Exhibit 10.8


 


DEED OF TRUST,
ASSIGNMENT OF

RENTS AND LEASES, FIXTURE FILING AND SECURITY AGREEMENT

(FEE AND LEASEHOLD)

(Nevada)


 


THIS DEED OF
TRUST, ASSIGNMENT OF RENTS AND LEASES, FIXTURE FILING AND SECURITY AGREEMENT
(FEE AND LEASEHOLD) (as amended, supplemented or otherwise modified from time
to time, this “Deed of Trust”) is
dated as of January 23, 2004 and is made by and from GNLV, CORP., a Nevada corporation (“Grantor”), whose address is 129 E. Fremont Street, Las Vegas,
NV 89101 to NEVADA TITLE COMPANY,
a Nevada corporation (“Trustee”),
with an address at 2500 North Buffalo, Suite #150, Las Vegas, Nevada 89128 for
the benefit of WELLS FARGO BANK, N.A.,
a national banking association organized under the laws of the United States of
America, in its capacity as Collateral Agent for the Holders and the Indenture
Trustee (the “Agent”) pursuant to
the Indenture (as defined below), having an address at Corporate Trust
Services, Sixth Street and Marquette Avenue, MAC N9303-120, Minneapolis, MN
55479, Attn: Jane Y. Schweiger (Agent, together with its successors and
assigns, is referred to herein as  “Beneficiary”).


 


RECITALS:


 


WHEREAS, Grantor
is the owner of (i) a fee estate in the real property described in Exhibit
A-1 attached hereto and (ii) leasehold estates in the real property
described in Exhibit A-2 attached hereto, pursuant to the ground leases
set forth in Exhibit B attached hereto (referred to herein collectively
as the “Ground Leases” and each
individually as a “Ground Lease”).


 


WHEREAS, Poster
Financial Group, Inc. (referred to herein as the context requires as “Parent”), the Guarantors under the
Indenture, (including Parent’s subsidiary, Grantor) and HSBC Bank USA, as
trustee (the “Indenture Trustee”), have entered into that certain Indenture
dated as of December 3, 2003 (as amended, supplemented or otherwise
modified heretofore or hereinafter from time to time, the “Indenture”), which Indenture
provides for the issuance of certain 8 3/4% Senior Secured Notes due 2011 (the
Initial Notes together with all Additional Notes and Exchange Notes, the “Notes”).  The Indenture requires Grantor to grant this
Deed of Trust to Trustee for the benefit of the Agent to secure the due and
punctual payment of all principal and interest under the Notes and the Guarantees
and the performance of all other obligations of Parent and the Guarantors to
the Holders or the Indenture Trustee.


 


WHEREAS, Grantor
is receiving a good and valuable benefit, the sufficiency and receipt of which
is hereby acknowledged, from the issuance of the Notes secured hereby.


 

















 


This Deed of Trust
is to be governed by the provisions of NRS 106.300 through
NRS 106.400 inclusive (“NRS”
means Nevada Revised Statutes).  The
maximum amount to be secured by this Deed of Trust is $300,000,000.00.  It is the intention of the parties that the
Obligations include the obligation of Grantor to repay “future advances” of
“principal” (as said terms are defined in NRS 106.320 and NRS 106.345,
respectively, as amended or recodified from time to time) in an amount up to
$300,000,000.00, and that the lien of this Deed of Trust secures the obligation
of Grantor, Parent and the other Guarantors to repay all such “future advances”
with the priority set forth in NRS 106.370(1), as amended or recodified from
time to time.  Without limiting the
foregoing, Obligations under any and all Additional Notes and Exchange Notes
and any guarantees in respect of the same shall be automatically secured
hereby, and the payment of all sums expended or advanced by Agent, Indenture
Trustee or the Holders under or pursuant to the terms hereof or the Indenture
or to protect the security hereof, together with interest thereon as herein
provided (without limiting the generality of the protections afforded by
NRS Chapter 106), and funds disbursed that, in the reasonable
exercise of Beneficiary’s judgment, are needed for improving Trust Property or
to protect Beneficiary’s security in the Trust Property are to be deemed
obligatory advances hereunder and will be added to the total indebtedness secured
by this Deed of Trust and such indebtedness shall be increased accordingly.


 


ARTICLE 1


DEFINITIONS


 


Section 1.1                                   Definitions.  All capitalized terms used herein without
definition shall have the respective meanings ascribed to them in the
Indenture.  As used herein, the
following terms shall have the following meanings:


 


(a)                                  “Event of
Default”: shall have the meaning ascribed to such term in Article 4
hereof.


 


(b)                                 “Indebtedness”:
All obligations of Grantor, Parent and any of the other Guarantors to (i)
Beneficiary, (ii) Indenture Trustee, (iii) the Holders or (iv) HSBC Bank USA,
as agent and as securities intermediary (“Pledge Agent”) under the Pledge Agreement
dated as of the date hereof by and between Parent, Indenture Trustee and Pledge
Agent (“Pledge
Agreement”), including without limitation: the due and punctual
payment of principal of and interest and Additional Interest, if any, on the
Notes when and as the same shall be due and payable, whether on an Interest
Payment Date, at maturity, by acceleration, repurchase, redemption or
otherwise, and interest on the overdue principal of and interest on the Notes
and the performance of all other obligations (including without limitation
fees, costs, expenses, charges and indemnification obligations) of the Parent
and the Guarantors, including Grantor, to the


 


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Holders or the Indenture
Trustee or Beneficiary or Pledge Agent under the Indenture, the Notes, the
Guarantees, the Pledge Agreement and any other Indebtedness Documents,
according to the terms hereunder or thereunder.


 


(c)                                  “Obligations”:
All of the agreements, covenants, conditions, warranties, representations and
other obligations of Grantor, Parent and the other Guarantors under the
Indenture, the Notes, the Guarantees, and any other Indebtedness Documents, and
any other “Obligations,” as defined under the Indenture.


 


(d)                                 “Trust
Property”:  All of Grantor’s
interest in (1) the fee estate in the real property described in Exhibit
A-1 attached hereto and the leasehold estates in the real property
described in Exhibit A-2 attached hereto, together with all existing and
future appurtenances, privileges, easements, franchises, herediments and
tenements of the real property (including all minerals, oil, gas and other
hydrocarbons and associated substances) which may be in, under or produced from
any part of the real property, all air, water or other interests or development
rights and credits and any greater estate therein as hereafter may be acquired by
Grantor (the “Land”), (2) all improvements now leased, owned or hereafter
acquired by Grantor, now or at any time situated, placed or constructed upon
the Land (the ”Improvements”; the Land and Improvements
are collectively referred to herein as the “Premises”), (3) the Operating
Assets and all materials, supplies, equipment, apparatus and other items of
personal property now owned or hereafter acquired by Grantor and now or
hereafter located on the Premises (excluding, however, the Excluded Assets)
(the “Operational
Property”), (4) all materials, supplies, equipment, apparatus and
other items of personal property now owned or hereafter acquired by Grantor and
now or hereafter attached to or installed in any of the Improvements or the
Land so as to constitute fixtures (excluding, however, the Excluded Assets) and
water, gas, electrical, telephone, storm and sanitary sewer facilities and all
other utilities whether or not situated in easements (the “Fixtures”), (5) all
reserves, escrows or impounds and deposit accounts maintained by Grantor with
respect to the Trust Property (excluding, however, the Excluded Assets) (the “Deposit
Accounts”), (6) all existing and future leases, subleases, licenses,
concessions, occupancy agreements or other agreements (written or oral, now or
at any time in effect), granted by Grantor or a direct or indirect lessee or
sublessee of Grantor, which grant to any Person a possessory interest in, or
the right to use or occupy, all or any part of the Trust Property, whether made
before or after the filing by or against Grantor of any petition for relief
under the Bankruptcy Code, together with any extension, renewal or replacement
of the same and together with all related security and other deposits (the “Leases”),
(7) all of the rents, additional rents, revenues, royalties, income,
proceeds, profits, early termination fees or payments, security and other types
of deposits, and other benefits paid or payable by parties to the Leases for
using, leasing, licensing, possessing, operating from, residing in, selling or
otherwise enjoying the Trust Property or any part thereof, whether paid or
accruing before or after the filing by or against Grantor of any petition for
relief under the Bankruptcy Code (the “Rents”), (8) all other agreements,


 


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such as construction
contracts, architects’ agreements, engineers’ contracts, utility contracts,
maintenance agreements, management agreements, service contracts, listing
agreements, guaranties, warranties, permits (including the Permits), licenses,
certificates and entitlements in any way relating to the construction, use,
occupancy, operation, maintenance, enjoyment or ownership of the Trust Property
(the “Property
Agreements”), (9) all rights, privileges, tenements,
hereditaments, rights-of-way, easements, appendages and appurtenances
appertaining to the foregoing, (10) all property tax refunds, utility
refunds and rebates, earned or received at any time (the “Tax Refunds”), (11) all
accessions, replacements and substitutions for any of the foregoing and all
proceeds thereof and all rents, fees, charges, accounts, issues, profits,
revenues and payments for or from (a) the use or occupancy of the guest rooms,
banquet facilities, ballrooms, spas, salons, pools, restaurants, meeting rooms
and other guest facilities at or in the Hotel and (b) the operation of the
Casino (excluding, however, the Excluded Assets) (the “Proceeds”), (12) all
insurance policies, unearned premiums therefor and proceeds from such policies
covering any of the above property now or hereafter acquired by Grantor (the “Insurance”),
(13) all of Grantor’s right, title and interest in and to any awards, damages,
remunerations, reimbursements, settlements or compensation heretofore made or
hereafter to be made by any governmental authority pertaining to the Land,
Improvements or Fixtures (the “Condemnation Awards”), (14) all of
Grantor’s rights to appear and defend any action or proceeding brought with
respect to the Trust Property and to commence any action or proceeding to
protect the interest of Beneficiary in the Trust Property, and (15) all rights,
powers, privileges, options and other benefits of Grantor under the Leases,
including, without limitation, the immediate and continuing right to claim for,
receive, collect and receive all Rents payable or receivable under the Leases
or pursuant thereto (and to apply the same to the payment of the Indebtedness
and the Obligations), and to do all other things which Grantor or any lessor is
or may become entitled to do under the Leases. 
As used in this Deed of Trust, the term “Trust Property” shall mean all
or, where the context permits or requires, any portion of the above or any
interest therein.  THE TERM “TRUST
PROPERTY” IS INTENDED TO EXCLUDE ALL ITEMS OF PERSONAL PROPERTY IN WHICH
BENEFICIARY HAS OBTAINED AND/OR PERFECTED A SECURITY INTEREST UNDER SEPARATE
INSTRUMENTS.


 


(e)                                  “Permitted Liens”: shall have the meaning
ascribed to such term in the Indenture, to the extent the same do not materially
impair the normal operation of the Casino Hotel in accordance with all Legal
Requirements and all Permits.


 


(f)                                    “UCC”:  The Uniform Commercial Code of the state in
which the Land is located or, if the creation, perfection and enforcement of
any security interest herein granted is governed by the laws of a state other
than the state in which the Land is located, then, as to the matter in
question, the Uniform Commercial Code in effect in that state.


 


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(g)                                 “Casino”:  That portion of the Casino Hotel used for
gaming and related activities.


 


(h)                                 “Casino
Bankroll”:  only the amount
of cash or Cash Equivalents required by the provisions of Section 6.150 of
the Regulations of the Nevada Gaming Commission to satisfy the Casino minimum
bankroll requirements, mandatory game security reserves, allowances for
redemption of casino chips and tokens, or payment of winning wagers to gaming
patrons, or as otherwise may be required by the Gaming Laws or a directive of
the Chairman of the Nevada State Gaming Control Board.


 


(i)                                     “Casino Hotel”:  That portion of the Improvements being a
casino and hotel complex.


 


(j)                                     “CFC”:  a controlled foreign corporation (as that
term is defined in the Internal Revenue Code of 1986, as in effect from time to
time and any successor statute).


 


(k)                                  “Excluded
Assets”:  (a) the Casino
Bankroll, (b) the “participation” slot machines listed on Exhibit C,
(c) any Investment Property of Parent, Grantor or any other Guarantor
constituting Stock of such Person’s Subsidiaries that are CFCs, solely to the
extent that such Investment Property is in excess of 65% of the Stock of such
CFC, (d) any agreements, permits, or licenses (including the Permits)
solely in the event and to the extent that a grant of a Lien on such license,
contract, or agreement is prohibited by law or results in a breach or
termination of the terms of, or constitutes a default under, or termination of
any such license, contract, or agreement (other than to the extent that any
such term would be rendered ineffective pursuant to Section 9-406, 9-407,
9-408 or 9-409 of the Uniform Commercial Code (or any successor provision or
provisions) of any relevant jurisdiction) and, in any event, immediately upon
the ineffectiveness, lapse or termination of any such terms or default under
such license, contract or agreement, the Excluded Assets shall not include, and
Grantor shall be deemed to have granted a security interest in, all such
licenses, contracts, or agreements as if such terms or defaults had never been
in effect; provided, however, that Excluded Assets shall not
include (and, accordingly, Trust Property shall include) any and all proceeds
of any of such assets; provided, further, that any agreement, permit,
license, or the like qualifying as an Excluded Asset under clause (b) above
no longer shall constitute an Excluded Asset (and instead shall constitute
Trust Property) from and after such time as the lessor, licensor, or other
party to such agreement, permit, license, or the like consents to the grant of
a Lien in favor of Beneficiary in such agreement, permit, license, or the like
or the prohibition against granting a Lien therein in favor of Beneficiary
shall cease to be effective, (e) the Government Treasury Strips, and (f) the
Stock of Parent’s Subsidiaries that are licensed or registered under the Gaming
Laws and are “Pledged Collateral” pursuant to the Stock Pledge Agreement
entered into as of the date hereof by and between Parent and the other Pledgors
pursuant thereto and Beneficiary.


 


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(l)                                     “FF&E
Financing Arrangements”: 
Only to the extent the same constitutes Permitted Debt under the
Indenture, an agreement which creates a Lien upon any after-acquired tangible
personal property and/or other items constituting operating assets, which are
financed, purchased or leased for the purposes of the operation of the Casino
Hotel.


