign a security interest in all or any
portion of its rights under this Agreement (including under its Note, if any)
to secure obligations of such Lender, including any pledge or assignment to
secure obligations to a Federal Reserve Bank; provided that no such
pledge or assignment shall release such Lender from any of its obligations
hereunder or substitute any such pledgee or assignee for such Lender as a party
hereto.


 


(g)                                 As
used herein, the following terms have the following meanings:


 


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


 


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


 


(h)                                 Notwithstanding
anything to the contrary contained herein, any Lender (a “Granting Lender”) may
grant to a special purpose funding vehicle identified as such in writing from
time to time by the Granting Lender to the Administrative Agent and Borrower
(an “SPC”) the option to provide all or any part of any Loan that such
Granting Lender would otherwise be obligated to make pursuant to this
Agreement; provided that (i) nothing herein shall constitute a
commitment by any SPC to fund any Loan, and (ii) if an SPC elects not to
exercise such option or otherwise fails to make all or any part of such Loan,
the Granting Lender shall be obligated to make such Loan pursuant to the terms
hereof.  Each party hereto hereby agrees
that (i) neither the grant to any SPC nor the exercise by any SPC of such
option shall increase the costs or expenses or otherwise increase or change the
obligations of the Borrower under this Agreement (including their obligations
under Sections 2.18 and 8.03), (ii) no SPC shall be liable for any
indemnity or similar payment obligation under this Agreement for which a Lender
would be liable, and (iii) the Granting Lender shall for all purposes,
including the approval of any amendment, waiver or other modification of any
provision of any Loan Document, remain the lender of record hereunder.  The making of a Loan by an SPC hereunder
shall utilize the Commitment of the Granting Lender to the same extent, and as
if, such Loan were made by such Granting Lender.  In furtherance of the foregoing, each party hereto hereby agrees
(which agreement shall survive the termination of this Agreement) that, prior to
the date that is one year and one day after the payment in full of all
outstanding


 


55

















 


commercial paper or other
senior debt of any SPC, it will not institute against, or join any other Person
in instituting against, such SPC any bankruptcy, reorganization, arrangement,
insolvency, or liquidation proceeding under the laws of the United States or
any State thereof with respect to matters directly related to this
Agreement.  Notwithstanding anything to
the contrary contained herein, any SPC may (i) with notice to, but without
prior consent of the Borrower and the Administrative Agent, assign all or any
portion of its right to receive payment with respect to any Loan to the
Granting Lender and (ii) disclose on a confidential basis any non-public
information relating to its funding of Loans to any rating agency, commercial
paper dealer or provider of any surety or guarantee or credit or liquidity
enhancement to such SPC.


 


(i)                                     Notwithstanding
anything to the contrary contained herein, any Lender that is a Fund may create
a security interest in all or any portion of the Loans owing to it and the
Note, if any, held by it to the trustee for holders of obligations owed, or
securities issued, by such Fund as security for such obligations or securities,
provided that unless and until such trustee actually becomes a Lender in
compliance with the other provisions of this Section 9.05, (i) no such
pledge shall release the pledging Lender from any of its obligations under the
Loan Documents and (ii) such trustee shall not be entitled to exercise any of
the rights of a Lender under the Loan Documents even though such trustee may
have acquired ownership rights with respect to the pledged interest through
foreclosure or otherwise.


 


(j)                                     Notwithstanding
anything to the contrary herein, the rights of the Lenders to make assignment
of, and grant participations in, their Commitments shall be subject to the
approval of any Gaming Board, to the extent required by applicable Gaming Laws.


 


(k)                                  Notwithstanding
anything to the contrary contained herein, if at any time Bank of America
assigns all of its Commitments and Loans pursuant to subsection (b) above,
Bank of America may, (i) upon 30 days’ notice to the Borrower and the Lenders,
resign as Issuing Lender and/or (ii) upon 30 days’ notice to the Borrower,
resign as Swing Line Lender.  In the
event of any such resignation as Issuing Lender or Swing Line Lender, the
Borrower shall be entitled to appoint from among the Lenders a successor Issuing
Lender or Swing Line Lender hereunder; provided, however, that no
failure by the Borrower to appoint any such successor shall affect the
resignation of Bank of America as Issuing Lender or Swing Line Lender, as the
case may be.  If Bank of America resigns
as Issuing Lender, it shall retain all the rights and obligations of the
Issuing Lender hereunder with respect to all Letters of Credit outstanding as
of the effective date of its resignation as Issuing Lender and all Letter of
Credit Liabilities with respect thereto (including the right to require the
Lenders to fund risk participations in drawn Letters of Credit pursuant to
Section 2.12(e)).  If Bank of
America resigns as Swing Line Lender, it shall retain all the rights of the
Swing Line Lender provided for hereunder with respect to Swing Line Loans made
by it and outstanding as of the effective date of such resignation, including
the right to require the Lenders to make Committed Revolving Loans or fund risk
participations in outstanding Swing Line Loans pursuant to
Section 2.05(e).


