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EXHIBIT 4.1    
  




HERBST GAMING, INC.  


 and  


 CARDIVAN COMPANY  


 CORRAL COIN, INC.  


 CORRAL COUNTRY COIN, INC.  


 E-T-T, INC.  


 E-T-T ENTERPRISES, LLC  


 FLAMINGO PARADISE GAMING, LLC  


 MARKET GAMING, INC.  


 SERIES A AND SERIES B

103/4% SENIOR SECURED NOTES DUE 2008  




 INDENTURE  


 Dated as of August 24, 2001  




 The Bank of New York,  


 Trustee  







 CROSS-REFERENCE TABLE*  



	Trust Indenture

Act Section


	 	Indenture Section

	310	(a)(1)	 	7.10
	 	(a)(2)	 	7.10
	 	(a)(3)	 	N.A.
	 	(a)(4)	 	N.A.
	 	(a)(5)	 	7.10
	 	(b)	 	7.10
	 	(c)	 	N.A.
	311	(a)	 	7.11
	 	(b)	 	7.11
	 	(c)	 	N.A.
	312	(a)	 	2.05
	 	(b)	 	12.03
	 	(c)	 	12.03
	313	(a)	 	7.06
	 	(b)(1)	 	10.03
	 	(b)(2)	 	7.07
	 	(c)	 	7.06;12.02
	 	(d)	 	7.06
	314	(a)	 	4.03;12.02
	 	(b)	 	10.02
	 	(c)(1)	 	12.04
	 	(c)(2)	 	12.04
	 	(c)(3)	 	N.A.
	 	(d)	 	10.03, 10.04, 10.05
	 	(e)	 	12.05
	 	(f)	 	N.A.
	315	(a)	 	7.01
	 	(b)	 	7.05,12.02
	 	(c)	 	7.01
	 	(d)	 	7.01
	 	(e)	 	6.11
	316	(a) (last sentence)	 	2.09
	 	(a)(1)(A)	 	6.05
	 	(a)(1)(B)	 	6.04
	 	(a)(2)	 	N.A.
	 	(b)	 	6.07
	 	(c)	 	2.12
	317	(a)(1)	 	6.08
	 	(a)(2)	 	6.09
	 	(b)	 	2.04
	318	(a)	 	12.01
	 	(b)	 	N.A.
	 	(c)	 	12.01






    N.A.
means not applicable. 


    *
This Cross Reference Table is not part of the Indenture. 







 
 

TABLE OF CONTENTS    
  



	 
	 	 
	 	Page

	ARTICLE I.

DEFINITIONS AND INCORPORATION

BY REFERENCE
	

Section 1.01.	
 	

Definitions.	
 	

1
	Section 1.02.	 	Other Definitions.	 	20
	Section 1.03.	 	Incorporation by Reference of Trust Indenture Act.	 	21
	Section 1.04.	 	Rules of Construction.	 	21
	

ARTICLE II.

THE NOTES
	

Section 2.01.	
 	

Form and Dating.	
 	

22
	Section 2.02.	 	Execution and Authentication.	 	23
	Section 2.03.	 	Registrar and Paying Agent.	 	23
	Section 2.04.	 	Paying Agent to Hold Money in Trust.	 	24
	Section 2.05.	 	Holder Lists.	 	24
	Section 2.06.	 	Transfer and Exchange.	 	24
	Section 2.07.	 	Replacement Notes.	 	37
	Section 2.08.	 	Outstanding Notes.	 	37
	Section 2.09.	 	Treasury Notes.	 	38
	Section 2.10.	 	Temporary Notes.	 	38
	Section 2.11.	 	Cancellation.	 	38
	Section 2.12.	 	Defaulted Interest.	 	38
	Section 2.13.	 	Cusip Numbers.	 	39
	

ARTICLE III.

REDEMPTION AND PREPAYMENT
	

Section 3.01.	
 	

Notices to Trustee.	
 	

39
	Section 3.02.	 	Selection of Notes to Be Redeemed.	 	39
	Section 3.03.	 	Notice of Redemption.	 	39
	Section 3.04.	 	Effect of Notice of Redemption.	 	40
	Section 3.05.	 	Deposit of Redemption Price.	 	40
	Section 3.06.	 	Notes Redeemed in Part.	 	41
	Section 3.07.	 	Optional Redemption.	 	41
	Section 3.08.	 	Mandatory Redemption.	 	42
	Section 3.09.	 	Mandatory Disposition or Redemption Pursuant to Gaming Laws.	 	42
	Section 3.10.	 	Offer to Purchase by Application of Excess Proceeds.	 	42
	

ARTICLE IV.

COVENANTS
	

Section 4.01.	
 	

Payment of Notes.	
 	

44
	Section 4.02.	 	Maintenance of Office or Agency.	 	45
	Section 4.03.	 	Reports.	 	45
	Section 4.04.	 	Compliance Certificate.	 	46
	Section 4.05.	 	Taxes.	 	47
	Section 4.06.	 	Stay, Extension and Usury Laws.	 	47
	Section 4.07.	 	Restricted Payments.	 	47
	i







	Section 4.08.	 	Dividend and Other Payment Restrictions Affecting Subsidiaries.	 	49
	Section 4.09.	 	Incurrence of Indebtedness and Issuance of Preferred Stock.	 	50
	Section 4.10.	 	Asset Sales.	 	52
	Section 4.11.	 	Transactions with Affiliates.	 	53
	Section 4.12.	 	Liens.	 	54
	Section 4.13.	 	Line of Business.	 	54
	Section 4.14.	 	Corporate Existence.	 	54
	Section 4.15.	 	Offer to Repurchase Upon Change of Control.	 	55
	Section 4.16.	 	Advances to Restricted Subsidiaries.	 	56
	Section 4.17	 	Limitation on Sale and Leaseback Transactions.	 	56
	Section 4.18	 	Limitation on Issuances and Sales of Equity Interests in Restricted Subsidiaries.	 	56
	Section 4.19	 	Events of Loss.	 	57
	Section 4.20	 	Independent Directors.	 	57
	Section 4.21	 	No Payments for Consent.	 	58
	Section 4.22	 	Additional Note Guarantees.	 	58
	Section 4.23.	 	Designation of Restricted and Unrestricted Subsidiaries	 	58
	Section 4.24.	 	Insurance	 	58
	Section 4.25.	 	Additional Collateral; Acquisition of Assets or Property	 	59
	Section 4.26.	 	Further Assurances	 	59
	Section 4.27.	 	Limitation on Status as an Investment Company	 	60
	

ARTICLE V.

SUCCESSORS
	

Section 5.01.	
 	

Merger, Consolidation, or Sale of Assets.	
 	

60
	Section 5.02.	 	Successor Corporation Substituted.	 	61
	

ARTICLE VI.

DEFAULTS AND REMEDIES
	

Section 6.01.	
 	

Events of Default.	
 	

62
	Section 6.02.	 	Acceleration.	 	64
	Section 6.03.	 	Other Remedies.	 	65
	Section 6.04.	 	Waiver of Past Defaults.	 	65
	Section 6.05.	 	Control by Majority.	 	65
	Section 6.06.	 	Limitation on Suits.	 	65
	Section 6.07.	 	Rights of Holders of Notes to Receive Payment.	 	66
	Section 6.08.	 	Collection Suit by Trustee.	 	66
	Section 6.09.	 	Trustee May File Proofs of Claim.	 	66
	Section 6.10.	 	Priorities.	 	67
	Section 6.11.	 	Undertaking for Costs.	 	67
	

ARTICLE VII.

TRUSTEE
	

Section 7.01.	
 	

Duties of Trustee.	
 	

68
	Section 7.02.	 	Rights of Trustee.	 	69
	Section 7.03.	 	Individual Rights of Trustee.	 	69
	Section 7.04.	 	Trustee's Disclaimer.	 	70
	Section 7.05.	 	Notice of Defaults.	 	70
	Section 7.06.	 	Reports by Trustee to Holders of the Notes.	 	70
	Section 7.07.	 	Compensation and Indemnity.	 	70
	Section 7.08.	 	Replacement of Trustee.	 	71
	Section 7.09.	 	Successor Trustee by Merger, etc.	 	72
	ii







	Section 7.10.	 	Eligibility; Disqualification.	 	72
	Section 7.11.	 	Preferential Collection of Claims Against Company.	 	72
	Section 7.12.	 	No Liability for Clean-up of Hazardous Materials.	 	73
	

ARTICLE VIII.

LEGAL DEFEASANCE AND COVENANT DEFEASANCE
	

Section 8.01.	
 	

Option to Effect Legal Defeasance or Covenant Defeasance.	
 	

73
	Section 8.02.	 	Legal Defeasance and Discharge.	 	73
	Section 8.03.	 	Covenant Defeasance.	 	74
	Section 8.04.	 	Conditions to Legal or Covenant Defeasance.	 	74
	Section 8.05.	 	Deposited Money and Government Securities to be Held in Trust; Other Miscellaneous Provisions.	 	75
	Section 8.06.	 	Repayment to Company.	 	76
	Section 8.07.	 	Reinstatement.	 	76
	

ARTICLE IX.

AMENDMENT, SUPPLEMENT AND WAIVER
	Section 9.01.	 	Without Consent of Holders of Notes.	 	77
	Section 9.02.	 	With Consent of Holders of Notes.	 	77
	Section 1.03.	 	Compliance with Trust Indenture Act.	 	79
	Section 1.04.	 	Revocation and Effect of Consents.	 	79
	Section 1.05.	 	Notation on or Exchange of Notes.	 	79
	Section 1.06.	 	Trustee to Sign Amendments, etc.	 	80
	

ARTICLE X.

COLLATERAL AND SECURITY
	

Section 10.01.	
 	

Collateral Documents.	
 	

80
	Section 10.02.	 	Recording and Opinions.	 	81
	Section 10.03.	 	Release of Collateral.	 	81
	Section 10.04.	 	Certificates of the Company.	 	82
	Section 10.05.	 	Authorization of Actions to Be Taken by the Trustee Under the Collateral Documents.	 	83
	Section 10.06.	 	Authorization of Receipt of Funds by the Trustee Under the Collateral Documents.	 	83
	Section 10.07.	 	Termination of Security Interest.	 	83
	

ARTICLE XI.

NOTE GUARANTEES
	

Section 11.01.	
 	

Note Guarantees.	
 	

83
	Section 11.02.	 	Limitation on Subsidiary Guarantor Liability.	 	84
	Section 11.03.	 	Execution and Delivery of Note Guarantee.	 	85
	Section 11.04.	 	Subsidiary Guarantors May Consolidate, etc., on Certain Terms.	 	85
	Section 11.05.	 	Releases of Note Guarantees.	 	86
	

ARTICLE XII.

SATISFACTION AND DISCHARGE
	

Section 12.01.	
 	

Satisfaction and Discharge.	
 	

86
	Section 12.02.	 	Application of Trust Money.	 	87
	

ARTICLE XIII.

MISCELLANEOUS
	

Section 13.01.	
 	

Trust Indenture Act Controls.	
 	

88
	iii







	Section 13.02.	 	Notices.	 	88
	Section 13.03.	 	Communication by Holders of Notes with Other Holders of Notes.	 	89
	Section 13.04.	 	Certificate and Opinion as to Conditions Precedent.	 	89
	Section 13.05.	 	Statements Required in Certificate or Opinion.	 	89
	Section 13.06.	 	Rules by Trustee and Agents.	 	90
	Section 13.07.	 	No Personal Liability of Directors, Officers, Employees and Stockholders.	 	90
	Section 13.08.	 	Governing Law.	 	90
	Section 13.09.	 	No Adverse Interpretation of Other Agreements.	 	90
	Section 13.10.	 	Successors.	 	90
	Section 13.11.	 	Severability.	 	91
	Section 13.12.	 	Counterpart Originals.	 	91
	Section 13.13.	 	Table of Contents, Headings, etc.	 	91




 
 

EXHIBITS    
  



	Exhibit A1	 	FORM OF NOTE
	Exhibit A2	 	FORM OF REGULATION S TEMPORARY GLOBAL NOTE
	Exhibit B	 	FORM OF CERTIFICATE OF TRANSFER
	Exhibit C	 	FORM OF CERTIFICATE OF EXCHANGE
	Exhibit D	 	FORM OF CERTIFICATE OF ACQUIRING INSTITUTIONAL ACCREDITED INVESTOR
	Exhibit E	 	FORM OF NOTE GUARANTEE
	Exhibit F	 	FORM OF SUPPLEMENTAL INDENTURE
	Exhibit G	 	COLLATERAL DOCUMENTS
	Exhibit H	 	FORM OF INTERCOMPANY NOTE
	iv










    INDENTURE
dated as of August 24, 2001, between Herbst Gaming, Inc., a Nevada corporation (the "Company"), and The Bank of
New York, a New York banking corporation, as trustee (the "Trustee"). 



    The
Company and the Trustee agree as follows for the benefit of each other and for the equal and ratable benefit of the Holders of the 103/4% Series A Senior
Secured Notes due 2008 (the "Series A Notes") and the 103/4% Series B Senior Secured Notes due 2008 (the
"Series B Notes" and, together with the Series A Notes, the "Notes"): 


 
 

ARTICLE I.
  
    DEFINITIONS AND INCORPORATION
  BY REFERENCE    



Section 1.01.  DEFINITIONS.  


    "144A Global Note" means a global note substantially in the form of Exhibit A1 hereto bearing the Global Note Legend and the Private
Placement Legend and deposited with or on behalf of, and registered in the name of, the Depositary or its nominee that will be issued in a denomination equal to the outstanding principal amount of the
Notes sold in reliance on Rule 144A. 


    "Acquired Debt" means, with respect to any specified Person, (i) Indebtedness of any other Person existing at the time such
other Person is merged with or into or became a Subsidiary of such specified Person, whether or not such Indebtedness is incurred in connection with, or in contemplation of, such other Person merging
with or into, or becoming a Subsidiary of, such specified Person; and (ii) Indebtedness secured by a Lien encumbering any asset acquired by such specified Person. 


    "Additional Notes" means any additional Notes (other than the Initial Notes) issued under this Indenture in accordance with Sections
2.02 and 4.09 hereof, as part of the same series as the Initial Notes. 


    "Affiliate" of any specified Person means any other Person directly or indirectly controlling or controlled by or under direct or
indirect common control with such specified Person. For purposes of
this definition, "control," as used with respect to any Person, shall mean the possession, directly or indirectly, of the, power to direct or cause the direction of the management or policies of such
Person, whether through the ownership of voting securities, by agreement or otherwise; provided,  however, that beneficial ownership of 10% or more of the
voting securities of a Person shall be deemed to be control. Terrible Herbst, Inc. and
any person directly or indirectly controlling or controlled by or under direct or indirect common control with Terrible Herbst, Inc. will be deemed to be Affiliates of the Company;  provided that
the proviso in the preceding sentence will not apply to the definition of control as applied to Terrible Herbst, Inc. For purposes
of this definition, the terms "controlling," "controlled by" and "under common control with" shall have correlative meanings. 


    "Agent" means any Registrar, Paying Agent or co-registrar. 


1



    "Applicable Procedures" means, with respect to any transfer or exchange of or for beneficial interests in any Global Note, the rules
and procedures of the Depositary, Euroclear and Clearstream that apply to such transfer or exchange. 


    "Applicable Tax Percentage" means the highest aggregate effective marginal rate of federal, state and local income taxes to which any
stockholder of a Person that qualifies as an "S" corporation within the meaning of Section 1361 of the Code would be subject in the relevant year of determination, taking into account only such
stockholder's share of income and deductions attributable to its interest in such Person. 






    "Asset Sale" means (i) the sale, lease, conveyance or other disposition of any assets or rights;  provided that the sale,
conveyance or other disposition of all or substantially all of the assets of the Company and its Restricted Subsidiaries taken
as a whole will be governed by Sections 4.15 and 5.01 hereof and not by the provisions of Section 4.10 hereof; and (ii) the issuance of Equity Interests by any of the Company's
Restricted Subsidiaries or the sale of Equity Interests by the Company in any of its Subsidiaries. Notwithstanding the preceding, the following items shall not be deemed to be Asset Sales:
(1) any single transaction or series of related transactions that involves assets having a fair market value of less than $1.0 million; (2) a transfer of assets between or among
the Company and its Restricted Subsidiaries; (3) an issuance of Equity Interests by a Restricted Subsidiary to the Company or to another Restricted Subsidiary; (4) the sale or lease of
equipment, inventory, accounts receivable or other
assets in the ordinary course of business; (5) the sale or other disposition of cash or Cash Equivalents; and (6) a Restricted Payment or Permitted Investment that is permitted by
Section 4.07. 


    "Attributable Debt" in respect of a sale and leaseback transaction means, at the time of determination, the present value of the
obligation of the lessee for net rental payments during the remaining term of the lease included in such sale and leaseback transaction, including any period for which such lease has been extended or
may, at the option of the lessor, be extended. Such present value shall be calculated using a discount rate equal to the rate of interest implicit in such transaction, determined in accordance with
GAAP. 


    "Bankruptcy Law" means Title 11, U.S. Code or any similar federal or state law for the relief of debtors. 



    "Beneficial Owner" has the meaning assigned to such term in Rule 13d-3 and Rule 13d-5 under the
Exchange Act, except that in calculating the beneficial ownership of any particular "person" (as that term is used in Section 13(d)(3) of the Exchange Act), such "person" shall be deemed to
have beneficial ownership of all securities that such "person" has the right to acquire by conversion or exercise of other securities, whether such right is currently exercisable or is exercisable
only upon the occurrence of a subsequent condition. The terms "Beneficially Owns" and "Beneficially Owned" shall have a corresponding meaning. 


    "Board of Directors" means (i) with respect to a corporation, the Board of Directors of the corporation; (ii) with
respect to a partnership, the Board of Directors of the managing general partner of the partnership; and (iii) with respect to any other Person, the board or committee of such Person serving a
similar function. 


2



    "Broker-Dealer" has the meaning set forth in the Registration Rights Agreement. 


    "Business Day" means any day other than a Legal Holiday. 


    "Capital Lease Obligation" means, at the time any determination thereof is to be made, the amount of the liability in respect of a
capital lease that would at that time be required to be capitalized on a balance sheet in accordance with GAAP. 


    "Capital Stock" means, (i) in the case of a corporation, corporate stock, (ii) in the case of an association or business
entity, any and all shares, interests, participations, rights or other equivalents (however designated) of corporate stock, (iii) in the case of a partnership or limited liability company,
partnership or membership interests (whether general or limited) and (iv) any other interest or participation that confers on a Person the right to receive a share of the profits and losses of,
or distributions of assets of, the issuing Person. 


    "Cash Equivalents" means (i) United States dollars, (ii) securities issued or directly and fully guaranteed or insured by
the United States government or any agency or instrumentality thereof (provided that the full faith and credit of the United States is pledged in support thereof) having 







maturities of not more than six months from the date of acquisition, (iii) certificates of deposit and eurodollar time deposits with maturities of six months or less from the date of
acquisition, bankers' acceptances with maturities not exceeding six months and overnight bank deposits, in each case, with any domestic commercial bank having capital and surplus in excess of
$500.0 million and a Thomson Bank Watch Rating of "B" or better, (iv) repurchase obligations with a term of not more than seven days for underlying securities of the types described in
clauses (ii) and (iii) above entered into with any financial institution meeting the qualifications specified in clause (iii) above, (v) commercial paper having the highest
rating obtainable from Moody's Investors Service, Inc. or Standard & Poor's Rating Services and in each case maturing within six months after the date of acquisition and
(vi) money market funds at least 95% of the assets of which constitute Cash Equivalents of the kinds described in clauses (i) through (v) of this definition. 



    "Casino Properties" means the real property comprising the Terrible's Hotel & Casino, located at 4100 Paradise Road, Las Vegas,
Nevada, Terrible's Town Casino, located at 771 S. Nevada Highway, Pahrump, Nevada, Terrible's Lakeside Casino and RV Park, located at 5870 S. Homestead, Pahrump, Nevada, and Terrible's Town
Casino & Bowl, located at 642 S. Boulder Highway, Henderson, Nevada. 


    "Change of Control" means the occurrence of any of the following: (i) the direct or indirect sale, transfer, conveyance or other
disposition (other than by way of merger or consolidation), in one or a series of related transactions, of all or substantially all of the assets of the Company and its Restricted Subsidiaries taken
as a whole to any "person" (as that term is used in Section 13(d)(3) of the Exchange Act), other than a Principal or any Related Party; (ii) the liquidation or dissolution of, or the
adoption of a plan relating to the liquidation or dissolution of the Company; (iii) prior to an Initial Public Offering, the Principals and their Related Parties cease to collectively
Beneficially Own more than 50% of the Voting Stock of the Company, measured by voting power rather than number of shares; (iv) after
an Initial Public Offering, the consummation of any transaction (including, without limitation, any merger or consolidation) the result of which 


3 









is that any "person" (as defined above), other than the Principals and their Related Parties, becomes the Beneficial Owner, directly or indirectly, of more than 35% of the Voting Stock of the Company,
measured by voting power rather than number of shares; or (v) the first day on which a majority of the members of the Board of Directors of the Company are not Continuing Directors. 


    "Clearstream" means Clearstream Banking, SA. 


    "Code" means the Internal Revenue Code of 1986, as amended. 



    "Collateral" means all Casino Properties, all shares of capital stock of the Company and its Subsidiaries and all other real and
personal property of the Company and its Restricted Subsidiaries, other than accounts receivable, and furniture, fixtures and equipment located in Terrible's Hotel & Casino and any licenses of
the Company or any of its Subsidiaries which may not be pledged pursuant to applicable law. 


    "Collateral Agent" means the "Bank," as defined in the Escrow Agreement, dated as of the date of this Indenture, among the Company,
E-T-T, Inc., the Principals, the Trustee and Wilmington Trust Company, as the same may be modified, amended or supplemented from time to time, or any successor agreement
thereto. The Collateral Agent shall initially be the Wilmington Trust Company. 


    "Collateral Documents" means, collectively, the all agreements, deeds of trust instruments, documents, pledges or filings executed in
connection with granting, or that otherwise evidence, the Lien of the Trustee in the Collateral. A list of the Collateral Documents as of the date of this Indenture is attached as Exhibit G
hereto. 


    "Company" has the meaning ascribed to it in the introduction to this Indenture. 



    "Consolidated Cash Flow" means, with respect to any specified Person for any period, the Consolidated Net Income of such Person for
such period plus: (i) an amount equal to any extraordinary loss plus any net loss realized by such Person or any of its Restricted Subsidiaries
in connection with an Asset Sale, to the extent such losses were deducted in computing such Consolidated Net Income; plus (ii) provision for
taxes based on income or profits or the Tax Amount of such Person and its Restricted Subsidiaries for such period, to the extent that such provision for taxes or Tax Amount was included in computing
such Consolidated Net Income; plus (iii) consolidated interest expense of such Person and its Restricted Subsidiaries for such period, whether
paid or accrued and whether or not capitalized (including, without limitation, amortization of debt issuance costs and original issue discount, non-cash interest payments, the interest
component of any deferred payment obligations, the interest component of all payments associated with Capital Lease Obligations, imputed interest with respect to Attributable Debt, commissions,
discounts and other fees and charges incurred in respect of letter of credit or bankers' acceptance financings, and net of the effect of all payments made or received pursuant to Hedging Obligations),
to the extent that any such expense was deducted in computing such Consolidated Net Income; plus (iv) depreciation, amortization (including
amortization of goodwill and other intangibles but excluding amortization of prepaid cash expenses that were paid in a prior period) and other non-cash expenses (excluding any such
non-cash expense to the extent that it represents an accrual of or reserve for cash expenses in any future period or amortization of a prepaid cash 


4










expense that was paid in a prior period) of such Person and its Restricted Subsidiaries for such period to the extent that such depreciation, amortization and other non-cash expenses were
deducted in computing such Consolidated Net Income; plus (v) any charges, premiums or expenses incurred as a direct result of the redemption of
the Mezzanine Notes to the extent that such amounts were deducted in computing Consolidated Net Income and determined in accordance with GAAP; plus
(vi) any pre-opening expenses relating to Terrible's Hotel & Casino to the extent that such pre-opening expenses were deducted in computing Consolidated Net
Income and determined in accordance with GAAP; minus (vii) non-cash items increasing such Consolidated Net Income for such period,
other than the accrual of revenue in the ordinary course of business, in each case, on a consolidated basis and determined in accordance with GAAP. 