 


(m)                               “Government
Treasury Strips”:  those
certain United States Treasury securities in an amount not to exceed $3,089,752
currently maintained by Mirage Resorts, Incorporated in a restricted account
for the benefit of GNLV, Corp. as a reserve in accordance with Nevada Gaming
Commission Regulation 5.115, pursuant to the order of the Nevada Gaming
Commission dated August 27, 1993, and to be maintained after the Closing
Date in a restricted account of GNLV, Corp. as a reserve pursuant to Gaming
Laws, securing periodic payments due to a progressive slot machine jackpot
winner at GNLV, Corp., which jackpot totaled $3,089,752 payable in 20 equal
annual installments of $154,488, without interest, commencing
September 24, 1988 and ending September 24, 2007.


 


(n)                                 “Hotel”:  That portion of the Casino Hotel not
included within the Casino.


 


(o)                                 “Indebtedness
Documents”:  The Indenture,
the Notes, the Guarantees, the Collateral Documents, including this Deed of
Trust, the Pledge Agreement and any other documents executed and delivered in
connection with the issuance of the Notes and the Guarantees.


 


(p)                                 “Investment
Property”:  investment
property (as that term is defined in the UCC), and any and all supporting
obligations in respect thereof.


 


(q)                                 “Legal
Requirements”:  All laws,
statutes, codes, acts, ordinances, orders, judgments, decrees, injunctions,
rules, regulations, permits (including the Permits), licenses, authorizations,
directions and requirements of all governments, departments, commissions,
boards, courts, authorities, agencies (including Gaming Authorities and Liquor
Authorities) and all officials and officers thereof, applicable to the Trust
Property and the use thereof, including Gaming Laws and Liquor Laws.


 


(r)                                    “Liquor
Authorities”:  the State of
Nevada Department of Taxation, the Clark County Liquor and Gaming Licensing
Board, the City of Las Vegas, the Department of the Treasury Bureau of Alcohol,
Tobacco and Firearms, and any agency, authority, board, bureau, commission,
department, office or instrumentality of any nature whatsoever of the United
States or foreign government, any state, province or any city or other
political subdivision, whether now or hereafter existing, or any officer or
official thereof, including any other agency with authority to regulate the
sale or distribution of alcoholic beverages.


 


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(s)                                  “Liquor Laws”:  the statutes and ordinances regarding the
sale and distribution of alcoholic beverages enforced by the Liquor Authorities
and the rules and regulations of the Liquor Authorities.


 


(t)                                    “Liquor
License”:  any license,
permit, registration, qualification or other approval required to sell,
dispense or distribute alcoholic beverages under the Liquor Laws.


 


(u)                                 “Operating
Assets”:  (a) bookings for
the use of guest rooms, banquet facilities, ballrooms, spas, salons, pools,
restaurants, meeting rooms and other guest facilities at the Casino Hotel or at
any other Improvements now or hereafter located on any of the Land; (b)
contract rights, trademarks, trade names, service marks, logos, copyrights,
warranties and other types of intangible personal property, and any and all
goodwill associated with the same relating to the ownership or operation of the
Casino Hotel or of any other Improvements now or hereafter located on any of
the Land, including, without limitation, (1) telephone and other communication
numbers, (2) all software licensing agreements as are required to operate
computer software systems at the Casino Hotel or at any other Improvements now
or hereafter located on any of the Land and books and records relating to the
software programs and (3) lessee’s interest under leases of Tangible Personal
Property; (c) Tangible Personal Property; (d) drawings, designs, plans and
specifications prepared by architects, engineers, interior designers, landscape
designers and any other professionals or consultants for the design,
development, construction and/or improvement of the Casino Hotel, or for any
other development of the Land, as amended from time to time; (e) customer lists
utilized in the operation of the Casino Hotel including lists of transient
guests and restaurant and bar patrons and “high roller” lists; and (f) all of
the goodwill in connection with the foregoing Operating Assets and in
connection with the operation of the Casino Hotel.


 


(v)                                 “Permits”:  the Gaming Licenses, the Liquor Licenses and
any other license, franchise, authorization, statement of compliance,
certificate of operation, certificate of occupancy and permit required for the
lawful ownership, operation, occupancy and use of all or any material portion
of the Improvements, in accordance with applicable Legal Requirements.


 


(w)                               “Stock”:  all shares, options, warrants, limited
liability, membership or other interests, participations, or other equivalents
(regardless of how designated) of or in a Person, whether voting or nonvoting,
including common stock, preferred stock, or any other “equity security” (as
such term is defined in Rule 3a11-1 of the General Rules and Regulations
promulgated by the United States Securities and Exchange Commission and any
successor thereto under the Securities Exchange Act of 1934, as in effect from
time to time).


 


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(x)                                   “Superior
Deed of Trust”:  that certain
Deed of Trust, Assignment of Rents and Leases, Fixture Filing and Security
Agreement (Fee and Leasehold) by and from Grantor to Trustee for the benefit of
Wells Fargo Foothill, Inc. as arranger, administrative agent and documentation
agent of the same date as this Deed of Trust securing the Trust Property.


 


(y)                                 “Tangible
Personal Property”:  the following
items of personal property now or hereafter acquired by Grantor (directly or by
way of lease) which are located on, or to be located on, or which are in use or
held in reserve storage for future use in connection with the gaming or other
operations of the Casino Hotel or any other Improvements, which are on hand or
on order whether stored on-site or off-site:


 


(i)                                     furniture,
furnishings, machinery, appliances, fixtures and fittings and other articles of
tangible personal property;


 


(ii)                                  slot
machines, video poker machines, electronic gaming devices, craps tables,
blackjack tables, roulette tables, baccarat tables, poker tables, other gaming
tables, big six wheels, racing and sports displays and video screens, prizes
and prize displays, and all other gaming furnishings and equipment;


 


(iii)                               cards,
dice, gaming chips and placques, tokens, chip racks, dealing shoes, dice cups,
dice sticks, layouts, paddles, roulette balls and other consumable supplies and
items;


 


(iv)                              china,
glassware, linens, kitchen utensils, silverware and uniforms;


 


(v)                                 consumables
and operating supplies of every kind and nature, including accounting supplies,
guest supplies, forms, printing, stationery, food and beverage stock, bar
supplies and laundry supplies; and


 


(vi)                              sets,
scenery, costumes, props and other items used in the production of shows in any
showroom, convention space, ballroom, exhibition hall or sports or
entertainment arena now or hereafter located on the Land.


 


ARTICLE 2


GRANT


 


Section 2.1                                   Grant.  For and in consideration of good and
valuable consideration, the receipt and sufficiency whereof are hereby
acknowledged, and in order to secure the indebtedness and other obligations of
Grantor herein set forth, to secure the full and timely payment of the
Indebtedness and the full and timely performance of the


 


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Obligations, Grantor
GRANTS, BARGAINS, ASSIGNS, SELLS, WARRANTS and CONVEYS, to Trustee the Trust
Property, subject, however, to the Permitted Liens, TO HAVE AND TO HOLD
the Trust Property and all parts, rights and appurtenances thereof to Trustee,
IN TRUST, WITH POWER OF SALE, and Grantor does hereby bind itself, its
successors and assigns to WARRANT AND FOREVER DEFEND the title to the Trust
Property unto Trustee.


 


TO HAVE AND TO HOLD the Trust Property, together with all and singular
the parts, rights, privileges, hereditaments, and appurtenances thereto in any
ways belonging or appertaining, to the use, benefit, and behoof of Trustee, its
successors and assigns, in trust for the benefit of Beneficiary, forever.  Notwithstanding anything to the contrary
contained in the immediately preceding sentence, Grantor hereby agrees and
acknowledges that this Deed of Trust is intended to secure future advances;
accordingly, this Deed of Trust shall not be canceled except pursuant to the
terms and conditions set forth in the Indenture.


 


ARTICLE 3


WARRANTIES, REPRESENTATIONS AND
COVENANTS


 


Grantor warrants,
represents and covenants to Beneficiary as follows:


 


Section 3.1                                   Title
to Trust Property and Lien of this Instrument.  Grantor (i) has good and indefeasible title
to the real property described in Exhibit A-1 attached hereto, in fee
simple, free and clear of any liens, claims or interests, except the Permitted
Liens (ii) holds pursuant to the Ground Leases valid leasehold estates in and
to the real property described in Exhibit A-2 attached hereto, free and
clear of any liens, claims or interests, except the Permitted Liens (iii) has
good and indefeasible title or holds valid leasehold interests in the remainder
of the Trust Property, in each case free and clear of any liens, claims or
interests, except the Permitted Liens and (iv) has full power and lawful
authority to encumber the Trust Property in the manner and form set forth in
this Deed of Trust.  This Deed of Trust
creates valid, enforceable liens and security interests against the Trust
Property, second in priority to the lien of the Superior Deed of Trust only.


 


Section 3.2                                   Priority.  Grantor shall preserve and protect the
second lien and security interest status of this Deed of Trust (and, following
satisfaction and discharge of the Superior Deed of Trust, the first lien and
security interest status of this Deed of Trust).  If Grantor has knowledge of any lien or security interest, other
than the Permitted Liens, that is asserted against the Trust Property, Grantor
shall promptly, and at its expense, (a) give Beneficiary a detailed written
notice of such lien or security interest (including origin, amount and other terms),
and (b) pay the underlying claim in full or take such other action so as to
cause it to be released or contest the same and provide a


 


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bond or other security
satisfactory to Beneficiary, and act in compliance with any other requirements
of the Indenture.


 


Section 3.3                                   Payment
and Performance.  Grantor shall
pay or cause Parent or the other Guarantors to pay the Indebtedness when due
under the Notes and the other Indebtedness Documents and shall perform or cause
Parent or the other Guarantors to perform the Obligations in full when they are
required to be performed.


 


Section 3.4                                   Replacement
of Fixtures.  Grantor shall not,
without the prior written consent of Beneficiary, permit any of the Fixtures to
be removed at any time from the Land or Improvements, unless the removed item
is removed temporarily for maintenance and repair or, if removed permanently,
is obsolete and is replaced by an article of equal or better suitability
and value, owned by Grantor subject to the liens and security interests of this
Deed of Trust and the other Indebtedness Documents, and free and clear of any
other lien or security interest except such as may be permitted under the
Indenture or first approved in writing by Beneficiary.


 


Section 3.5                                   Inspection.  Grantor shall permit Beneficiary and its
agents, representatives and employees to inspect the Trust Property and all
books and records of Grantor located thereon, and to conduct such environmental
and engineering studies as Beneficiary may require.  Provided that no Event of Default exists, all such testing and
investigation shall be conducted at reasonable times and upon reasonable prior
notice to Grantor.  Beneficiary shall
restore the Trust Property to at least as good condition as it was in
immediately prior to such testing and investigation.


 


Section 3.6                                   Other
Covenants.  All of the covenants
in the Indenture are incorporated herein by reference and, together with
covenants in this Article 3, shall, to the extent applicable, be
covenants running with the land.


 


Section 3.7                                   Condemnation Awards and Insurance Proceeds.


 


(a)                                  Condemnation
Awards.  Grantor, immediately upon
obtaining knowledge of the institution of any proceedings for the condemnation
of the Trust Property or any portion thereof, will notify Beneficiary of the
pendency of such proceedings.  Except as
set forth in the Indenture, Beneficiary may participate in any such proceedings
and Grantor from time to time will deliver to Beneficiary all instruments
requested by it to permit such participation. 
Grantor assigns all awards and compensation to which it is entitled for
any condemnation or other taking, or any purchase in lieu thereof, to
Beneficiary and authorizes Beneficiary to collect and receive such awards and
compensation and to give proper receipts and acquittances therefor, subject to
the terms of the Indenture. Grantor hereby waives all rights to such awards and
compensation described in the foregoing sentence.  Grantor, upon request by Beneficiary, shall make, execute and
deliver any and all instruments requested for the purpose of confirming the


 


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assignment of the
aforesaid awards and compensation to Beneficiary free and clear of any liens,
charges or encumbrances of any kind or nature whatsoever.  Grantor specifically, unconditionally and
irrevocably waives all rights of a property owner granted under applicable law,
including NRS 37.115, as amended or recodified from time to time, which provide
for an allocation of condemnation proceeds between a property owner and a
lienholder, and any other law or successor statute of similar import.


 


(b)                                 Insurance
Proceeds.  Without limitation to the
requirements of Section 4.23 of the Indenture, Grantor shall maintain such
insurance coverage as is customarily carried by owners and operators of first
class casino and hotel complexes in Las Vegas, Nevada and in no event less than
that required under the Ground Leases and the Superior Deed of Trust.  Grantor assigns to Beneficiary all proceeds
of any insurance policies insuring against loss or damage to the Trust
Property.  Except as set forth in the
Indenture, Grantor authorizes Beneficiary to collect and receive such proceeds
and authorizes and directs the issuer of each of such insurance policies to
make payment for all such losses directly to Beneficiary, instead of to Grantor
and Beneficiary jointly.  In the event
that the issuer of such insurance policy fails to disburse directly or solely
to Beneficiary but disburses instead either solely to Grantor or to Grantor and
Beneficiary, jointly, Grantor shall immediately endorse and transfer such
proceeds to Beneficiary.  Upon Grantor’s
failure to do so, Beneficiary may execute such endorsements or transfers from
and in the name of Grantor, and Grantor hereby irrevocably appoints Beneficiary
as Grantor’s agent and attorney-in-fact so to do.


 


(c)                                  Beneficiary
acknowledges that, notwithstanding the foregoing provisions of this
Section 3.7, Grantor has granted certain rights in and to condemnation
awards and insurance proceeds pursuant to the Superior Deed of Trust and,
subject to the terms of the Intercreditor Agreement, the provisions of this
Section 3.7 are entered into subject to such rights.


 


Section 3.8                                   Costs
of Defending and Upholding the Lien. 
If any action or proceeding is commenced to which action or proceeding
Trustee or Beneficiary is made a party or in which it becomes necessary for
Trustee or Beneficiary to defend or uphold the lien of this Deed of Trust,
including any extensions, renewals, amendments or modifications thereof,
Grantor shall, on demand, reimburse Trustee and Beneficiary for all expenses
(including, without limitation, reasonable attorneys’ fees and reasonable
appellate attorneys’ fees) incurred by Trustee or Beneficiary in any such
action or proceeding and all such expenses shall be secured by this Deed of
Trust.  In any action or proceeding to
foreclose this Deed of Trust or to recover or collect the Indebtedness, the
provisions of law relating to the recovering of costs, disbursements and
allowances shall prevail unaffected by this covenant.


