Exhibit 10.8


 


AMENDMENT
NUMBER TWO

TO LOAN AND SECURITY AGREEMENT


 


This AMENDMENT NUMBER TWO TO LOAN AND
SECURITY AGREEMENT (this “Amendment”) is entered into as of August 31,
2004, by the lenders identified on the signature pages hereof (the “Lenders”),
WELLS FARGO FOOTHILL,
INC., a California corporation (“Agent”; and together with
the Lenders, the “Lender Group”), as the arranger and administrative
agent for the Lenders, and POSTER FINANCIAL GROUP,
INC., a Nevada corporation (“Parent”), and each of Parent’s
Subsidiaries identified on the signature pages hereof (such Subsidiaries
together with Parent are referred to hereinafter each individually as a “Borrower”
and individually and collectively, jointly and severally, as the “Borrowers”),
with reference to the following:


 


WHEREAS,
Borrowers and the Lender Group are parties to that certain Loan and Security
Agreement, dated as of January 23, 2004, as amended by that certain
Amendment Number One to Loan and Security Agreement, dated as of May 17, 2004
(as further amended, restated, supplemented or otherwise modified from time to
time, the “Loan Agreement”);


 


WHEREAS,
Borrowers have requested that the Lender Group amend the Loan Agreement as set
forth herein; and


 


WHEREAS,
subject to the terms and conditions set forth herein, the Lender Group is
willing to make the amendments requested by Borrowers.


 


NOW, THEREFORE,
in consideration of the foregoing and the mutual covenants herein contained,
and for other good and valuable consideration, the receipt and sufficiency of
which are hereby acknowledged, the parties hereby agree as follows:


 


1.                Defined Terms. 
Capitalized terms used herein and not otherwise defined herein shall
have the meanings ascribed to them in the Loan Agreement, as amended hereby.


 


2.                Amendments to Loan Agreement.


 


(a)           Section 1.1
of the Loan Agreement is hereby amended by amending and restating the defined
terms “Fixed Charge Coverage Ratio” and “TTM EBITDA” in their entirety as
follows:


 


“Fixed Charge Coverage
Ratio” means, as of any date of determination, with respect to Parent and
its Subsidiaries, the ratio of (i) TTM EBITDA minus
Capital Expenditures made (to the extent not already incurred in a prior
period) or incurred during the most recently completed 12 month period, to
(ii) Fixed Charges for the most recently completed 12 month period.


 


“TTM EBITDA”
means, as of any date of determination, EBITDA of Parent and its Subsidiaries
for the most recently completed 12 month period.


 





















 


(b)           Section 2.6(d)
of the Loan Agreement is hereby amended by replacing the words “Section 2.12(a)”
with the words “Section 2.13(a)”.


 


(c)           Section 7.18(b)(i)
of the Loan Agreement is hereby amended by deleting such section in its
entirety and replacing it with the following:


 


(i)                                     Capital Expenditures. 
Capital Expenditures in any fiscal year in excess of the
amount set forth in the following table for the applicable period:


 


	
  Fiscal Year 2004

  	
   

  	
  Fiscal Year 2005

  	
   

  	
  Fiscal Year 2006

  	
   

  	
  Fiscal Year 2007

  	
   

  	
  Fiscal Year 2008

  	
   

  
	
  $

  	
  15,500,000

  	
   

  	
  $

  	
  10,500,000

  	
   

  	
  $

  	
  10,500,000

  	
   

  	
  $

  	
  24,000,000

  	
   

  	
  $

  	
  10,500,000”

  	
   

  
															



 


3.                Conditions Precedent to Amendment. 
The satisfaction of each of the following shall constitute conditions
precedent to the effectiveness of this Amendment and each and every provision
hereof:


 


(a)           Agent
shall have received this Amendment, duly executed by the parties hereto, and
the same shall be in full force and effect.


 


(b)           Agent
shall have received a reaffirmation and consent substantially in the form
attached hereto as Exhibit A, duly executed and delivered by each Guarantor.


 


(c)           The
representations and warranties herein and in the Loan Agreement and the other
Loan Documents shall be true and correct in all material respects on and as of
the date hereof, as though made on such date (except to the extent that such
representations and warranties relate solely to an earlier date).


 


(d)           No Default
or Event of Default shall have occurred and be continuing on the date hereof,
nor shall result from the consummation of the transactions contemplated herein.


 


(e)           No
injunction, writ, restraining order, or other order of any nature prohibiting,
directly or indirectly, the consummation of the transactions contemplated
herein shall have been issued and remain in force and effect by any
Governmental Authority against any Borrower, any Guarantor, Agent, or any
Lender.