    "Consolidated Net Income" means, with respect to any specified Person for any period, the aggregate of the Net Income of such Person
and its Restricted Subsidiaries for such period, on a consolidated basis, determined in accordance with GAAP; provided,  however, that (i) the Net
Income of any Person that is not a Subsidiary or that is accounted for by the equity method of accounting shall be
included only to the extent of the amount of dividends or distributions paid in cash to the specified Person or a Restricted Subsidiary thereof; (ii) the Net Income of any Restricted Subsidiary
shall be excluded to the extent that the declaration or payment of dividends or similar distributions by that Restricted Subsidiary of that Net Income is not at the date of determination permitted
without any prior governmental approval (that has not been obtained) or, directly or indirectly, by operation of the terms of its charter or any agreement, instrument, judgment, decree, order,
statute, rule or governmental regulation applicable to that Restricted Subsidiary or its stockholders; (iii) the Net Income of any Person acquired in a pooling of interests transaction for any
period prior to the date of such acquisition shall be excluded; (iv) the cumulative effect of a change in accounting principles shall be excluded; and (v) the Net Income of any
Unrestricted Subsidiary shall be excluded, whether or not distributed to the specified Person or one of its Restricted Subsidiaries. 


    "Continuing Directors" means, as of any date of determination, any member of the Board of Directors of the Company who (i) was a
member of such Board of Directors on the date of the Indenture or (ii) was nominated for election or elected to such Board of Directors with the approval of a majority of the Continuing
Directors who were members of such Board at the time of such nomination or election. 


    "Corporate Trust Office of the Trustee" shall be at the address of the Trustee specified in Section 13.02 hereof or such other
address as to which the Trustee may give written notice to the Company. 


    "Custodian" means the Trustee, as custodian with respect to the Notes in global form, or any successor entity thereto. 



    "Default" means any event that is or with the passage of time or the giving of notice or both would be an Event of Default. 


    "Definitive Note" means a certificated Note registered in the name of the Holder thereof and issued in accordance with
Section 2.06 hereof, substantially in the form of Exhibit A1 hereto 


5










except that such Note shall not bear the Global Note Legend and shall not have the "Schedule of Exchanges of Interests in the Global Note" attached thereto. 


    "Depositary" means, with respect to the Notes issuable or issued in whole or in part in global form, the Person specified in
Section 2.03 hereof as the Depositary with respect to the Notes, and any and all successors thereto appointed as depositary hereunder and having become such pursuant to the applicable provision
of this Indenture. 


    "Disqualified Stock" means any Capital Stock that, by its terms (or by the terms of any security into which it is convertible, or for
which it is exchangeable, in each case at the option of the holder thereof), or upon the happening of any event, matures or is mandatorily redeemable, pursuant to a sinking fund obligation or
otherwise, or redeemable at the option of the holder thereof, in whole or in part, on or prior to the date that is 91 days after the date on which the Notes mature. Notwithstanding the
preceding sentence, any Capital Stock that would constitute Disqualified Stock solely because the holders thereof have the right to require the Company to repurchase such Capital Stock upon the
occurrence of a change of control or an asset sale shall not constitute Disqualified Stock if the terms of such Capital Stock provide that the Company may not repurchase or redeem any such Capital
Stock pursuant to such provisions unless such repurchase or redemption complies with Section 4.07. 


    "Eligible Institution" means a domestic commercial banking institution that has combined capital and surplus of not less than
$500 million or its equivalent in foreign currency, whose debt is rated "A" or higher according to S&P or Moody's at the time any investment or rollover therein is made. 


    "Employment Agreement" means the Employment Agreement dated as of August 1, 2001, between Edward Herbst and the Company, as in
effect on the date of this Indenture. 


    "Equity Interests" means Capital Stock and all warrants, options or other rights to acquire Capital Stock (but excluding any debt
security that is convertible into, or exchangeable for, Capital Stock). 


    "Euroclear" means Morgan Guaranty Trust Company of New York, Brussels office, as operator of the Euroclear system. 


    "Event of Loss" means, with respect to any asset, any (i) loss, destruction or damage of such asset, (ii) condemnation,
seizure or taking by exercise of the power of eminent domain or otherwise of such
property or asset, or confiscation of such asset or the requisition of the use of such asset or (iii) settlement in lieu of clause (ii) above. 


    "Exchange Act" means the Securities Exchange Act of 1934, as amended. 


    "Exchange Notes" means the Notes issued in the Exchange Offer pursuant to Section 2.06(f) hereof. 


    "Exchange Offer" has the meaning set forth in the Registration Rights Agreement. 


6 


    "Exchange Offer Registration Statement" has the meaning set forth in the Registration Rights Agreement. 






    "Executive Compensation and Bonus Plan" means the Executive Compensation and Bonus Plan of the Company, as in effect on the date of
this Indenture. 


    "Existing Transactions" means (i) the Trademark Agreement and any payments made by the Company thereunder; (ii) the
License Agreement, dated as of Decemer 20, 1999, between E-T-T, Inc. and Terrible Herbst, Inc., as in effect on the date of this Indenture; (iii) the Lease
Agreement, dated July 1, 1996, between The Herbst Family Limited Partnership and E-T-T, Inc., as in effect on the date of this Indenture; (iv) the Lease
Agreement, dated July 1, 1997, between The Herbst Family Limited Partnership and E-T-T Enterprises, LLC, as in effect on the date of this Indenture; and (v) the
servicing arrangement between the Company and Terrible Herbst, Inc., pursuant to which the Company provides accounting and administrative services relating to the collection of deposits from
Terrible Herbst, Inc. convenience stores in a manner consistent with the practice of the servicing arrangement as of the date of this Indenture. 



    "Fixed Charges" means, with respect to any specified Person for any period, the sum, without duplication, of (i) the
consolidated interest expense of such Person and its Restricted Subsidiaries for such period, whether paid or accrued, including, without limitation, amortization of debt issuance costs and original
issue discount, non-cash interest payments, the interest component of any deferred payment obligations, the interest component of all payments associated with Capital Lease Obligations,
imputed interest with respect to Attributable Debt, commissions, discounts and other fees and charges incurred in respect of letter of credit or bankers' acceptance financings, and net of the effect
of all payments made or received pursuant to Hedging Obligations; plus (ii) the consolidated interest of such Person and its Restricted
Subsidiaries that was capitalized during such period; plus (iii) any interest expense on Indebtedness of another Person that is Guaranteed by
such Person or one of its Restricted Subsidiaries or secured by a Lien on assets of such Person or one of its Restricted Subsidiaries, whether or not such Guarantee or Lien is called upon;  plus
(iv) the product of (a) all dividends, whether paid or accrued and whether or not in cash, on any series of preferred stock of such
Person or any of its Restricted Subsidiaries, other than dividends on Equity Interests payable solely in Equity Interests of the Company (other than Disqualified Stock) or to the Company or a
Restricted Subsidiary of the Company, times (b) a fraction, the numerator of which is one and the denominator of which is one minus the then current combined federal, state and local statutory
tax rate of such Person (or, in the case of a Person that is a subchapter "S" corporation under the Code, the combined federal, state and local income tax rate that was or would have been utilized to
calculate the Tax Amount of such Person), expressed as a decimal, in each case, on a consolidated basis and in accordance with GAAP. 


    "Fixed Charge Coverage Ratio" means with respect to any specified Person for any period, the ratio of the Consolidated Cash Flow of
such Person and its Restricted Subsidiaries for such period to the Fixed Charges of such Person for such period. In the event that the specified Person or any of its Restricted Subsidiaries incurs,
assumes, Guarantees, repays, repurchases or redeems any Indebtedness (other than ordinary working capital borrowings) or issues, repurchases or redeems preferred equity subsequent to the commencement
of the period for which the Fixed Charge Coverage Ratio is being calculated and on or prior to the date on which the event for which the calculation of the Fixed Charge Coverage Ratio is made (the
"Calculation Date"), then the 


7



Fixed
Charge Coverage Ratio shall be calculated giving pro forma effect to such incurrence, assumption, Guarantee, repayment, repurchase or redemption of Indebtedness, or such issuance, repurchase or
redemption of preferred equity, and the use of the proceeds therefrom as if the same had occurred at the beginning of the applicable four-quarter reference period;  provided that the Fixed Charges of
such Person attributable to interest on any Indebtedness under a revolving credit facility computed on a pro forma
basis will be computed based on the average daily balance of such Indebtedness during the four-quarter reference period using the interest rate in effect at the end of such period. 







    In addition, for purposes of calculating the Fixed Charge Coverage Ratio, (i) acquisitions that have been made by the specified Person or any of its Restricted Subsidiaries,
including through mergers or consolidations and including any related financing transactions, during the four-quarter reference period or subsequent to such reference period and on or
prior to the Calculation Date shall be given pro forma effect as if they had occurred on the first day of the four-quarter reference period and Consolidated Cash Flow for such reference
period shall be calculated on a pro forma basis in accordance with Regulation S-X under the Securities Act, but without giving effect to clause (iii) of the proviso set forth
in the definition of Consolidated Net Income; (ii) the Consolidated Cash Flow attributable to discontinued operations, as determined in accordance with GAAP, and operations or businesses
disposed of prior to the Calculation Date, shall be excluded; and (iii) the Fixed Charges attributable to discontinued operations, as determined in accordance with GAAP, and operations or
businesses disposed of prior to the Calculation Date, shall be excluded, but only to the extent that the obligations giving rise to such Fixed Charges will not be obligations of the specified Person
or any of its Restricted Subsidiaries following the Calculation Date. 


    "GAAP" means generally accepted accounting principles set forth in the opinions and pronouncements of the Accounting Principles Board
of the American Institute of Certified Public Accountants and statements and pronouncements of the Financial Accounting Standards Board or in such other statements by such other entity as have been
approved by a significant segment of the accounting profession, which are in effect from time to time. 


    "Gaming Authority" means any agency, authority, board, bureau, commission, department, office or instrumentality of any nature
whatsoever of the United States federal government, any foreign government, any state, province or city or other political subdivision or otherwise, whether now or hereafter in existence, or any
officer or official thereof, including, without limitation, the Nevada State Gaming Control Board and the Nevada Gaming Commission, with authority to regulate any gaming operation (or proposed gaming
operation) owned, managed or operated by the Company or any of its Subsidiaries. 


    "Gaming Law" means any gaming law or regulation of any jurisdiction or jurisdictions to which the Company or any of the its
Subsidiaries is, or may at any time after the date of the indenture, be subject. 


    "Gaming License" means any license, permit, franchise or other authorization from any Gaming Authority necessary on the date of the
indenture or at any time thereafter to own, lease, or operate the assets of or otherwise conduct the business of the Company or any of its Restricted Subsidiaries. 


8 


    "Global Notes" means, individually and collectively, each of the Restricted Global Notes and the Unrestricted Global Notes,
substantially in the form of Exhibit A1 and A2 hereto issued in accordance with Section 2.01, 2.06(b)(iv), 2.06(d)(ii) or 2.06(f) hereof. 


    "Global Note Legend" means the legend set forth in Section 2.06(g)(ii), which is required to be placed on all Global Notes
issued under this Indenture. 


    "Government Securities" means securities that are (i) direct obligations of the United States of America for the timely payment
of which its full faith and credit is pledged; or (ii) obligations of a Person controlled or supervised by and acting as an agency or instrumentality of the United States of America the timely
payment of which is unconditionally guaranteed as a full faith and credit obligation by the United States of America; which, in either case, are not callable or redeemable at the option of the issuer
thereof, and also includes a depository receipt issued by a bank (as defined in Section 3(a)(2) of the Securities Act of 1933, as amended), as custodian with respect to any such Government
Security or a specific payment of principal of or interest on any such Government Security held by such custodian for the account of the holder of such depository receipt;  provided that (except as
required by 







law) such custodian is not authorized to make any deduction from the amount payable to the holder of such depository receipt from any amount received by the custodian in respect of the Government
Security or the specific payment of principal of or interest on the Government Security evidenced by such depository receipt. 


    "Guarantee" means a guarantee other than by endorsement of negotiable instruments for collection in the ordinary course of business,
direct or indirect, in any manner including, without limitation, by way of a pledge of assets or through letters of credit or reimbursement agreements in respect thereof, of all or any part of any
Indebtedness. 


    "Hedging Obligations" means, with respect to any Person, the obligations of such Person under (i) interest rate swap agreements,
interest rate cap agreements and interest rate collar agreements and (ii) other agreements or arrangements designed to protect such Person against fluctuations in interest rates. 


    "Holder" means a Person in whose name a Note is registered. 


    "IAI Global Note" means the global Note substantially in the form of Exhibit A1 hereto bearing the Global Note Legend and the Private
Placement Legend and deposited with or on behalf of and registered in the name of the Depositary or its nominee that will be issued in a denomination equal to the outstanding principal amount of the
Notes sold to Institutional Accredited Investors. 


    "Indebtedness" means, with respect to any specified Person, any indebtedness of such Person, whether or not contingent, in respect of
(i) borrowed money; (ii) obligations evidenced by bonds, notes, debentures or similar instruments or letters of credit (or reimbursement agreements in respect thereof);
(iii) banker's acceptances; (iv) Capital Lease Obligations; (v) the balance deferred and unpaid of the purchase price of any property, except any such balance that constitutes an
accrued expense or trade payable; or (vi) any Hedging Obligations; if and to the extent any of the preceding items (other than letters of credit and Hedging Obligations) would appear as a
liability upon a balance sheet of the specified Person prepared in accordance with GAAP. In addition, the 


9



term
"Indebtedness" includes all Indebtedness of others secured by a Lien on any assets of the specified Person (whether or not such Indebtedness is assumed by the specified Person) and, to the extent
not otherwise included, the Guarantee by the specified Person of any Indebtedness of any other Person. 


    The
amount of any Indebtedness outstanding as of any date shall be (i) the accreted value thereof, in the case of any Indebtedness issued with original issue discount and
(ii) the principal amount thereof, together with any interest thereon that is more than 30 days past due, in the case of any other Indebtedness. 


    "Indenture" means this Indenture, as amended or supplemented from time to time. 


    "Independent Director" means a member of the Company's Board of Directors that (i) is not a legal or Beneficial Owner, directly
or indirectly, of any Equity Interests of the Company or any of its Affiliates and does not have any other material, direct or indirect, financial interest in the Company or any of its Affiliates,
(ii) is not a director, officer, employee, manager, contractor or partner of the Company or
any of its Affiliates (other than in respect of his or her service as an Independent Director of the Company), (iii) is not a customer, supplier or creditor of the Company or any of its
Affiliates, (iv) does not control, directly or indirectly, the Company, any of its Affiliates or any Person described in clauses (i), (ii) or (iii) above and (v) is not a
parent, sibling or child of any Person described in clauses (i), (ii), (iii) or (iv) above. 


    "Indirect Participant" means a Person who holds a beneficial interest in a Global Note through a Participant. 






    "Initial Notes" means the first $170,000,000 aggregate principal amount of Notes issued under this Indenture on the date hereof. 



    "Initial Public Offering" means a firmly underwritten initial public offering of the Company's common stock that is registered under
the Securities Act and results in net cash proceeds to the Company of at least $20.0 million. 


    "Initial Purchasers" means Lehman Brothers Inc. and U.S. Bancorp Libra, a division of U.S. Bancorp Investments, Inc. 


    "Institutional Accredited Investor" means an institution that is an "accredited investor" as defined in Rule 501(a)(1), (2),
(3) or (7) under the Securities Act, who are not also QIBs. 


    "Intercompany Notes" means the intercompany notes issued by Restricted Subsidiaries of the Company in favor of the Company or any of
its Restricted Subsidiaries to evidence advances by the Company or any of its Restricted Subsidiaries. 


    "Investments" means, with respect to any Person, all direct or indirect investments by such Person in other Persons (including
Affiliates) in the forms of loans (including Guarantees or other obligations), advances or capital contributions (excluding commission, travel and similar advances to officers and employees made in
the ordinary course of business), purchases or other acquisitions for consideration of Indebtedness, Equity Interests or other securities, together with all items that 


10



are
or would be classified as investments on a balance sheet prepared in accordance with GAAP. If the Company or any Restricted Subsidiary of the Company sells or otherwise disposes of any Equity
Interests of any direct or indirect Restricted Subsidiary of the Company such that, after giving effect to any such sale or disposition, such Person is no longer a Restricted Subsidiary of the
Company, the Company shall be deemed to have made an Investment on the date of any such sale or disposition equal to the fair market value of the Equity Interests of such Restricted Subsidiary not
sold or disposed of in an amount determined as provided in the final paragraph of Section 4.07. The acquisition by the Company or any Restricted Subsidiary of the Company of a Person that holds
an Investment in a third Person shall be deemed to be an Investment by the Company or such Restricted Subsidiary in such third Person in an amount equal to the fair market value of the Investment held
by the acquired Person in such third Person in an amount determined as provided in the final paragraph of Section 4.07. 


    "Legal Holiday" means a Saturday, a Sunday or a day on which banking institutions in the City of New York or at a place of payment are
authorized by law, regulation or executive order to remain closed. If a payment date is a Legal Holiday at a place of payment, payment may be made at that place on the next succeeding day that is not
a Legal Holiday, and no interest shall accrue on such payment for the intervening period. 


    "Letter of Transmittal" means the letter of transmittal to be prepared by the Company and sent to all Holders of the Notes for use by
such Holders in connection with the Exchange Offer. 


    "Lien" means, with respect to any asset, any mortgage, lien, pledge, charge, security interest or encumbrance of any kind in respect of
such asset, whether or not filed, recorded or otherwise perfected under applicable law, including any conditional sale or other title retention agreement, any lease in the nature thereof, any option
or other agreement to sell or give a security interest in and any filing of or agreement to give any financing statement under the Uniform Commercial Code (or equivalent statutes) of any jurisdiction. 


    "Liquidated Damages" means all liquidated damages then owing pursuant to Section 5 of the Registration Rights Agreement. 







    "Mezzanine Notes" means (i) the 13% Senior Subordinated Notes due 2006 issued pursuant to the Note Purchase Agreement, dated as
of November 20, 2000, among E-T-T, Inc., a Nevada corporation, Market Gaming, Inc., a Nevada corporation, E-T-T Enterprises, LLC, a
Nevada limited liability company, and, as of November 22, 2000, Cardivan Company, a Nevada corporation, Corral Coin, Inc., a Nevada corporation and Corral Country Coin, Inc., a
Nevada corporation, and the several purchasers set forth therein and (ii) the Subordinated Junior Note due November 22, 2006, in the principal amount at maturity of $750,000, issued by
E-T-T, Inc., Market Gaming, Inc. and E-T-T Enterprises, LLC to U.S. Bancorp Libra, a division of U.S. Bancorp Investments, Inc. 


    "Net Income" means, with respect to any Person for any period, (i) the net income (loss) of such Person for such period,
determined in accordance with GAAP and before any reduction in respect of preferred equity dividends or distributions, excluding, however (a) any gain (but not loss), together with any related
provision for taxes or Tax Distributions on such gain (but not loss), realized in connection with (1) any Asset Sale (including, without limitation, dispositions 


11 


pursuant
to sale and leaseback transactions), other than with respect to the Company any gains realized in connection with the termination of a Street Route Contract; or (2) the disposition of
any securities by such Person or any of its Restricted Subsidiaries or the extinguishment of any Indebtedness of such Person or any of its Restricted Subsidiaries; and (b) any extraordinary
gain (but not loss), together with any related provision for taxes or Tax Distributions on such extraordinary gain (but not loss); less (ii) in
the case of any Person that is a subchapter "S" corporation under the Code, the Tax Amount of such Person for such period; less (iii) in the case
the Company, any amounts paid pursuant to the Employment Agreement or Sections 3 or 4 of the Executive Compensation and Bonus Plan, to the extent such amounts were not deducted in computing net income
of the Company. 


    "Net Loss Proceeds" means the aggregate cash proceeds received by the Company or any of its Restricted Subsidiaries in respect of any
Event of Loss, including, without limitation, insurance proceeds, proceeds from condemnation awards or damages awarded by any judgment, net of the direct costs in recovery of such proceeds (including,
without limitation, legal, accounting, appraisal and insurance adjuster fees and any relocation expenses incurred as a result thereof), amounts required to be applied to the repayment of Indebtedness
secured by a Lien on the asset or assets that were the subject of such Event of Loss, and any taxes or Tax Distributions attributable to such Event of Loss paid or payable as a result thereof. 


    "Net Proceeds" means the aggregate cash proceeds received by the Company or any of its Restricted Subsidiaries in respect of any Asset
Sale (including, without limitation, any cash received upon the sale or other disposition of any non-cash consideration received in any Asset Sale), net of the direct costs relating to
such Asset Sale, including, without limitation, legal, accounting and investment banking fees, sales commissions, relocation expenses incurred as a result thereof and taxes or Tax Distributions paid
or payable as a result thereof, in each case, after taking into account any available tax credits or deductions and any tax sharing arrangements, and amounts required to be applied to the repayment of
Indebtedness secured by a Lien on the asset or assets that were the subject of such Asset Sale and any reserve for adjustment in respect of the sale price of such asset or assets established in
accordance with GAAP. 


    "Non-Recourse Debt" means Indebtedness (i) as to which neither the Company nor any of its Restricted Subsidiaries
(a) provides credit support of any kind (including any undertaking, agreement or instrument that would constitute Indebtedness), (b) is directly or indirectly liable as a subsidiary
guarantor or otherwise or (c) constitutes the lender; (ii) no default with respect to which (including any rights that the holders thereof may have to take enforcement action against an
Unrestricted Subsidiary) would permit upon notice, lapse of time or both any holder of any other Indebtedness (other than the Notes) of the Company or any of its Restricted Subsidiaries to declare a
default on such other Indebtedness or cause the payment thereof to be accelerated or payable prior to its stated maturity; 







and (iii) as to which the lenders have been notified in writing that they will not have any recourse to the stock or assets of the Company or any of its Restricted Subsidiaries. 


    "Non-U.S. Person" means a Person who is not a U.S. Person. 


12



    "Note Guarantee" means the Guarantee by each Subsidiary Guarantor of the Company's payment obligations under this Indenture and on the
Notes, executed pursuant to the provisions of this Indenture. 


    "Notes" has the meaning assigned to it in the preamble to this Indenture. The Initial Notes and the Additional Notes shall be treated
as a single class for all purposes under this Indenture. 