 


Section 3.9                                   TRANSFER OF THE SECURED PROPERTY.  EXCEPT AS EXPRESSLY PERMITTED PURSUANT TO
THE TERMS OF THE


 


11

















 


INDENTURE, GRANTOR SHALL
NOT SELL, ASSIGN, TRANSFER, PLEDGE, ENCUMBER, CREATE A SECURITY INTEREST IN,
LEASE, OR OTHERWISE HYPOTHECATE, ALL OR ANY PORTION OF THE TRUST PROPERTY
WITHOUT THE PRIOR WRITTEN CONSENT OF BENEFICIARY.  THE CONSENT BY BENEFICIARY TO ANY SALE, ASSIGNMENT, TRANSFER,
PLEDGE, ENCUMBRANCE, CREATION OF A SECURITY INTEREST IN, LEASE, OR OTHER
HYPOTHECATION OF, ANY PORTION OF THE TRUST PROPERTY SHALL NOT BE DEEMED TO
CONSTITUTE A NOVATION OR A CONSENT TO ANY FURTHER SALE, ASSIGNMENT, TRANSFER,
PLEDGE, ENCUMBRANCE, CREATION OF A SECURITY INTEREST IN, LEASE, OR OTHER
HYPOTHECATION, OR TO WAIVE THE RIGHT OF BENEFICIARY, INDENTURE TRUSTEE AND/OR
HOLDERS, AT THEIR OPTION, TO DECLARE THE INDEBTEDNESS SECURED HEREBY
IMMEDIATELY DUE AND PAYABLE, WITHOUT NOTICE TO GRANTOR OR ANY OTHER PERSON OR
ENTITY, UPON ANY SUCH SALE, ASSIGNMENT, TRANSFER, PLEDGE, ENCUMBRANCE, CREATION
OF A SECURITY INTEREST, LEASE, OR OTHER HYPOTHECATION TO WHICH BENEFICIARY
SHALL NOT HAVE CONSENTED.


 


Section 3.10                            Security Deposits.  To the extent required by law, or after an
Event of Default has occurred and during its continuance, if required by
Beneficiary, all security deposits of tenants of the Trust Property shall be
treated as trust funds not to be commingled with any other funds of
Grantor.  Within twenty (20) days after
request by Beneficiary, Grantor shall furnish satisfactory evidence of
compliance with this Section 3.10, as necessary, together with a
statement of all security deposits deposited by the tenants and copies of all Leases
not theretofore delivered to Beneficiary, as requested thereby, certified by
Grantor.


 


Section 3.11                            Leasehold Representations, Warranties and
Covenants.  Grantor
hereby represents, warrants and covenants as follows:


 


(a)                                  (i)
each of the Ground Leases is in full force and effect, (ii) to Grantor’s
knowledge, except as set forth on Exhibit B hereof, each is unmodified
by any writing or otherwise, and (iii) Grantor has not waived, canceled or
surrendered any of its rights thereunder;


 


(b)                                 all
rent, additional rent and/or other charges reserved in or payable under the
Ground Leases have been paid to the extent that they are payable to the date
hereof;


 


(c)                                  Grantor
enjoys the quiet and peaceful possession of the leasehold estate granted by
each Ground Lease;


 


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(d)                                 Grantor
has not delivered or received any notices of default under the Ground Leases,
and there are no circumstances which, with the passage of time or the giving of
notice, or both, would constitute a default under the Ground Leases;


 


(e)                                  to
Grantor’s best knowledge, the lessor is not in default under any of the terms
of the Ground Leases on its part to be observed or performed;


 


(f)                                    the
execution, delivery and performance of this Deed of Trust do not require any
consent (other than those consents which have been obtained and are in full
force and effect) under, and will not contravene any provisions of, or cause a
default under, the Ground Leases;


 


(g)                                 the
term of each of the Ground Leases (including all renewal terms currently
provided for in such Ground Lease) expires no earlier than January 1,
2022;


 


(h)                                 each
of the Ground Leases, by its terms or the terms of any other agreement executed
by Grantor or its predecessors in title, is not subordinate to any mortgage or
other lease of the fee interest in the Premises or any lien, encumbrance or
matter whatsoever;


 


(i)                                     each
Ground Lease or a memorandum thereof has been duly recorded and there have been
no amendments to each such Ground Lease since said recordation;


 


(j)                                     Grantor
has delivered to Beneficiary a true and accurate copy of each of the Ground
Leases;


 


(k)                                  as
of the date of this Deed of Trust, no Leases are in effect and no Leases have
been entered into that are due to come into effect at a later date (the license
for the car rental desk in the lobby of the Casino Hotel not being a Lease for
the purposes of this representation);


 


(l)                                     Grantor
promptly shall pay the rent and all other sums and charges mentioned in, and
payable under, the Ground Leases;


 


(m)                               Grantor,
at its sole cost and expense, shall exercise all renewal options under each
Ground Lease, promptly and in accordance with the provisions of each such
Ground Lease, so that the term of each Ground Lease shall not expire before the
date upon which Beneficiary releases the liens and security interests created
by this Deed of Trust or reconveys the Trust Property to Grantor in accordance
with the provisions of Section 9.7 of this Deed of Trust.  Grantor shall give written notice to
Beneficiary (i) within five business days after the date on which each option
first becomes exercisable and (ii) within two business days of Grantor’s
exercise of each


 


13

















 


option (together with a
copy of the option exercise notice). 
Grantor hereby irrevocably appoints Beneficiary as its attorney in fact,
with power of substitution, to exercise such option on behalf of Grantor if
Grantor is required under the foregoing provisions to exercise said option but
for any reason fails or refuses to exercise said option within a reasonable
time prior to the expiration of Grantor’s time to exercise the option;


 


(n)                                 Grantor
promptly shall perform and observe all of the terms, covenants and conditions
required to be performed and observed by the lessee under the Ground Leases,
the breach of which could permit any party to the Ground Leases to validly
terminate the Ground Leases (including, without limitation, all payment
obligations), shall do all things necessary to preserve and to keep unimpaired
its rights under the Ground Leases, shall not waive, excuse or discharge any of
the material obligations of the lessor without Beneficiary’s prior written
consent in each instance, and shall diligently and continuously enforce the material
obligations of the lessor under the Ground Leases;


 


(o)                                 Grantor
shall not do, permit or suffer any event or omission as a result of which there
could occur a default under the Ground Leases or any event which, with the
giving of notice or the passage or time, or both, would constitute a default
under the Ground Leases which could permit any party to the Ground Leases to
validly terminate the Ground Leases (including, without limitation, a default
in any payment obligation), and Grantor shall obtain the consent or approval of
the lessor to the extent required pursuant to the terms of the Ground Leases;


 


(p)                                 Grantor
shall not (1) permit the amendment, modification or alteration of any of the
provisions of the Ground Leases in any material respect, without Beneficiary’s
prior written consent in each instance or (2) agree to any termination or
surrender of the Ground Leases, without Beneficiary’s prior written consent in
each instance;


 


(q)                                 Grantor
shall deliver to Beneficiary copies of any notice of default by any party under
the Ground Leases, or of any notice from the lessor of its intention to
terminate the Ground Leases or to re-enter and take possession of the Premises,
immediately upon delivery or receipt of such notice, as the case may be;


 


(r)                                    Grantor
shall promptly furnish to Beneficiary copies of such information and evidence
as Beneficiary may reasonably request concerning Grantor’s due observance,
performance and compliance with the terms, covenants and conditions of the
Ground Leases;


 


(s)                                  Grantor
knows of no adverse claim to the title or possession of Grantor or the lessor;


 


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(t)                                    Grantor
shall not consent to the subordination of the Ground Leases to any mortgage or
other lease of the fee interest in the Premises or any lien, encumbrance or
matter whatsoever;


 


(u)                                 Grantor,
at its sole cost and expense, shall execute and deliver to Beneficiary or
Trustee, within five (5) days after request, such documents, instruments or
agreements as may be required to permit Beneficiary or Trustee to cure any
default under the Ground Leases;


 


(v)                                 Grantor
shall, upon request, furnish Beneficiary with executed copies of all Ground
Leases and any Leases hereafter entered into and all amendments, modifications
and supplements thereto;


 


(w)                               Grantor
shall (i)  observe and perform in all material respects all the
obligations imposed upon the lessor under the Leases and shall not do or permit
to be done anything to materially impair the value of the Leases as security
for the Indebtedness and the Obligations; (ii) promptly send copies to
Beneficiary of all notices of default which Grantor shall send or receive
thereunder; (iii) enforce all the material terms, covenants and conditions
contained in the Leases upon the part of the lessee thereunder to be observed
or performed, (iv) not collect any of the Rents more than one (1) month in
advance, except as may be specifically required in the applicable Lease;
(v) not execute any other assignment of the lessor’s interest in the Leases
or the Rents; and (vi) use reasonable efforts to obtain and deliver to
Beneficiary, upon request, tenant estoppel certificates from each tenant at the
Premises in the form required under the applicable Lease, or if no such form is
provided, in form and substance reasonably satisfactory to Beneficiary; and


 


(x)                                   Grantor
shall not, except to the extent Grantor has received the prior written consent
of Beneficiary, (A) alter, modify or change the terms of any Lease in any
material respect; (B) consent to any assignment of or subletting under any
Lease not in accordance with its terms; and (C) cancel or terminate any
Lease or accept a surrender thereof, unless such tenant is in default
thereunder and a new Lease has been entered into on substantially the same
terms or more favorable terms as the canceled Lease.


 


Section 3.12                            Additional
Ground Lease and Lease Covenants.


 


(a)                                  Grantor
shall give Beneficiary and Trustee not less than thirty (30) days prior written
notice of the date on which Grantor shall apply to any court or other
governmental authority for authority and permission to reject any of the Ground
Leases or Leases in the event that there shall be filed by or against Grantor
any petition, action or proceeding under the Bankruptcy Code or under any other
similar federal or state law now or hereafter in effect and if Grantor
determines to reject any of the Ground


 


15

















 


Leases or Leases.  Beneficiary and Trustee shall have the
right, but not the obligation, to serve upon Grantor within such thirty (30)
day period a notice stating that (i) Beneficiary or Trustee demands that
Grantor assume and assign any of the Ground Leases or Leases to Beneficiary or
Trustee subject to and in accordance with the Bankruptcy Code and
(ii) Beneficiary covenants to cure or provide reasonably adequate
assurance thereof with respect to all defaults reasonably susceptible of being
cured by Beneficiary or Trustee and of future performance under the applicable
Ground Lease or Leases.  If Beneficiary
or Trustee serves upon Grantor the notice described above, Grantor shall not
seek to reject any of the Ground Leases or Leases and shall comply with the
demand provided for in clause (i) above within fifteen (15) days after the
notice shall have been given by Beneficiary and Trustee.


 


(b)                                 During
the continuance of an Event of Default, Beneficiary and Trustee shall have the
right, but not the obligation, (i) to perform and comply with all obligations
of Grantor under the Ground Leases or Leases without relying on any grace
period provided therein, (ii) to do and take, without any obligation to do so,
such action as Beneficiary or Trustee deems necessary or desirable to prevent
or cure any default by Grantor under any of the Ground Leases or Leases,
including, without limitation, any act, deed, matter or thing whatsoever that
Grantor may do in order to cure a default under the applicable Ground Lease or
Leases and (iii) to enter in and upon the Land or any part thereof to such
extent and as often as Beneficiary or Trustee  deems necessary or desirable
in order to prevent or cure any default of Grantor under the Ground Leases or
Leases.  Grantor shall on demand,
reimburse Beneficiary for all advances made and expenses incurred by Beneficiary
in exercising the foregoing rights (including, without limitation, reasonable
attorneys’ fees and disbursements), together with interest thereon at three
percentage points above the “prime rate” announced by Wells Fargo Bank, N.A. at
its principal office in San Francisco from time to time (the “Applicable
Rate”) from the date that an advance is made or expense is incurred,
to and including the date the same is paid and such monies so expended by
Beneficiary with interest thereon shall be secured by this Deed of Trust.  Grantor shall, within five (5) days after
written request is made therefor by Beneficiary or Trustee, execute and deliver
to Beneficiary or to any party designated by Beneficiary or Trustee, such
further instruments, agreements, powers, assignments, conveyances or the like
as may be reasonably necessary to complete or perfect the interest, rights or
powers of Beneficiary pursuant to this paragraph or as may otherwise be
required by Beneficiary  or Trustee.


 


(c)                                  During
the continuance of an Event of Default, in the event of any arbitration under
or pursuant to the Ground Lease or Leases in which Beneficiary elects to
participate, Grantor hereby irrevocably appoints Beneficiary and Trustee as its
true and lawful attorneys-in-fact (which appointment shall be deemed coupled
with an interest) to exercise, during the continuance of an Event of Default,
all right, title and interest of Grantor in connection with such arbitration,
including, without limitation, the right to appoint arbitrators and to conduct
arbitration proceedings on behalf of Grantor


 


16

















 


and Beneficiary.  All costs and expenses incurred by
Beneficiary and Trustee in connection with such arbitration and the settlement
thereof shall be borne solely by Grantor, including, without limitation,
attorneys’ fees and disbursements. 
Nothing contained in this paragraph shall obligate Beneficiary or
Trustee to participate in any such arbitration.


 


(d)                                 During
the continuance of an Event of Default, Beneficiary shall have the right, but
not the obligation, to proceed in respect of any claim, suit, action or
proceeding relating to the rejection of any of the Ground Leases by the fee
owner of the Land as a result of the fee owner’s bankruptcy, including, but not
limited to, the right to file and prosecute any and all proofs of claims,
complaints, notices and other documents in any case in respect of the fee owner
under and pursuant to the Bankruptcy Code.


 


(e)                                  With
respect to each Ground Lease, Grantor hereby unconditionally and irrevocably
assigns to Beneficiary (i) any right which Grantor has pursuant to the terms of
the Ground Lease to renew and/or extend the term thereof, (ii) any right which
Grantor has pursuant to the terms of the Ground Lease to cancel or terminate
the Ground Lease, and (iii) any option or right that Grantor has pursuant to
the Ground Lease to purchase any or all of the premises demised thereunder,
provided that Beneficiary shall not exercise any such rights or options prior
to the occurrence of any default.


