Exhibit 4.1


 


SUPPLEMENTAL
INDENTURE


 


SUPPLEMENTAL INDENTURE (this “Supplemental
Indenture”), dated as of January 9, 2008, by and among Festival Fun
Parks, LLC, a Delaware limited liability company (“Festival Fun Parks”),
Palace Finance, Inc., a Delaware corporation (“Palace Finance” and,
together with Festival Fun Parks, the “Issuers”), Palace Entertainment
Holdings, Inc., a Delaware corporation (the “Parent”), the
Subsidiary Guarantors (as defined in the Indenture referred to herein) party
hereto and Wells Fargo Bank, National Association, as trustee (the “Trustee”).


 


WHEREAS, the Issuers, the Parent, the Subsidiary
Guarantors and the Trustee are parties to that certain Indenture, dated as of April 12,
2006 (as amended, supplemented or otherwise modified from time to time, the “Indenture”),
pursuant to which the Issuers’ 10 7/8% Senior Notes due 2014 (the “Notes”)
were issued.  Capitalized terms used but
not defined herein shall have the same meanings ascribed to such terms in the
Indenture;


 


WHEREAS, Section 9.2 of the Indenture provides
that the Issuers, the Note Guarantors and the Trustee may make certain
amendments to the Indenture with the written consent of the Holders of not less
than a majority in principal amount of the outstanding Notes;


 


WHEREAS, the Issuers issued an Offer to Purchase and
Consent Solicitation Statement dated as of December 20, 2007 (the “Statement”)
to, among other things, make an offer to purchase all outstanding Notes upon
terms and conditions described in the Statement (the “Offer”) and to
solicit consents from the Holders to the Proposed Amendments (as defined in the
Statement);


 


WHEREAS, Holders of at least a majority in aggregate
principal amount of the outstanding Notes have given and not withdrawn their
consent to the Proposed Amendments pursuant to the Statement; and


 


WHEREAS, the execution of this Supplemental Indenture
by the parties hereto is in all respects authorized by the provisions of the
Indenture, the Issuers and the Note Guarantors have delivered to the Trustee an
Officers’ Certificate and an Opinion of Counsel with respect to such
authorization, and all things necessary to make this Supplemental Indenture a
valid agreement of the Issuers, the Note Guarantors and the Trustee in
accordance with its terms have been done.


 


NOW THEREFORE, in consideration of the foregoing and
for other good and valuable consideration, the receipt of which is hereby
acknowledged, each Issuer, each Note Guarantor and the Trustee mutually
covenant and agree as follows:


 


1.             Effect.  This Supplemental Indenture shall become
effective upon its execution and delivery by the parties hereto.  If, after the date hereof, the Offer is
terminated or withdrawn, the Notes accepted for payment pursuant to the Offer
are not paid, or the Consent Payments (as defined in the Statement) are not
made, on the Payment Date (as defined in the Statement), this Supplemental
Indenture shall no longer be effective. 
Notwithstanding the foregoing, the amendments set forth in Section 2
below will not become operative until the opening of business on the Payment
Date (as defined in the Statement), at which time such amendments shall be
effective as of the date hereof.


 


2.             Amendments.


 


The Indenture is hereby amended as follows:


 


(a)          the text of
Sections 3.2, 3.3, 3.4, 3.5, 3.6 (except to the extent provided in clause (c) below),
3.7, 3.9, 3.11, 3.12, 3.13, 3.14, 3.17, 3.18, 3.19 and 3.20 of the Indenture is
hereby deleted in its entirety and these Sections shall be of no further
force and effect and the words “[INTENTIONALLY DELETED]” shall be inserted, in
each case, in replacement of the deleted text;


 

















 


(b)          the text of
Sections 4.1 and 4.2 of the Indenture is hereby deleted in its entirety
and these Sections shall be of no further force and effect and the words “[INTENTIONALLY
DELETED]” shall be inserted, in each case, in replacement of the deleted text;


 


(c)          Sections 3.6 (to the
extent relating to Section 3.8), 3.8 and 3.10 are hereby amended so that
these Sections shall only apply to Sale/Leaseback Transactions, Asset
Dispositions and Change of Control events that have already occurred as of the
date hereof and shall become inapplicable to Sale/Leaseback Transactions, Asset
Dispositions and Change of Control events that have not yet occurred as of the
date hereof;


 


(d)          the provisions of
Sections 6.1(2) and 6.1(4) as they apply to the covenants
referred to in paragraph (c) and paragraph (a), respectively, above are
hereby deleted in their entirety and shall be of no further force and effect;


 


(e)          the text of
Sections 6.1(3), 6.1(5), 6.1(6), 6.1(9) and 6.1(10) is hereby
deleted in its entirety and these Sections shall be of no further force
and effect; and


 


(f)           any and all
references in the Indenture to the deleted Sections, Subsections or provisions
referred to in paragraphs (a)-(e) above are hereby deleted in their
entirety as are any defined terms in the Indenture which are used solely in
such deleted Sections, Subsections or provisions of the Indenture.


 


Any covenant or other provision contained in the Notes
that relates to any covenant or other provision of the Indenture amended by
this Supplemental Indenture shall be likewise amended so that such covenant or
other provision will conform to and be consistent with any covenant or other
provision of the Indenture amended by this Supplemental Indenture.


 


3.             Governing Law.  This Supplemental Indenture shall be governed
by and construed in accordance with the laws of the State of New York.