    "Obligations" means any principal, interest, penalties, fees, indemnifications, reimbursements, damages and other liabilities payable
under the documentation governing any Indebtedness. 


    "Offering" means the offering of the Notes by the Company. 



    "Officer" means, with respect to any Person, the Chairman of the Board, the Chief Executive Officer, the President, the Chief Operating
Officer, the Chief Financial Officer, the Treasurer, any Assistant Treasurer, the Controller, the Secretary or any Vice-President of such Person. 


    "Officers' Certificate" means a certificate signed on behalf of the Company by two Officers of the Company, one of whom must be the
principal executive officer, the principal financial officer, the treasurer or the principal accounting officer of the Company, that meets the requirements of Section 13.05 hereof. 



    "Opinion of Counsel" means an opinion from legal counsel that meets the requirements of Section 13.05 hereof. The counsel may be
an employee of or counsel to the Company or any Subsidiary of the Company. 


    "Participant" means, with respect to the Depositary, Euroclear or Clearstream, a Person who has an account with the Depositary,
Euroclear or Clearstream, respectively (and, with respect to DTC, shall include Euroclear and Clearstream). 


    "Permitted Business" means the gaming business and other businesses necessary for, incident to, connected with, arising out of, that is
a reasonable extension of or developed or operated to permit, facilitate or enhance the conduct or pursuit of the gaming business (including purchasing real estate in connection with any such business
and developing and operating lodging facilities, restaurants, sports or entertainment facilities, transportation services or other related activities or enterprises and any additions or improvements
thereto) and potential opportunities in the gaming business. 


    "Permitted C-Corp. Reorganization" means a transaction resulting in the Company or any of its Restricted Subsidiaries
becoming a subchapter "C" corporation under the Code; provided that, in connection with such transaction (i) the entity resulting from such
transaction is organized and existing under the laws of any state of the United States or the District of Columbia; (ii) the entity resulting from such transaction assumes in writing all of the
obligations of the Company or any of its Restricted Subsidiaries under this Indenture, the Notes, the Guarantee and the Collateral Documents and all other documents and instruments to which the
Company or the Restricted Subsidiary is a party (other than any documents and instruments that, 


13



individually
or in the aggregate, are not material to the Company or the Restricted Subsidiary); (iii) the Trustee is given not less than 15 days advance written notice of such
transaction and evidence 







satisfactory to the Trustee (including, without limitation, title insurance and a satisfactory Opinion of Counsel) regarding the maintenance of the perfection and priority of liens granted, or
intended to be granted, in favor of the Trustee in the Collateral following such transaction; (iv) such transaction would not cause or result in an Event of Default; (v) such transaction
would not result in the loss or suspension or material impairment of any Gaming Licenses, 








unless a comparable Gaming License is effective prior to or simultaneously with such loss, suspension or material impairment; (vi) such transaction would not require any Holder or Beneficial
Owner of the Notes to obtain a Gaming License or be qualified or found suitable under the laws of any applicable gaming jurisdiction; provided that such
Holder or Beneficial Owner would not have been required to obtain a Gaming License or be qualified or found suitable under the laws of any applicable gaming jurisdiction in the absence of such
transaction; (vii) the Company or the Restricted Subsidiary shall have delivered to the Trustee an Opinion of Counsel in the United States reasonably acceptable to the Trustee confirming that
neither the Company nor any of the Holders will recognize income, gain or loss for U.S. federal or state income tax purposes as a result of such transaction; and (viii) the Company shall have
delivered to the Trustee a certificate of the chief financial officer of the Company confirming that the conditions in clauses (1) through (7) have been satisfied. 


    "Permitted Investments" means (i) any Investment in the Company or in a Restricted Subsidiary of the Company; (ii) any
Investment in Cash Equivalents; (iii) any Investment by the Company or any Restricted Subsidiary of the Company in a Person, if as a result of such Investment (a) such Person becomes a
Restricted Subsidiary of the Company or (b) such Person is merged, consolidated or amalgamated with or into, or transfers or conveys substantially all of its assets to, or is liquidated into,
the Company or a Restricted Subsidiary of the Company; (iv) any Investment made as a result of the receipt of non-cash consideration from an Asset Sale that was made pursuant to and
in compliance with Section 4.10; (v) any acquisition of assets solely in exchange for the issuance of Equity Interests (other
than Disqualified Stock) of the Company; (vi) Hedging Obligations; (vii) any Investment made in settlement of gambling debts incurred by patrons of any casino owned or operated by the
Company or any of its Restricted Subsidiaries which settlements have been entered into in the ordinary course of business; (viii) Investments in any Person with which the Company has a Street
Route Contract; provided such Investment is made in the ordinary course of business consistent with past practices; and (ix) Investments not
otherwise permitted by the foregoing clauses (i) through (viii) in an aggregate outstanding amount of not more than $1.0 million. 


    "Permitted Liens" means (i) Liens on the assets of the Company and its Restricted Subsidiaries created by this Indenture and the
Collateral Documents securing the Notes and the Note Guarantees; (ii) Liens in favor of the Company or any of its Restricted Subsidiaries; (iii) Liens on property of a Person existing at
the time such Person is merged into or consolidated with the Company or any of its Restricted Subsidiaries; provided that such Liens were in existence
prior to the contemplation of such merger or consolidation and do not extend to any assets other than those of the Person merged into or consolidated with the Company or any Restricted Subsidiary;
(iv) Liens on property existing at the time of acquisition thereof by the Company or any of its Restricted Subsidiaries, provided,  however, that such
Liens were in existence prior to the 


14



contemplation
of such acquisition; (v) Liens to secure the performance of statutory obligations, surety or appeal bonds, performance bonds or other obligations of a like nature incurred in the
ordinary course of business; (vi) Liens existing on the date of this Indenture; (vii) Liens to secure Indebtedness permitted by clause (ii) of the second paragraph of
Section 4.09 covering only the assets acquired with such Indebtedness; (viii) Liens on the Separate Collateral to secure Indebtedness permitted by clause (viii) of the second
paragraph of Section 4.09; (ix) Liens on the accounts receivable of the Company or its Restricted Subsidiaries incurred in the ordinary course of its business; (x) Liens for
taxes, assessments or governmental charges or claims that are not yet due and payable or that are being contested in good faith by appropriate proceedings promptly instituted and diligently concluded;  provided that any reserve or other appropriate provision as shall be required in conformity with GAAP shall have been made therefor;
(xi) easements, rights-of-way, minor defects or irregularities in title and other similar charges or encumbrances not interfering in any material respect (a) with
the use or value of such property as a whole, or (b) with the business or assets of the Company or any Subsidiary; and 







(xii) Liens on assets of Unrestricted Subsidiaries that secure Non-recourse Debt of Unrestricted Subsidiaries. 






    "Permitted Refinancing Indebtedness" means any Indebtedness of the Company or any of its Restricted Subsidiaries issued in exchange
for, or the net proceeds of which are used to extend, refinance, renew, replace, defease or refund other Indebtedness of the Company or any of its Restricted Subsidiaries (other than intercompany
Indebtedness); provided, however, that (i) the principal amount (or accreted value, if
applicable) of such Permitted Refinancing Indebtedness does not exceed the principal amount (or accreted value, if applicable) of the Indebtedness so extended, refinanced, renewed, replaced, defeased
or refunded (plus all accrued interest thereon and the amount of all expenses and premiums incurred in connection therewith); (ii) such Permitted Refinancing Indebtedness has a final maturity
date later than the final maturity date of, and has a Weighted Average Life to Maturity equal to or greater than the Weighted Average Life to Maturity of, the Indebtedness being extended, refinanced,
renewed, replaced, defeased or refunded; (iii) if the Indebtedness being extended, refinanced, renewed, replaced, defeased or refunded is subordinated in right of payment to the Notes, such
Permitted Refinancing Indebtedness has a final maturity date later than the final maturity date of, and is subordinated in right of payment to, the Notes on terms at least as favorable to the Holders
of Notes as those contained in the documentation governing the Indebtedness being extended, refinanced, renewed, replaced, defeased or refunded; and (iv) such Indebtedness is incurred either by
the Company or by the Restricted Subsidiary who is the obligor on the Indebtedness being extended, refinanced, renewed, replaced, defeased or refunded. 



    "Person" means any individual, corporation, partnership, joint venture, association, joint-stock company, trust, unincorporated
organization, limited liability company or government or other entity. 


    "Principals" means Edward J. Herbst, Timothy P. Herbst and Troy D. Herbst. 


    "Private Placement Legend" means the legend set forth in Section 2.06(g)(i) to be placed on all Notes issued under this
Indenture except where otherwise permitted by the provisions of this Indenture. 


15 


    "Purchase Money Indebtedness" means Indebtedness of the Company or any of its Restricted Subsidiaries incurred for the purpose of
financing all or any part of the purchase price or cost of installation, construction or improvement of any property. 


    "QIB" means a "qualified institutional buyer" as defined in Rule 144A. 


    "Registration Rights Agreement" means the Registration Rights Agreement, dated as of the date of this Indenture, by and among the
Company and the other parties named on the signature pages thereof, as such agreement may be amended, modified or supplemented from time to time and, with respect to any Additional Notes, one or more
registration rights agreements between the Company and the other parties thereto, as such agreement(s) may be amended, modified or supplemented from time to time, relating to rights given by the
Company to the purchasers of Additional Notes to register such Additional Notes under the Securities Act. 


    "Regulation S" means Regulation S promulgated under the Securities Act. 


    "Regulation S Global Note" means a Regulation S Temporary Global Note or Regulation S Permanent Global Note, as
appropriate. 


    "Regulation S Permanent Global Note" means a permanent global Note in the form of Exhibit A1 hereto bearing the Global Note
Legend and the Private Placement Legend and deposited with or on behalf of and registered in the name of the Depositary or its nominee, issued in a denomination equal to the outstanding principal
amount of the Regulation S Temporary Global Note upon expiration of the Restricted Period. 


    "Regulation S Temporary Global Note" means a temporary global Note in the form of Exhibit A2 hereto bearing the Private
Placement Legend and deposited with or on behalf of and registered in the 







name of the Depositary or its nominee, issued in a denomination equal to the outstanding principal amount of the Notes initially sold in reliance on Rule 903 of Regulation S. 


    "Related Party" means (i) any spouse, sibling or child of any Principal; or (ii) any trust, corporation, partnership or
other entity, the beneficiaries, stockholders, partners, owners or Persons beneficially holding an 80% or more controlling interest of which consist of any one or more Principals and/or such other
Persons referred to in the immediately preceding clause (i). 


    "Responsible Officer," when used with respect to the Trustee, means any officer within the Corporate Trust Administration of the
Trustee (or any successor group of the Trustee) or any other officer of the
Trustee customarily performing functions similar to those performed by any of the above designated officers and also means, with respect to a particular corporate trust matter, any other officer to
whom such matter is referred because of his knowledge of and familiarity with the particular subject and who shall have direct responsibility for the administration of this Indenture. 


    "Restricted Definitive Note" means a Definitive Note bearing the Private Placement Legend. 


    "Restricted Global Note" means a Global Note bearing the Private Placement Legend. 


16



    "Restricted Investment" means an Investment other than a Permitted Investment. 


    "Restricted Period" means the 40-day restricted period as defined in Regulation S. 



    "Restricted Subsidiary" of a Person means any Subsidiary of the referent Person that is not an Unrestricted Subsidiary. 


    "Rule 144" means Rule 144 promulgated under the Securities Act. 


    "Rule 144A" means Rule 144A promulgated under the Securities Act. 


    "Rule 903" means Rule 903 promulgated under the Securities Act. 



    "Rule 904" means Rule 904 promulgated the Securities Act. 


    "SEC" means the Securities and Exchange Commission. 


    "Securities Act" means the Securities Act of 1933, as amended. 


    "Separate Collateral" means the furniture, fixture and equipment from time to time located in, and used in connection with the
operations of, Terrible's Hotel & Casino. 


    "Shelf Registration Statement" means the Shelf Registration Statement as defined in the Registration Rights Agreement. 


    "Significant Subsidiary" means any Subsidiary that would be a "significant subsidiary" as defined in Article 1,
Rule 1-02 of Regulation S-X, promulgated pursuant to the Securities Act, as such Regulation is in effect on the date of this Indenture. 








    "Slot Route Operations" means the operations of the Company and its subsidiaries consisting of (i) the Gaming Devices License
Agreement, dated as of August 31, 1998, by and between Market Gaming, Inc. and Safeway, Inc., (ii) the Gaming Devices License Agreement, dated as of August 31, 1998,
by and between Market Gaming, Inc. and The Vons Company, Inc., (iii) the License Agreement dated as of September 16, 1998, by and between Cardivan Company and
Albertson's, Inc., as modified by the Settlement Agreement, dated November 18, 1999, by and among Cardivan Company, Corral United, Inc., Jackpot Enterprises, Inc. and
Albertsons, Inc., (iv) the Agreement, dated as of May 1, 1998, by and between Cardivan Company and KMART Corporation (v) the License Agreement, dated as of
August 12, 1998, by and between Cardivan Company and Waremart, Inc. and (vi) the License Agreement, dated as of December 20, 1999, by and between
E-T-T, Inc. and Terrible Herbst, Inc., each as may be amended, supplemented or modified after the date of this Indenture. 


    "Stated Maturity" means, with respect to any installment of interest or principal on any series of Indebtedness, the date on which such
payment of interest or principal was scheduled to be paid in the original documentation governing such Indebtedness, and shall not include any contingent obligations to repay, redeem or repurchase any
such interest or principal prior to the date originally scheduled for the payment thereof. 


17 


    "Street Route Contract" means any contract entered into by the Company or any of its Restricted Subsidiaries with any Person that
provides for the installation and operation of slot machines, video poker machines or other electronic gaming devices at premises owned or operated by such Person other than the Company or any of its
Subsidiaries; provided such Person and its Affiliates own or operate less than five locations at which gaming devices will be installed and operated by
the Company and its Restricted Subsidiaries. 


    "Subsidiary" means, with respect to any specified Person, (i) any corporation, association or other business entity of which
more than 50% of the total voting power of shares of Capital Stock entitled (without regard to the occurrence of any contingency) to vote in the election of directors, managers or trustees thereof is
at the time owned or controlled, directly or indirectly, by such Person or one or more of the other Subsidiaries of that Person (or a combination thereof) and (ii) any partnership
(a) the sole general partner or the managing general partner of which is such Person or a Subsidiary of such Person or (b) the only general partners of which are such Person or one or
more Subsidiaries of such Person (or any combination thereof). 


    "Subsidiary Guarantor" means each of (i) Cardivan Company, a Nevada corporation; (ii) Corral Coin, Inc., a Nevada
corporation; (iii) Corral Country Coin, Inc., a Nevada corporation; (iv) E-T-T, Inc., a Nevada corporation; (v) E-T-T
Enterprises, LLC, a Nevada limited-liability company; (vi) Flamingo Paradise Gaming, LLC, a Nevada limited-liability company; (vii) Market Gaming, Inc., a Nevada corporation;
(viii) any Restricted Subsidiary of the Company that executes a Guarantee in accordance with the provisions of this Indenture; and (ix) their respective successors and assigns. 


    "Tax Amount" means, with respect to any Person for any period, an amount equal to (i) the product of (a) the Taxable
Income of such Person and (b) the Applicable Tax Percentage, less (ii) to the extent not previously taken into account, any income tax benefit attributable to such Person which could be
utilized by its shareholders, in the current or any prior year, or portion thereof, from and after the date of this Indenture (including any tax losses or tax credits), computed at the Applicable Tax
Percentage of the year that such benefit is taken into account for purposes of this computation; provided,  however, that the computation of Tax Amount
shall also take into account (x) the deductibility of state and local taxes for federal income tax
purposes and (y) any difference in the Applicable Tax Percentage resulting from the nature of the Taxable Income (such as capital gain as opposed to ordinary income). 



    "Tax Distribution" means a distribution in respect of taxes to the shareholders of the Company pursuant to clause (v) of the
second paragraph Section 4.07. 







    "Taxable Income" means, with respect to any Person for any period, the taxable income (including all separately stated items of income)
or loss of such Person (including any such taxable income payable by such Person's shareholders as a result of such Person's election to be taxed as a subchapter "S" corporation pursuant to
Section 1361 of the Code) for such period for federal income tax purposes. 


    "Terrible's Hotel & Casino" means the Terrible's Hotel & Casino located at 4100 Paradise Road in Las Vegas, Nevada. 


18



    "TIA" means the Trust Indenture Act of 1939 (15 U.S.C. §§ 77aaa-77bbbb) as in effect on the date on
which this Indenture is qualified under the TIA. 







    "Trademark Agreement" means the Trademark License Agreement, dated as of December 19, 1999, by and between
E-T-T, Inc. and Terrible Herbst, Inc., as in effect on the date of this Indenture. 


    "Trustee" means the party named as such above until a successor replaces it in accordance with the applicable provisions of this
Indenture and thereafter means the successor serving hereunder. 


    "Unrestricted Global Note" means a permanent global Note substantially in the form of Exhibit A1 attached hereto that bears the Global
Note Legend and that has the "Schedule of Exchanges of Interests in the Global Note" attached thereto, and that is deposited with or on behalf of and registered in the name of the Depositary,
representing a series of Notes that do not bear the Private Placement Legend. 


    "Unrestricted Definitive Note" means one or more Definitive Notes that do not bear and are not required to bear the Private Placement
Legend. 


    "Unrestricted Subsidiary" means any Subsidiary of the Company that is designated by the Board of Directors as an Unrestricted
Subsidiary pursuant to a resolution, but only to the extent that such Subsidiary (i) has no Indebtedness other than Non-Recourse Debt; (ii) is not party to any agreement,
contract, arrangement or understanding with the Company or any Restricted Subsidiary of the Company unless the terms of any such agreement, contract, arrangement or understanding are no less favorable
to the Company or such Restricted Subsidiary than those that might be obtained at the time from Persons who are not Affiliates of the Company; (iii) is a Person with respect to which neither
the Company nor any of its Restricted Subsidiaries has any direct or indirect obligation (a) to subscribe for additional Equity Interests or (b) to maintain or preserve such Person's
financial condition or to cause such Person to achieve any specified levels of operating results; (iv) has not guaranteed or otherwise directly or indirectly provided credit support for any
Indebtedness of the Company or any of its Restricted Subsidiaries; and (v) has at least one director on its Board of Directors that is not a director or executive officer of the Company or any
if its Restricted Subsidiaries and has at least one executive officer that is not a director or executive officer of the Company or any of its Restricted Subsidiaries. 


    Any
designation of a Subsidiary of the Company as an Unrestricted Subsidiary shall be evidenced to the Trustee by filing with the Trustee a certified copy of the Board Resolution
giving effect to such designation and an Officers' Certificate certifying that such designation complied with the preceding conditions and was permitted by Section 4.07. If, at any time, any
Unrestricted Subsidiary would fail to meet the preceding requirements as an Unrestricted Subsidiary, it shall thereafter cease to be an Unrestricted Subsidiary for purposes of this Indenture and any
Indebtedness of such Subsidiary shall be deemed to be incurred by a Restricted Subsidiary of the Company as of such date and, if such Indebtedness is not permitted to be incurred as of such date under
Section 4.09, the Company shall be in default of such covenant. The Board of Directors of the Company may at any time designate any Unrestricted Subsidiary to be a Restricted Subsidiary;  provided
that such designation shall be deemed to be an incurrence of Indebtedness by a Restricted 


19 


Subsidiary
of the Company of any outstanding Indebtedness of such Unrestricted Subsidiary and such designation shall only be permitted if (x) such Indebtedness is permitted under
Section 4.09, calculated on a pro forma basis as if such designation had occurred at the beginning of the four-quarter reference period, (y) no Default or Event of Default
would be in existence following such designation and (z) the provisions of Section 4.22 have been satisfied with respect to such Subsidiary. 


    "U.S. Person" means a U.S. person as defined in Rule 902(o) under the Securities Act. 



    "Voting Stock" of any Person as of any date means the Capital Stock of such Person that is at the time entitled to vote in the election
of the Board of Directors of such Person. 


    "Weighted Average Life to Maturity" means, when applied to any Indebtedness at any date, the number of years obtained by dividing
(i) the sum of the products obtained by multiplying (a) the 








amount of each then remaining installment, sinking fund, serial maturity or other required payments of principal, including payment at final maturity, in respect thereof, by (b) the number of
years (calculated to the nearest one-twelfth) that will elapse between such date and the making of such payment, by (ii) the then outstanding principal amount of such Indebtedness. 


Section 1.02.  OTHER DEFINITIONS.  



	Term
 
	 	Defined in

Section

	"Affiliate Transaction"	 	4.11
	"Asset Sale"	 	4.10
	"Asset Sale Offer"	 	3.10
	"Authentication Order"	 	2.02
	"Bankruptcy Law"	 	4.01
	"Change of Control Offer"	 	4.15
	"Change of Control Payment"	 	4.15
	"Change of Control Payment Date"	 	4.15
	"Covenant Defeasance"	 	8.03
	"Excess Loss Proceeds"	 	4.19
	"Event of Default"	 	6.01
	"Event of Loss Offer"	 	4.19
	"Excess Proceeds"	 	4.10
	"Excess Proceeds Offer"	 	3.10
	"incur"	 	4.09
	"Legal Defeasance"	 	8.02
	"Offer Amount"	 	3.10
	"Offer Period"	 	3.10
	"Paying Agent"	 	2.03
	"Permitted Debt"	 	4.09
	"Purchase Date"	 	3.10
	"Registrar"	 	2.03





20




	Term
 
	 	Defined in

Section

	"Restricted Payments"	 	4.07
	"Subject Property"	 	4.19
	"Unit Legend"	 	2.06






Section 1.03.  INCORPORATION BY REFERENCE OF TRUST INDENTURE ACT.  


    Whenever this Indenture refers to a provision of the TIA, the provision is incorporated by reference in and made a part of this Indenture. 


    The
following TIA terms used in this Indenture have the following meanings: 


    "indenture securities" means the Notes; 



    "indenture security Holder" means a Holder of a Note; 


    "indenture to be qualified" means this Indenture; 







    "indenture trustee" or "institutional trustee" means the Trustee; and 



    "obligor" on the Notes and the Note Guarantees means the Company and the Subsidiary Guarantors, respectively, and any successor obligor
upon the Notes and the Note Guarantees, respectively. 


    All
other terms used in this Indenture that are defined by the TIA, defined by TIA reference to another statute or defined by SEC rule under the TIA have the meanings so assigned to
them. 








Section 1.04.  RULES OF CONSTRUCTION.  


    Unless the context otherwise requires: 


    (a) a
term has the meaning assigned to it; 


    (b) an
accounting term not otherwise defined has the meaning assigned to it in accordance with GAAP; 


    (c) "or"
is not exclusive; 


    (d) words
in the singular include the plural, and in the plural include the singular; 


    (e) provisions
apply to successive events and transactions; and 


    (f)  references
to sections of or rules under the Securities Act shall be deemed to include substitute, replacement of successor sections or rules adopted by the SEC
from time to time. 


21 


 
 

ARTICLE II.
  
    THE NOTES    



Section 2.01. FORM AND DATING.  


    (a) General. The Notes and the Trustee's certificate of authentication shall be substantially in the form of Exhibit A1
or A2 hereto. The Notes may have notations, legends or endorsements required by law, stock exchange rule or usage. Each Note shall be dated the date of its authentication. The Notes shall be in
denominations of $1,000 and integral multiples thereof. 