 


(f)                                    With
respect to each Ground Lease, if any action or proceeding shall be instituted
to evict Grantor or to recover possession of the demised premises or any part
thereof or interest therein or any action or proceeding otherwise affecting the
Ground Lease or this Deed of Trust shall be instituted, then Grantor will,
immediately upon service thereof on or to Grantor, or by Grantor, deliver to
Beneficiary a true and complete copy of each petition, summons, complaint,
notice of motion, order to show cause and of all other provisions, pleadings,
and papers, however designated, served in any such action or proceeding.


 


Section 3.13                            Estoppel Certificates.  Grantor shall use commercially reasonable
efforts to obtain and deliver to Beneficiary within twenty (20) days after
written demand by Beneficiary, an estoppel certificate from the applicable
lessor under the Ground Leases or applicable lessee or sublessee under the
Leases setting forth (i) the name of the lessee and the lessor thereunder,
(ii) that the applicable Ground Lease or Lease is in full force and effect
and has not been modified or, if it has been modified, the date of each
modification (together with copies of each such modification), (iii) the
basic rent payable under the applicable Ground Lease or Lease, (iv) the
date to which all rental charges have been paid by the lessee under the
applicable Ground Lease or Lease, (v) whether a notice of default has been
received by the fee owner or lessor which has not been cured, and if such
notice has been received, the date it was received and the nature


 


17

















 


of the default,
(vi) whether there are any alleged defaults of the lessee under the
applicable Ground Lease or Lease and, if there are, setting forth the nature
thereof in reasonable detail, and (vii) if the lessee under the applicable
Ground Lease or Lease shall be in default, the default.


 


Section 3.14                            No Liability.  Anything contained herein to the contrary
notwithstanding, this Deed of Trust shall not constitute an assignment of the
Ground Leases within the meaning of any provision thereof prohibiting its
assignment and Beneficiary and Trustee  shall have no liability or obligation
thereunder by reason of its acceptance of this Deed of Trust.  Beneficiary shall be liable for the
obligations of the lessee arising under the Ground Leases for only that period
of time which Beneficiary is in actual possession of the applicable premises or
has acquired, by foreclosure or otherwise, and is holding all of Grantor’s
right, title and interest therein.


 


Section 3.15                            No Merger.  It is hereby agreed that the fee title to
Premises and the leasehold estate created by the Ground Leases shall not merge
but shall always be kept separate and distinct, notwithstanding the union of
said estates in either lessor, Grantor or a third party, whether by purchase or
otherwise.  If Grantor shall acquire fee
title to the Premises or any other estate, title or interest in the Premises or
any portion thereof, then, immediately upon Grantor’s acquisition thereof, this  Deed
of Trust automatically shall spread to cover Grantor’s interest in such leased
property on the same terms, covenants and conditions as set forth herein.  Upon such acquisition, Grantor, at its sole
cost and expense, shall deliver to Beneficiary a Title Insurance Policy issued
by a title insurance company acceptable to Beneficiary insuring that this Deed
of Trust, as so spread to cover Grantor’s interest in such leased property, is
a valid lien on Grantor’s interest therein, subject only to the Permitted Liens
and the Superior Deed of Trust.  It is
the intention of Grantor and Beneficiary that no documents, instruments or
agreements shall be necessary to confirm the foregoing spread of this  Deed
of Trust  to
cover Grantor’s interest in such leased property, as aforesaid, and that such
spreading shall occur automatically upon the consummation of Grantor’s
acquisition of such estate, title or interest to such leased property.  Notwithstanding the foregoing, Grantor shall
make, execute, acknowledge and deliver to Beneficiary and Trustee or so cause
to be made, executed, acknowledged and delivered to Beneficiary and Trustee, in
form satisfactory to Beneficiary and Trustee, all such further or other
documents, instruments, agreements or assurances as may be required by
Beneficiary and Trustee to confirm the foregoing spread of this Deed of Trust
to cover Grantor’s interest in such leased property.  Grantor shall pay all reasonable expenses incurred by Beneficiary
and Trustee in connection with the preparation, execution, acknowledgment,
delivery and/or recording of any such documents, including, without limitation,
all filing, registration and recording fees and charges, documentary stamps,
mortgage taxes, intangible taxes, and reasonable attorneys’ fees, costs and
disbursements.


 


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Section 3.16                            FF&E
Financing Arrangements.  Grantor
shall comply with the terms of all FF&E Financing Arrangements.  If Grantor has acquired or hereafter
acquires Operational Property or Fixtures subject to any FF&E Financing
Arrangement, or becomes lessee under a lease for any of the same, the Lien of
this Deed of Trust on such acquired or leased assets shall be subordinate to
the Lien of such FF&E Financing Arrangement and Beneficiary, at Grantor’s
cost, shall execute and deliver to Grantor such documents as Grantor may
reasonably request evidencing such subordination.


 


Section 3.17                            Maintenance
of Premises.  Grantor shall
maintain and keep the Premises in such good repair, working order and condition
and shall make or cause to be made all such needful and proper repairs,
renewals and replacements thereto consistent with the standards of other first
class casino and hotel complexes in Las Vegas, Nevada.  Grantor shall occupy and continuously
operate the Casino Hotel and keep the Casino Hotel supplied with Tangible
Personal Property, all in a manner consistent with the standards of other first
class casino and hotel complexes in Las Vegas, Nevada.


 


Section 3.18                            Alterations.  All alterations to the Premises (a) shall be
carried out in conformity with the Indebtedness Documents, Legal Requirements
and insurance requirements in a good and workmanlike manner and prosecuted with
reasonable dispatch subject to force majeure; (b) shall be undertaken only with
appropriate workers compensation insurance covering workers engaged in such
alterations and appropriate commercial general liability insurance covering all
hazards resulting from such alterations; and (c) affecting the structure of any
of the Improvements, the building systems or any material portion of the
Improvements, (i) shall be carried out under the supervision of a reputable
architect with no less than ten (10) years’ experience in the design and
construction of first class casino and hotel complexes in Las Vegas, Nevada,
(ii) shall be notified to Beneficiary prior to the commencement thereof and,
upon Beneficiary’s request, Grantor shall deliver to Beneficiary copies of all
drawings, plans, specifications and cost estimates therefor prepared and
approved in writing by said architect and accompanied by a certificate of such
architect stating that such drawings, plans and specifications are in
compliance with all Legal Requirements and insurance requirements, and (iii)
shall not be commenced until Grantor has furnished to Beneficiary, at Grantor’s
sole cost and expense, a surety bond or bonds, covering performance, labor and
material payments with respect to the work, naming Beneficiary as obligee (or
as co-obligee with the beneficiary under the Superior Deed of Trust and
Grantor), issued by a responsible surety company, authorized to do business in
the State of Nevada, in a form generally and customarily used by such surety in
an amount equal to the estimated cost of construction of the work, guaranteeing
the performance and completion of such construction, substantially in
conformity with the plans and specifications and within a reasonable time
subject to force majeure free and clear of all Liens, claims and liabilities
for the cost of such alterations (if such surety bond is unobtainable, Grantor
shall provide equivalent security in the form of cash, letter


 


19

















 


of credit or other
guarantee).  No alterations of any kind
shall be made which shall change the primary use of the Casino Hotel from its
use as a gaming and hotel facility.


 


ARTICLE 4


DEFAULT


 


Section 4.1                                   Events
of Default.  The occurrence of
any of the following events shall constitute an event of default under this
Deed of Trust (each an “Event of Default”):


 


(a)                                  an
“Event of Default” (as such term is defined in the Indenture) shall have
occurred;


 


(b)                                 the
revocation, termination, suspension or other cessation of effectiveness of (i)
any Liquor License which results in the cessation or suspension of the serving
of alcohol at the Casino Hotel or a material portion thereof for more than 90
consecutive days or (ii) any other Permit which results in the cessation or
suspension of all or a substantial portion of the operations of the Casino
Hotel for more than 90 consecutive days, in either case, other than as a result
of an Asset Sale permitted under the Indenture or any voluntary relinquishment
that is, in the judgment of the Board of Directors of Parent, both desirable in
the conduct of the business of Parent and its Restricted Subsidiaries, taken as
a whole, and not disadvantageous in any material respect to the Holders;


 


(c)                                  if
any event or omission shall occur which, with the giving of notice or the
passage of time, or both, would constitute a default by Grantor under the
Ground Leases which would permit any party thereto to terminate the applicable
Ground Lease, or if any of the Ground Leases shall otherwise terminate for any
reason whatsoever, except to the extent permitted by the terms and conditions
of the Indenture;


 


(d)                                 if
Grantor shall give Beneficiary Notice of Election to Terminate under NRS
106.380;


 


(e)                                  if
Grantor shall be made a party in any foreclosure action or similar proceeding
in connection with any other deed of trust on the fee interest of the
applicable Premises, unless the holder of such deed of trust has agreed not to
disturb the rights of Grantor under the Ground Leases;


 


(f)                                    Grantor’s
breach of any of the covenants set forth in this Deed of Trust; or


 


(g)                                 if
any misstatement or misrepresentation exists now or hereafter in any warranty
or representation set forth in Article 3 hereof.


 


20

















 


ARTICLE 5


REMEDIES AND FORECLOSURE


 


Section 5.1                                   Remedies.  If an Event of Default exists, Beneficiary
may, at Beneficiary’s election and by or through Trustee or otherwise, exercise
any or all of the following rights, remedies and recourses:


 


(a)                                  To
the extent permitted under the Indenture and in accordance with the provisions
thereof, declare the Indebtedness to be immediately due and payable, without
further notice, presentment, protest, notice of intent to accelerate, notice of
acceleration, demand or action of any nature whatsoever (each of which hereby
is expressly waived by Grantor), whereupon the same shall become immediately
due and payable.


 


(b)                                 Notify
all tenants of the Premises and all others obligated on leases of any part of
the Premises that all rents and other sums owing on leases have been assigned
to Beneficiary and are to be paid directly to Beneficiary, and to enforce
payment of all obligations owing on leases, by suit, ejectment, cancellation,
releasing, reletting or otherwise, whether or not Beneficiary has taken possession
of the Premises, and to exercise whatever rights and remedies Beneficiary may
have under any assignment of rents and leases.


 


(c)                                  As
and to the extent permitted by law, enter the Trust Property, either personally
or by its agents, nominees or attorneys, and take exclusive possession thereof
and thereupon, Beneficiary may (i) use, operate, manage, control, insure,
maintain, repair, restore and otherwise deal with all and every part of the
Premises and conduct business thereat; (ii) complete any construction on the
Premises in such manner and form as Beneficiary deems advisable in the
reasonable exercise of its judgment; (iii) exercise all rights and power of
Grantor with respect to the Premises, whether in the name of Grantor, or
otherwise, including, without limitation, the right to make, cancel, enforce or
modify leases, obtain and evict tenants, and demand, sue for, collect and
receive all earnings, revenues, rents, issues, profits and other income of the
Premises and every part thereof, which rights shall not be in limitation of
Beneficiary’s rights under any assignment of rents and leases securing the
Indebtedness; and (iv)  apply the receipts from the Premises to the
payment of the Indebtedness, after deducting therefrom all expenses (including attorneys’
fees) incurred in connection with the aforesaid operations and all amounts
necessary to pay the taxes, assessments, insurance and other charges in
connection with the Trust Property, as well as just and reasonable compensation
for the services of Beneficiary, its counsel, agents and employees.


 


(d)                                 Hold,
lease, develop, manage, operate or otherwise use the Trust Property upon such
terms and conditions as Beneficiary may deem reasonable under the circumstances
(making such repairs, alterations, additions and improvements


 


21

















 


and taking other actions,
from time to time, as Beneficiary deems necessary or desirable), and apply all
Rents and other amounts collected by Trustee in connection therewith in accordance
with the provisions of Section 5.7 hereof.


 


(e)                                  Require
Grantor to assemble any collateral under the UCC and make it available to
Beneficiary, at Grantor’s sole risk and expense, at a place or places to be
designated by Beneficiary, in its sole discretion.


 


(f)                                    Institute
proceedings for the complete foreclosure of this Deed of Trust, either by
judicial action or by power of sale, in which case the Trust Property may be
sold for cash or credit in accordance with applicable law in one or more
parcels as Beneficiary may determine. 
Except as otherwise required by applicable law, with respect to any
notices required or permitted under the UCC, Grantor agrees that ten (10) days’
prior written notice shall be deemed commercially reasonable.  At any such sale by virtue of any judicial
proceedings, power of sale, or any other legal right, remedy or recourse, the
title to and right of possession of any such property shall pass to the
purchaser thereof, and to the fullest extent permitted by law, Grantor shall be
completely and irrevocably divested of all of its right, title, interest,
claim, equity, equity of redemption, and demand whatsoever, either at law or in
equity, in and to the property sold and such sale shall be a perpetual bar both
at law and in equity against Grantor, and against all other Persons claiming or
to claim the property sold or any part thereof, by, through or under
Grantor.  Beneficiary, the Indenture
Trustee or any of the Holders may be a purchaser at such sale.  If Beneficiary is the highest bidder,
Beneficiary may credit the portion of the purchase price that would be
distributed to Beneficiary against the Indebtedness in lieu of paying
cash.  In the event this Deed of Trust
is foreclosed by judicial action, appraisement and valuation of the Trust
Property is waived. In the event of any sale made under or by virtue of this Article 5
(whether made by virtue of judicial proceedings or of a judgment or decree of
foreclosure and sale) the entire Indebtedness, if not previously due and
payable, immediately thereupon shall become due and payable. The failure to
make any such tenants of the Premises party to any such foreclosure proceedings
and to foreclose their rights will not be, nor be asserted to be by Grantor, a
defense to any proceedings instituted by Beneficiary to collect the sums
secured hereby.