 


4.             Counterparts.  This Supplemental Indenture may be executed
in one or more counterparts, each of which when so executed and delivered shall
be an original, but all of which together shall constitute one and the same
document.  Facsimile transmission of any
signature and/or electronic re-transmission of any signature will be deemed the
same as delivery of the original.


 


5.             Effect on
Indenture.  This Supplemental
Indenture shall form a part of the Indenture for all purposes, and every Holder
of Notes heretofore or hereafter authenticated and delivered shall be bound
hereby.  Except as expressly set forth
herein, the Indenture is in all respects ratified and confirmed and all the
terms, conditions and provisions thereof, including all the provisions of Section 7.1,
7.2, 7.3, 7.4 and 7.7 of the Indenture shall remain in full force and effect, including
with respect to this Supplemental Indenture.


 


6.             Indemnification.  The Issuers and the Subsidiary Guarantors
shall jointly and severally indemnify the Trustee and its agents, employees,
officers, directors and shareholders for, and hold same harmless against, any
and all loss, liability or expense (including, without limitation, reasonable
attorneys’ fees and expenses) incurred by it without negligence, willful
misconduct or bad faith on its part, in connection with the transactions
contemplated by this Supplemental Indenture, including the performance by the
Trustee of any duty or obligation required of the Trustee pursuant to this
Supplemental Indenture.  Notwithstanding
the foregoing, the parties hereby agree that in no event shall the Trustee be
found or held negligent for agreeing to enter into and execute the Supplemental
Indenture.


 


2

















 


7.             Trustee’s
Disclaimer.  The Trustee shall not be
responsible for and makes no representation as to the validity or adequacy of
this Supplemental Indenture or the Notes, and it shall not be responsible for
any statement of the Issuers or the Subsidiary Guarantors in this Supplemental
Indenture.  The recitals contained herein
shall be taken as the statements of the Issuers and the Subsidiary Guarantors,
and the Trustee assumes no responsibility for their correctness.


 


8.             Conflict with
Trust Indenture Act.  If any
provision of this Supplemental Indenture limits, qualifies or conflicts with
any provision of the Trust Indenture Act that may not be so limited, qualified
or conflicted with, such provision of such Act shall control.  If any provision of this Supplemental
Indenture modifies or excludes any provision of the Trust Indenture Act that
may be so modified or excluded, the provision of such Act shall be deemed to
apply to the Indenture as so modified or to be excluded by this Supplemental
Indenture, as the case may be.


 


9.             Separability
Clause.  In case any provision in
this Supplemental Indenture shall be invalid, illegal or unenforceable, the
validity, legality and enforceability of the remaining provisions shall not in
any way be affected or impaired thereby.


 


10.           Effect of
Headings.  The Article and Section headings
herein are for convenience only and shall not affect the construction hereof.


 


11.           Benefits of
Supplemental Indenture, etc.  Nothing
in this Supplemental Indenture, the Indenture or the Notes, express or implied,
shall give to any person, other than the parties hereto and thereto and their
successors hereunder and thereunder and the Holders of Notes, any benefit of
any legal or equitable right, remedy or claim under the Indenture, this
Supplemental Indenture or the Notes.


 


12.           Successors and
Assigns.  All agreements of the
Issuers in this Supplemental Indenture and the Notes shall bind their
respective successors.


 


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page intentionally left blank]


 


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IN WITNESS WHEREOF, the parties have executed this
Supplemental Indenture as of the date first written above.


 


	
   

  	
  FESTIVAL FUN
  PARKS, LLC

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By: 

  	
  /s/ Todd R.
  Wulffson

  
	
   

  	
   

  	
  Name: Todd R.
  Wulffson

  
	
   

  	
   

  	
  Title: General
  Counsel and Secretary

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  PALACE FINANCE,
  INC.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By: 

  	
  /s/ Todd R.
  Wulffson

  
	
   

  	
   

  	
  Name: Todd R.
  Wulffson

  
	
   

  	
   

  	
  Title: Secretary

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  PALACE
  ENTERTAINMENT HOLDINGS, INC.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By: 

  	
  /s/ Todd R.
  Wulffson

  
	
   

  	
   

  	
  Name: Todd R.
  Wulffson

  
	
   

  	
   

  	
  Title: General
  Counsel and Secretary

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  SPLISH SPLASH AT

  
	
   

  	
  ADVENTURELAND
  INC.

  
	
   

  	
  FAMILY FUN
  CENTERS HOLDINGS LLC

  
	
   

  	
  SMARTPARKS - SAN
  JOSE INC.

  
	
   

  	
  SMARTPARKS -
  RIVERSIDE INC.

  
	
   

  	
  SMARTPARKS - SAN
  DIMAS INC.

  
	
   

  	
  RAGING WATERS
  GROUP INC.

  
	
   

  	
  WET ‘N WILD
  NEVADA INC.

  
	
   

  	
  SMARTPARKS -
  CAROLINA INC.

  
	
   

  	
  SMARTPARKS -
  FLORIDA INC.

  
	
   

  	
  SMARTPARKS -
  SILVER SPRINGS INC.

  
	
   

  	
  PALACE
  MANAGEMENT COMPANY LLC

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By: 

  	
  /s/ Todd R.
  Wulffson

  
	
   

  	
   

  	
  Name: Todd R.
  Wulffson

  
	
   

  	
   

  	
  Title: Secretary

  



 

















 


	
   

  	
  WELLS FARGO
  BANK, NATIONAL ASSOCIATION, as Trustee

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By: 

  	
  /s/ Lynn M.
  Steiner

  
	
   

  	
   

  	
  Name: Lynn M.
  Steiner

  
	
   

  	
   

  	
  Title: Vice
  President