    The
terms and provisions contained in the Notes shall constitute, and are hereby expressly made, a part of this Indenture and the Company, the Subsidiary Guarantors and the Trustee,
by their execution and delivery of this Indenture, expressly agree to such terms and provisions and to be bound thereby. However, to the extent any provision of any Note conflicts with the express
provisions of this Indenture, the provisions of this Indenture shall govern and be controlling. 


    (b) Global Notes. Notes issued in global form shall be substantially in the form of Exhibits A1 or A2 attached hereto
(including the Global Note Legend thereon and the "Schedule of Exchanges of Interests in the Global Note" attached thereto). Notes issued in definitive form shall be substantially in the form of
Exhibit A1 attached hereto (but without the Global Note Legend thereon and without the "Schedule of Exchanges of Interests in the Global Note" attached thereto). Each Global Note shall represent such
of the outstanding Notes as shall be specified therein and each shall provide that it shall represent the aggregate principal amount of outstanding Notes from time to time endorsed thereon and that
the aggregate principal amount of outstanding Notes represented thereby may from time to time be reduced or increased, as appropriate, to reflect exchanges and redemptions. Any endorsement of a Global
Note to reflect the amount of any increase or decrease in the aggregate principal amount of outstanding Notes represented thereby shall be made by the Trustee or the Custodian, at the direction of the
Trustee, in accordance with instructions given by the Holder thereof as required by Section 2.06 hereof. 


    (c) Temporary Global Notes. Notes offered and sold in reliance on Regulation S shall be issued initially in the
form of the Regulation S Temporary Global Note, which shall be deposited on behalf of the purchasers of the Notes represented thereby with the Trustee, at its New York office, as custodian for
the Depositary, and registered in the name of the Depositary or the nominee of the Depositary for the accounts of designated agents holding on behalf of Euroclear or Clearstream, duly executed by the
Company and authenticated by the Trustee as hereinafter provided. The Restricted Period shall be terminated upon the receipt by the Trustee of (i) a written certificate from the Depositary,
together with copies of certificates from Euroclear and Clearstream certifying that they have received 







certification of non-United States beneficial ownership of 100% of the aggregate principal amount of the Regulation S Temporary Global Note (except to the extent of any beneficial
owners thereof who
acquired an interest therein during the Restricted Period pursuant to another exemption from registration under the Securities Act and who will take delivery of a beneficial ownership interest in a
144A Global Note or an IAI Global Note bearing a Private Placement Legend, all as contemplated by Section 2.06(a)(ii) hereof), and (ii) an Officers' Certificate from the Company.
Following the 


22



termination
of the Restricted Period, beneficial interests in the Regulation S Temporary Global Note shall be exchanged for beneficial interests in Regulation S Permanent Global Notes
pursuant to the Applicable Procedures. Simultaneously with the authentication of Regulation S Permanent Global Notes, the Trustee shall cancel the Regulation S Temporary Global Note. The
aggregate principal amount of the Regulation S Temporary Global Note and the Regulation S Permanent Global Notes may from time to time be increased or decreased by adjustments made on
the records of the Trustee and the Depositary or its nominee, as the case may be, in connection with transfers of interest as hereinafter provided. 


    (d) Euroclear and Clearstream Procedures Applicable. The provisions of the "Operating Procedures of the Euroclear
System" and "Terms and Conditions Governing Use of Euroclear" and the "General Terms and Conditions of Clearstream" and "Customer Handbook" of Clearstream shall be applicable to transfers of
beneficial interests in the Regulation S Temporary Global Note and the Regulation S Permanent Global Notes that are held by Participants through Euroclear or Clearstream. 


Section 2.02. EXECUTION AND AUTHENTICATION.  


    Two Officers shall sign the Notes for the Company by manual or facsimile signature. The Company's seal shall be reproduced on the Notes and may be in facsimile
form. 


    If
an Officer whose signature is on a Note no longer holds that office at the time a Note is authenticated, the Note shall nevertheless be valid. 



    A
Note shall not be valid until authenticated by the manual signature of the Trustee. The signature shall be conclusive evidence that the Note has been authenticated under this
Indenture. 


    The
Trustee shall, upon a written order of the Company signed by two Officers (an "Authentication Order"), authenticate Notes for
original issue up to the aggregate principal amount stated in
paragraph 4 of the Notes. The aggregate principal amount of Notes outstanding at any time may not exceed such amount except as provided in Section 2.07 hereof. 


    The
Trustee may appoint an authenticating agent acceptable to the Company to authenticate Notes. An authenticating agent may authenticate Notes whenever the Trustee may do so. Each
reference in this Indenture to authentication by the Trustee includes authentication by such agent. An authenticating agent has the same rights as an Agent to deal with Holders or an Affiliate of the
Company. 


Section 2.03. REGISTRAR AND PAYING AGENT.  


    The Company shall maintain an office or agency where Notes may be presented for registration of transfer or for exchange
("Registrar") and an office or agency where Notes may be presented for payment ("Paying Agent"). The
Registrar shall keep a register of the Notes and of their transfer and exchange. The Company may appoint one or more co-registrars and one or more additional paying agents. The term
"Registrar" includes any co-registrar and the term "Paying Agent" includes any additional paying agent. The Company may change any Paying Agent or Registrar without notice to any Holder.
The Company shall notify the Trustee in writing of the name and address of any Agent not a party to this Indenture. If the Company fails 






23 



to
appoint or maintain another entity as Registrar or Paying Agent, the Trustee shall act as such. The Company or any of its Subsidiaries may act as Paying Agent or Registrar. 







    The Company initially appoints The Depository Trust Company ("DTC") to act as Depositary with respect to the Global Notes. 


    The
Company initially appoints the Trustee to act as the Registrar and Paying Agent and to act as Custodian with respect to the Global Notes. 



Section 2.04. PAYING AGENT TO HOLD MONEY IN TRUST.  


    The Company shall require each Paying Agent other than the Trustee to agree in writing that the Paying Agent will hold in trust for the benefit of Holders or
the Trustee all money held by the Paying Agent for the payment of principal, premium or Liquidated Damages, if any, or interest on the Notes, and will notify the Trustee of any default by the Company
in making any such payment. While any such default continues, the Trustee may require a Paying Agent to pay all money held by it to the Trustee. The Company at any time may require a Paying Agent to
pay all money held by it to the Trustee. Upon payment over to the Trustee, the Paying Agent (if other than the Company or a Subsidiary) shall have no further liability for the money. If the Company or
a Subsidiary acts as Paying Agent, it shall segregate and hold in a separate trust fund for the benefit of the Holders all money held by it as Paying Agent. Upon any bankruptcy or reorganization
proceedings relating to the Company, the Trustee shall serve as Paying Agent for the Notes. 


Section 2.05. HOLDER LISTS.  


    The Trustee shall preserve in as current a form as is reasonably practicable the most recent list available to it of the names and addresses of all Holders and
shall otherwise comply with TIA § 312(a). If the Trustee is not the Registrar, the Company shall furnish to the Trustee at least seven Business Days before each interest payment date and
at such other times as the Trustee may request in writing, a list in such form and as of such date as the Trustee may reasonably require of the names and addresses of the Holders of Notes and the
Company shall otherwise comply with TIA § 312(a). 


Section 2.06. TRANSFER AND EXCHANGE.  


    (a) Transfer and Exchange of Global Notes. A Global Note may not be transferred as a whole except by the Depositary to a
nominee of the Depositary, by a nominee of the Depositary to the Depositary or to another nominee of the Depositary, or by the Depositary or any such nominee to a successor Depositary or a nominee of
such successor Depositary. All Global Notes will be exchanged by the Company for Definitive Notes if (i) the Company delivers to the Trustee notice from the Depositary that it is unwilling or
unable to continue to act as Depositary or that it is no longer a clearing agency registered under the Exchange Act and, in either case, a successor Depositary is not appointed by the Company within
120 days after the date of such notice from the Depositary or (ii) the Company in its sole discretion determines that the Global Notes (in whole but not in part) should be exchanged for
Definitive Notes and delivers a written notice to such effect to the Trustee; provided that in no event shall the Regulation S Temporary Global
Note be exchanged by the Company for Definitive Notes prior 


24 


to
(x) the expiration of the Restricted Period and (y) the receipt by the Registrar of any certificates required pursuant to Rule 903(b)(3)(ii)(B) under the Securities Act. Upon
the occurrence of either of the preceding events in (i) or (ii) above, Definitive Notes shall be issued in such names as the Depositary shall instruct the Trustee. Global Notes also may be exchanged
or replaced, in whole or in part, as provided in Sections 2.07 and 2.10 hereof. Every Note authenticated and delivered in exchange for, or in lieu of, a Global Note or any portion thereof,
pursuant to this Section 2.06 or Section 2.07 or 2.10 hereof, shall be authenticated and delivered in the form of, and shall be, a Global Note. A Global Note may not be exchanged for
another Note other than as provided in this Section 2.06(a), however, 







beneficial interests in a Global Note may be transferred and exchanged as provided in Section 2.06(b), (c) or (f) hereof. 








    (b) Transfer and Exchange of Beneficial Interests in the Global Notes. The transfer and exchange of beneficial interests
in the Global Notes shall be effected through the Depositary, in accordance with the provisions of this Indenture and the Applicable Procedures. Beneficial interests in the Restricted Global Notes
shall be subject to restrictions on transfer comparable to those set forth herein to the extent required by the Securities Act. Transfers of beneficial interests in the Global Notes also shall require
compliance with either subparagraph (i) or (ii) below, as applicable, as well as one or more of the other following subparagraphs, as applicable: 



     (i) Transfer of Beneficial Interests in the Same Global Note. Beneficial interests in any Restricted Global Note may be
transferred to Persons who take delivery thereof in the form of a beneficial interest in the same Restricted Global Note in accordance with the transfer restrictions set forth in the Private Placement
Legend; provided, however, that prior to the expiration of the Restricted Period, transfers of beneficial interests in the Temporary Regulation S
Global Note may not be made to a U.S. Person or for the account or benefit of a U.S. Person (other than an Initial Purchaser). Beneficial interests in any Unrestricted Global Note may be transferred
to Persons who take delivery thereof in the form of a
beneficial interest in an Unrestricted Global Note. No written orders or instructions shall be required to be delivered to the Registrar to effect the transfers described in this
Section 2.06(b)(i). 


    (ii) All Other Transfers and Exchanges of Beneficial Interests in Global Notes. In connection with all transfers and
exchanges of beneficial interests that are not subject to Section 2.06(b)(i) above, the transferor of such beneficial interest must deliver to the Registrar either (A) (1) a
written order from a Participant or an Indirect Participant given to the Depositary in accordance with the Applicable Procedures directing the Depositary to credit or cause to be credited a beneficial
interest in another Global Note in an amount equal to the beneficial interest to be transferred or exchanged and (2) instructions given in accordance with the Applicable Procedures containing
information regarding the Participant account to be credited with such increase or (B) (1) a written order from a Participant or an Indirect Participant given to the Depositary in accordance
with the Applicable Procedures directing the Depositary to cause to be issued a Definitive Note in an amount equal to the beneficial interest to be transferred or exchanged and (2) instructions
given by the Depositary to the Registrar containing information regarding the Person in whose name such Definitive Note shall be registered to effect the transfer or exchange referred to in
(1) above; provided that in no event shall Definitive Notes be issued upon the transfer or exchange of beneficial interests in the
Regulation S 



25




Temporary
Global Note prior to (x) the expiration of the Restricted Period and (y) the receipt by the Registrar of any certificates required pursuant to Rule 903 under the
Securities Act. Upon consummation of an Exchange Offer by the Company in accordance with Section 2.06(f) hereof, the requirements of this Section 2.06(b)(ii) shall be deemed to
have been satisfied upon receipt by the Registrar of the instructions contained in the Letter of Transmittal delivered by the Holder of such beneficial interests in the Restricted Global Notes. Upon
satisfaction of all of the requirements for transfer or exchange of beneficial interests in Global Notes contained in this Indenture and the Notes or otherwise applicable under the Securities Act, the
Trustee shall adjust the principal amount of the relevant Global Note(s) pursuant to Section 2.06(h) hereof. 


    (iii) Transfer of Beneficial Interests to Another Restricted Global Note. A beneficial interest in any Restricted Global
Note may be transferred to a Person who takes delivery thereof in the form of a beneficial interest in another Restricted Global Note if the transfer complies with the requirements of
Section 2.06(b)(ii) above and the Registrar receives the following: 



    (A) if
the transferee will take delivery in the form of a beneficial interest in the 144A Global Note, then the transferor must deliver a certificate in the form of
Exhibit B hereto, including the certifications in item (1) thereof; 










    (B) if the transferee will take delivery in the form of a beneficial interest in the Regulation S Temporary Global Note or the Regulation S Global Note,
then the transferor must deliver a certificate in the form of Exhibit B hereto, including the certifications in item (2) thereof; and 


    (C) if
the transferee will take delivery in the form of a beneficial interest in the IAI Global Note, then the transferor must deliver a certificate in the form of
Exhibit B hereto, including the certifications and certificates and Opinion of Counsel required by item (3) thereof, if applicable. 




    (iv) Transfer and Exchange of Beneficial Interests in a Restricted Global Note for Beneficial Interests in the Unrestricted Global
Note. A beneficial interest in any Restricted Global Note may be exchanged by any holder thereof for a beneficial interest in an Unrestricted Global Note or transferred to a
Person who takes delivery thereof in the form of a beneficial interest in an Unrestricted Global Note if the exchange or transfer complies with the requirements of
Section 2.06(b)(ii) above and: 



    (A) such
exchange or transfer is effected pursuant to the Exchange Offer in accordance with the Registration Rights Agreement and the holder of the beneficial interest
to be transferred, in the case of an exchange, or the transferee, in the case of a transfer, certifies in the applicable Letter of Transmittal that it is not (1) a broker-dealer, (2) a
Person participating in the distribution of the Exchange Notes or (3) a Person who is an affiliate (as defined in Rule 144) of the Company; 




26 




    (B) such
transfer is effected pursuant to the Shelf Registration Statement in accordance with the Registration Rights Agreement; 


    (C) such
transfer is effected by a Broker-Dealer pursuant to the Exchange Offer Registration Statement in accordance with the Registration Rights Agreement; or 


    (D) the
Registrar receives the following: 



    (1) if
the holder of such beneficial interest in a Restricted Global Note proposes to exchange such beneficial interest for a beneficial interest in an Unrestricted
Global Note, a certificate from such holder in the form of Exhibit C hereto, including the certifications in item (1)(a) thereof; or 


    (2) if
the holder of such beneficial interest in a Restricted Global Note proposes to transfer such beneficial interest to a Person who shall take delivery thereof in
the form of a beneficial interest in an Unrestricted Global Note, a certificate from such holder in the form of Exhibit B hereto, including the certifications in item (4) thereof; 




and,
in each such case set forth in this subparagraph (D), if the Registrar so requests or if the Applicable Procedures so require, an Opinion of Counsel in form reasonably acceptable to the
Registrar to the effect that such exchange or transfer is in compliance with the Securities Act and that the restrictions on transfer contained herein and in the Private Placement Legend are no longer
required in order to maintain compliance with the Securities Act. 





    If
any such transfer is effected pursuant to subparagraph (B) or (D) above at a time when an Unrestricted Global Note has not yet been issued, the Company shall issue
and, upon receipt of an Authentication Order in accordance with Section 2.02 hereof, the Trustee shall authenticate one or more Unrestricted Global Notes in an aggregate principal amount equal
to the aggregate principal amount of beneficial interests transferred pursuant to subparagraph (B) or (D) above. 



    Beneficial
interests in an Unrestricted Global Note cannot be exchanged for, or transferred to Persons who take delivery thereof in the form of, a beneficial interest in a Restricted
Global Note. 







    (c) Transfer or Exchange of Beneficial Interests for Definitive Notes. 



     (i) Beneficial Interests in Restricted Global Notes to Restricted Definitive Notes. If any holder of a beneficial
interest in a Restricted Global Note proposes to exchange such beneficial interest for a Restricted Definitive Note or to transfer such beneficial interest to a Person who takes delivery thereof in
the form of a Restricted Definitive Note, then, upon receipt by the Registrar of the following documentation: 



    (A) if
the holder of such beneficial interest in a Restricted Global Note proposes to exchange such beneficial interest for a Restricted Definitive Note, a 




27





certificate
from such holder in the form of Exhibit C hereto, including the certifications in item (2)(a) thereof; 



    (B) if
such beneficial interest is being transferred to a QIB in accordance with Rule 144A under the Securities Act, a certificate to the effect set forth in
Exhibit B hereto, including the certifications in item (1) thereof; 


    (C) if
such beneficial interest is being transferred to a Non-U.S. Person in an offshore transaction in accordance with Rule 903 or Rule 904
under the Securities Act, a certificate to the effect set forth in Exhibit B hereto, including the certifications in item (2) thereof; 


    (D) if
such beneficial interest is being transferred pursuant to an exemption from the registration requirements of the Securities Act in accordance with
Rule 144 under the Securities Act, a certificate to the effect set forth in Exhibit B hereto, including the certifications in item (3)(a) thereof; 


    (E) if
such beneficial interest is being transferred to an Institutional Accredited Investor in reliance on an exemption from the registration requirements of the
Securities Act other than those listed in subparagraphs (B) through (D) above, a certificate to the effect set forth in Exhibit B hereto, including the certifications,
certificates and Opinion of Counsel required by item (3) thereof, if applicable; 


    (F) if
such beneficial interest is being transferred to the Company or any of its Subsidiaries, a certificate to the effect set forth in Exhibit B hereto,
including the certifications in item (3)(b) thereof; or 


    (G) if
such beneficial interest is being transferred pursuant to an effective registration statement under the Securities Act, a certificate to the effect set forth in
Exhibit B hereto, including the certifications in item (3)(c) thereof, 




the
Trustee shall cause the aggregate principal amount of the applicable Global Note to be reduced accordingly pursuant to Section 2.06(h) hereof, and the Company shall execute and the Trustee
shall authenticate and deliver to the Person designated in the instructions a Definitive Note in the appropriate principal amount. Any Definitive Note issued in exchange for a beneficial interest in a
Restricted Global Note pursuant to this Section 2.06(c) shall be registered in such name or names and in such authorized denomination or denominations as the holder of such beneficial interest
shall instruct the Registrar through instructions from the Depositary and the Participant or Indirect Participant. The Trustee shall deliver such Definitive Notes to the Persons in whose names such
Notes are so registered. Any Definitive Note issued in exchange for a beneficial interest in a Restricted Global Note pursuant to this Section 2.06(c)(i) shall bear the Private Placement
Legend and shall be subject to all restrictions on transfer contained therein. 


    (ii) Beneficial Interests in Regulation S Temporary Global Note to Definitive Notes. Notwithstanding Sections
2.06(c)(i)(A) and (C) hereof, a beneficial interest in the 






28 



Regulation S
Temporary Global Note may not be exchanged for a Definitive Note or transferred to a Person who takes delivery thereof in the form of a Definitive Note prior to (x) the
expiration of the Restricted Period and (y) the receipt by the Registrar of any certificates required pursuant to 








Rule 903(b)(3)(ii)(B) under the Securities Act, except in the case of a transfer pursuant to an exemption from the registration requirements of the Securities Act other than Rule 903 or
Rule 904. 


    (iii) Beneficial Interests in Restricted Global Notes to Unrestricted Definitive Notes. A holder of a beneficial
interest in a Restricted Global Note may exchange such beneficial interest for an Unrestricted Definitive Note or may transfer such beneficial interest to a Person who takes delivery thereof in the
form of an Unrestricted Definitive Note only if: 



    (A) such
exchange or transfer is effected pursuant to the Exchange Offer in accordance with the Registration Rights Agreement and the holder of such beneficial
interest, in the case of an exchange,
or the transferee, in the case of a transfer, certifies in the applicable Letter of Transmittal that it is not (1) a broker-dealer, (2) a Person participating in the distribution of the
Exchange Notes or (3) a Person who is an affiliate (as defined in Rule 144) of the Company; 


    (B) such
transfer is effected pursuant to the Shelf Registration Statement in accordance with the Registration Rights Agreement; 


    (C) such
transfer is effected by a Broker-Dealer pursuant to the Exchange Offer Registration Statement in accordance with the Registration Rights Agreement; or 



    (D) the
Registrar receives the following: 



    (1) if
the holder of such beneficial interest in a Restricted Global Note proposes to exchange such beneficial interest for a Definitive Note that does not bear the
Private Placement Legend, a certificate from such holder in the form of Exhibit C hereto, including the certifications in item (1)(b) thereof; or 


    (2) if
the holder of such beneficial interest in a Restricted Global Note proposes to transfer such beneficial interest to a Person who shall take delivery thereof in
the form of a Definitive Note that does not bear the Private Placement Legend, a certificate from such holder in the form of Exhibit B hereto, including the certifications in item
(4) thereof; 




and,
in each such case set forth in this subparagraph (D), if the Registrar so requests or if the Applicable Procedures so require, an Opinion of Counsel in form reasonably acceptable to the Registrar
to the effect that such exchange or transfer is in compliance with the Securities Act and that the restrictions on transfer contained herein and in the Private Placement Legend are no longer required
in order to maintain compliance with the Securities Act. 




29




    (iv) Beneficial Interests in Unrestricted Global Notes to Unrestricted Definitive Notes. If any holder of a beneficial
interest in an Unrestricted Global Note proposes to exchange such beneficial interest for a Definitive Note or to transfer such beneficial interest to a Person who takes delivery thereof in the form
of a Definitive Note, then, upon satisfaction of the conditions set forth in Section 2.06(b)(ii) hereof,
the Trustee shall cause the aggregate principal amount of the applicable Global Note to be reduced accordingly pursuant to Section 2.06(h) hereof, and the Company shall execute and the Trustee
shall authenticate and deliver to the Person designated in the instructions a Definitive Note in the appropriate principal amount. Any Definitive Note issued in exchange for a beneficial interest
pursuant to this Section 2.06(c)(iv) shall be registered in such name or names and in such authorized denomination or denominations as the holder of such beneficial interest shall
instruct the Registrar through instructions from the Depositary and the Participant or Indirect Participant. The Trustee shall deliver such Definitive Notes to the Persons in whose names such Notes
are so registered. Any Definitive Note issued in exchange for a beneficial interest pursuant to this Section 2.06(c)(iv) shall not bear the Private Placement Legend. 







    (d) Transfer and Exchange of Definitive Notes for Beneficial Interests. 