 


(g)                                 With
or without entry, to the extent permitted and pursuant to the procedures
provided by applicable law, institute proceedings for the partial foreclosure
of this Deed of Trust for the portion of the Indebtedness then due and payable
(if Beneficiary shall have elected not to declare the entire Indebtedness to be
immediately due and owing), subject to the continuing lien of this Deed of
Trust for the balance of the Indebtedness not then due; or (1) as and to the
extent permitted by law, sell for cash or upon credit the Trust Property or any
part thereof and all estate, claim, demand, right, title and interest of
Grantor therein, pursuant to power of sale or otherwise, at one or more sales,
as an entity or in parcels, at such time and place, upon such terms and after
such notice thereof as may be required or permitted by law, and in the event of
a sale, by


 


22

















 


foreclosure or otherwise,
of less than all of the Trust Property, this Deed of Trust shall continue as a
lien on the remaining portion of the Trust Property; or (2) institute an
action, suit or proceeding in equity for the specific performance of any
covenant, condition or agreement contained herein or in any Indebtedness
Document; or (3) to the extent permitted by applicable law, recover judgment on
the Indenture either before, during or after any proceedings for the
enforcement of this Deed of Trust.


 


(h)                                 Make
application to a court of competent jurisdiction for, and obtain from such
court as a matter of strict right and without notice to Grantor or regard to
the adequacy of the Trust Property for the repayment of the Indebtedness, the
appointment of a receiver of the Trust Property, and Grantor irrevocably
consents to such appointment.  Any such
receiver shall have all the usual powers and duties of receivers in similar
cases, including the full power to rent, maintain and otherwise operate the
Trust Property upon such terms as may be approved by the court, and shall apply
such Rents in accordance with the provisions of Section 5.7
hereof.  Beneficiary may request, in
connection with any foreclosure proceeding hereunder, that the Nevada Gaming
Commission petition a court of competent jurisdiction for the appointment of a
supervisor to conduct the normal gaming activities on the Premises following
such foreclosure proceeding.


 


(i)                                     Exercise
all other rights, remedies and recourses granted under the Indebtedness
Documents or otherwise available at law or in equity.


 


Section 5.2                                   Separate
Sales.  The Trust Property may
be sold in one or more parcels and in such manner and order as Trustee in its
sole discretion may elect; the right of sale arising out of any Event of
Default shall not be exhausted by any one or more sales.


 


Section 5.3                                   Remedies
Cumulative, Concurrent and Nonexclusive.  Beneficiary and Trustee shall have all rights, remedies and
recourses granted in the Indebtedness Documents and available at law or equity
(including the UCC), which rights (a) shall be cumulated and concurrent,
(b) may be pursued separately, successively or concurrently against
Grantor or others obligated under the Indebtedness Documents, or against the
Trust Property, or against any one or more of them, at the sole discretion of
Beneficiary or Trustee, as the case may be, (c) may be exercised as often
as occasion therefor shall arise, and the exercise or failure to exercise any
of them shall not be construed as a waiver or release thereof or of any other
right, remedy or recourse, and (d) are intended to be, and shall be,
nonexclusive.  No action by Beneficiary
or Trustee in the enforcement of any rights, remedies or recourses under the
Indebtedness Documents or otherwise at law or equity shall be deemed to cure
any Event of Default.


 


Section 5.4                                   Release
of and Resort to Collateral. 
Beneficiary may release, regardless of consideration and without the
necessity for any notice to or consent


 


23

















 


by the holder of any
subordinate lien on the Trust Property, any part of the Trust Property without,
as to the remainder, in any way impairing, affecting, subordinating or
releasing the lien or security interest created in or evidenced by the
Indebtedness Documents or their status as a lien and security interest in and
to the Trust Property second in priority to the Superior Deed of Trust
only.  For payment of the Indebtedness,
Beneficiary may resort to any other security in such order and manner as
Beneficiary may elect.


 


Section 5.5                                   Waiver
of Redemption, Notice and Marshalling of Assets.  To the fullest extent permitted by law,
Grantor hereby irrevocably and unconditionally waives and releases (a) all
benefit that might accrue to Grantor by virtue of any present or future statute
of limitations or law or judicial decision exempting the Trust Property from
attachment, levy or sale on execution or providing for any stay of execution,
exemption from civil process, redemption or extension of time for payment,
(b) all notices of any Event of Default or of any election by Trustee or
Beneficiary to exercise or the actual exercise of any right, remedy or recourse
provided for under the Indebtedness Documents, and (c) any right to a
marshalling of assets, a sale in inverse order of alienation or to require sale
of assets in a particular order, including rights provided by NRS 100.040 and
100.050, as such sections may be amended or recodified from time to time.  Each successor and assign of Grantor,
including any holder of a lien or security interest subordinate to this Deed of
Trust, by acceptance of its interest or lien or security interest, agrees that
it shall be bound by the above waiver, as if it had given the waiver itself.


 


Section 5.6                                   Discontinuance
of Proceedings.  If Beneficiary
or Trustee shall have proceeded to invoke any right, remedy or recourse
permitted under the Indebtedness Documents and shall thereafter elect to
discontinue or abandon it for any reason, Beneficiary or Trustee, as the case
may be, shall have the unqualified right to do so and, in such an event,
Grantor, Beneficiary and Trustee shall be restored to their former positions
with respect to the Indebtedness, the Obligations, the Indebtedness Documents,
the Trust Property and otherwise, and the rights, remedies, recourses and
powers of Beneficiary and Trustee shall continue as if the right, remedy or
recourse had never been invoked, but no such discontinuance or abandonment
shall waive any Event of Default which may then exist or the right of
Beneficiary or Trustee thereafter to exercise any right, remedy or recourse
under the Indebtedness Documents for such Event of Default.


 


Section 5.7                                   Application
of Proceeds.  The proceeds of
any sale made under or by virtue of this Article 5, together with
any Rents and other amounts generated by the holding, leasing, management,
operation or other use of the Trust Property, shall be applied by Beneficiary
or Trustee (or the receiver, if one is appointed) in the following order unless
otherwise required by applicable law:


 


24

















 


(a)                                  to
the payment of the costs and expenses of taking possession of the Trust
Property and of holding, using, leasing, repairing, improving and selling the
same, including, without limitation (1) trustee’s and receiver’s fees and
expenses, including the repayment of the amounts evidenced by any receiver’s
certificates, (2) court costs, (3) attorneys’ and accountants’ fees and
expenses, and (4) costs of advertisement;


 


(b)                                 to
the payment of the Indebtedness and performance of the Obligations in such
manner and order of preference as set forth in the Indenture; and


 


(c)                                  the
balance, if any, to the payment of the Persons legally entitled thereto.


 


Section 5.8                                   Occupancy
After Foreclosure.  Except as
otherwise required by applicable law, any sale of the Trust Property or any
part thereof in accordance with Section 5.1(e) or Section 5.1(f)
hereof will divest all right, title and interest of Grantor in and to the
property sold.  Subject to applicable
law, any purchaser at a foreclosure sale will receive immediate possession of
the property purchased.  If Grantor
retains possession of such property or any part thereof subsequent to such
sale, Grantor will be considered a tenant at sufferance of the purchaser, and
will, if Grantor remains in possession after demand to remove, be subject to
eviction and removal, forcible or otherwise, with or without process of law.


 


Section 5.9                                   Additional Advances and Disbursements; Costs
of Enforcement.


 


(a)                                  If
any Event of Default exists, Beneficiary shall have the right, but not the
obligation, to cure such Event of Default in the name and on behalf of
Grantor.  All sums advanced and expenses
incurred at any time by Beneficiary under this Section 5.9, or
otherwise under this Deed of Trust or any of the other Indebtedness Documents
or applicable law, shall bear interest from the date that such sum is advanced
or expense incurred, to and including the date of reimbursement, computed at
the Applicable Rate, and all such sums, together with interest thereon, shall
be secured by this Deed of Trust.


 


(b)                                 Grantor
shall pay all expenses (including reasonable attorneys’ fees and expenses and
all costs and expenses related to legal work, research and litigation) of or
incidental to the perfection and enforcement of this Deed of Trust and the
other Indebtedness Documents, or the enforcement, compromise or settlement of
the Indebtedness or any claim under this Deed of Trust and the other
Indebtedness Documents, and for the curing thereof, or for defending or asserting
the rights and claims of Beneficiary in respect thereof, by litigation or
otherwise.


 


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Section 5.10                            No
Mortgagee in Possession. 
Neither the enforcement of any of the remedies under this Article 5,
the assignment of the rents and leases under Article 6, the security
interests under Article 7, nor any other remedies afforded to
Beneficiary under the Indebtedness Documents, at law or in equity shall cause
Beneficiary or Trustee to be deemed or construed to be a mortgagee in
possession of the Trust Property, to obligate Beneficiary or Trustee to lease
the Trust Property or attempt to do so, or to take any action, incur any
expense, or perform or discharge any obligation, duty or liability whatsoever under
any of the Leases or otherwise.


 


Section 5.11                            WAIVER OF GRANTOR’S RIGHTS.  BY EXECUTION
OF THIS DEED OF TRUST, GRANTOR EXPRESSLY: 
(A) ACKNOWLEDGES THE RIGHT OF BENEFICIARY, INDENTURE TRUSTEE AND/OR
HOLDERS TO ACCELERATE THE INDEBTEDNESS EVIDENCED BY THE INDENTURE OR OTHER
INDEBTEDNESS DOCUMENTS UPON THE OCCURRENCE OF AN EVENT OF DEFAULT;  (B) TO THE EXTENT ALLOWED BY APPLICABLE LAW,
WAIVES ANY AND ALL RIGHTS WHICH GRANTOR MAY HAVE UNDER THE CONSTITUTION OF THE
UNITED STATES, THE VARIOUS PROVISIONS OF THE CONSTITUTIONS FOR THE SEVERAL
STATES, OR BY REASON OF ANY OTHER APPLICABLE LAW, TO NOTICE AND TO JUDICIAL
HEARING PRIOR TO THE EXERCISE BY BENEFICIARY OF ANY RIGHT OR REMEDY HEREIN
PROVIDED TO BENEFICIARY;  (C) ACKNOWLEDGES
THAT GRANTOR HAS READ THIS DEED OF TRUST AND ITS PROVISIONS HAVE BEEN EXPLAINED
FULLY TO GRANTOR AND GRANTOR HAS CONSULTED WITH LEGAL COUNSEL OF GRANTOR’S
CHOICE PRIOR TO EXECUTING THIS DEED OF TRUST; 
AND (D) ACKNOWLEDGES THAT ALL WAIVERS OF THE AFORESAID RIGHTS OF
GRANTOR HAVE BEEN MADE KNOWINGLY, INTENTIONALLY AND WILLINGLY BY GRANTOR AS
PART OF A BARGAINED FOR LOAN TRANSACTION.


 


ARTICLE 6

ASSIGNMENT OF RENTS AND LEASES


 


Section 6.1                                   Assignment.  In furtherance of and in addition to the
assignment made by Grantor in Section 2.1 of this Deed of Trust,
Grantor hereby absolutely and unconditionally assigns, sells, transfers and
conveys to Trustee (for the benefit of Beneficiary) and to Beneficiary all of
its right, title and interest in and to all Leases, whether now existing or
hereafter entered into, and all of its right, title and interest in and to all
Rents.  This assignment is an absolute
assignment and not an assignment for additional security only.  So long as no Event of Default shall have
occurred and be continuing and to the extent not prohibited by the Indenture,
Grantor shall have a revocable license from Trustee and Beneficiary to exercise
all rights extended to the landlord under the Leases, including the right to
receive and collect all


 


26

















 


Rents and to hold the
Rents in trust for use in the payment and performance of the Obligations and to
otherwise use the same.  The foregoing
license is granted subject to the conditional limitation that no Event of Default
shall have occurred and be continuing. 
Upon the occurrence and during the continuance of an Event of Default,
whether or not legal proceedings have commenced, and without regard to waste,
adequacy of security for the Obligations or solvency of Grantor, the license
herein granted shall automatically expire and terminate, without notice by
Trustee or Beneficiary (any such notice being hereby expressly waived by
Grantor).


 


Section 6.2                                   Perfection
Upon Recordation.  Grantor
acknowledges that Beneficiary and Trustee have taken all actions necessary to
obtain, and that upon recordation of this Deed of Trust Beneficiary and Trustee
shall have, to the extent permitted under applicable law, a valid and fully
perfected, present assignment of the Rents arising out of the Leases and all
security for such Leases, subject only to the assignment of such Rents pursuant
to the Superior Deed of Trust and/or any separate assignment of Rents executed
in conjunction therewith.  Grantor
acknowledges and agrees that upon recordation of this Deed of Trust, Trustee’s
and Beneficiary’s interest in the Rents shall be deemed to be fully perfected,
“choate” and enforced as to Grantor and all third parties, including, without
limitation, any subsequently appointed trustee in any case under Title 11 of the
United States Code (the ”Bankruptcy Code”), without the necessity of
commencing a foreclosure action with respect to this Deed of Trust, making
formal demand for the Rents, obtaining the appointment of a receiver or taking
any other affirmative action.


 


Section 6.3                                   Bankruptcy
Provisions.  Without limitation
of the absolute nature of the assignment of the Rents hereunder, Grantor,
Trustee and Beneficiary agree that (a) this Deed of Trust shall constitute a
“security agreement” for purposes of Section 552(b) of the Bankruptcy
Code, (b) the security interest created by this Deed of Trust extends to
property of Grantor acquired before the commencement of a case in bankruptcy
and to all amounts paid as Rents and (c) such security interest shall extend to
all Rents acquired by the estate after the commencement of any case in
bankruptcy.


 


Section 6.4                                   No
Merger of Estates.  So long as
part of the Indebtedness and the Obligations secured hereby remain unpaid and
undischarged, the fee and leasehold estates to the Trust Property shall not
merge, but shall remain separate and distinct, notwithstanding the union of
such estates either in Grantor, Beneficiary, any tenant or any third party by
purchase or otherwise.