 


4.                Release. 
To the extent permitted by applicable law, each Borrower and each
Guarantor hereby waives, releases, remises and forever discharges each member
of the Lender Group, each of their respective Affiliates, and each of their
respective officers, directors, employees, and agents (collectively, the “Released
Parties”), from any and all claims, demands, obligations, liabilities,
causes of action, damages, losses, costs and expenses of any kind or character,
known or unknown, past or present, liquidated or unliquidated, suspected or
unsuspected, which any Borrower or any Guarantor ever had, now has or might
hereafter have against any such Released Party which relates, directly or
indirectly, to the Loan Agreement or any other Loan Document, or to any acts or
omissions of any such Release with respect to the Loan Agreement or any other
Loan Document, or to the lender-borrower relationship evidenced


 


2





















 


by
the Loan Documents.  As to each and every
claim released hereunder, each Borrower and each Guarantor hereby represents
that it has received the advice of legal counsel with regard to the releases
contained herein, and having been so advised, each Borrower specifically
waives, to the extent permitted by applicable law, the benefit of the
provisions of Section 1542 of the Civil Code of California which provides
as follows:


 


“A GENERAL RELEASE DOES NOT EXTEND TO CLAIMS WHICH A
CREDITOR DOES NOT KNOW OR SUSPECT TO EXIST IN HIS FAVOR AT THE TIME OF
EXECUTING THE RELEASE, WHICH IF KNOWN BY HIM, MUST HAVE MATERIALLY AFFECTED HIS
SETTLEMENT WITH THE DEBTOR.”


 


As to each and every
claim released hereunder, each Borrower and each Guarantor also waives the
benefit of each other similar provision of applicable federal or state law, if
any, pertaining to general releases after having been advised by its legal
counsel with respect thereto.


 


5.                Representation and Warranty. 
Each Borrower represents and warrants to the Lender Group that the execution,
delivery, and performance of this Amendment and of the Loan Agreement, as
amended hereby, are within its powers, have been duly authorized by all
necessary corporate action, and are not in contravention of any law, rule, or
regulation applicable to it, or any order, judgment, decree, writ, injunction,
or award of any arbitrator, court, or Governmental Authority, or of the terms
of its Governing Documents, or of any contract or undertaking to which it is a
party or by which any of its properties may be bound or affected.


 


6.                Choice of Law. 
The validity of this Amendment, its construction, interpretation and
enforcement and the rights of the parties hereunder, shall be determined under,
governed by, and construed in accordance with the laws of the State of
California.


 


7.                Counterpart Execution. 
This Amendment may be executed in any number of counterparts, all of
which when taken together shall constitute one and the same instrument, and any
of the parties hereto may execute this Amendment by signing any such
counterpart.  Delivery of an executed
counterpart of this Amendment by telefacsimile or electronic mail shall be
equally as effective as delivery of an original executed counterpart of this
Amendment.  Any party delivering an
executed counterpart of this Amendment by telefacsimile or electronic mail also
shall deliver an original executed counterpart of this Amendment, but the
failure to deliver an original executed counterpart shall not affect the
validity, enforceability and binding effect of this Amendment.


 


8.                Effect on Loan Documents.


 


(a)           The Loan
Agreement, as amended hereby, and each of the other Loan Documents shall be and
remain in full force and effect in accordance with their respective terms and
are hereby ratified and confirmed in all respects.  The execution, delivery, and performance of
this Amendment shall not operate, except as expressly set forth herein, as a
modification or waiver of any right, power, or remedy of Agent or any Lender
under the Loan Agreement or any other Loan Document.  The waivers, consents and modifications
herein are


 


3





















 


limited
to the specifics hereof, shall not apply with respect to any facts or
occurrences other than those on which the same are based, shall not excuse
future non-compliance with the Loan Documents and shall not operate as a
consent to any further or other matter under the Loan Documents.


 


(b)           Upon and
after the effectiveness of this Amendment, each reference in the Loan Agreement
to “this Agreement”, “hereunder”, “herein”, “hereof” or words of like import
referring to the Loan Agreement, and each reference in the other Loan Documents
to “the Loan Agreement”, “thereunder”, “therein”, “thereof” or words of like
import referring to the Loan Agreement, shall mean and be a reference to the
Loan Agreement as modified and amended hereby.


 


(c)           To the
extent that any terms and conditions in any of the Loan Documents shall
contradict or be in conflict with any terms or conditions of the Loan
Agreement, after giving effect to this Amendment, such terms and conditions are
hereby deemed modified or amended accordingly to reflect the terms and
conditions of the Loan Agreement as modified or amended hereby.