     (i) Restricted Definitive Notes to Beneficial Interests in Restricted Global Notes. If any Holder of a Restricted
Definitive Note proposes to exchange such Note for a beneficial interest in a Restricted Global Note or to transfer such Restricted Definitive Notes to a Person who takes delivery thereof in the form
of a beneficial interest in a Restricted Global Note, then, upon receipt by the Registrar of the following documentation: 



    (A) if
the Holder of such Restricted Definitive Note proposes to exchange such Note for a beneficial interest in a Restricted Global Note, a certificate from such
Holder in the form of Exhibit C hereto, including the certifications in item (2)(b) thereof; 


    (B) if
such Restricted Definitive Note is being transferred to a QIB in accordance with Rule 144A under the Securities Act, a certificate to the effect set forth
in Exhibit B hereto, including the certifications in item (1) thereof; 


    (C) if
such Restricted Definitive Note is being transferred to a Non-U.S. Person in an offshore transaction in accordance with Rule 903 or
Rule 904 under the Securities Act, a certificate to the effect set forth in Exhibit B hereto, including the certifications in item (2) thereof; 


    (D) if
such Restricted Definitive Note is being transferred pursuant to an exemption from the registration requirements of the Securities Act in accordance with
Rule 144 under the Securities Act, a certificate to the effect set forth in Exhibit B hereto, including the certifications in item (3)(a) thereof; 


    (E) if
such Restricted Definitive Note is being transferred to an Institutional Accredited Investor in reliance on an exemption from the registration 




30





requirements
of the Securities Act other than those listed in subparagraphs (B) through (D) above, a certificate to the effect set forth in Exhibit B hereto, including the
certifications, certificates and Opinion of Counsel required by item (3) thereof, if applicable; 


    (F) if
such Restricted Definitive Note is being transferred to the Company or any of its Subsidiaries, a certificate to the effect set forth in Exhibit B hereto,
including the certifications in item (3)(b) thereof; or 


    (G) if
such Restricted Definitive Note is being transferred pursuant to an effective registration statement under the Securities Act, a certificate to the effect set
forth in Exhibit B hereto, including the certifications in item (3)(c) thereof, 




the
Trustee shall cancel the Restricted Definitive Note, increase or cause to be increased the aggregate principal amount of, in the case of clause (A) above, the appropriate Restricted Global
Note, in the case of clause (B) above, the 144A Global Note, in the case of clause (C) above, the Regulation S Global Note, and in all other cases, the IAI Global Note. 


    (ii) Restricted Definitive Notes to Beneficial Interests in Unrestricted Global Notes. A Holder of a Restricted
Definitive Note may exchange such Note for a beneficial interest in an Unrestricted Global Note or transfer such Restricted Definitive Note to a Person who takes delivery thereof in the form of a
beneficial interest in an Unrestricted Global Note only if: 



    (A) such
exchange or transfer is effected pursuant to the Exchange Offer in accordance with the Registration Rights Agreement and the Holder, in the case of an
exchange, or the transferee, in the case of a transfer, certifies in the applicable Letter of Transmittal that it is not (1) a broker-dealer, (2) a Person participating in the
distribution of the Exchange Notes or (3) a Person who is an affiliate (as defined in Rule 144) of the Company; 










    (B) such transfer is effected pursuant to the Shelf Registration Statement in accordance with the Registration Rights Agreement; 


    (C) such
transfer is effected by a Broker-Dealer pursuant to the Exchange Offer Registration Statement in accordance with the Registration Rights Agreement; or 



    (D) the
Registrar receives the following: 



    (1) if
the Holder of such Definitive Notes proposes to exchange such Notes for a beneficial interest in the Unrestricted Global Note, a certificate from such Holder in
the form of Exhibit C hereto, including the certifications in item (1)(c) thereof; or 





31






    (2) if
the Holder of such Definitive Notes proposes to transfer such Notes to a Person who shall take delivery thereof in the form of a beneficial interest in the
Unrestricted Global Note, a certificate from such Holder in the form of Exhibit B hereto, including the certifications in item (4) thereof; 




and,
in each such case set forth in this subparagraph (D), if the Registrar so requests or if the Applicable Procedures so require, an Opinion of Counsel in form reasonably acceptable to the Registrar
to the effect that such exchange or transfer is in compliance with the Securities Act and that the restrictions on transfer contained herein and in the Private Placement Legend are no longer required
in order to maintain compliance with the Securities Act. 




    Upon
satisfaction of the conditions of any of the subparagraphs in this Section 2.06(d)(ii), the Trustee shall cancel the Definitive Notes and increase or cause to be increased
the aggregate principal amount of the Unrestricted Global Note. 


    (iii) Unrestricted Definitive Notes to Beneficial Interests in Unrestricted Global Notes. A Holder of an Unrestricted
Definitive Note may exchange such Note for a beneficial interest in an Unrestricted Global Note or transfer such Definitive Notes to a Person who takes delivery thereof in the form of a beneficial
interest in an Unrestricted Global Note at any time. Upon receipt of a request for such an exchange or transfer, the Trustee shall cancel the applicable Unrestricted Definitive Note and increase or
cause to be increased the aggregate principal amount of one of the Unrestricted Global Notes. 


    If
any such exchange or transfer from a Definitive Note to a beneficial interest is effected pursuant to subparagraphs (ii)(B), (ii)(D) or (iii) above at a time when an
Unrestricted Global Note has not yet been issued, the Company shall issue and, upon receipt of an Authentication Order in accordance with Section 2.02 hereof, the Trustee shall authenticate one
or more Unrestricted Global Notes in an aggregate principal amount equal to the principal amount of Definitive Notes so transferred. 




    (e) Transfer and Exchange of Definitive Notes for Definitive Notes. Upon request by a Holder of Definitive Notes and
such Holder's compliance with the provisions of this Section 2.06(e), the Registrar shall register the transfer or exchange of Definitive Notes. Prior to such registration of transfer or
exchange, the requesting Holder shall present or surrender to the Registrar the Definitive Notes duly endorsed or accompanied by a written instruction of transfer in form satisfactory to the Registrar
duly executed by such Holder or by its attorney, duly authorized in writing. In addition, the requesting Holder shall provide any additional certifications, documents and information, as applicable,
required pursuant to the following provisions of this Section 2.06(e). 






     (i) Restricted Definitive Notes to Restricted Definitive Notes. Any Restricted Definitive Note may be transferred to and
registered in the name of Persons who take delivery thereof in the form of a Restricted Definitive Note if the Registrar receives the following: 



32 




    (A) if
the transfer will be made pursuant to Rule 144A under the Securities Act, then the transferor must deliver a certificate in the form of Exhibit B
hereto, including the certifications in item (1) thereof; 


    (B) if
the transfer will be made pursuant to Rule 903 or Rule 904, then the transferor must deliver a certificate in the form of Exhibit B hereto,
including the certifications in item (2) thereof; and 


    (C) if
the transfer will be made pursuant to any other exemption from the registration requirements of the Securities Act, then the transferor must deliver a
certificate in the form of Exhibit B hereto, including the certifications, certificates and Opinion of Counsel required by item (3) thereof, if applicable. 




    (ii) Restricted Definitive Notes to Unrestricted Definitive Notes. Any Restricted Definitive Note may be exchanged by
the Holder thereof for an Unrestricted Definitive Note or transferred to a Person or Persons who take delivery thereof in the form of an Unrestricted Definitive Note if: 



    (A) such
exchange or transfer is effected pursuant to the Exchange Offer in accordance with the Registration Rights Agreement and the Holder, in the case of an
exchange, or the transferee, in the case of a transfer, certifies in the applicable Letter of Transmittal that it is not (1) a broker-dealer, (2) a Person participating in the
distribution of the Exchange Notes or (3) a Person who is an affiliate (as defined in Rule 144) of the Company; 


    (B) any
such transfer is effected pursuant to the Shelf Registration Statement in accordance with the Registration Rights Agreement; 



    (C) any
such transfer is effected by a Broker-Dealer pursuant to the Exchange Offer Registration Statement in accordance with the Registration Rights Agreement; or 


    (D) the
Registrar receives the following: 



    (1) if
the Holder of such Restricted Definitive Notes proposes to exchange such Notes for an Unrestricted Definitive Note, a certificate from such Holder in the form of
Exhibit C hereto, including the certifications in item (1)(d) thereof; or 


    (2) if
the Holder of such Restricted Definitive Notes proposes to transfer such Notes to a Person who shall take delivery thereof in the form of an Unrestricted
Definitive Note, a certificate from such Holder in the form of Exhibit B hereto, including the certifications in item (4) thereof; 




and,
in each such case set forth in this subparagraph (D), if the Registrar so requests, an Opinion of Counsel in form reasonably acceptable to the Company to the effect that such exchange or transfer
is in compliance with the Securities Act 




33 




and
that the restrictions on transfer contained herein and in the Private Placement Legend are no longer required in order to maintain compliance with the Securities Act. 




    (iii) Unrestricted Definitive Notes to Unrestricted Definitive Notes. A Holder of Unrestricted Definitive Notes may
transfer such Notes to a Person who takes delivery thereof in the form of an Unrestricted Definitive Note. Upon receipt of a request to register such a transfer, the Registrar 








shall register the Unrestricted Definitive Notes pursuant to the instructions from the Holder thereof. 







    (f)  Exchange Offer. Upon the occurrence of the Exchange Offer in accordance with the Registration Rights Agreement, the
Company shall issue and, upon receipt of an Authentication Order in accordance with Section 2.02, the Trustee shall authenticate (i) one or more Unrestricted Global Notes in an aggregate
principal amount equal to the principal amount of the beneficial interests in the Restricted Global Notes tendered for acceptance by Persons that certify in the applicable Letters of Transmittal that
(x) they are not broker-dealers, (y) they are not participating in a distribution of the Exchange Notes and (z) they are not affiliates (as defined in Rule 144) of the
Company, and accepted for exchange in the Exchange Offer and (ii) Definitive Notes in an aggregate principal amount equal to the principal amount of the Restricted Definitive Notes accepted for
exchange in the Exchange Offer. Concurrently with the issuance of such Notes, the Trustee shall cause the aggregate principal amount of the applicable Restricted Global Notes to be reduced
accordingly, and the Company shall execute and the Trustee shall authenticate and deliver to the Persons designated by the Holders of Definitive Notes so accepted Definitive Notes in the appropriate
principal amount. 


    (g) Legends. The following legends shall appear on the face of all Global Notes and Definitive Notes issued under this
Indenture unless specifically stated otherwise in the applicable provisions of this Indenture. 



     (i) Private Placement Legend.



    (A) Except
as permitted by subparagraph (B) below, each Global Note and each Definitive Note (and all Notes issued in exchange therefor or substitution thereof)
shall bear the legend in substantially the following form: 





"THE
SECURITY (OR ITS PREDECESSOR) EVIDENCED HEREBY WAS ORIGINALLY ISSUED IN A TRANSACTION EXEMPT FROM REGISTRATION UNDER SECTION 5 OF THE UNITED STATES SECURITIES ACT OF 1933 (THE "SECURITIES ACT"),
AND THE SECURITY EVIDENCED HEREBY MAY NOT BE OFFERED, SOLD OR OTHERWISE TRANSFERRED IN ABSENCE OF SUCH REGISTRATION OR AN APPLICABLE EXEMPTION THEREFROM. EACH PURCHASER OF THE SECURITY EVIDENCED
HEREBY IS HEREBY NOTIFIED THAT THE SELLER MAY BE RELYING ON THE EXEMPTION FROM THE PROVISIONS OF SECTION 5 OF THE SECURITIES ACT PROVIDED BY RULE 144A THEREUNDER. THE HOLDER OF THE SECURITY
EVIDENCED HEREBY AGREES FOR THE BENEFIT OF THE COMPANY THAT (A) SUCH SECURITY MAY BE RESOLD, PLEDGED OR OTHERWISE TRANSFERRED, ONLY (1) (a) TO A PERSON WHO THE SELLER REASONABLY BELIEVES
IS A QUALIFIED 


34



INSTITUTIONAL
BUYER (AS DEFINED IN RULE 144A UNDER THE SECURITIES ACT) IN A TRANSACTION MEETING THE REQUIREMENTS OF RULE 144A, (b) IN A TRANSACTION MEETING THE REQUIREMENTS OF RULE 144
UNDER THE SECURITIES ACT, (c) OUTSIDE THE UNITED STATES TO A NON-U.S. PERSON IN A TRANSACTION MEETING THE REQUIREMENTS OF RULE 904 UNDER THE SECURITIES ACT OR (d) IN
ACCORDANCE WITH ANOTHER EXEMPTION FROM THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT (AND BASED UPON AN OPINION OF COUNSEL IF THE COMPANY SO REQUESTS), (2) TO THE COMPANY OR
(3) PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT AND, IN EACH CASE, IN ACCORDANCE WITH ANY APPLICABLE SECURITIES LAWS OF ANY STATE OF THE UNITED STATES OR ANY OTHER APPLICABLE JURISDICTION
AND (B) THE HOLDER WILL, AND EACH SUBSEQUENT HOLDER IS REQUIRED TO, NOTIFY ANY PURCHASER FROM IT OF THE SECURITY EVIDENCED HEREBY OF THE RESALE RESTRICTIONS SET FORTH IN (A) ABOVE." 




    (B) Notwithstanding
the foregoing, any Global Note or Definitive Note issued pursuant to subparagraphs (b)(iv), (c)(iii), (c)(iv), (d)(ii), (d)(iii), (e)(ii),
(e)(iii) or (f) to this 










Section 2.06 (and all Notes issued in exchange therefor or substitution thereof) shall not bear the Private Placement Legend. 




    (ii) Global Note Legend. Each Global Note shall bear a legend in substantially the following form: 




"THIS
GLOBAL NOTE IS HELD BY THE DEPOSITARY (AS DEFINED IN THE INDENTURE GOVERNING THIS NOTE) OR ITS NOMINEE IN CUSTODY FOR THE BENEFIT OF THE BENEFICIAL OWNERS HEREOF, AND IS NOT TRANSFERABLE TO ANY
PERSON UNDER ANY CIRCUMSTANCES EXCEPT THAT (I) THE TRUSTEE MAY MAKE SUCH NOTATIONS HEREON AS MAY BE REQUIRED PURSUANT TO SECTION 2.07 OF THE INDENTURE, (II) THIS GLOBAL NOTE MAY
BE EXCHANGED IN WHOLE BUT NOT IN PART PURSUANT TO SECTION 2.06(a) OF THE INDENTURE, (III) THIS GLOBAL NOTE MAY BE DELIVERED TO THE TRUSTEE FOR CANCELLATION PURSUANT TO
SECTION 2.11 OF THE INDENTURE AND (IV) THIS GLOBAL NOTE MAY BE TRANSFERRED TO A SUCCESSOR DEPOSITARY WITH THE PRIOR WRITTEN CONSENT OF THE COMPANY." 



    (iii) Regulation S Temporary Global Note Legend. The Regulation S Temporary Global Note shall bear a
legend in substantially the following form: 




"THE
RIGHTS ATTACHING TO THIS REGULATION S TEMPORARY GLOBAL NOTE, AND THE CONDITIONS AND PROCEDURES GOVERNING ITS EXCHANGE FOR CERTIFICATED NOTES, ARE AS SPECIFIED IN THE INDENTURE (AS DEFINED
HEREIN). NEITHER THE HOLDER NOR THE BENEFICIAL OWNERS OF THIS REGULATION S TEMPORARY GLOBAL NOTE SHALL BE ENTITLED TO RECEIVE PAYMENT OF INTEREST HEREON." 


    (h) Cancellation and/or Adjustment of Global Notes. At such time as all beneficial interests in a particular Global Note
have been exchanged for Definitive Notes or a particular 


35



Global
Note has been redeemed, repurchased or canceled in whole and not in part, each such Global Note shall be returned to or retained and canceled by the Trustee in accordance with
Section 2.11 hereof. At any time prior to such cancellation, if any beneficial interest in a Global Note is exchanged for or transferred to a Person who will take delivery thereof in the form
of a beneficial interest in another Global Note or for Definitive Notes, the principal amount of Notes represented by such Global Note shall be reduced accordingly and an endorsement shall be made on
such Global Note by the Trustee or by the Depositary at the direction of the Trustee to reflect such reduction; and if the beneficial interest is being exchanged for or transferred to a Person who
will take delivery thereof in the form of a beneficial interest in another Global Note, such other Global Note shall be increased accordingly and an endorsement shall be made on such Global Note by
the Trustee or by the Depositary at the direction of the Trustee to reflect such increase. 


    (i)  General Provisions Relating to Transfers and Exchanges. 



     (i) To
permit registrations of transfers and exchanges, the Company shall execute and the Trustee shall authenticate Global Notes and Definitive Notes upon the
Company's order or at the Registrar's request. 


    (ii) No
service charge shall be made to a holder of a beneficial interest in a Global Note or to a Holder of a Definitive Note for any registration of transfer or
exchange; provided, however, the Company may require payment of a sum sufficient to cover any transfer
tax or similar governmental charge payable in connection therewith (other than any such transfer taxes or similar governmental charge payable upon exchange or transfer pursuant to
Sections 2.10, 3.06, 3.10, 4.10, 4.15, 4.19 and 9.05 hereof). 








    (iii) The Registrar shall not be required to register the transfer of or exchange any Note selected for redemption in whole or in part, except the unredeemed portion of
any Note being redeemed in part. 


    (iv) All
Global Notes and Definitive Notes issued upon any registration of transfer or exchange of Global Notes or Definitive Notes shall be the valid obligations of
the Company, evidencing the same debt, and entitled to the same benefits under this Indenture, as the Global Notes or Definitive Notes surrendered upon such registration of transfer or exchange. 


    (v) The
Company shall not be required (A) to issue, to register the transfer of or to exchange any Notes during a period beginning at the opening of business
15 days before the day of any selection of Notes for redemption under Section 3.02 hereof and ending at the close of business on the day of selection,
(B) to register the transfer of or to exchange any Note so selected for redemption in whole or in part, except the unredeemed portion of any Note being redeemed in part or (C) to
register the transfer of or to exchange a Note between a record date and the next succeeding Interest Payment Date. 


    (vi) Prior
to due presentment for the registration of a transfer of any Note, the Trustee, any Agent and the Company may deem and treat the Person in whose name any 



36



Note
is registered as the absolute owner of such Note for the purpose of receiving payment of principal of and interest on such Notes and for all other purposes, and none of the Trustee, any Agent or
the Company shall be affected by notice to the contrary. 



   (vii) The
Trustee shall authenticate Global Notes and Definitive Notes in accordance with the provisions of Section 2.02 hereof. 


   (viii) All
certifications, certificates and Opinions of Counsel required to be submitted to the Registrar pursuant to this Section 2.06 to effect a registration
of transfer or exchange may be submitted by facsimile. 




Section 2.07. REPLACEMENT NOTES.  


    If any mutilated Note is surrendered to the Trustee or the Company and the Trustee receives evidence to its satisfaction of the destruction, loss or theft of
any Note, the Company shall issue and the Trustee, upon receipt of an Authentication Order, shall authenticate a replacement Note if the Trustee's requirements are met. If required by the Trustee or
the Company, an indemnity bond must be supplied by the Holder that is sufficient in the judgment of the Trustee and the Company to protect the Company, the Trustee, any Agent and any authenticating
agent from any loss that any of them may suffer if a Note is replaced. The Company may charge for its expenses in replacing a Note. 



    Every
replacement Note is an additional obligation of the Company and shall be entitled to all of the benefits of this Indenture equally and proportionately with all other Notes duly
issued hereunder. 


Section 2.08. OUTSTANDING NOTES.  


    The Notes outstanding at any time are all the Notes authenticated by the Trustee except for those canceled by it, those delivered to it for cancellation, those
reductions in the interest in a Global Note effected by the Trustee in accordance with the provisions hereof, and those described in this Section as not outstanding. Except as set forth in
Section 2.09 hereof, a Note does not cease to be outstanding because the Company or an Affiliate of the Company holds the Note; however, Notes
held by the Company or a Subsidiary of the Company shall not be deemed to be outstanding for purposes of Section 3.07(b) hereof. 


    If
a Note is replaced pursuant to Section 2.07 hereof, it ceases to be outstanding unless the Trustee receives proof satisfactory to it that the replaced Note is held by a bona
fide purchaser. 








    If
the principal amount of any Note is considered paid under Section 4.01 hereof, it ceases to be outstanding and interest on it ceases to accrue. 


    If
the Paying Agent (other than the Company, a Subsidiary or an Affiliate of any thereof) holds, on a redemption date or maturity date, money sufficient to pay Notes payable on that
date, then on and after that date such Notes shall be deemed to be no longer outstanding and shall cease to accrue interest. 


37



Section 2.09.  TREASURY NOTES.  


    In determining whether the Holders of the required principal amount of Notes have concurred in any direction, waiver or consent, Notes owned by the Company, or
by any Person directly or indirectly controlling or controlled by or under direct or indirect common control with the Company, shall be considered as though not outstanding, except that for the
purposes of determining whether the Trustee shall be protected in relying on any such direction, waiver or consent, only Notes that a Responsible Officer of the Trustee actually knows are so owned
shall be so disregarded. 


Section 2.10.  TEMPORARY NOTES.  


    Until certificates representing Notes are ready for delivery, the Company may prepare and the Trustee, upon receipt of an Authentication Order, shall
authenticate temporary Notes. Temporary Notes shall be substantially in the form of certificated Notes but may have variations that the Company considers appropriate for temporary Notes and as shall
be reasonably acceptable to the Trustee. Without unreasonable delay, the Company shall prepare and the Trustee shall authenticate definitive Notes in exchange for temporary Notes. 


    Holders
of temporary Notes shall be entitled to all of the benefits of this Indenture. 


Section 2.11.  CANCELLATION.  


    The Company at any time may deliver Notes to the Trustee for cancellation. The Registrar and Paying Agent shall forward to the Trustee any Notes surrendered to
them for registration of transfer, exchange or payment. The Trustee and no one else shall cancel all Notes surrendered for registration of transfer, exchange, payment, replacement or cancellation and
shall dispose of such canceled Notes in its customary manner (consistent with all applicable legal requirements). Certification of the disposition of all canceled Notes shall be delivered to the
Company. The Company may not issue new Notes to replace Notes that it has paid or that have been delivered to the Trustee for cancellation. 


Section 2.12.  DEFAULTED INTEREST.  


    If the Company defaults in a payment of interest on the Notes, it shall pay the defaulted interest in any lawful manner plus, to the extent lawful, interest
payable on the defaulted interest, to the Persons who are Holders on a subsequent special record date, in each case at the rate provided in the Notes and in Section 4.01 hereof. The Company
shall notify the Trustee in writing of the amount of defaulted interest proposed to be paid on each Note and the date of the proposed payment. The Company shall fix or cause to be fixed each such
special record date and payment date, provided that no such special record date shall be less than 10 days prior to the related payment date for
such defaulted interest. At least 15 days before the special record date, the Company (or, upon the written request of the Company, the Trustee in the name and at the expense of the Company)
shall mail or cause to be mailed to Holders a notice that states the special record date, the related payment date and the amount of such interest to be paid. 






38 


Section 2.13.  CUSIP NUMBERS.  


    The Company in issuing the Notes may use "CUSIP" numbers (if then generally in use), and, if so, the Trustee shall use "CUSIP" numbers in notices of redemption
as a convenience to Holders; provided that any such notice may state that no representation is made as to the correctness of such numbers either as
printed on the Notes or as contained in any notice of a redemption and that reliance may be
placed only on the other identification numbers printed on the Notes, and any such redemption shall not be affected by any defect in or omission of such numbers. The Company will promptly notify the
Trustee of any changes in the "CUSIP" numbers. 


 
 

ARTICLE III.
  
    REDEMPTION AND PREPAYMENT    




Section 3.01.  NOTICES TO TRUSTEE.  


    If the Company elects to redeem Notes pursuant to the optional redemption provisions of Section 3.07 hereof, it shall furnish to the Trustee, at least
30 days but not more than 60 days before a redemption date, an Officers' Certificate setting forth (i) the clause of this Indenture pursuant to which the redemption shall occur,
(ii) the redemption date, (iii) the principal amount of Notes to be redeemed and (iv) the redemption price. 


Section 3.02.  SELECTION OF NOTES TO BE REDEEMED.  