 


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ARTICLE 7


SECURITY AGREEMENT


 


Section 7.1                                   Security
Interest.  This Deed of Trust
constitutes a “security agreement” on personal property within the meaning of
the UCC and other applicable law and with respect to the Operational Property,
Fixtures, Ground Leases, Leases, Rents, Deposit Accounts, Property Agreements,
Tax Refunds, Proceeds, Insurance and Condemnation Awards.  To this end, Grantor grants to
Beneficiary a security interest in the Operational Property, Fixtures, Ground
Leases, Leases, Rents, Deposit Accounts, Property Agreements, Tax Refunds,
Proceeds, Insurance and Condemnation Awards and all other Trust Property which
is personal property, second in priority to the security interest created by
the Superior Deed of Trust only, to secure the payment of the Indebtedness and
performance of the Obligations and agrees that Beneficiary shall have all the
rights and remedies of a secured party under the UCC with respect to such
property.  Any notice of sale, disposition
or other intended action by Beneficiary with respect to the Operational
Property, Fixtures, Ground Leases, Leases, Rents, Deposit Accounts, Property
Agreements, Tax Refunds, Proceeds, Insurance and Condemnation Awards sent to
Grantor at least five (5) days prior to any action under the UCC shall
constitute reasonable notice to Grantor. 
THE TERM “TRUST PROPERTY” IS INTENDED TO EXCLUDE ALL ITEMS OF PERSONAL
PROPERTY IN WHICH BENEFICIARY HAS OBTAINED AND/OR PERFECTED A SECURITY INTEREST
UNDER SEPARATE INSTRUMENTS.


 


Section 7.2                                   Financing
Statements.  Grantor shall
provide authorization for Beneficiary to prepare and record, in form and
substance satisfactory to Beneficiary, financing statements (and shall make,
execute and/or otherwise deliver to Beneficiary, in form and substance
satisfactory to Beneficiary, such further documentation and assurances) as
Beneficiary may, from time to time, reasonably consider necessary to create,
perfect and preserve Beneficiary’s security interest hereunder and Beneficiary
may cause such statements and assurances to be recorded and filed, at such
times and places as may be required or permitted by law to so create, perfect
and preserve such security interest. 
Grantor’s state of organization is the State of Nevada.


 


Section 7.3                                   Fixture
Filing.  This Deed of Trust shall
also constitute a “fixture filing” for the purposes of the UCC against all of
the Trust Property which is or is to become fixtures.  Information concerning the security interest herein granted may
be obtained at the address of Debtor (Grantor) and Secured Party (Beneficiary)
as set forth in the first paragraph of this Deed of Trust.


 


Section 7.4                                   Applicable Provisions of Gaming Laws and
Liquor Laws.  The parties
acknowledge and agree that all rights, remedies, and powers provided in this
Deed of Trust relative to the Trust Property may be exercised only to the
extent


 


28

















 


that the exercise thereof
does not violate any applicable mandatory provision of the applicable Gaming
Laws and Liquor Laws and all provisions of this Deed of Trust relative to the
Trust Property are intended to be subject to all applicable mandatory
provisions of the applicable Gaming Laws and Liquor Laws and to be limited
solely to the extent necessary to not render the provisions of this Deed of
Trust invalid or unenforceable, in whole or in part.  Beneficiary will timely apply for and receive all required
approvals of the applicable Gaming Authorities and Liquor Authorities for the
assignment of interests in, sale or other disposition of gaming equipment
regulated by applicable Gaming Laws (including without limitation any such sale
or disposition of gaming equipment consisting of slot machines, gaming tables,
cards, dice, gaming chips, player tracking systems, and all other “gaming devices”
and “associated equipment” (as such terms or words of like import referring
thereto are defined in the applicable Gaming Laws) and for the sale of liquor
and other alcoholic beverages regulated by applicable Liquor Laws.


 


ARTICLE 8


CONCERNING THE TRUSTEE


 


Section 8.1                                   Certain
Rights.  With the approval of
Beneficiary, Trustee shall have the right to select, employ and consult with
counsel.  Trustee shall have the right
to rely on any instrument, document or signature authorizing or supporting any
action taken or proposed to be taken by it hereunder, believed by it in good
faith to be genuine.  Trustee shall be
entitled to reimbursement for actual, reasonable expenses incurred by it in the
performance of its duties and to reasonable compensation for Trustee’s services
hereunder as shall be rendered.  Grantor
shall, from time to time, pay the compensation due to Trustee hereunder and
reimburse Trustee for, and indemnify, defend and save Trustee harmless against,
all liability and reasonable expenses which may be incurred by it in the
performance of its duties, including those arising from joint, concurrent, or
comparative negligence of Trustee; however, Grantor shall not be liable under
such indemnification to the extent such liability or expenses result solely
from Trustee’s or Beneficiary’s gross negligence or willful misconduct.  Grantor’s obligations under this Section 8.1
shall not be reduced or impaired by principles of comparative or contributory
negligence.


 


Section 8.2                                   Retention
of Money.  All moneys received
by Trustee shall, until used or applied as herein provided, be held in trust
for the purposes for which they were received, but need not be segregated in
any manner from any other moneys (except to the extent required by law), and
Trustee shall be under no liability for interest on any moneys received by him
hereunder.


 


Section 8.3                                   Successor
Trustees.  If Trustee or any
successor Trustee shall die, resign or become disqualified from acting in the
execution of this trust, or Beneficiary shall, in Beneficiary’s sole and
absolute discretion, desire to appoint a


 


29

















 


substitute Trustee,
Beneficiary shall have full power to appoint one or more substitute Trustees
and, if preferred, several substitute Trustees in succession who shall succeed
to all the estates, rights, powers and duties of Trustee.  Such appointment may be executed by any
authorized agent of Beneficiary and as so executed, such appointment shall be
conclusively presumed to be executed with authority, valid and sufficient,
without further proof of any action.


 


Section 8.4                                   Perfection
of Appointment.  Should any
deed, conveyance or instrument of any nature be required from Grantor by any
successor Trustee to more fully and certainly vest in and confirm to such
successor Trustee such estates, rights, powers and duties, then, upon request
by such Trustee, all such deeds, conveyances and instruments shall be made,
executed, acknowledged and delivered and shall be caused to be recorded and/or
filed by Grantor.


 


Section 8.5                                   Trustee
Liability.  In no event or
circumstance shall Trustee or any substitute Trustee hereunder be personally
liable under or as a result of this Deed of Trust, either as a result of any
action by Trustee (or any substitute Trustee) in the exercise of the powers
hereby granted or otherwise.


 


ARTICLE 9


MISCELLANEOUS


 


Section 9.1                                   Notices.  Any notice required or permitted to be given
under this Deed of Trust shall be given in accordance with Section 13.02
of the Indenture to the addresses of the parties hereto set forth in the
Preamble hereof.


 


Section 9.2                                   Covenants
Running with the Land.  All
Obligations contained in this Deed of Trust are intended by Grantor,
Beneficiary and Trustee to be, and shall be construed as, covenants running
with the Trust Property.  As used
herein, “Grantor” shall refer to the party named in the first paragraph of this
Deed of Trust and to any subsequent owner of all or any portion of the Trust
Property.  All Persons who may have or
acquire an interest in the Trust Property shall be deemed to have notice of,
and be bound by, the terms of the Indenture and the other Indebtedness
Documents; however, no such party shall be entitled to any rights thereunder
without the prior written consent of Beneficiary.


 


Section 9.3                                   Attorney-in-Fact.  Grantor hereby irrevocably appoints
Beneficiary and its successors and assigns, as its attorney-in-fact, which
agency is coupled with an interest and with full power of substitution, (a) to
execute and/or record any notices of completion, cessation of labor or any
other notices that Beneficiary deems appropriate to protect Beneficiary’s
interest, if Grantor shall fail to do so within ten (10) days after
written request by Beneficiary, (b) upon the issuance of a deed pursuant to the
foreclosure of this Deed of Trust or the delivery of a deed in lieu of
foreclosure, to


 


30

















 


execute all instruments
of assignment, conveyance or further assurance with respect to the Operational
Assets, Fixtures, Ground Leases, Leases, Rents, Deposit Accounts, Property
Agreements, Tax Refunds, Proceeds, Insurance and Condemnation Awards in favor
of the grantee of any such deed and as may be necessary or desirable for such
purpose, (c) to prepare, execute and file or record financing statements,
continuation statements, applications for registration and like papers
necessary to create, perfect or preserve Beneficiary’s security interests and
rights in or to any of the Trust Property, and (d) while any Event of Default
exists, to perform any obligation of Grantor hereunder, however:  (1) Beneficiary shall not under any
circumstances be obligated to perform any obligation of Grantor; (2) any sums
advanced by Beneficiary in such performance shall be added to and included in
the Indebtedness and shall bear interest at the Applicable Rate; (3)
Beneficiary as such attorney-in-fact shall only be accountable for such funds
as are actually received by Beneficiary; and (4) Beneficiary shall not be
liable to Grantor or any other person or entity for any failure to take any
action which it is empowered to take under this Section 9.3.  Notwithstanding the foregoing, Beneficiary
shall be liable for its gross negligence, willful misconduct, and bad faith in
connection with exercising its rights hereunder.  Regardless of any provision of this Deed of Trust or the
Indebtedness Documents, Beneficiary shall not be considered to have accepted
any property other than cash or immediately available funds in satisfaction of
any obligation of Grantor to Beneficiary unless Beneficiary has given express
written notice of Beneficiary’s election of that remedy in accordance with NRS
104.9505, as it may be amended or recodified from time to time.


 


Section 9.4                                   Successors
and Assigns.  This Deed of Trust
shall be binding upon and inure to the benefit of Beneficiary, the Lenders,
Trustee and Grantor and their respective successors and assigns.  Grantor shall not, without the prior written
consent of Beneficiary, assign any rights, duties or obligations hereunder.


 


Section 9.5                                   No
Waiver.  Any failure by
Beneficiary, the Lenders or Trustee to insist upon strict performance of any of
the terms, provisions or conditions of the Indebtedness Documents shall not be
deemed to be a waiver of the same, and Beneficiary, the Indenture Trustee, the
Holders or Trustee shall have the right at any time to insist upon strict
performance of all such terms, provisions and conditions.


 


Section 9.6                                   Indenture.  If any conflict or inconsistency exists
between this Deed of Trust and the Indenture, the Indenture shall govern.


 


Section 9.7                                   Release
or Reconveyance.  Upon payment
in full of the Indebtedness and performance in full of the Obligations,
Beneficiary, at Grantor’s expense, shall release the liens and security interests
created by this Deed of Trust or reconvey the Trust Property to Grantor.  Beneficiary shall also release Beneficiary’s
lien and security interest created by this Deed of Trust or reconvey the Trust
Property to


 


31

















 


Grantor upon the
satisfaction of the release conditions contained in Section 3.5 or
elsewhere in the Indenture.


 


Section 9.8                                   Waiver
of Stay, Moratorium and Similar Rights.  Grantor agrees, to the full extent that it may lawfully do so,
that it will not at any time insist upon or plead or in any way take advantage
of any stay, marshalling of assets, extension, redemption or moratorium law now
or hereafter in force and effect so as to prevent or hinder the enforcement of
the provisions of this Deed of Trust or the Indebtedness secured hereby, or any
agreement between Grantor and Beneficiary or any rights or remedies of
Beneficiary or Trustee.


 


Section 9.9                                   Applicable
Law.  The provisions of this
Deed of Trust regarding the creation, perfection and enforcement of the liens
and security interests herein granted shall be governed by and construed under
the laws of the state in which the Trust Property is located.  All other provisions of this Deed of Trust
shall be governed by the laws of the State of New York, without regard to
conflicts of law principles; provided, however, that whenever in this Deed of
Trust a right is given to Beneficiary, which right is affected by applicable
Gaming Laws or Liquor Laws or the enforcement of which is subject to applicable
Gaming Laws or Liquor Laws, the enforcement of any such right shall be subject
to applicable Gaming Laws and Liquor Laws and approval, if so required, of the
applicable Gaming Authorities or Liquor Authorities.


 


Section 9.10                            Headings.  The Article, Section and
Subsection titles hereof are inserted for convenience of reference only
and shall in no way alter, modify or define, or be used in construing, the text
of such Articles, Sections or Subsections.


 


Section 9.11                            Entire
Agreement.  This Deed of Trust
and the other Indebtedness Documents embody the entire agreement and
understanding between Grantor and Beneficiary and supersede all prior
agreements and understandings between such parties relating to the subject
matter hereof and thereof.  Accordingly,
the Indebtedness Documents may not be contradicted by evidence of prior,
contemporaneous or subsequent oral agreements of the parties.  There are no unwritten oral agreements
between the parties.


 


Section 9.12                            Beneficiary as Agent; Successor Agents.


 


(a)                                  Agent
has been appointed to act as Agent hereunder by the Indenture Trustee.  Agent shall have the right hereunder to make
demands, to give notices, to exercise or refrain from exercising any rights,
and to take or refrain from taking any action (including, without limitation,
the release or substitution of the Trust Property) in accordance with the terms
of the Indenture, any related agency agreement between Agent and the Indenture
Trustee (collectively, as amended, supplemented or otherwise modified or replaced
from time to time, the “Agency Documents”) and this


 


32

















 


Deed of Trust.  Grantor and all other persons shall be
entitled to rely on releases, waivers, consents, approvals, notifications and
other acts of Agent, without inquiry into the existence of required consents or
approvals of the Indenture Trustee therefor.


 


(b)                                 Beneficiary
shall at all times be the same Person that is Agent under the Agency
Documents.  Written notice of
resignation by Agent pursuant to the Agency Documents shall also constitute
notice of resignation as Agent under this Deed of Trust.  Removal of Agent pursuant to any provision
of the Agency Documents shall also constitute removal as Agent under this Deed
of Trust.  Appointment of a successor
Agent pursuant to the Agency Documents shall also constitute appointment of a
successor Agent under this Deed of Trust. 
Upon the acceptance of any appointment as Agent by a successor Agent
under the Agency Documents, that successor Agent shall thereupon succeed to and
become vested with all the rights, powers, privileges and duties of the
retiring or removed Agent as the Beneficiary under this Deed of Trust, and the
retiring or removed Agent shall promptly (i) assign and transfer to such successor
Agent all of its right, title and interest in and to this Deed of Trust and the
Trust Property, and (ii) execute and deliver to such successor Agent such
assignments and amendments and take such other actions, as may be necessary or
appropriate in connection with the assignment to such successor Agent of the
liens and security interests created hereunder, whereupon such retiring or
removed Agent shall be discharged from its duties and obligations under this
Deed of Trust.  After any retiring or
removed Agent’s resignation or removal hereunder as Agent, the provisions of
this Deed of Trust and the Agency Documents shall inure to its benefit as to
any actions taken or omitted to be taken by it under this Deed of Trust while
it was the Agent hereunder.