 


(d)           This
Amendment is a Loan Document.


 


9.                Entire Agreement. 
This Amendment embodies the entire understanding and agreement between
the parties hereto with respect to the subject matter hereof and supersedes any
and all prior or contemporaneous agreements or understandings with respect to
the subject matter hereof, whether express or implied, oral or written.


 


[signature page
follows]


 


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IN WITNESS WHEREOF, the
parties have entered into this Amendment as of the date first above written.


 


 


	
   

  	
  POSTER
  FINANCIAL GROUP,

  
	
   

  	
  a Nevada corporation

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By

  	
  /s/ Dawn Prendes

  	
   

  
	
   

  	
  Title:  Sr. Vice President/CFO

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  GNL, CORP.,

  
	
   

  	
  a Nevada corporation

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By

  	
  /s/ Dawn Prendes

  	
   

  
	
   

  	
  Title:  Sr. Vice President/CFO

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  GNLV, CORP.,

  
	
   

  	
  a Nevada corporation

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By

  	
  /s/ Dawn Prendes

  	
   

  
	
   

  	
  Title:  Sr. Vice President/CFO

  



 


 


[SIGNATURE PAGE TO
AMENDMENT NUMBER TWO TO LOAN AND SECURITY AGREEMENT]


 





















 


	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  WELLS
  FARGO FOOTHILL, INC.,

  
	
   

  	
  a California
  corporation, as Agent and as a

  Lender

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By

  	
  /s/ Daniel Morihiro

  	
   

  
	
   

  	
  Title:  Vice President

  



 


 


[SIGNATURE PAGE TO
AMENDMENT NUMBER TWO TO LOAN AND SECURITY AGREEMENT]


 





















 


Exhibit A


 


REAFFIRMATION AND CONSENT


 


Dated as of August 31, 2004


 


Reference is hereby made
to that certain Amendment Number Two to Loan and Security Agreement, dated as
of the date hereof (the “Amendment”), among the lenders signatory
thereto (the “Lenders”), Wells Fargo Foothill, Inc., as arranger and
administrative agent for the Lenders (“Agent”) and Poster Financial
Group, Inc. (“Poster”), GNL, Corp. (“GNL”) and GNLV, Corp. (“GNLV”
and together with Poster and GNL, the “Borrowers”).  Capitalized terms used herein shall have the
meanings ascribed to them in that certain Loan and Security Agreement, dated as
of January 23, 2004, as amended by that certain Amendment Number One to
Loan and Security Agreement, dated as of May 17, 2004 (as further amended,
restated, supplemented, or otherwise modified from time to time, the “Loan
Agreement”), among Borrowers, Agent, and the Lenders.  Each of the undersigned hereby (a) represents
and warrants that the execution and delivery of this Reaffirmation and Consent
are within its powers, have been duly authorized by all necessary limited
liability company action and are not in contravention of any law, rule, or
regulation applicable to it, or any order, judgment, decree, writ, injunction,
or award of any arbitrator, court, or Governmental Authority, or of the terms
of its Governing Documents, or of any contract or undertaking to which it is a
party or by which any of its properties may be bound or affected, (b) consents
to the amendment of the Loan Agreement set forth in the Amendment and any
waivers granted therein; (c) acknowledges and reaffirms all obligations owing
by it to the Lender Group under any Loan Document to which it is a party; (d)
agrees that each Loan Document to which it is a party is and shall remain in
full force and effect, and (e) ratifies and confirms its consent to any
previous waivers granted with respect to the Loan Agreement.  Although each of the undersigned have been
informed of the matters set forth herein and have acknowledged and agreed to
same, each of the undersigned understands that the Lender Group shall have no
obligation to inform the undersigned of such matters in the future or to seek
the undersigned’s acknowledgement or agreement to future amendments, waivers or
modifications and nothing herein shall create such a duty.


 


IN
WITNESS WHEREOF, the undersigned have executed this Reaffirmation and Consent
as of the date first set forth above.


 


 


	
   

  	
  GOLDEN
  NUGGET EXPERIENCE, LLC,

  
	
   

  	
  a Nevada limited
  liability company

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By

  	
  /s/ Dawn Prendes

  	
   

  
	
   

  	
  Title:  Sr. Vice President/CFO

  



 


 


[SIGNATURE PAGE TO
REAFFIRMATION AND CONSENT

TO AMENDMENT NUMBER TWO TO LOAN AND SECURITY AGREEMENT]