    If less than all of the Notes are to be redeemed or purchased in an offer to purchase at any time, the Trustee shall select the Notes to be redeemed or
purchased among the Holders of the Notes in compliance with the requirements of the principal national securities exchange, if any, on which the Notes are listed or, if the Notes are not so listed, on
a pro rata basis, by lot or in accordance with any other method the Trustee considers appropriate. In the event of partial redemption by lot, the
particular Notes to be redeemed shall be selected, unless otherwise provided herein, not less than 30 nor more than 60 days prior to the redemption date by the Trustee from the outstanding
Notes not previously called for redemption. 


    The
Trustee shall promptly notify the Company in writing of the Notes selected for redemption and, in the case of any Note selected for partial redemption, the principal amount
thereof to be redeemed. Notes and portions of Notes selected shall be in amounts of $1,000 or whole multiples of $1,000; provided,  however, that if all of
the Notes of a Holder are to be redeemed, the entire outstanding amount of Notes held by such Holder, even if not a multiple of
$1,000, shall be redeemed. Except as provided in the preceding sentence, provisions of this Indenture that apply to Notes called for redemption also apply to portions of Notes called for redemption. 


Section 3.03.  NOTICE OF REDEMPTION.  


    Subject to the provisions of Section 3.10 hereof, at least 30 days but not more than 60 days before a redemption date, the Company shall
mail or cause to be mailed, by first class mail, a notice of redemption to each Holder whose Notes are to be redeemed at its registered address. 


39



    The
notice shall identify the Notes (including "CUSIP" numbers) to be redeemed and shall state: 



    (a) the
redemption date; 


    (b) the
redemption price; 


    (c) if
any Note is being redeemed in part, the portion of the principal amount of such Note to be redeemed and that, after the redemption date upon surrender of such
Note, a new Note or 








Notes in principal amount equal to the unredeemed portion shall be issued upon cancellation of the original Note; 


    (d) the
name and address of the Paying Agent; 


    (e) that
Notes called for redemption must be surrendered to the Paying Agent to collect the redemption price; 


    (f)  that,
unless the Company defaults in making such redemption payment, interest on Notes called for redemption ceases to accrue on and after the redemption date; 



    (g) the
paragraph of the Notes and/or Section of this Indenture pursuant to which the Notes called for redemption are being redeemed; and 


    (h) that
no representation is made as to the correctness or accuracy of the CUSIP number, if any, listed in such notice or printed on the Notes. 




    At
the Company's request, the Trustee shall give the notice of redemption in the Company's name and at its expense; provided,  however, that the Company shall
have delivered to the Trustee, at least 45 days prior to the redemption date, an Officers' Certificate requesting
that the Trustee give such notice and setting forth the information to be stated in such notice as provided in the preceding paragraph. 


Section 3.04.  EFFECT OF NOTICE OF REDEMPTION.  


    Once notice of redemption is mailed in accordance with Section 3.03 hereof, Notes called for redemption become irrevocably due and payable on the
redemption date at the redemption price. A notice of redemption may not be conditional. 


Section 3.05.  DEPOSIT OF REDEMPTION PRICE.  


    One Business Day prior to the redemption date, the Company shall deposit with the Trustee or with the Paying Agent money sufficient to pay the redemption price
of and accrued interest on all Notes to be redeemed on that date. The Trustee or the Paying Agent shall promptly return to the Company any money deposited with the Trustee or the Paying Agent by the
Company in excess of the amounts necessary to pay the redemption price of, and accrued interest on, all Notes to be redeemed. 


40



    If
the Company complies with the provisions of the preceding paragraph, on and after the redemption date, interest shall cease to accrue on the Notes or the portions of Notes called
for redemption. If a Note is redeemed on or after an interest record date but on or prior to the related interest payment date, then any accrued and unpaid interest shall be paid to the Person in
whose name such Note was registered at the close of business on such record date. If any Note called for redemption shall not be so paid upon surrender for redemption because of the failure of the
Company to comply with the preceding paragraph, interest shall be paid on the unpaid principal, from the redemption date until such principal is paid, and to the extent lawful on any interest not paid
on such unpaid principal, in each case at the rate provided in the Notes and in Section 4.01 hereof. 


Section 3.06.  NOTES REDEEMED IN PART.  


    Upon surrender of a Note that is redeemed in part, the Company shall issue and, upon the Company's written request, the Trustee shall authenticate for the
Holder at the expense of the Company a new Note equal in principal amount to the unredeemed portion of the Note surrendered. 






Section 3.07.  OPTIONAL REDEMPTION.  


    (a) Except
as set forth in clause (b) of this Section 3.07, the Company shall not have the option to redeem the Notes pursuant to this Section 3.07
prior to September 1, 2005. On or after September 1, 2005, the Company shall have the option to redeem the Notes, in whole or in part, at the redemption prices (expressed as percentages
of principal amount) set forth below plus accrued and unpaid interest and Liquidated Damages thereon, if any, to the applicable redemption date, if redeemed during the twelve-month period beginning on
September 1 of the years indicated below: 



	Year
 
	 	Percentage
	 
	2005	 	105.375	%
	2006	 	102.688	%
	2007 and thereafter	 	100.000	%






    (b) Notwithstanding
the provisions of clause (a) of this Section 3.07, at any time prior to September 1, 2004, the Company may redeem up to 35% of
the aggregate principal amount of Notes at a redemption price equal to 110.75% of the principal amount thereof, plus accrued and unpaid interest and Liquidated Damages, if any, to the redemption date,
with the net proceeds of an Initial Public Offering by the Company; provided (i) that at least 65% of the aggregate principal amount of Notes
remain outstanding immediately after the occurrence of such redemption and that (ii) the redemption occurs within 45 days of the date of the closing of such Initial Public Offering. 



    (c) Any
redemption pursuant to this Section 3.07 shall be made pursuant to the provisions of Section 3.01 through 3.06 hereof. 


41



Section 3.08.  MANDATORY REDEMPTION.  


    Other than as set forth in Section 3.09 below, the Company shall not be required to make mandatory redemption payments with respect to the Notes. 



Section 3.09.  MANDATORY DISPOSITION OR REDEMPTION PURSUANT TO GAMING LAWS.  


    If any Gaming Authority requires that a Holder or Beneficial Owner of Notes be licensed, qualified or found suitable under any applicable Gaming Law and such
Holder or Beneficial Owner (i) fails to apply for a license, qualification or a finding of suitability within 30 days (or such shorter period as may be required by the applicable Gaming
Authority) after being requested to do so by the Gaming Authority or (ii) is denied such license or qualification or not found suitable the Company shall have the right, at its option
(1) to require any such Holder or Beneficial Owner to dispose of its Notes within 30 days (or such earlier date as may be required by the applicable Gaming Authority) of the occurrence
of the event described in clause (i) or (ii) above or (2) to redeem the Notes of such Holder or Beneficial Owner at a redemption price equal to the least of (x) the
principal amount thereof, together with accrued and unpaid interest and Liquidated Damages, if any, to the earlier of the date of redemption or the date of the denial of license or qualification or of
the finding of unsuitability by such Gaming Authority (y) the price at which such Holder or Beneficial Owner acquired the Notes, together with accrued and unpaid interest and Liquidated
Damages, if any, to the earlier of the date of redemption or the date of the
denial of license or qualification or of the finding of unsuitability by such Gaming Authority; and (z) such other lesser amount as may be required by any Gaming Authority. The Company shall
notify the Trustee in writing of any redemption pursuant to this Section 3.09 as soon as practicable. 



    Immediately
upon a determination by a Gaming Authority that a Holder or Beneficial Owner of the Notes will not be licensed, qualified or found suitable, the Holder or Beneficial Owner
will, to the extent required by applicable law, have no further right (i) to exercise, directly or indirectly, through any trustee or nominee or any other person or entity, any right conferred
by the Notes; or (ii) to 







receive any interest, dividend, economic interests or any other distributions or payments with respect to the Notes or any remuneration in any form with respect to the Notes from the Company, the
Subsidiary Guarantors or the Trustee. 


    The
Holder or Beneficial Owner that is required to apply for a license, qualification or a finding of suitability shall pay all fees and costs of applying for and obtaining the
license, qualification or finding of suitability and of any investigation by the applicable Gaming Authorities. 


Section 3.10.  OFFER TO PURCHASE BY APPLICATION OF EXCESS PROCEEDS.  


    In the event that, pursuant to Sections 4.10 or 4.19 hereof, the Company shall be required to commence an Asset Sale Offer or an Event of Loss Offer (each
Asset Sale Offer or Event of Loss Offer is referred to in this section as an "Excess Proceeds Offer"), it shall follow the procedures specified below. 



    The
Excess Proceeds Offer shall remain open for a period of 20 Business Days following its commencement and no longer, except to the extent that a longer period is required by
applicable law (the "Offer Period"). No later than five Business Days after the termination of 


42



the
Offer Period (the "Purchase Date"), the Company shall purchase the principal amount of Notes required to be purchased pursuant to Sections 4.10 or
4.19 hereof (the "Offer Amount") or, if less than
the Offer Amount has been tendered, all Notes tendered in response to the Excess Proceeds Offer. Payment for any Notes so purchased shall be made in the same manner as interest payments are made. 



    If
the Purchase Date is on or after an interest record date and on or before the related interest payment date, any accrued and unpaid interest shall be paid to the Person in whose
name a Note is registered at the close of business on such record date, and no additional interest shall be payable to Holders who tender Notes pursuant to the Excess Proceeds Offer. 


    Upon
the commencement of an Excess Proceeds Offer, the Company shall send, by first class mail, a notice to the Trustee and each of the Holders, with a copy to the Trustee. The notice
shall contain all instructions and materials necessary to enable such Holders to tender Notes pursuant to the Excess Proceeds Offer. The Excess Proceeds Offer shall be made to all Holders. The notice,
which shall govern the terms of the Excess Proceeds Offer, shall state: 



    (a) that
the Asset Sale Offer is being made pursuant to this Section 3.10 and Section 4.10 or Section 4.19 hereof, as appropriate, and the length
of time the Excess Proceeds Offer shall remain open; 


    (b) the
Offer Amount, the purchase price and the Purchase Date; 


    (c) that
any Note not tendered or accepted for payment shall continue to accrete or accrue interest; 


    (d) that,
unless the Company defaults in making such payment, any Note accepted for payment pursuant to the Excess Proceeds Offer shall cease to accrete or accrue
interest after the Purchase Date; 


    (e) that
Holders electing to have a Note purchased pursuant to an Excess Proceeds Offer may elect to have Notes purchased in integral multiples of $1,000 only; 


    (f)  that
Holders electing to have a Note purchased pursuant to any Excess Proceeds Offer shall be required to surrender the Note, with the form entitled "Option of
Holder to Elect Purchase" on the reverse of the Note completed, or transfer by book-entry transfer, to the Company, a depositary, if appointed by the Company, or a Paying Agent at the
address specified in the notice at least three days before the Purchase Date; 








    (g) that Holders shall be entitled to withdraw their election if the Company, the depositary or the Paying Agent, as the case may be, receives, not later than the
expiration of the Offer Period, a telegram, telex, facsimile transmission or letter setting forth the name of the Holder, the principal amount of the Note the Holder delivered for purchase and a
statement that such Holder is withdrawing his election to have such Note purchased; 



    (h) that,
if the aggregate principal amount of Notes surrendered by Holders exceeds the Offer Amount, the Company shall select the Notes to be purchased on a  pro rata basis (with 



43




such
adjustments as may be deemed appropriate by the Company so that only Notes in denominations of $1,000, or integral multiples thereof, shall be purchased); and 


    (i)  that
Holders whose Notes were purchased only in part shall be issued new Notes equal in principal amount to the unpurchased portion of the Notes surrendered (or
transferred by book-entry transfer). 




    On
or before the Purchase Date, the Company shall, to the extent lawful, accept for payment, on a pro rata basis to the extent
necessary, the Offer Amount of Notes or portions thereof tendered pursuant to the Excess Proceeds Offer, or if less than the Offer Amount has been tendered, all Notes tendered, and shall deliver to
the Trustee an Officers' Certificate stating that such Notes or portions thereof were accepted for payment by the Company in accordance with the terms of this Section 3.10. The Company, the
Depositary or the Paying Agent, as the case may be, shall promptly (but in any case not later than five days after the Purchase Date) mail or deliver to each tendering Holder an amount equal to the
purchase price of the Notes tendered by such Holder and accepted by the Company for purchase, and the Company shall promptly issue a new Note, and the Trustee, upon written request from the Company
shall authenticate and mail or deliver such new Note to such Holder, in a principal amount equal to any unpurchased portion of the Note surrendered. Any Note not so accepted shall be promptly mailed
or delivered by the Company to the Holder thereof. The Company shall publicly announce the results of the Excess Proceeds Offer on the Purchase Date. 


    Other
than as specifically provided in this Section 3.10, any purchase pursuant to this Section 3.10 shall be made pursuant to the provisions of Sections 3.01 through
3.06 hereof. 


 
 

ARTICLE IV.
  
    COVENANTS    



Section 4.01.  PAYMENT OF NOTES.  


    The Company shall pay or cause to be paid the principal of, premium, if any, and interest on the Notes on the dates and in the manner provided in the Notes.
Principal, premium, if any, and interest shall be considered paid on the date due if the Paying Agent, if other than the Company or a Subsidiary thereof, holds as of 10:00 a.m. Eastern Time on
the due date money deposited by the Company in immediately available funds and designated for and sufficient to pay all principal, premium, if any, and interest then due. The Company shall pay all
Liquidated Damages, if any, in the same manner on the dates and in the amounts set forth in the Registration Rights Agreement. 


    The
Company shall pay interest (including post-petition interest in any proceeding under any Bankruptcy Law) on overdue principal at the rate equal to 1% per annum in
excess of the then applicable interest rate on the Notes to the extent lawful; it shall pay interest (including post-petition interest in any proceeding under any Bankruptcy Law) on
overdue installments of interest and Liquidated Damages (without regard to any applicable grace period) at the same rate to the extent lawful. 






44 


Section 4.02.  MAINTENANCE OF OFFICE OR AGENCY.  


    The Company shall maintain in the Borough of Manhattan, the City of New York, an office or agency (which may be an office of the Trustee or an affiliate of the
Trustee, Registrar or co-registrar) where Notes may be surrendered for registration of transfer or for exchange and where notices and demands to or upon the Company in respect of the Notes
and this Indenture may be served. The Company shall
give prompt written notice to the Trustee of the location, and any change in the location, of such office or agency. If at any time the Company shall fail to maintain any such required office or
agency or shall fail to furnish the Trustee with the address thereof, such presentations, surrenders, notices and demands may be made or served at the Corporate Trust Office of the Trustee. 


    The
Company may also from time to time designate one or more other offices or agencies where the Notes may be presented or surrendered for any or all such purposes and may from time
to time rescind such designations; provided, however, that no such designation or rescission shall in
any manner relieve the Company of its obligation to maintain an office or agency in the Borough of Manhattan, the City of New York for such purposes. The Company shall give prompt written notice to
the Trustee of any such designation or rescission and of any change in the location of any such other office or agency. 


    The
Company hereby designates the Corporate Trust Office of the Trustee as one such office or agency of the Company in accordance with Section 2.03. 


Section 4.03.  REPORTS.  


    (a) Whether
or not required by the SEC, so long as any Notes are outstanding, the Company shall furnish to the Holders of Notes, within the time periods specified in
the SEC's rules and regulations, (i) all quarterly and annual financial information that would be required to be contained in a filing with the SEC on Forms 10-Q and
10-K if the Company were required to file such forms, including a "Management's Discussion and Analysis of Financial Condition and Results of Operations" and, with respect to the annual
information only, a report thereon by the Company's certified independent accountants and (ii) all current reports that would be required to be filed with the SEC on Form 8-K
if the Company were required to file such reports. In addition, following consummation of the Exchange Offer, whether or not required by the rules and regulations of the SEC, the Company shall
file a copy of all such information and reports with the SEC for public availability within the time periods specified in the SEC's rules and regulations (unless the SEC will not accept such a
filing) and make such information available to securities analysts and prospective investors upon request. The Company shall at all times comply with TIA § 314(a). 


    (b) If
the Company has designated any of its Subsidiaries as Unrestricted Subsidiaries, then the consolidated quarterly and annual financial information required by
subsection (a) shall include a reasonably detailed presentation, either on the face of the financial statements or in the footnotes thereto, and in Management's Discussion and Analysis of
Financial Condition and Results of Operations, of the financial condition and results of operations of the Company and its Restricted Subsidiaries separate from the financial condition 


45



and
results of operations of the Company's Unrestricted Subsidiaries as required by the rules and regulations of the SEC. 


    (c) For
so long as any Notes remain outstanding, the Company and the Subsidiary Guarantors shall furnish to the Holders and to securities analysts and prospective
investors, upon their request, the information required to be delivered pursuant to Rule 144A(d)(4) under the Securities Act. 



    (d) Delivery
of the reports, information and other documents set forth in this Section 4.03 to the Trustee is for informational purposes only and the Trustee's
receipt of such reports, information and 







other documents shall not constitute constructive notice of any information contained therein or determinable from information contained therein, including the Company's compliance with any of its
covenants under this Indenture. 



Section 4.04.  COMPLIANCE CERTIFICATE.  


    (a) The
Company and each Subsidiary Guarantor (to the extent that such Subsidiary Guarantor is so required under the TIA) shall deliver to the Trustee, within
90 days after the end of each fiscal year, an Officers' Certificate stating that a review of the activities of the Company and its Subsidiaries during the preceding fiscal year has been made
under the supervision of the signing Officers with a view to determining whether the Company has kept, observed, performed and fulfilled its obligations under this Indenture and the Collateral
Documents, and further stating, as to each such Officer signing such certificate, that to the best of his or her knowledge, the Company has kept, observed, performed and fulfilled each and every
covenant contained in this Indenture and the Collateral Documents and is not in default in the performance or observance of any of the terms, provisions and conditions of this Indenture or the
Collateral Documents (or, if a Default or Event of Default shall have occurred, describing all such Defaults or Events of Default of which he or she may have knowledge and what action the Company is
taking or proposes to take with respect thereto) and that to the best of his or her knowledge no event has occurred and remains in existence by reason of which payments on account of the principal of
or interest, if any, on the Notes is prohibited or if such event has occurred, a description of the event and what action the Company is taking or proposes to take with respect thereto. 


    (b) So
long as not contrary to the then current recommendations of the American Institute of Certified Public Accountants, the year-end financial statements
delivered pursuant to Section 4.03(a) above shall be accompanied by a written statement of the Company's independent public accountants (who shall be a firm of established national reputation)
that in making the examination necessary for certification of such financial statements, nothing has come to their attention that would lead them to believe that the Company has violated any
provisions of Article 4 or Article 5 hereof or, if any such violation has occurred, specifying the nature and period of existence thereof, it being understood that such accountants shall
not be liable directly or indirectly to any Person for any failure to obtain knowledge of any such violation. 



    (c) The
Company shall, so long as any of the Notes are outstanding, deliver to the Trustee, forthwith upon any Officer becoming aware of any Default or Event of
Default, an 


46 


Officers'
Certificate specifying such Default or Event of Default and what action the Company is taking or proposes to take with respect thereto. 


Section 4.05.  TAXES.  


    The Company shall pay, and shall cause each of its Subsidiaries to pay, prior to delinquency, all material taxes, assessments, and governmental levies except
such as are contested in good faith and by appropriate proceedings or where the failure to effect such payment is not adverse in any material respect to the Holders of the Notes. 


Section 4.06.  STAY, EXTENSION AND USURY LAWS.  


    The Company and each of the Subsidiary Guarantors covenants (to the extent that it may lawfully do so) that it shall not at any time insist upon, plead, or in
any manner whatsoever claim or take the benefit or advantage of, any stay, extension or usury law wherever enacted, now or at any time hereafter in force, that may affect the covenants or the
performance of this Indenture; and the Company and each of the Subsidiary Guarantors (to the extent that it may lawfully do so) hereby expressly waives all benefit or advantage of any such law, and
covenants that it shall not, by resort to 







any such law, hinder, delay or impede the execution of any power herein granted to the Trustee, but shall suffer and permit the execution of every such power as though no such law has been enacted. 



Section 4.07.  RESTRICTED PAYMENTS.  


    The Company shall not, and shall not permit any of its Restricted Subsidiaries to, directly or indirectly: (i) declare or pay any dividend or make any
other payment or distribution on account of the Company's or any of its Restricted Subsidiaries' Equity Interests (including, without limitation, any payment in connection with any merger or
consolidation involving the Company or any of its Restricted Subsidiaries) or to the direct or indirect holders of the Company's or any of its Restricted Subsidiaries' Equity Interests in any capacity
(other than dividends or distributions payable in Equity Interests (other than Disqualified Stock) of the Company or dividends or distributions payable to the Company or a Restricted Subsidiary of the
Company); (ii) purchase, redeem or otherwise acquire or retire for value (including, without limitation, in connection with any merger or consolidation involving the Company) any Equity
Interests of the Company or any direct or indirect parent of the Company; (iii) make any payment on or with respect to, or purchase, redeem, defease or otherwise acquire or retire for value any
Indebtedness that is subordinate to the Notes or the Note Guarantees, except a payment of interest or principal at the Stated Maturity thereof; or (iv) make any Restricted Investment (all such
payments and other actions set forth in clauses (i) through (iv) above being collectively referred to as "Restricted Payments"), unless,
at the time of and after giving effect to such Restricted Payment: 



    (a) no
Default or Event of Default shall have occurred and be continuing or would occur as a consequence thereof; 


    (b) the
Company would, at the time of such Restricted Payment and after giving pro forma effect thereto as if such Restricted Payment had been made at the beginning 



47




of
the applicable four-quarter period, have been permitted to incur at least $1.00 of additional Indebtedness pursuant to the Fixed Charge Coverage Ratio test set forth in the first
paragraph of Section 4.09; and 


    (c) such
Restricted Payment, together with the aggregate amount of all other Restricted Payments made by the Company and its Restricted Subsidiaries after the date of
this Indenture (excluding Restricted Payments permitted by clauses (ii), (iii), (v) or (vi) of the next succeeding paragraph), is less than the sum, without duplication, of
(1) 50% of the Consolidated Net Income of the Company for the period (taken as one accounting period) from the beginning of the first fiscal quarter commencing after the date of this Indenture
to the end of the Company's most recently ended fiscal quarter for which internal financial statements are available at the time of such Restricted Payment (or, if such Consolidated Net Income for
such period is a deficit, less 100% of such deficit); plus (2) 100% of the aggregate net cash proceeds received by the Company since the date of
this Indenture as a contribution to its common equity capital or from the issue and sale of Equity Interests of the Company (other than Disqualified Stock) or from the issue or sale of convertible or
exchangeable Disqualified Stock or convertible or exchangeable debt securities of the Company that have been converted into or exchanged for such Equity Interests (other than Equity Interests (or
Disqualified Stock or debt securities) sold to a Subsidiary of the Company); plus (3) to the extent that any Restricted Investment that was made
after the date of this Indenture is sold for cash or otherwise liquidated or repaid for cash, the lesser of (A) the cash return of capital with respect to such Restricted Investment (less the
cost of disposition, if any) and (B) the initial amount of such Restricted Investment; plus (4) 100% of any dividends received by the
Company or any Restricted Subsidiary after the date of this Indenture from an Unrestricted Subsidiary of the Company to the extent that such dividends constitute a cash return of capital invested by
the Company or any Restricted Subsidiary in such Unrestricted Subsidiary and such dividends were not otherwise included in Consolidated Net Income of the Company for such 








period and 50% of any other dividends received by the Company or any Restricted Subsidiary after the date of this Indenture from an Unrestricted Subsidiary of the Company, to the extent such dividends
were not otherwise included in Consolidated Net Income of the Company for such period; plus (5) to the extent that any Unrestricted Subsidiary of
the Company is redesignated as a Restricted Subsidiary after the date of this Indenture, the lesser of (X) the fair market value of the Company's Investment in such Subsidiary as of the date of
such redesignation or (Y) such fair market value as of the date on which such Subsidiary was originally designated as an Unrestricted Subsidiary. 