 


(c)                                  Each
reference herein to any right granted to, benefit conferred upon or power
exercisable, exercised or action taken by the “Beneficiary” shall be deemed to
be a reference to or be deemed to have been so taken, as the case may be, by
Beneficiary, together with its successors and assigns, in its capacity as
Collateral Agent pursuant to the Indenture for the benefit of the Holders, all
as more fully set forth in the Indenture


 


Section 9.13                            No Amendments. 
This Deed of Trust shall not be in any way amended or modified unless
such amendment or modification is in writing and signed by Beneficiary.


 


ARTICLE 10


LOCAL
LAW PROVISIONS


 


Section 10.1                            Power of Sale.  Should default be made by Grantor in the
payment or performance of any Indebtedness or other Obligation or agreement
secured hereby and/or in the performance of any agreement herein, or should
Grantor otherwise


 


33

















 


be in default hereunder,
Beneficiary may, subject to NRS 107.080, declare all sums secured hereby
immediately due by delivery to Trustee of a written notice of breach and
election to sell (which notice Trustee shall cause to be recorded and mailed as
required by law) and shall surrender to Trustee this Deed of Trust.


 


After three (3) months shall have elapsed following recordation of any
such notice of breach, Trustee shall sell the property subject hereto at such
time and at such place in the State of Nevada as Trustee, in its sole
discretion, shall deem best to accomplish the objects of these trusts, having
first given notice of such sale as then required by law.  In the conduct of any such sale Trustee may
act itself or through any auctioneer, agent or attorney.  The place of sale may be either in the
county in which the property to be sold, or any part thereof, is situated, or
at an office of the Trustee located in the State of Nevada.


 


Upon the request of Beneficiary or if required by law Trustee shall
postpone sale of all or any portion of said property or interest therein by
public announcement at the time fixed by said notice of sale, and shall
thereafter postpone said sale from time to time by public announcement at the
time previously appointed.


 


At the time of sale so fixed, Trustee shall sell the property so
advertised or any part thereof or interest therein either as a whole or in
separate parcels, as Beneficiary may determine in its sole and absolute
discretion, to the highest bidder for cash in lawful money of the United
States, payable at the time of sale, and shall deliver to such purchaser a deed
or deeds or other appropriate instruments conveying the property so sold, but
without covenant or warranty, express or implied.  Beneficiary and Trustee may bid and purchase at such sale.  To the extent of the Indebtedness secured
hereby, Beneficiary need not bid for cash at any sale of all or any portion of
the Property pursuant hereto, but the amount of any successful bid by
Beneficiary shall be applied in reduction of said Indebtedness.  Trustor hereby agrees, if it is then still
in possession, to surrender, immediately and without demand, possession of said
property to any purchaser.


 


Trustee shall apply the proceeds of any such sale to the payment of
expenses of sale and all charges and expenses of Trustee and of these trusts,
including costs of evidence of title and Trustee’s fees in connection with
sale; all sums expended under the terms hereof, not then repaid, with accrued
interest at the default rate determined by the Indenture; all other sums then
secured hereby; and the remainder, if any, to the person or persons legally
entitled thereto.


 


Beneficiary, from time to time before Trustee’s sale, may rescind any
notice of breach and election to sell by executing, delivering and causing
Trustee to record a written notice of such rescission.  The exercise by Beneficiary of such right of
rescission shall not constitute a waiver of any breach or default then existing
or subsequently occurring, or impair the right of Beneficiary to execute and
deliver to


 


34

















 


Trustee, as above
provided, other notices of breach and election to sell, nor otherwise affect
any term, covenant or condition hereof or under any obligation secured hereby,
or any of the rights, obligations or remedies of the parties thereunder.


 


Section 10.2                            Credit Bids.  At any foreclosure sale, any person,
including Grantor, Trustee or Beneficiary, may bid for and acquire the Trust
Property or any part thereof to the extent permitted by then applicable law.  Instead of paying cash for such property,
Beneficiary may settle for the purchase price by crediting the sales price of
the property against the obligations in the order provided by NRS 40.462.


 


Section 10.3                            Nevada Law.  Where not inconsistent with the above, the
following covenants, Nos. 1; 2 (full replacement value); 3; 4 (the rate or
rates at which interest is computed upon default of the Indebtedness); 5; 6; 7
(attorneys’ fees as provided herein); 8 and 9 of NRS 107.030 are
hereby adopted and made a part of this Deed of Trust.


 


ARTICLE 11


INTERCREDITOR AGREEMENT


 


The lien of this Deed of Trust is subordinate to the lien of the
Superior Deed of Trust to the extent set forth in the Intercreditor Agreement
and this Deed of Trust is subject to the terms of the Intercreditor Agreement.


 


[The remainder of this page has been intentionally left
blank]


 


35

















 


IN WITNESS WHEREOF,
Grantor has on the date set forth in the acknowledgement hereto, effective as
of the date first above written, caused this instrument to be duly EXECUTED AND
DELIVERED by authority duly given.


 


	
  GRANTOR:

  	
  GNLV,
  CORP., a Nevada corporation

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Timothy N. Poster

  	
   

  
	
   

  	
  Name:

  	
  Timothy N. Poster

  	
   

  
	
   

  	
  Its:

  	
  Chairman of the Board and
  CEO

  	
   

  



 

















 


	
  STATE OF NEVADA

  	
   

  	
  )

  
	
   

  	
   

  	
  )ss.

  
	
  COUNTY OF CLARK

  	
   

  	
  )

  



 


This instrument was
acknowledged before me on  January 21,
2004, by Timothy Poster as Chairman and CEO of GNLV, CORP., a Nevada
corporation.


 


 


	
   

  	
  /s/ Lenore J. DiVicino

  	
   

  
	
   

  	
  Signature of Notarial Officer

  



 

















 


Exhibit A-1


 


Legal Description:
Fee Owned Property


 


PARCEL
I:


 


PARCEL ONE (1):


 


LOTS ONE (1) THROUGH
NINETEEN (19), INCLUSIVE, IN BLOCK THIRTEEN (13) AND LOTS TWENTY-SEVEN (27)
THROUGH THIRTY-TWO (32), INCLUSIVE, IN BLOCK THIRTEEN (13) OF CLARK’S LAS VEGAS
TOWNSITE, AS SHOWN BY MAP THEREOF ON FILE IN BOOK 1 OF PLATS, PAGE 37, IN THE
OFFICE OF THE COUNTY RECORDER OF CLARK COUNTY, NEVADA.


 


PARCEL TWO (2):


 


THAT PORTION OF VACATED
ALLEY AS PROVIDED FOR IN THAT CERTAIN ORDER OF VACATION, RECORDED
NOVEMBER 13, 1978 IN BOOK 969 AS DOCUMENT NO. 928271, OF OFFICIAL RECORDS.


 


PARCEL THREE (3):


 


THAT PORTION OF THE
VACATED STREET COMMONLY KNOWN AS CARSON AVENUE AS PROVIDED FOR IN THAT CERTAIN
ORDER OF VACATION, RECORDED NOVEMBER 8, 1985 IN BOOK 2214 AS DOCUMENT NO.
2173941, OF OFFICIAL RECORDS.


 


PARCEL
II:


 


PARCEL ONE (1):


 


LOTS TWENTY (20) AND
TWENTY-ONE (21) IN BLOCK THIRTEEN (13) OF CLARK’S LAS VEGAS TOWNSITE, AS SHOWN
BY MAP THEREOF ON FILE IN BOOK 1 OF PLATS, PAGE 37, IN THE OFFICE OF THE COUNTY
RECORDER OF CLARK COUNTY, NEVADA.


 


PARCEL TWO (2):


 


THAT PORTION OF VACATED
ALLEY AS PROVIDED FOR IN THAT CERTAIN ORDER OF VACATION, RECORDED
NOVEMBER 13, 1978 IN BOOK 969 AS DOCUMENT NO. 928271, OF OFFICIAL RECORDS.


 

















 


PARCEL
IV:


 


PARCEL ONE (1):


 


LOTS ONE (1) AND TWO (2)
IN BLOCK FOURTEEN (14) OF CLARK’S LAS VEGAS TOWNSITE, AS SHOWN BY MAP THEREOF
ON FILE IN BOOK 1 OF PLATS, PAGE 37, IN THE OFFICE OF THE COUNTY RECORDER OF
CLARK COUNTY, NEVADA.


 


PARCEL TWO (2):


 


THAT PORTION OF VACATED
ALLEY AS PROVIDED FOR IN THAT CERTAIN ORDER OF VACATION, RECORDED MARCH 25,
1983 IN BOOK 1709 AS DOCUMENT NO. 1668172, OF OFFICIAL RECORDS.


 


PARCEL
V:


 


PARCEL ONE (1):


 


LOTS THREE (3) THROUGH
SEVEN (7), INCLUSIVE, IN BLOCK FOURTEEN (14) OF CLARK’S LAS VEGAS TOWNSITE, AS
SHOWN BY MAP THEREOF ON FILE IN BOOK 1 OF PLATS, PAGE 37, IN THE OFFICE OF THE
COUNTY RECORDER OF CLARK COUNTY, NEVADA.


 


PARCEL TWO (2):


 


THAT PORTION OF VACATED
ALLEY AS PROVIDED FOR IN THAT CERTAIN ORDER OF VACATION, RECORDED
MARCH 25, 1983 IN BOOK 1709 AS DOCUMENT NO. 1668172, OF OFFICIAL RECORDS.


 


PARCEL
VI:


 


PARCEL ONE (1):


 


LOTS NINE (9) THROUGH
TWELVE (12), INCLUSIVE, IN BLOCK FOURTEEN (14) OF CLARK’S LAS VEGAS TOWNSITE,
AS SHOWN BY MAP THEREOF ON FILE IN BOOK 1 OF PLATS, PAGE 37, IN THE OFFICE OF
THE COUNTY RECORDER OF CLARK COUNTY, NEVADA.


 


TOGETHER WITH THE NORTH
10.00 FEET OF THAT VACATED ALLEY AS DISCLOSED BY THAT CERTAIN ORDER OF VACATION
RECORDED MARCH 1, 1962 IN BOOK 346 AS DOCUMENT NO. 279369, OF OFFICIAL
RECORDS.


 


2

















 


PARCEL TWO (2):


 


THAT PORTION OF VACATED
ALLEY AS PROVIDED FOR IN THAT CERTAIN ORDER OF VACATION, RECORDED MARCH 1,
1962 IN BOOK 346 AS DOCUMENT NO. 279369 AND AMENDED JULY 19, 1967 IN BOOK
810 AS DOCUMENT NO. 650610, OF OFFICIAL RECORDS.


 


PARCEL
VII:


 


PARCEL ONE (1):


 


LOT THIRTEEN (13) IN
BLOCK FOURTEEN (14) OF CLARK’S LAS VEGAS TOWNSITE, AS SHOWN BY MAP THEREOF ON
FILE IN BOOK 1 OF PLATS, PAGE 37, IN THE OFFICE OF THE COUNTY RECORDER OF CLARK
COUNTY, NEVADA.


 


PARCEL TWO (2):


 


THAT PORTION OF VACATED
ALLEY AS PROVIDED FOR IN THAT CERTAIN ORDER OF VACATION, RECORDED JULY 8,
1977 IN BOOK 760 AS DOCUMENT NO. 719759 AND RECORDED MARCH 25, 1983 IN
BOOK 1709 AS DOCUMENT NO. 1668172, OF OFFICIAL RECORDS.


 


PARCEL
VIII:


 


PARCEL ONE (1):


 


LOT FOURTEEN (14) IN
BLOCK FOURTEEN (14) OF CLARK’S LAS VEGAS TOWNSITE, AS SHOWN BY MAP THEREOF ON
FILE IN BOOK 1 OF PLATS, PAGE 37, IN THE OFFICE OF THE COUNTY RECORDER OF CLARK
COUNTY, NEVADA.


 


PARCEL TWO (2):


 


THAT PORTION OF VACATED
ALLEY AS PROVIDED FOR IN THAT CERTAIN ORDER OF VACATION RECORDED JULY 8,
1977 IN BOOK 760 AS DOCUMENT NO. 719758, OF OFFICIAL RECORDS.


 


PARCEL
IX:


 


PARCEL ONE (1):


 


3

















 


LOTS FIFTEEN (15) THROUGH
TWENTY-EIGHT (28), INCLUSIVE, AND LOT THIRTY (30) IN BLOCK FOURTEEN (14) OF
CLARK’S LAS VEGAS TOWNSITE, AS SHOWN BY MAP THEREOF ON FILE IN BOOK 1 OF PLATS,
PAGE 37, IN THE OFFICE OF THE COUNTY RECORDER, CLARK COUNTY, NEVADA.


 


PARCEL TWO (2):


 


THAT PORTION OF VACATED
ALLEY AS PROVIDED FOR IN THAT CERTAIN ORDER OF VACATION RECORDED JULY 8,
1977 IN BOOK 760 AS DOCUMENT NO. 719758, OF OFFICIAL RECORDS.


 


PARCEL THREE (3):


 


THOSE PORTIONS OF THE
VACATED STREET COMMONLY KNOWN AS CARSON AVENUE AS PROVIDED FOR IN THAT CERTAIN
ORDER OF VACATION, RECORDED NOVEMBER 8, 1985 IN BOOK 2214 AS DOCUMENT NO.
2173941, OF OFFICIAL RECORDS.


 


PARCEL
XIII:


 


LOTS SEVENTEEN (17)
THROUGH TWENTY (20), INCLUSIVE, IN BLOCK FOUR (4) OF CLARK’S LAS VEGAS
TOWNSITE, AS SHOWN BY MAP THEREOF ON FILE IN BOOK 1 OF PLATS, PAGE 37, IN THE
OFFICE OF THE COUNTY RECORDER OF CLARK COUNTY, NEVADA.


 


PARCEL
XIV:


 


LOTS TWENTY-ONE (21)
THROUGH THIRTY-TWO (32), INCLUSIVE, IN BLOCK FOUR (4) OF CLARK’S LAS VEGAS
TOWNSITE, AS SHOWN BY MAP THEREOF ON FILE IN BOOK 1 OF PLATS, PAGE 37, IN THE
OFFICE OF THE COUNTY RECORDER OF CLARK COUNTY, NEVADA.