 


56

















 


9.06                           Collateral. 
Each of the Lenders represents to each Agent and each of the other
Lenders that it in good faith is not relying upon any “margin stock” (as
defined in Regulation U) as collateral in the extension or maintenance of the
credit provided for in this Agreement.


 


9.07                           California Law; Submission to
Jurisdiction.  This Agreement
and each Note shall be construed in accordance with and governed by the laws of
the State of California.  The Borrower
hereby submits to the nonexclusive jurisdiction of the United States District
Court for the Central District of California and of any California State court
sitting in Los Angeles, California for purposes of all legal proceedings
arising out of or relating to this Agreement or the transactions contemplated
hereby.  The Borrower irrevocably,
waives, to the fullest extent permitted by law, any objection which it may now
or hereafter have to the laying of the venue of any such proceeding brought in
such a court and any claim that any such proceeding brought in such a court has
been brought in an inconvenient forum.


 


9.08                           Counterparts; Integration.  This Agreement may be signed in any number
of counterparts, each of which shall be an original, with the same effect as if
the signatures thereto and hereto were upon the same instrument.  This Agreement constitutes the entire
agreement and understanding among the parties hereto and supersedes any and all
prior agreements and understandings, oral or written, relating to the subject
matter hereof.


 


9.09                           Several Obligations.  The obligations of the Lenders hereunder are
several.  Neither the failure of any
Lender to carry out its obligations hereunder nor the failure of this Agreement
to be duly authorized, executed and delivered by any Lender shall relieve any
other Lender of its obligations hereunder (or affect the rights hereunder of
such other Lender).  No Lender shall be
responsible for the obligations of, or any action taken or omitted by, any
other Lender hereunder.


 


9.10                           Sharing of Set-Offs.  Each Lender agrees that if it shall, by exercising any right of
set-off or counterclaim or otherwise, receive payment of a proportion of the
aggregate amount of principal and interest due with respect to any Note held by
it and any Letter of Credit Liabilities which is greater than the proportion
received by any other Lender in respect of the aggregate amount of principal
and interest due with respect to any Note and any Letter of Credit Liabilities
held by such other Lender, the Lender receiving such proportionately greater
payment shall purchase such participations in the Notes and Letter of Credit
Liabilities held by the other Lenders, and such other adjustments shall be
made, as may be required so that all such payments of principal and interest
with respect to the Notes and Letter of Credit Liabilities held by the Lenders
shall be shared by the Lenders pro rata; provided that nothing in this
Section shall impair the right of any Lender to exercise any right of
set-off or counterclaim it may have and to apply the amount subject to such
exercise to the payment of indebtedness of the Borrower other than its
indebtedness under the Notes.  The
Borrower agrees, to the fullest extent it may effectively do so under
applicable law, that any holder of a participation in a Note or Letter of
Credit Liability, whether or not acquired pursuant to the foregoing
arrangements, may exercise rights of set-off or counterclaim and other rights
with respect to such participation as fully as if such holder of a
participation were a direct creditor of the Borrower in the amount of such
participation.


 


57

















 


9.11                           WAIVER OF JURY TRIAL.  EACH OF THE BORROWER, THE AGENTS AND THE
LENDERS HEREBY IRREVOCABLY WAIVES ANY AND ALL RIGHT TO TRIAL BY JURY IN ANY
LEGAL PROCEEDING ARISING OUT OF OR RELATING TO THIS AGREEMENT OR THE
TRANSACTIONS CONTEMPLATED HEREBY.