    So
long as no Default has occurred and is continuing or would be caused thereby, the preceding provisions shall not prohibit (i) the payment of any dividend within
60 days after the date of declaration thereof, if at such date of declaration such payment would have complied with the provisions of this Indenture; (ii) the redemption, repurchase,
retirement, defeasance or other acquisition of any subordinated Indebtedness of the Company or any of its Restricted Subsidiaries or of any Equity Interests of the Company in exchange for, or out of
the net cash proceeds of the 


48



substantially
concurrent sale (other than to a Subsidiary of the Company) of, Equity Interests of the Company (other than Disqualified Stock); provided,  however, that
the amount of any such net cash proceeds that are utilized for any such redemption, repurchase, retirement, defeasance or other
acquisition shall be excluded from clause (c)(2) of the preceding paragraph; (iii) the defeasance, redemption, repurchase or other acquisition of subordinated Indebtedness of the Company
or any of its Restricted Subsidiaries with the net cash proceeds from an incurrence of Permitted Refinancing Indebtedness; (iv) the redemption or repurchase of any Equity Interests or
Indebtedness of the Company or any of its Subsidiaries to the extent required by any Gaming Authority or, if determined in the good faith judgement of the Board of Directors of the Company as
evidenced by a resolution of the Board of Directors that has been delivered to the Trustee, to prevent the loss or to secure the grant or establishment of any gaming license or other right to conduct
lawful gaming operations; (v) with respect to any period after June 30, 2001, so long as the Company qualifies as a subchapter "S" corporation within the meaning of Section 1361
of the Code and no Default or Event of Default has occurred and is continuing under this Indenture, distributions to shareholders of the Company in an amount not to exceed the Tax Amount for such
period; and (vi) payments under the Employment Agreement and payments of salary and bonus pursuant to Sections 3 and 4 of the Executive Compensation and Bonus Plan. 


    The
amount of all Restricted Payments (other than cash) shall be the fair market value on the date of the Restricted Payment of the assets or securities proposed to be transferred or
issued to or by the Company or such Restricted Subsidiary, as the case may be, pursuant to the Restricted Payment. The fair market value of any assets or securities that are required to be valued by
this covenant shall be determined by Company's Board of Directors whose resolution with respect thereto shall be delivered to the Trustee. The Company's Board of Directors' determination must be based
upon an opinion or appraisal issued by an accounting, appraisal or investment banking firm of national standing if the fair market value exceeds $5.0 million. Not later than the date of making
any Restricted Payment, the Company shall deliver to the Trustee an Officers' Certificate stating that such Restricted Payment is permitted and setting forth the basis upon which the calculations
required by this Section 4.07 were computed, together with a copy of any fairness opinion or appraisal required by this Indenture. 


Section 4.08.  DIVIDEND AND OTHER PAYMENT RESTRICTIONS AFFECTING SUBSIDIARIES.  


    The Company shall not, and shall not permit any of its Restricted Subsidiaries to, directly or indirectly, create or permit to exist or become effective any
consensual encumbrance or restriction on the ability of any Restricted Subsidiary to (i) pay dividends or make any other distributions on its Capital Stock to the Company or any of its
Restricted Subsidiaries, or with respect to any other interest or participation in, or measured by, its profits, or pay any indebtedness owed to the Company or any of 







its Restricted Subsidiaries; (ii) make loans or advances to the Company or any of its Restricted Subsidiaries; or (iii) transfer any of its properties or assets to the Company or any of
its Restricted Subsidiaries. However, the preceding restrictions shall not apply to encumbrances or restrictions existing under or by reason of (a) this Indenture, the Notes, the Note
Guarantees and the Collateral Documents; (b) applicable law; (c) any instrument governing Indebtedness or Capital Stock of a Person
acquired by the Company or any of its Restricted Subsidiaries as in effect at the time of such acquisition (except to the extent such Indebtedness or Capital Stock was incurred in connection with or
in contemplation of such acquisition), which encumbrance or restriction is not applicable to any Person, or the properties or 


49



assets
of any Person, other than the Person, or the property or assets of the Person, so acquired; provided that, in the case of Indebtedness, such
Indebtedness was permitted by the terms of this Indenture to be incurred; (d) customary non-assignment provisions in leases entered into in the ordinary course of business and
consistent with past practices; (e) any agreement for the sale or other disposition of a Restricted Subsidiary that restricts distributions by that Restricted Subsidiary pending its sale or
other disposition; (f) Permitted Refinancing Indebtedness; provided, however, that the
restrictions contained in the agreements governing such Permitted Refinancing Indebtedness are no more restrictive, taken as a whole, than those contained in the agreements governing the Indebtedness
being refinanced; (g) purchase money obligations or capital lease obligations for property acquired in the ordinary course of business that impose restrictions on that property of the nature
described in clause (iii) of the preceding sentence; (h) Liens securing Indebtedness that limit the right of the debtor to dispose of the assets subject to such Lien;
(i) provisions with respect to the disposition or distribution of assets or property in joint venture agreements, asset sale agreements, stock sale agreements and other similar agreements
entered into in the ordinary course of business; and (j) restrictions on cash or other deposits or net worth imposed by customers under contracts entered into in the ordinary course of
business. 


Section 4.09.  INCURRENCE OF INDEBTEDNESS AND ISSUANCE OF PREFERRED STOCK.  


    The Company shall not, and shall not permit any of its Subsidiaries to, directly or indirectly, create, incur, issue, assume, guarantee or otherwise become
directly or indirectly liable, contingently or otherwise, with respect to (collectively, "incur") any Indebtedness (including Acquired Debt), and the
Company shall not issue any Disqualified Stock and shall not permit any of its Subsidiaries to issue any shares of preferred stock; provided,  however, that
the Company may incur Indebtedness (including Acquired Debt) or issue Disqualified Stock, and the Subsidiary Guarantors may incur
Indebtedness or issue preferred stock, if the Fixed Charge Coverage Ratio for the Company's most recently ended four full fiscal quarters for which internal financial statements are available
immediately preceding the date on which such additional Indebtedness is incurred or such Disqualified Stock or preferred stock is issued would have been at least 2.0 to 1, determined on a pro forma
basis (including pro forma application of the net proceeds therefrom) as if the additional Indebtedness had been incurred or the preferred stock or Disqualified Stock had been issued, as the case may
be, at the beginning of such four-quarter period. 


    The
first paragraph of this Section 4.09 shall not prohibit the incurrence of any of the following items of Indebtedness (collectively, "Permitted
Debt"): 



     (i) the
incurrence by the Company and its Restricted Subsidiaries of (a) Indebtedness represented by the Initial Notes and the related Note Guarantees to be
issued on the date of this Indenture and the Notes and the related Note Guarantees to be issued in exchange for the Initial Notes pursuant to the Registration Rights Agreement and (b) their
respective obligations arising under the Collateral Documents to the extent such obligations would represent Indebtedness; 


    (ii) the
incurrence by the Company or any of its Restricted Subsidiaries of Indebtedness represented by Purchase Money Indebtedness and Capital Lease Obligations
incurred in 








connection with the purchase or capital lease of video gaming machines, slot machines or other gaming equipment in an aggregate principal amount or 



50




accreted
value, as applicable, including all Permitted Refinancing Indebtedness incurred to refund, refinance or replace any Indebtedness incurred pursuant to this clause (ii), not to exceed
$10.0 million at any time outstanding; 


    (iii) the
incurrence by the Company or any of its Restricted Subsidiaries of Permitted Refinancing Indebtedness in exchange for, or the net proceeds of which are used
to refund, refinance or replace Indebtedness (other than intercompany Indebtedness or Indebtedness held by Affiliates of the Company) that was permitted by this Indenture to be incurred under the
first paragraph of this covenant or clauses (i), (ii) or (viii) of this paragraph; 


    (iv) the
incurrence by the Company or any of its Restricted Subsidiaries of intercompany Indebtedness between or among the Company and any of its Restricted
Subsidiaries as provided in Section 4.16; provided, however, that: 



    (a) such
Indebtedness must be expressly subordinated to the prior payment in full in cash of all Obligations with respect to the Notes, in the case of the Company, or
the Guarantee, in the case of a Restricted Subsidiary; and 


    (b) (1)
any subsequent issuance or transfer of Equity Interests that results in any such Indebtedness being held by a Person other than the Company or a Restricted
Subsidiary thereof and (2) any sale or other transfer of any such Indebtedness to a Person that is not either the Company or a Restricted Subsidiary thereof shall be deemed, in each case, to
constitute an incurrence of such Indebtedness by the Company or such Restricted Subsidiary, as the case may be, that was not permitted by this clause (iv); 




    (v) the
incurrence by the Company or any of its Restricted Subsidiaries of Hedging Obligations that are incurred for the purpose of fixing or hedging interest rate risk
with respect to any floating rate Indebtedness that is permitted by the terms of this indenture to be outstanding; 


    (vi) the
Guarantee by the Company or any of its Restricted Subsidiaries of Indebtedness of the Company or any of its Restricted Subsidiaries that was permitted to be
incurred by another provision of this covenant; 


   (vii) the
incurrence by the Company or any of its Restricted Subsidiaries of Indebtedness in respect of performance, surety or appeal bonds in the ordinary course of
business; 


   (viii) the
incurrence by the Company or any of its Restricted Subsidiaries of Indebtedness, including all Permitted Refinancing Indebtedness incurred to refund,
refinance or replace any Indebtedness incurred pursuant to this clause (viii), in an aggregate principal amount not to exceed $10.0 million at any one time outstanding for working
capital and other general corporate purposes; and 



51




    (ix) the
incurrence by the Company's Unrestricted Subsidiaries of Non-Recourse Debt; provided,  however, that if any such Indebtedness ceases to be Non-Recourse Debt
of an Unrestricted Subsidiary, such event shall be deemed to
constitute an incurrence of Indebtedness by a Restricted Subsidiary of the Company that was not permitted by this clause (ix). 




    The
Company shall not incur any Indebtedness (including Permitted Debt) that is contractually subordinated in right of payment to any other Indebtedness of the Company unless such
Indebtedness is also contractually subordinated in right of payment to the Notes on substantially identical terms; 







 provided, however, that no Indebtedness of the Company shall be deemed to be contractually subordinated in right of payment to
any other Indebtedness of the Company solely by virtue of being unsecured. 


    For
purposes of determining compliance with this Section 4.09, in the event that an item of proposed Indebtedness meets the criteria of more than one of the categories of
Permitted Debt described in clauses (i) through (ix) above, or is entitled to be incurred pursuant to the first paragraph of this covenant, the Company shall be permitted to classify
such item of Indebtedness on the date of its incurrence, or later reclassify all or a portion of such item of Indebtedness, in any manner that complies with this covenant. 


Section 4.10.  ASSET SALES.  


    The Company shall not, and shall not permit any of its Restricted Subsidiaries to, consummate an Asset Sale unless (i) the Company (or the Restricted
Subsidiary, as the case may be) receives consideration at the time of such Asset Sale at least equal to the fair market value of the assets or Equity Interests issued or sold or otherwise disposed of,
(ii) such fair market value is determined by the Company's Board of Directors and evidenced by a resolution of that Board of Directors set forth in an Officers' Certificate delivered to the
Trustee; and (iii) at least 80% of the consideration therefor received by the Company or such Restricted Subsidiary is in the form of cash. For purposes of this provision and not for purposes
of the definition of "Net Proceeds" (except to the extent set forth in that definition with respect to the conversion of non-cash proceeds to cash), each of the following shall be deemed
to be cash: (a) any liabilities (as shown on the Company's or such Restricted Subsidiary's most recent balance sheet) of the Company or any Restricted Subsidiary (other than contingent
liabilities and liabilities that are by their terms subordinated to the Notes or any Guarantee) that are assumed by the transferee of any such assets pursuant to a customary novation agreement that
releases the Company or such Restricted Subsidiary from further liability; and (b) any securities, Notes or other obligations received by the Company or any such Restricted Subsidiary from such
transferee that are contemporaneously (subject to ordinary settlement periods) converted by the Company or such Restricted Subsidiary into cash (to the extent of the cash received in that conversion). 


    Within
360 days after the receipt of any Net Proceeds from an Asset Sale, the Company or the applicable Restricted Subsidiary may apply such Net Proceeds to: (1) to
acquire all or substantially all of the assets of, or a majority of the Voting Stock of, another Permitted Business; (2) to make a capital expenditure; or (3) to acquire other
long-term assets that are used or useful in a Permitted Business;  provided, however, that with respect to any assets that are acquired or constructed or
Voting Stock that
is acquired with such Net Proceeds, other than Net Proceeds from 


52 


the
sale of Separate Collateral, the Company or the applicable Restricted Subsidiary, as the case may be, promptly grants to the Trustee, on behalf of the Holders of Notes, a first priority perfected
security interest on any such assets or Voting Stock on the terms set forth in this Indenture and the Collateral Documents. Pending the final application of any such Net Proceeds, the Company or the
applicable Restricted Subsidiary may temporarily reduce revolving credit borrowings or invest such Net Proceeds in Cash Equivalents which shall be held in an account in which the Trustee shall have a
first priority perfected security interest, subject to Permitted Liens, for the benefit of the Holders in accordance with this Indenture and the Collateral Documents. 



    Any
Net Proceeds from Asset Sales that are not applied or invested as provided in the preceding paragraph shall constitute "Excess Proceeds." When the aggregate amount of Excess
Proceeds exceeds $5.0 million, the Company shall make an offer (an "Asset Sale Offer") to all Holders of Notes and all holders of other
Indebtedness that is pari passu with the Notes containing provisions similar to those set forth in this Indenture with respect to offers to purchase or
redeem with the proceeds of sales of assets to purchase the maximum principal amount of Notes and such other Indebtedness that may be purchased out of the Excess Proceeds. The offer price in any Asset
Sale Offer shall be equal to 100% 







of principal amount plus accrued and unpaid interest and Liquidated Damages, if any, to the date of purchase, and shall be payable in cash. If any Excess Proceeds remain after consummation of an Asset
Sale Offer, the Company may use such Excess Proceeds for any purpose not otherwise prohibited by this Indenture and the Collateral Documents. If the aggregate principal amount of Notes and such other
Indebtedness tendered pursuant to such Asset Sale Offer exceeds the amount of Excess Proceeds, the Trustee shall select the Notes and such other Indebtedness to be purchased on a  pro rata basis based on
the principal amount of Notes and such other Indebtedness tendered. Upon completion of each Asset Sale Offer, the amount of
Excess Proceeds shall be reset at zero. 


    The
Company shall comply with the requirements of Rule 14e-1 under the Exchange Act and any other securities laws and regulations thereunder to the extent such laws
and regulations are applicable in connection with each repurchase of Notes pursuant to an Asset Sale Offer. To the extent that the provisions of any securities laws or regulations conflict with the
Asset Sales provisions of this Indenture, the Company shall comply with the applicable securities laws and regulations and shall not be deemed to have breached its obligations under the Asset Sale
provisions of this Indenture by virtue of such conflict. 








Section 4.11.  TRANSACTIONS WITH AFFILIATES.  


    The Company shall not, and shall not permit any of its Restricted Subsidiaries to, make any payment to, or sell, lease, transfer or otherwise dispose of any of
its properties or assets to, or purchase any property or assets from, or enter into or make or amend any transaction, contract, agreement, understanding, loan, advance or guarantee with, or for the
benefit of, any Affiliate (each, an "Affiliate Transaction"), unless (i) such Affiliate Transaction is on terms that are no less favorable to the
Company or the relevant Restricted Subsidiary than those that would have been obtained in a comparable transaction by the Company or such Restricted Subsidiary with an unrelated Person; and
(ii) the Company delivers to the Trustee (a) with respect to any Affiliate Transaction or series of related Affiliate Transactions involving aggregate consideration in excess of
$1.0 million, a resolution of the Board of Directors set forth in an Officers' Certificate certifying that such Affiliate Transaction complies with this covenant and that such Affiliate
Transaction has been approved unanimously by the Board of Directors; provided that at the time of any such 


53



approval
the Board of Directors must have at least two Independent Directors; and (b) with respect to any Affiliate Transaction or series of related Affiliate Transactions involving aggregate
consideration in excess of $5.0 million, an opinion as to the fairness to the Holders of Notes of such Affiliate Transaction from a financial point of view issued by an accounting, appraisal or
investment banking firm of national standing. 


    The
following items shall not be deemed to be Affiliate Transactions and, therefore, shall not be subject to the provisions of the prior paragraph: (1) the Employment Agreement
and the Executive Compensation and Bonus Plan; (2) the Existing Transactions; (3) transactions between or among the Company and/or its Restricted Subsidiaries; (4) transactions
with a Person that is an Affiliate of the Company solely because the Company owns an Equity Interest in such Person; (5) payment of reasonable directors fees to Persons who are not otherwise
Affiliates of the Company; and (6) Restricted Payments that are permitted by Section 4.07. 


Section 4.12.  LIENS.  


    The Company shall not, and shall not permit any of its Restricted Subsidiaries to, directly or indirectly create, incur, assume or suffer to exist any Lien on
any asset now owned or hereafter acquired, or any
income or profits therefrom or assign or convey any right to receive income therefrom, except Permitted Liens. 


Section 4.13.  LINE OF BUSINESS.  


    The Company shall not, and shall not permit any Subsidiary to, engage in any business or investment activities, other than a Permitted Business. Neither the
Company nor any of its Subsidiaries may conduct a Permitted Business in any gaming jurisdiction in which the Company or such Subsidiary is not licensed on the date of this Indenture if the Holders of
the Notes would be required to be licensed as a result thereof; provided, however, that the provisions
described in this sentence shall not prohibit the Company or any of its Subsidiaries from conducting a Permitted Business in any jurisdiction that does not require the licensing or qualification of
all the Holders, but reserves the discretionary right to require the licensing or qualification of any Holders. 


Section 4.14.  CORPORATE EXISTENCE.  


    Subject to Article 5 hereof, the Company shall do or cause to be done all things necessary to preserve and keep in full force and effect (i) its
corporate existence, and the corporate, partnership or other existence of each of its Subsidiaries, in accordance with the respective organizational documents (as the same may be amended from time to
time) of the Company or any such Subsidiary and (ii) the rights (charter and statutory), licenses and franchises of the Company and its Subsidiaries;  provided, 






 however, that the Company shall not be required to preserve any such right, license or franchise, or the corporate, partnership or other existence of any of its Subsidiaries,
if the Board of Directors shall determine that the preservation thereof is no longer desirable in the conduct of the business of the Company and its Subsidiaries, taken as a whole, and that the loss
thereof is not adverse in any material respect to the Holders of the Notes. 


54



Section 4.15. OFFER TO REPURCHASE UPON CHANGE OF CONTROL.  


    (a) Upon
the occurrence of a Change of Control, the Company shall make an offer (a "Change of Control Offer") to each
Holder to repurchase all or any part (equal to $1,000 or an integral multiple thereof) of each Holder's Notes at a purchase price equal to 101% of the aggregate principal amount thereof plus accrued
and unpaid interest and Liquidated Damages thereon, if any, to the date of purchase (the "Change of Control Payment"). Within 30 days following
any Change of Control, the Company shall mail a notice to each Holder stating: (1) that the Change of Control Offer is being made pursuant to this Section 4.15 and that all Notes
tendered shall be accepted for payment; (ii) the purchase price and the purchase date, which shall be no earlier than 30 days and no later than 60 days from the date such notice
is mailed (the "Change of Control Payment Date"); (iii) that any Note not tendered shall continue to accrue interest; (iv) that, unless
the Company defaults in the payment of the Change of Control Payment, all Notes accepted for payment pursuant to the Change of Control Offer shall cease to accrue interest after the Change of Control
Payment Date; (v) that Holders electing to have any Notes purchased pursuant to a Change of Control Offer shall be required to surrender the Notes, with the form entitled "Option of Holder to
Elect Purchase" on the reverse of the Notes completed, to the Paying Agent at the address specified in the notice prior to the close of business on the third Business Day preceding the Change of
Control Payment Date; (vi) that Holders shall be entitled to withdraw their election if the Paying Agent receives, not later than the close of business on the second Business Day preceding the
Change of Control Payment Date, a telegram, telex, facsimile transmission or letter setting forth the name of the Holder, the principal amount of Notes delivered for purchase, and a statement that
such Holder is withdrawing its election to have the Notes purchased; and (vii) that Holders whose Notes are being purchased only in part shall be issued new Notes equal in principal amount to
the unpurchased portion of the Notes surrendered, which unpurchased portion must be equal to $1,000 in principal amount or an integral multiple thereof. The Company shall comply with the requirements
of Rule 14e-1 under the Exchange Act and any other securities laws and regulations thereunder to the extent such laws and regulations are applicable in connection with the
repurchase of Notes in connection with a Change of Control. To the extent that the provisions of any securities laws or regulations conflict with the Change of Control provisions of this Indenture,
the Company will comply with the applicable securities laws and regulations and will not be deemed to have breached its obligations under the Change of Control provisions of this Indenture by virtue
of such conflict. 


    (b) On
the Change of Control Payment Date, the Company shall, to the extent lawful, (i) accept for payment all Notes or portions thereof properly tendered
pursuant to the Change of Control Offer, (ii) deposit with the Paying Agent an amount equal to the Change of Control Payment in respect of all Notes or portions thereof so tendered and
(iii) deliver or cause to be delivered to the Trustee the Notes so accepted together with an Officers' Certificate stating the aggregate principal amount of Notes or portions thereof being
purchased by the Company. The Paying Agent shall promptly mail to each Holder of Notes so tendered the Change of Control Payment for such Notes, and the Trustee shall promptly authenticate and mail
(or cause to be transferred by book entry) to each Holder a new Note equal in principal amount to any unpurchased portion of the Notes surrendered, if any;  provided, that each such new Note shall be in
a principal amount of $1,000 or an integral multiple thereof. The Company shall publicly
 






55 


announce
the results of the Change of Control Offer on or as soon as practicable after the Change of Control Payment Date. 


Section 4.16. ADVANCES TO RESTRICTED SUBSIDIARIES.  


    All advances, other than equity contributions, to Restricted Subsidiaries made by Company after the date of this Indenture shall be evidenced by intercompany
notes in favor of the Company substantially in the form of Exhibit H hereto. These intercompany notes shall be pledged pursuant to the Collateral Documents as Collateral to secure the Notes.
Each intercompany note shall be payable upon demand, shall bear interest at the then current fair market interest rate and shall be subordinated in right of payment to the obligations of the
applicable Restricted Subsidiary under its Guarantee. 


Section 4.17 LIMITATION ON SALE AND LEASEBACK TRANSACTIONS.  