 


PARCEL
XV:


 


THAT PORTION OF THE
NORTHWEST QUARTER (NW 1⁄4) OF THE SOUTHEAST QUARTER (SE 1⁄4) OF SECTION 27,
TOWNSHIP 20 SOUTH, RANGE 61 EAST, M.D.M., AND A PORTION OF BLOCK ONE (1) OF THE
ORIGINAL PLAT OF LAS VEGAS TOWNSITE AS SHOWN BY MAP THEREOF ON FILE IN BOOK 1
OF PLATS, PAGE 17-B, CLARK COUNTY, NEVADA RECORDS, DESCRIBED AS FOLLOWS:


 


COMMENCING AT A POINT IN
THE EAST LINE OF THE UNION PACIFIC RAILROAD COMPANY RIGHT OF WAY DISTANT
THEREON NORTH 27°45’00”


 


4

















 


EAST 676.17 FEET FROM THE
SOUTH LINE OF THE NORTHEAST QUARTER (NE 1⁄4) OF THE SOUTHWEST QUARTER (SW 1⁄4) OF
SAID SECTION 27, SAID POINT OF BEGINNING ALSO BEING DISTANT SOUTH 27°45’00”
WEST 100 FEET FROM THE MOST NORTHERLY CORNER OF THAT PARCEL OF LAND CONVEYED BY
CARL A. HUGGEY ET UX TO J KELL HOUSSELS, ET UX, BY DEED DATED JANUARY 15,
1946 AND RECORDED IN BOOK 41 OF DEEDS, PAGE 345, CLARK COUNTY, NEVADA RECORDS;
THENCE SOUTH 62°15’00” EAST A DISTANCE OF 180 FEET MORE OR LESS
TO A POINT DISTANT NORTH 62°15’00” WEST 170
FEET FROM THE WEST LINE OF MAIN STREET (80 FEET WIDE); THENCE SOUTH 27°45’00”
WEST A PARALLEL WITH THE WEST LINE OF SAID MAIN STREET A DISTANCE OF 200 FEET
TO A POINT; THENCE NORTH 62°15’00” WEST A
DISTANCE OF 180 FEET, MORE OR LESS TO A POINT IN THE EAST LINE OF THE UNION
PACIFIC RAILROAD COMPANY RIGHT OF WAY; THENCE NORTH 27°45’00”
EAST ALONG THE EAST LINE OF SAID RAILROAD RIGHT OF WAY A DISTANCE OF 200 FEET
TO THE POINT OF BEGINNING.


 


TOGETHER WITH THE RIGHT
OF INGRESS AND EGRESS IN COMMON WITH GRANTORS, THE SURVIVORS OF THEM, THEIR
TENANTS AND ASSIGNS, FROM NORTH MAIN STREET TO THE ABOVE DESCRIBED PARCEL OF
LAND OVER AND ACROSS THE FOLLOWING DESCRIBED PARCEL OF LAND; A PORTION OF THE
SOUTHEAST QUARTER (SE 1⁄4) OF SECTION 27, TOWNSHIP 20 SOUTH, RANGE 61 EAST,
M.D.M., DESCRIBED AS FOLLOWS:


 


COMMENCING AT THE
INTERSECTION OF THE NORTH LINE OF BONANZA ROAD, (FORMERLY CLARK AVENUE) AS
SAID ROAD NOW EXISTS 80 FEET IN WIDTH, WITH THE WEST LINE OF MAIN STREET, SAID
STREET NOW EXISTS 80 FEET IN WIDTH, THENCE NORTH 27°45’00”
EAST ALONG THE WEST LINE OF SAID MAIN STREET A DISTANCE OF 224.19 FEET TO A
POINT BEING THE SOUTHEAST CORNER OF THAT PARCEL OF LAND CONVEYED BY CARL A.
HUFFEY AND JULIA S. HUFFEY, TO RICHARD H. CLOUGH AND EDITH CLOUGH AND JULES C.
RENBOW BY DEED DATED JULY 16, 1945, AND RECORDED IN BOOK 39 OF DEEDS, PAGE
211, RECORDS OF CLARK COUNTY, NEVADA BEING THE TRUE POINT OF BEGINNING; THENCE
NORTH 62°15’00” WEST ALONG THE SOUTH LINE OF THE LAST
MENTIONED CONVEYED PARCEL OF LAND A DISTANCE OF 140 FEET TO THE SOUTHWEST
CORNER OF SAID PARCEL; THENCE NORTH 27°45’” EAST ALONG THE
WEST LINE OF SAID CONVEYED PARCEL TO RICHARD E. CLOUGH, ET AL, AND ALSO ALONG
THE WEST LINE OF THAT PARCEL OF LAND CONVEYED BY CARL A. HUGGEY AND JULIA S.
HUFFEY TO J. KELL HOUSSELS, SR., AND ALICE M. HOUSSELS BY DEED DATED
JULY 20, 1945 AND RECORDED IN BOOK 39 OF DEEDS, PAGE 225, RECORDS OF CLARK


 


5

















 


COUNTY, NEVADA AND ALSO
ALONG THE WEST LINE OF THE PARCEL OF LAND CONVEYED BY CARL A. HUFFEY
AND JULIA S. HUFFEY TO BERT A. STEVENS AND ETHEL MAY STEVENS, BY DEED DATED
AUGUST 28, 1945 AND RECORDED IN BOOK 40 OF DEEDS, PAGE 10, RECORDS OF
CLARK COUNTY, NEVADA, AND CONTINUING NORTH 27145’ EAST A TOTAL DISTANCE OF 325
FEET TO A POINT; THENCE SOUTH 62°15’00”
EAST A DISTANCE OF 140 FEET TO A POINT IN THE WEST LINE OF MAIN STREET; THENCE
NORTH 27°45’00” EAST ALONG THE WEST LINE OF SAID MAIN
STREET A DISTANCE OF 50 FEET TO A POINT; THENCE NORTH 62°15’00” WEST
A DISTANCE OF 170 FEET TO A POINT; THENCE SOUTH 27°45’00”
WEST A DISTANCE OF 399.0 FEET TO A POINT; THENCE SOUTH 62°15’00”
EAST A DISTANCE OF 170 FEET TO A POINT IN THE WEST LINE OF SAID MAIN STREET;
THENCE NORTH 27°45’00” EAST ALONG THE WEST LINE OF SAID MAIN
STREET A DISTANCE OF 24 FEET TO THE TRUE POINT OF BEGINNING.


 


6

















 


Exhibit A-2


 


Legal Description:
Ground Leased Property


 


PARCEL
III:


 


PARCEL ONE (1):


LOTS TWENTY-TWO (22)
THROUGH TWENTY-SIX (26), INCLUSIVE, IN BLOCK THIRTEEN (13) OF CLARK’S LAS VEGAS
TOWNSITE, AS SHOWN BY MAP THEREOF ON FILE IN BOOK 1 OF PLATS, PAGE 37, IN THE
OFFICE OF THE COUNTY RECORDER OF CLARK COUNTY, NEVADA.


 


PARCEL TWO (2):


THAT PORTION OF VACATED
ALLEY AS PROVIDED FOR IN THAT CERTAIN ORDER OF VACATION, RECORDED NOVEMBER 13,
1978 IN BOOK 969 AS DOCUMENT NO. 928271, OF OFFICIAL RECORDS.


 


PARCEL
X:


 


PARCEL ONE (1):


 


LOT EIGHT (8) IN BLOCK
FOURTEEN (14) OF CLARK’S LAS VEGAS TOWNSITE, AS SHOWN BY MAP THEREOF ON FILE IN
BOOK 1 OF PLATS, PAGE 37, IN THE OFFICE OF THE COUNTY RECORDER OF CLARK COUNTY,
NEVADA.


 


PARCEL TWO (2):


 


THAT PORTION OF VACATED
ALLEY AS PROVIDED FOR IN THAT CERTAIN ORDER OF VACATION RECORDED MARCH 1,
1962 IN BOOK 346 AS DOCUMENT NO. 279369 AND AMENDED JULY 19, 1967 IN BOOK
810 AS DOCUMENT NO. 650610, OF OFFICIAL RECORDS.


 


PARCEL
XI:


 


PARCEL ONE (1):


 


LOT TWENTY-NINE (29) IN
BLOCK FOURTEEN (14) OF CLARK’S LAS VEGAS TOWNSITE, AS SHOWN BY MAP THEREOF ON
FILE IN BOOK 1 OF PLATS, PAGE 37, IN THE OFFICE OF THE COUNTY RECORDER OF CLARK
COUNTY, NEVADA.


 

















 


PARCEL TWO (2):


 


THAT PORTION OF VACATED
ALLEY AS PROVIDED FOR IN THAT CERTAIN ORDER OF VACATION RECORDED JULY 8,
1977 IN BOOK 760 AS DOCUMENT NO. 719758, OF OFFICIAL RECORDS.


 


PARCEL
XII:


 


PARCEL ONE (1):


 


LOTS THIRTY-ONE (31) AND
THIRTY-TWO (32) IN BLOCK FOURTEEN (14) OF CLARK’S LAS VEGAS TOWNSITE, AS SHOWN
BY MAP THEREOF ON FILE IN BOOK 1 OF PLATS, PAGE 37, IN THE OFFICE OF THE COUNTY
RECORDER OF CLARK COUNTY, NEVADA.


 


PARCEL TWO (2):


 


THOSE PORTION OF VACATED
ALLEYS AS PROVIDED FOR IN THOSE CERTAIN ORDERS OF VACATION, RECORDED
MARCH 1, 1962 IN BOOK 346 AS DOCUMENT NO. 279369 AND AMENDED JULY 19,
1967 IN BOOK 810 AS DOCUMENT NO. 650610 AND RECORDED JULY 8, 1977 IN BOOK
760 AS DOCUMENT NO. 719758 AND 719759, AND RECORDED MARCH 25, 1983 IN BOOK
1709 AS DOCUMENT NO. 1688172, OF OFFICIAL RECORDS.


 


2

















 


Exhibit B


 


Description of
Ground Leases


 


As to Parcel III:


 


Lease by and between Elizabeth Properties Trust,
Elizabeth Zahn, Lessor, and Golden Nugget, Inc., a Nevada Corporation, Lessee,
recorded May 20, 1976 in Book 623 as Document No. 582418, upon and subject to
all of the provisions therein contained; and thereafter the trustors interest
was assigned to GNLV, Corp., a Nevada Corporation by mesne assignments of record,
the last of which was dated May 9, 1986, recorded June 23, 1986 in Book
860623 as Document No. 00182.


 


As to Parcels XI and XII:


 


Lease by and between First National Bank of Nevada,
Trustee under Private Trust No. 87, Lessor, and Golden Nugget, Inc., a Nevada
Corporation, Lessee, recorded July 5, 1973 in Book 343 as Document No.
302700, upon and subject to all of the provisions therein contained; and
thereafter the trustors interest was assigned to GNLV Corp., a Nevada
Corporation by mesne assignments of record, the last of which was dated May 9,
1986, recorded June 23, 1986 in Book 860623 as Document No. 00176.


 


As to
Parcel X:


 


Lease by and between Fraternal Order of Eagles, Las
Vegas Aerie 1213, Lessor, and Golden Nugget, Inc., a Nevada Corporation, Lessee,
recorded September 12, 1962 in Book 386 as Document No. 311481, upon and
subject to all of the provisions therein contained; and thereafter the trustors
interest was assigned to GNLV, Corp., a Nevada Corporation by mesne assignments
of record, the last of which was dated May 9, 1986, recorded June 23, 1986
in Book 860623 as Document No. 00179.


 

















 


Exhibit C


 


“Participation”
Slot Machines


 


[take from
Schedule E-1 of Senior Loan Agreement]


 


2

















 


ASSESSOR’S PARCEL NOS:

139-34-210-031 ; 139-34-210-032 ;

137-34-210-045 ; 139-34-111-050 ;

139-27-702-014 ; 139-34-111-049 ;

139-34-111-051 ; 139-34-111-052 ; 

139-27-310-093


 


SEND
PROPERTY TAX STATEMENTS

TO:  GNLV, CORP.,

129 E. Fremont Street, Las Vegas, NV 89101


 


WHEN RECORDED MAIL TO:

Weil, Gotshal & Manges LLP

767 Fifth Avenue

New York, New York 10153

Attention:  David A. Berlyne, Esq.


 


DEED OF TRUST, ASSIGNMENT

OF RENTS AND LEASES, FIXTURE FILING AND SECURITY AGREEMENT (FEE AND LEASEHOLD)


 


by and from


 


GNLV, CORP., “Grantor”


 


to


 


NEVADA TITLE COMPANY, “Trustee”


 


for the benefit of


 


WELLS FARGO BANK,
N.A.,

in its capacity as Collateral Agent, “Beneficiary”


 


Dated as of January 23, 2004


 




	
   

  	
  Municipality:

  	
   

  	
  Las
  Vegas

  
	
   

  	
  County:

  	
   

  	
  Clark

  
	
   

  	
  State:

  	
   

  	
  Nevada

  






 

















 


This Deed of Trust is to be filed and indexed in the real estate
records and is also to be indexed in the index of Financing Statements of Clark
County, Nevada under the names of GNLV, CORP., a Nevada corporation, as Debtor,
and Wells Fargo Bank, N.A., in its capacity as Collateral Agent, as secured
party.  Debtor’s organizational number
is Nevada file number C1348-1974. 
Information concerning the security interest may be obtained from Beneficiary
at the following address:  Corporate
Trust Services, Sixth Street and Marquette Avenue, MAC N9303-120, Minneapolis,
MN 55479, Attn: Jane Y. Schweiger.


 


This Deed of Trust is to be governed by the provisions of
NRS 106.300 through NRS 106.400 inclusive.  The maximum amount to be secured by this Deed of Trust is
$300,000,000.  Without limiting the
foregoing, Obligations under any and all Additional Notes and Exchange Notes
and any guarantees in respect of the same shall be automatically secured
hereby, and the payment of all sums expended or advanced by Agent, Indenture
Trustee or the Holders under or pursuant to the terms hereof or the Indenture
or to protect the security hereof, together with interest thereon as herein
provided (without limiting the generality of the protections afforded by
NRS Chapter 106), and funds disbursed that, in the reasonable
exercise of Beneficiary’s judgment, are needed for improving Trust Property or
to protect Beneficiary’s security in the Trust Property are to be deemed
obligatory advances hereunder and will be added to the total indebtedness secured
by this Deed of Trust and such indebtedness shall be increased accordingly.