 


9.12                           Confidentiality.  The Lenders hereby agree to hold any confidential information
that they may receive from the Borrower or its Subsidiaries pursuant to this
Agreement in confidence, except for disclosure:  (a) to their respective Affiliates and to other parties to this
Agreement; (b) to legal counsel and accountants for any such party; (c) to
other professional advisors to any such party, provided that the recipient has
accepted such information subject to a confidentiality agreement substantially
similar to this paragraph or has notified such professional advisors of the confidentiality
of such information; (d) to regulatory officials having jurisdiction over that
Lender; (e) to any Gaming Board; (f) as required by law or legal process
(provided that the Lender shall endeavor, to the extent it may do so under
applicable law, to give the Borrower reasonable prior notice thereof to allow
the Borrower to seek a protective order) or in connection with any legal
proceeding to which that Lender and the Borrower are adverse parties; and
(g) to another financial institution (or a professional advisor thereof)
in connection with any swap, securitization or derivative transaction relating
to or involving any of the rights or obligations of that Lender under this
Agreement or to another financial institution in connection with a disposition
or proposed disposition to that financial institution of all or part of that
Lender’s interests hereunder or a participation interest in its Note, provided
in each case that the recipient has accepted such information subject to a
confidentiality agreement substantially similar to this Section.  For purposes of the foregoing, “confidential
information” shall mean any information respecting the Borrower or its
Subsidiaries reasonably considered by them to be confidential, other than (i)
information previously filed with any governmental agency and available to the
public, (ii) information previously published in any public medium from a
source other than, directly or indirectly, that Lender, and
(iii) information previously disclosed by the Borrower or its Subsidiaries
to any person not associated therewith without a confidentiality agreement
substantially similar to this Section. 
Notwithstanding anything herein to the contrary, “confidential
information” shall not include, and the Borrower, the Administrative Agent and
each Lender (and each authorized employee, representative, or other authorized
person thereof) may disclose to any and all Persons, without limitation of any
kind, the “tax treatment” and “tax structure” (in each case, within the meaning
of Treasury Regulation Section 1.6011-4) of the transactions contemplated
hereby and all materials of any kind (including opinions or other tax analyses)
that are provided to the Borrower, the Administrative Agent or such Lender
relating to such tax treatment and tax structure; provided that with
respect to any document or similar item that in either case contains
information concerning the tax treatment or tax structure of the transaction as
well as other information, this sentence shall only apply to such portions of
the document or similar item that relate to the tax treatment or tax structure
of the Loans and transactions contemplated hereby.  Nothing in this Section shall be construed to create or give
rise to any fiduciary duty on the part of any Lender.


 


[Remainder of this
page intentionally left blank]


 


58

















 


IN WITNESS WHEREOF, the Borrower, the Administrative
Agent and the Lenders have caused this Agreement to be duly executed by their
respective authorized officers as of the day and year first above written.


 


	
   

  	
  PARK PLACE
  ENTERTAINMENT CORPORATION

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
  Name:

  	
   

  	
   

  
	
   

  	
  Title:

  	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  Address for
  Notices:

  
	
   

  	
  Park Place
  Entertainment Corporation

  
	
   

  	
  3930 Howard
  Hughes Parkway, 4th Floor

  
	
   

  	
  Las Vegas,
  Nevada  89109

  
	
   

  	
  Attn:  Chief Financial Officer

  
	
   

  	
  Telephone:  702/699-5030

  
	
   

  	
  Telecopier:  702/699-5190

  
	
   

  	
   

  
	
   

  	
  With a copy
  to:

  
	
   

  	
  Park Place
  Entertainment Corporation

  
	
   

  	
  3930 Howard
  Hughes Parkway, 4th Floor

  
	
   

  	
  Las Vegas,
  Nevada 89109

  
	
   

  	
  Attn:  Chief Legal Officer

  
	
   

  	
  Telephone:  702/699-5033

  
	
   

  	
  Telecopier:  702/699-5110

  



 

















 


	
   

  	
  BANK OF
  AMERICA, N.A., as Administrative Agent,

  Issuing Lender and Swing Line Lender

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
  Name:

  	
   

  	
   

  
	
   

  	
  Title:

  	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  Address for Notices:

  
	
   

  	
  Bank of America, N.A.

  
	
   

  	
  Gaming and Leisure
  Industries Group

  
	
   

  	
  Portfolio Management -
  CA9-706-17-54

  
	
   

  	
  555 South Flower
  Street, 17th Floor

  
	
   

  	
  Los Angeles,
  California  90071

  
	
   

  	
  Attn:  Janice Hammond, Vice President

  
	
   

  	
  Telecopier:  (213) 345-1213

  
	
   

  	
  Telephone:  (213) 345-1210

  
	
   

  	
   

  
	
   

  	
  BANK OF
  AMERICA, N.A., as a Lender

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
  Name:

  	
   

  	
   

  
	
   

  	
  Title:

  	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  Address for
  Notices:

  
	
   

  	
  Bank of
  America, N.A.

  
	
   

  	
  Gaming and
  Leisure Industries Group

  
	
   

  	
  Portfolio
  Management - CA9-706-17-54

  
	
   

  	
  555 South
  Flower Street, 17th Floor

  
	
   

  	
  Los Angeles,
  California  90071

  
	
   

  	
  Attn:  Matthew J. Koenig, Managing Director

  
	
   

  	
  Telecopier:  (213) 345-1215

  
	
   

  	
  Telephone:  (213) 345-1198

  
	
   

  	
   

  
	
   

  	
  With a copy
  to:

  
	
   

  	
  Bank of
  America, N.A.

  
	
   

  	
  Gaming and
  Leisure Industries Group

  
	
   

  	
  Client
  Management - CA9-706-17-54

  
	
   

  	
  555 South
  Flower Street, 17th Floor

  
	
   

  	
  Los Angeles,
  California  90071

  
	
   

  	
  Attn:  William S. Newby, Managing Director

  
	
   

  	
  Telecopier:  (213) 345-1214

  
	
   

  	
  Telephone:  (213) 345-1194

  
					



 

















 


SCHEDULE 1


Pricing Schedule –
First Amended and Restated Multi-Year Credit Facility


 


This Schedule 1 is attached to and made a part of
the First Amended and Restated Multi-Year Credit Agreement dated as of
August 12, 2003, among Park Place Entertainment Corporation, a Delaware
corporation, the Lenders, Syndication Agent and Documentation Agent referred to
therein, Bank of America, N.A., as Administrative Agent, and Banc of America
Securities LLC and J.P. Morgan Securities Inc. as Joint Lead Arrangers and
Joint Book Managers (the “Credit Agreement”). 
Capitalized terms used in this Schedule 1 are used with the
meanings set forth for those terms in the Credit Agreement.


 


The “Euro-Dollar Margin,” “Base Rate Margin,”
“Facility Fee Rate” and “LC Fee Rate” referred to in the Credit Agreement shall
be determined for any day on the basis of the Status (as defined below) of the
Borrower as of that date, provided that in the event that the Borrower
fails to deliver any Compliance Certificate or Pricing Certificate on the date
when required by Section 5.01, and it is ultimately determined that the
Status of Borrower would have been changed on the basis of such delivery, then
(a) the rate at which interest, facility fees, and letter of credit fees accrue
under the Credit Agreement shall be increased in accordance with this Schedule,
with retroactive effect to the first day of the Pricing Period to which such
Compliance Certificate or Pricing Certificate relates, and (b) Borrower shall,
within 10 Business Days of a request by the Administrative Agent, make such
additional payments to the Lenders through the Administrative Agent as are
required to give effect to such increased interest rates, facility fees and
letter of credit fees in respect of any payments previously made by
Borrower.  As of each date of
determination, the Euro-Dollar Margin, Facility Fee Rates and LC Fee Rates
shall equal the percentages set forth below under the column corresponding to
the Status that exists on such day, provided that the Euro-Dollar Margin
shall be increased or decreased by the “Margin Adjustment” described below:


 


	
  Status

  	
   

  	
  Level I

  	
   

  	
  Level II

  	
   

  	
  Level III

  	
   

  	
  Level IV

  	
   

  	
  Level V

  	
   

  	
  Level VI

  	
   

  
	
  Facility
  Fee Rate

  	
   

  	
  0.100

  	
  %

  	
  0.125

  	
  %

  	
  0.150

  	
  %

  	
  0.200

  	
  %

  	
  0.250

  	
  %

  	
  0.300

  	
  %

  
	
  Euro-Dollar
  Margin

  	
   

  	
  0.500

  	
  %

  	
  0.625

  	
  %

  	
  0.850

  	
  %

  	
  0.925

  	
  %

  	
  1.125

  	
  %

  	
  1.450

  	
  %

  
	
  LC
  Fee Rate

  	
   

  	
  0.600

  	
  %

  	
  0.750

  	
  %

  	
  1.000

  	
  %

  	
  1.125

  	
  %

  	
  1.375

  	
  %

  	
  1.750

  	
  %

  



 


The “Base Rate Margin” shall, as of each date of
determination, be the percentage, not less than 0.000% per annum, which is
equal to then prevailing Euro-Dollar Margin (after adjustment upwards or
downwards by the Margin Adjustment), minus 1.250%


 


As of each date of determination, the Status of the
Borrower shall be determined on the basis of:


 


(a)                                  the
Borrower’s Debt Rating as of that date; or


 


(b)                                 the
Leverage Ratio as of the last day of the fiscal quarter of Borrower ending
immediately prior to the first day of the Pricing Period in which such date of
determination occurs (the “Applicable Leverage Ratio”);


 


1

















 


whichever such criteria yields the more favorable
pricing to the Borrower according to the following standards:


 


“Level I Status” exists at any date if, at such date,
either (x) the Debt Rating assigned by S&P is A- or higher or the Debt
Rating assigned by Moody’s is A3 or higher, or (y) the Applicable Leverage
Ratio is less than 1.50:1.


 


“Level II Status” exists at any date if, at such date,
(i) either (x) the Debt Rating assigned by S&P is BBB+ or higher
or the Debt Rating assigned by Moody’s is Baa1 or higher, or (y) the
Applicable Leverage Ratio is less than 2.25:1 and (ii) Level I Status does
not exist.


 


“Level III Status” exists at any date, if, at such
date, (i) either (x) the Debt Rating assigned by S&P is BBB or
higher or the Debt Rating assigned by Moody’s is Baa2 or higher, or
(y) the Applicable Leverage Ratio is less than 3.00:1 and
(ii) neither Level I Status nor Level II Status exists.


 


“Level IV Status” exists at any date, if, at such
date, (i) either (x) the Debt Rating Assigned by S&P is BBB- or
higher or the Debt Rating assigned by Moody’s is Baa3 or higher, or
(y) the Applicable Leverage Ratio is less than 3.75 and (ii) none of
Level I Status, Level II Status or Level III Status exists.


 


“Level V Status” exists at any date, if, at such date,
(i) either (x) the Debt Rating assigned by S&P is BB+ or higher
or the Debt Rating assigned by Moody’s is Ba1 or higher or (y) the Applicable
Leverage Ratio is less than 4.25:1 and (ii) none of Level I Status, Level
II Status, Level III Status or Level IV Status exists.


 


“Level VI Status” exists at any date if, at such date,
no such other Status exists.


 


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


 


“Margin Adjustment” means, (a) as of any date of
determination when the Applicable Leverage Ratio is in excess of 3.50:1 but
equal to or less than 4.00:1, an incremental interest margin of 0.075% per
annum to be added to the Euro-Dollar Margin in determining the rate applicable
to Euro-Dollar Loans, (b) as of any date of determination when the Applicable
Leverage Ratio is in excess of 4.00:1 but equal to or less than 4.75:1, an
incremental interest margin of 0.150% per annum to be added to the Euro-Dollar
Margin in determining the rate applicable to Euro-Dollar Loans, (c) as of any
date of determination when the Applicable Leverage Ratio is in excess of 4.75:1,
an incremental interest margin of 0.225% per annum to be added to the
Euro-Dollar Margin in determining the rate applicable to Euro-Dollar Loans, and
(d) as of any date of determination when the Applicable Leverage Ratio is less
than 2.00:1, a deduction of 0.075% per annum to be subtracted from the
Euro-Dollar Margin in determining the rate applicable to Euro-Dollar Loans.


 


“Debt Rating” means, as of any date of determination,
the rating assigned by the Rating Agencies to the senior unsecured long-term
debt securities of the Borrower without third-party credit enhancement (and any
rating assigned to any other debt security of the Borrower shall be
disregarded) as of the close of business on such date, provided that
(a) if such securities receive a


 


2

















 


split-rating and the rating differential is one level,
the higher of the two ratings will apply (e.g. 
A-/Baa1 results in Level I Status and A-/Baa2 results in Level II
Status), and (b) if the Borrower is split-rated and the ratings differential is
more than one level, the average of the two ratings (or the higher of any two
intermediate ratings) shall be used (e.g. 
A-/Baa2 results in Level II Status, as does A-/Baa3).


 


3