    The Company shall not, and shall not permit any of its Restricted Subsidiaries to, enter into any sale and leaseback transaction;  provided, however, that the Company or any of its Restricted Subsidiaries may enter into a sale and
leaseback transaction if (i) the Company or that Restricted Subsidiary, as applicable, could have (a) incurred Indebtedness in an amount equal to the Attributable Debt relating to such
sale and leaseback transaction under of the first paragraph of Section 4.09 and (b) incurred a Lien to secure such Indebtedness pursuant to Section 4.12; (ii) the gross
cash proceeds of the sale and leaseback transaction are at least equal to the fair market value, as determined in good faith by the Board of Directors and set forth in an Officers' Certificate
delivered to the Trustee, of the property that is the subject of such sale and leaseback transaction; and (iii) the transfer of assets in such sale and leaseback transaction is permitted by,
and the Company applies the proceeds of such transaction in compliance with, Section 4.10. 


    Section 4.18 LIMITATION ON ISSUANCES AND SALES OF EQUITY INTERESTS IN RESTRICTED SUBSIDIARIES.


    All
of the Company's Restricted Subsidiaries shall be wholly owned by the Company, by one or more of its Restricted Subsidiaries or by the Company and one or more of its Restricted
Subsidiaries. 


    The
Company shall not, and shall not permit any of its Restricted Subsidiaries to, transfer, convey, sell, lease or otherwise dispose of any Equity Interests in any Restricted
Subsidiary of the Company to any Person (other than the Company or a Restricted Subsidiary of the Company), unless (i) such transfer, conveyance, sale, lease or other disposition is of all the
Equity Interests in such Restricted Subsidiary; and (ii) the Net Proceeds from such transfer, conveyance, sale, lease or other disposition are applied in accordance with Section 4.10. 


    In
addition, the Company shall not permit any of its Restricted Subsidiaries to issue any of its Equity Interests to any Person, other than to the Company or one or more of its
Restricted Subsidiaries. 


56



Section 4.19 EVENTS OF LOSS.  


    Within 360 days after any Event of Loss with respect to any Casino Property with a fair market value (or replacement cost, if greater) in excess of
$5.0 million, the Company or the affected Restricted Subsidiary of the Company, as the case may be, may apply the Net Loss Proceeds from such Event of Loss to the rebuilding, repair,
replacement or construction of improvements to the property affected by such Event of Loss (the "Subject Property"), with no concurrent obligation to
make any purchase of any Notes; provided, however, that (i) the Company delivers to the Trustee
within 150 days of such Event of Loss a written opinion from a reputable contractor that the Subject Property can be rebuilt, repaired, replaced or constructed in, and operating in,
substantially the same condition as it existed prior to the 







Event of Loss within 24 months of the Event of Loss; and (ii) an Officers' Certificate certifying that the Company has available from Net Loss Proceeds or other sources sufficient funds
to complete the rebuilding, repair, replacement or construction described in clause (i) above. 


    Any
Net Loss Proceeds that are not reinvested or not permitted to be reinvested as provided in the first sentence of this covenant shall be deemed "Excess Loss
Proceeds." When the aggregate amount of Excess Loss Proceeds exceeds $5.0 million, the Company shall make an offer (an "Event of Loss
Offer") to all Holders of Notes and holders of other Indebtedness that is pari passu with the Notes and containing provisions
similar to those set forth in this Indenture with respect to offers to purchase or redeem with the proceeds of Events of Loss to purchase the maximum principal amount of Notes and such other
Indebtedness that may be purchased out of the Excess Loss Proceeds. The offer price in any Event of Loss Offer shall be equal to 100% of principal amount plus accrued and unpaid interest and
Liquidated Damages, if any, to the date of purchase, and shall be payable in cash. If any Excess Loss Proceeds remain after consummation of an Event of Loss Offer, the Company may use such Excess Loss
Proceeds for any purpose not otherwise prohibited by this Indenture and the Collateral Documents. If the aggregate principal amount of Notes tendered pursuant to an Event of Loss Offer exceeds the
Excess Loss Proceeds, the Trustee shall select the Notes and such other Indebtedness to be purchased on a pro rata basis based on the principal amount
of Notes and such other Indebtedness tendered. Upon completion of any such Event of Loss Offer, the amount of Excess Loss Proceeds shall be reset at zero. 


    In
the event of an Event of Loss pursuant to clause (3) of the definition of "Event of Loss" with respect to any property or assets that have a fair market value (or
replacement cost, if greater) in excess of $5.0 million, the Company or the affected Restricted Subsidiary, as the case may be, shall be required to receive consideration (1) at least
equal to the fair market value (evidenced by a resolution of the Company's Board of Directors set forth in an Officers' Certificate delivered to the Trustee) of the property or assets subject to the
Event of Loss and (2) with respect to any "Event of Loss" of any portion of the hotel, casino or parking structure and other property comprising the Casino Properties, at least 75% of which is
in the form of Cash Equivalents. 


Section 4.20 INDEPENDENT DIRECTORS.  


    The Company's Board of Directors shall within 60 days after the date of this Indenture select two nominees for Independent Director. The Company shall,
at all times after such nominees are selected, have at least two Independent Directors, other than during (1) one or more periods not in any one case to exceed 90 consecutive days due to the
Independent Director's death, disability, 


57 


resignation
or retirement and (2) any period during which a nominee is undergoing review by applicable Gaming Authorities. 


Section 4.21 NO PAYMENTS FOR CONSENT.  


    The Company shall not, and shall not permit any of its Restricted Subsidiaries to, directly or indirectly, pay or cause to be paid any consideration to or for
the benefit of any Holder of Notes for or as an inducement to any consent, waiver or amendment of any of the terms or provisions of this Indenture, the Notes, any Guarantee or any Collateral Document
unless such consideration is offered to be paid and is paid to all Holders of Notes that consent, waive or agree to amend in the time frame set forth in the solicitation documents relating to such
consent, waiver or agreement. 


Section 4.22 ADDITIONAL NOTE GUARANTEES.  


    If the Company or any of its Restricted Subsidiaries acquires or creates a Restricted Subsidiary after the date of this Indenture, then that newly acquired or
created Restricted Subsidiary shall become a Subsidiary Guarantor and execute a supplemental indenture and an assumption agreement in the 








form attached as Exhibit E hereto with respect to all Collateral Documents securing the Guarantee and deliver an Opinion of Counsel to the Trustee within ten Business Days of the date on which
it was acquired or created. Any Restricted Subsidiary that becomes a Subsidiary Guarantor shall remain a Subsidiary Guarantor unless designated an Unrestricted Subsidiary by the Company in accordance
with this Indenture or is otherwise released from its obligations as a Subsidiary Guarantor as provided in this Indenture. 



Section 4.23. DESIGNATION OF RESTRICTED AND UNRESTRICTED SUBSIDIARIES  


    The Company's Board of Directors may designate any Restricted Subsidiary to be an Unrestricted Subsidiary if that designation would not cause a Default;  provided
that in no event shall the business currently comprised of the Slot Route Operations or Terrible's Hotel and Casino be transferred to or held
by an Unrestricted Subsidiary. If a Restricted Subsidiary is designated as an Unrestricted Subsidiary, the aggregate fair market value of all outstanding Investments owned by the Company and its
Restricted Subsidiaries in the Subsidiary so designated shall be deemed to be an Investment made as of the time of such designation and shall either reduce the amount available for Restricted Payments
under the first paragraph of Section 4.07 or reduce the amount available for future Investments under one or more clauses of the definition of Permitted Investments, as the Company shall
determine. That designation shall only be permitted if such Investment would be permitted at that time and if such Restricted Subsidiary otherwise meets the definition of an Unrestricted Subsidiary.
The Board of Directors may redesignate any Unrestricted Subsidiary to be a Restricted Subsidiary if the redesignation would not cause a Default. 


Section 4.24. INSURANCE  


    The Company shall, and shall cause its Restricted Subsidiaries to, maintain insurance with carriers against such risks and in such amounts as is customarily
carried by similar businesses with such deductibles, retentions, self insured amounts and coinsurance provisions as are customarily carried by similar businesses of similar size, including, without
limitation, property and casualty. Customary insurance coverage shall be deemed to include, without limitation, the following (i) business interruption insurance at all times; and
(ii) property 


58



insurance
protecting the property against losses or damages as is customarily covered by an "all-risk" policy or a property policy covering "special" causes of loss for a business of
similar type and size; provided, however, that such insurance shall provide coverage of not less than
the lesser of (a) 120% of the outstanding principal amount of the Notes plus accrued and unpaid interest and (b) 100% of actual replacement value (as determined at each policy renewal
based on the F.W. Dodge Building Index or some other recognized means) of any improvements customarily insured consistent with industry standards and, in each case, with a deductible no greater than
2% of the insured value of the Casino Properties or such greater amount as is available on commercially reasonable terms (other than earthquake or flood insurance, for which the deductible may be up
to 10% of such replacement value). 


    All
insurance required by this Section 4.24 (except worker's compensation) shall name the Company and the Trustee as additional insureds or loss payees, as the case may be,
with losses in excess of $1.0 million payable jointly to the Company and the Trustee (unless a Default or Event of Default has occurred and is then continuing, in which case all losses are
payable solely to the Trustee), with no recourse against the Trustee for the payment of premiums, deductibles, commissions or club calls, and for at least 30 days notice of cancellation. All
such insurance policies shall be issued by carriers having an A.M. Best & Company, Inc. rating of A or higher and a financial size category of not less than X, or if such carrier
is not rated by A.M. Best & Company, Inc., having the financial stability and size deemed appropriate by an opinion from a reputable insurance broker. 






Section 4.25. ADDITIONAL COLLATERAL; ACQUISITION OF ASSETS OR PROPERTY  


    Other than with respect to the Separate Collateral, concurrently with the acquisition by the Company or any Restricted Subsidiary of any assets or property
with a fair market value (as determined by the Board of Director of the Company) in excess of $2.0 million individually or $10.0 million in the aggregate, to the extent not prohibited by
Gaming Authorities or applicable Gaming Laws, the Company shall, or shall cause the applicable Restricted Subsidiary to (i) in the case of personal property, execute and deliver to the Trustee
such Uniform Commercial Code financing statements or take such other actions as shall be necessary or (in the opinion of the Trustee) desirable to perfect and protect the Trustee's security interest
in such assets or property; (ii) in the case of real property, execute and deliver to the Trustee (a) a deed of trust or a leasehold deed of trust, as appropriate, substantially in the
form of the deeds of trust or leasehold deed of trust, as appropriate, executed in connection with the Liens on the Casino Properties (with such modifications as are necessary to comply with
applicable law) (under which such Restricted Subsidiary shall grant a security interest to the Trustee in such real property and any related fixtures); and (b) title and extended coverage
insurance covering such real property in an amount at least equal to the purchase price of such real property; and (iii) promptly deliver to the Trustee such opinions of counsel, if any, as the
Trustee may reasonably require with respect to the foregoing (including opinions as to enforceability and perfection of security interests). 


Section 4.26. FURTHER ASSURANCES  


    The Company shall, and shall cause each of its Restricted Subsidiaries to, execute and deliver such additional instruments, certificates or documents, and take
all such actions as may be reasonably required from time to time in order to (i) carry out more effectively the purposes 


59 


of
the Collateral Documents; (ii) create, grant, perfect and maintain the validity, effectiveness and priority of any of the Collateral Documents and the Liens created, or intended to be
created, by the Collateral Documents; and (iii) ensure the protection and enforcement of any of the rights granted or intended to be granted to the Trustee under any other instrument executed
in connection therewith. 


    Upon
the exercise by the Trustee or any Holder of any power, right, privilege or remedy under this Indenture or any of the Collateral Documents which requires any consent, approval,
recording, qualification or authorization of any governmental authority (including any Gaming Authority), the Company shall, and shall cause each of its Restricted Subsidiaries to, execute and deliver
all applications, certifications, instruments and other documents and papers that may be required from the
Company or any of its Restricted Subsidiaries for such governmental consent, approval, recording, qualification or authorization. 


Section 4.27. LIMITATION ON STATUS AS AN INVESTMENT COMPANY  


    Neither the Company nor any of its Restricted Subsidiaries shall become required to register as an "investment company" (as that term is defined in the
Investment Company Act of 1940, as amended), or otherwise become subject to regulation under the Investment Company Act of 1940. 


 
 

ARTICLE V.
  
    SUCCESSORS    



Section 5.01. MERGER, CONSOLIDATION, OR SALE OF ASSETS.  


    Neither the Company nor any of its Restricted Subsidiaries may, directly or indirectly, (i) consolidate or merge with or into another Person (whether or
not the Company or the Restricted Subsidiary is the surviving entity) or (ii) sell, assign, transfer, convey or otherwise dispose of all or 







substantially all of the properties or assets of the Company and its Restricted Subsidiaries taken as a whole, in one or more related transactions, to another Person; unless (a) either
(1) the Company or the Restricted Subsidiary, as applicable, is the surviving entity or (2) the Person formed by or surviving any such consolidation or merger (if other than the Company
or the Restricted Subsidiary) or to which such sale, assignment, 


60 


transfer,
conveyance or other disposition shall have been made is a corporation organized or existing under the laws of the United States, any state thereof or the District of Columbia; (b) the
Person formed by or surviving any such consolidation or merger (if other than the Company or the Restricted Subsidiary) or the Person to which such sale, assignment, transfer, conveyance or other
disposition shall have been made assumes all the obligations of the Company or the Restricted Subsidiary, as applicable, under the Notes, this Indenture, the Registration Rights Agreement, the
Guarantee, if any, and the Collateral Documents pursuant to agreements reasonably satisfactory to the Trustee; (c) immediately after such transaction no Default or Event of Default exists;
(d) such transaction would not result in the loss or suspension or material impairment of any of the Company's or any of its Restricted Subsidiaries' Gaming Licenses, unless a comparable
replacement Gaming License is effective prior to or simultaneously with such loss, suspension or material impairment; (e) in the case of a consolidation or merger of the Company, the Company or
the Person formed by or surviving any such consolidation or merger (if other than the Company) or to which such sale, assignment, transfer, conveyance or other disposition shall have been made shall,
or, in the case of a consolidation or merger of a Restricted Subsidiary or the sale, assignment, transfer, conveyance or other disposition of the property or assets of the Restricted Subsidiary, the
Company shall, in each case, on the date of such transaction after giving pro forma effect thereto and any related financing transactions as if the same had occurred at the beginning of the applicable
four-quarter period, (1) be permitted to incur at least $1.00 of additional Indebtedness pursuant to the Fixed Charge Coverage Ratio test set forth in the first paragraph of
Section 4.09 hereof or (2) have a Fixed Charge Coverage Ratio that is no less than the Fixed Charge Coverage Ratio of the Company immediately prior to such transaction; and
(f) such transaction would not require any Holder or Beneficial Owner of Notes to obtain a Gaming License or be qualified or found suitable under the law of any applicable gaming jurisdiction;  provided that such Holder or Beneficial Owner would not have been required to obtain a Gaming License or be qualified or found suitable under the laws
of any applicable gaming jurisdiction in the absence of such transaction. 


    In
addition, neither the Company nor any of its Restricted Subsidiaries may, directly or indirectly, lease all or substantially all of its properties or assets, in one or more related
transactions, to any other Person. This Section 5.01 shall not apply to a sale, assignment, transfer, conveyance or other disposition of assets between or among the Company and any of its
Restricted Subsidiaries. 


    Notwithstanding
the foregoing, the Company and any of its Restricted Subsidiaries may reorganize pursuant to a Permitted C-Corp. Reorganization. 



Section 5.02. SUCCESSOR CORPORATION SUBSTITUTED.  


    Upon any consolidation or merger, or any sale, assignment, transfer, lease, conveyance or other disposition of all or substantially all of the assets of the
Company or any of its Restricted Subsidiaries in accordance with Section 5.01 hereof, the successor corporation formed by such consolidation or into or with which the Company or the Restricted
Subsidiary is merged or to which such sale, assignment, transfer, lease, conveyance or other disposition is made shall succeed to, and be substituted for (so that from and after the date of such
consolidation, merger, sale, lease, conveyance or other disposition, the provisions of this Indenture referring to the "Company" or to a "Restricted Subsidiary" or the "Restricted Subsidiaries," as
appropriate, shall refer instead to the successor corporation and not to the Company or the Restricted Subsidiary), and may exercise every right and power of the Company under
this Indenture with the same effect as if such successor Person had been named as the Company or a Restricted Subsidiary herein; provided, however, that
the predecessor Company or Restricted Subsidiary 








shall not be relieved from the obligation to pay the principal of and interest on the Notes except in the case of a sale, assignment, transfer, conveyance or other disposition of all of the Company's
or the Restricted Subsidiary's assets that meets the requirements of Section 5.01 hereof. 


61



 
 

ARTICLE VI.
  
    DEFAULTS AND REMEDIES    



Section 6.01. EVENTS OF DEFAULT.  



    An "Event of Default" occurs if: 


    (a) the
Company defaults in the payment when due of interest on, or Liquidated Damages with respect to, the Notes and such default continues for a period of
30 days; 


    (b) the
Company defaults in the payment when due of principal of or premium, if any, on the Notes when the same becomes due and payable at maturity, upon redemption
(including in connection with an offer to purchase) or otherwise; 


    (c) the
Company or any of its Restricted Subsidiaries fails to comply with any of the provisions of Section 4.10, 4.15, 4.19 or 5.01 hereof; 



    (d) the
Company or any of its Restricted Subsidiaries defaults or breaches any covenant, condition or agreement contained in the Collateral Documents; 


    (e) the
Company or any of its Restricted Subsidiaries fails, for 60 days after notice to the Company by the Trustee or the Holders of at least 25% in aggregate
principal amount of the Notes then outstanding voting as a single class, to comply with any other covenant, representation, warranty or other agreement in this Indenture, or the Notes not set forth in
clause (c) above; 


    (f)  a
default occurs under any mortgage, indenture or instrument under which there may be issued or by which there may be secured or evidenced any Indebtedness for
money borrowed by the Company or any of its Restricted Subsidiaries (or the payment of which is guaranteed by the Company or any of its Restricted Subsidiaries), whether such Indebtedness or guarantee
now exists, or is created after the date of this Indenture, which default (i) is caused by a failure to pay principal of, or interest or premium, if any, on such Indebtedness prior to the
expiration of the grace period provided in such Indebtedness on the date of such default (a "Payment Default"); or (ii) results in the acceleration of such Indebtedness prior to its express
maturity; and, in each case, the principal amount of any such Indebtedness, together with the principal amount of any other such Indebtedness under which there has been a Payment Default or the
maturity of which has been so accelerated, is $5.0 million or more in the aggregate; 


    (g) a
final judgment or final judgments for the payment of money are entered by a court or courts of competent jurisdiction against the Company or any of its Restricted
Subsidiaries and such judgment or judgments remain undischarged for a period (during which execution shall not be effectively stayed) of 60 days;  provided that the aggregate of all such
undischarged judgments exceeds $5 million; 


    (h) any
of the Collateral Documents ceases, for any reason (other than pursuant to the terms thereof), to be in full force and effect, or the Company so asserts, or any
security interest created, or purported to be created, by any of the Collateral Documents ceases to be enforceable and of the same effect and priority purported to be created thereby; 






62 


    (i)  except
as permitted by this Indenture, any Note Guarantee is held in any judicial proceeding to be unenforceable or invalid or ceases for any reason to be in full
force and effect or any Subsidiary Guarantor, or any Person acting on behalf of any such Subsidiary Guarantor, denies or disaffirms its obligations under its Guarantee; 



    (j)  any
representation or warranty made by the Company or any of its Restricted Subsidiaries in any Collateral Document or that is contained in any certificate,
document or financial or other statement furnished by any of them at any time under or in connection with any such Collateral Document proves to have been inaccurate in any material respect on or as
of the date made or deemed made; 


    (k) (i) at
any time that Gaming Licenses utilized in connection with the route operations of the Company and its Restricted Subsidiaries are revoked, terminated,
suspended or otherwise cease to be effective, resulting in the concurrent cessation or suspension of operation for a period of more than 90 days at route locations that, in the aggregate,
represented in excess of 20% of the Company's net gaming revenues for its most recently completed four fiscal quarters for which internal financial statements are available, or (ii) any Gaming
Licenses are revoked, terminated, suspended or otherwise cease to be effective with results in the cessation or suspension of gaming operations at Terrible's Hotel & Casino for more than 90
consecutive days; in either case, other than as a result of an Asset Sale permitted under this Indenture or any voluntary relinquishment that is, in the judgement of the Board of Directors of the
Company, both desirable in the conduct of the business of the Company and its Restricted Subsidiaries, taken as a whole, and not disadvantageous in any material respect to the Holders; 



    (l)  the
Company or any of its Significant Subsidiaries or any group of Subsidiaries that, taken as a whole, would constitute a Significant Subsidiary pursuant to or
within the meaning of Bankruptcy Law: 



     (i) commences
a voluntary case, 


    (ii) consents
to the entry of an order for relief against it in an involuntary case, 


    (iii) consents
to the appointment of a custodian of it or for all or substantially all of its property, 



    (iv) makes
a general assignment for the benefit of its creditors, or 


    (v) generally
is not paying its debts as they become due; or 




    (m) a
court of competent jurisdiction enters an order or decree under any Bankruptcy Law that: 



     (i) is
for relief against the Company or any of its Significant Subsidiaries or any group of Subsidiaries that, taken as a whole, would constitute a Significant
Subsidiary in an involuntary case; 


    (ii) appoints
a custodian of the Company or any of its Significant Subsidiaries or any group of Subsidiaries that, taken as a whole, would constitute a Significant 



63




Subsidiary
or for all or substantially all of the property of the Company or any of its Significant Subsidiaries or any group of Subsidiaries that, taken as a whole, would constitute a Significant
Subsidiary; or 


    (iii) orders
the liquidation of the Company or any of its Significant Subsidiaries or any group of Subsidiaries that, taken as a whole, would constitute a Significant
Subsidiary; 




and
the order or decree remains unstayed and in effect for 60 consecutive days. 






Section 6.02. ACCELERATION.  


    If any Event of Default (other than an Event of Default specified in clause (l) or (m) of Section 6.01 hereof with respect to the Company,
any Significant Subsidiary or any group of Significant Subsidiaries that, taken as a whole, would constitute a Significant Subsidiary) occurs and is continuing, the Trustee or the Holders of at least
25% in principal amount of the then outstanding Notes may declare all the Notes to be due and payable immediately. Upon any such declaration, the Notes shall become due and payable immediately.
Notwithstanding the foregoing, if an Event of Default specified in clause (l) or
(m) of Section 6.01 hereof occurs with respect to the Company, any of its Significant Subsidiaries or any group of Subsidiaries that, taken as a whole, would constitute a Significant
Subsidiary, all outstanding Notes shall be due and payable immediately without further action or notice. The Holders of a majority in aggregate principal amount of the then outstanding Notes by
written notice to the Trustee may on behalf of all of the Holders rescind an acceleration and its consequences if the rescission would not conflict with any judgment or decree and if all existing
Events of Default (except nonpayment of principal, interest or premium that has become due solely because of the acceleration) have been cured or waived. 


    If
an Event of Default occurs on or after September 1, 2005 by reason of any willful action (or inaction) taken (or not taken) by or on behalf of the Company with the intention
of avoiding payment of the premium that the Company would have had to pay if the Company then had elected to redeem the Notes pursuant to Section 3.07 hereof, then, upon acceleration of the
Notes, an equivalent premium shall also become and be immediately due and payable, to the extent permitted by law, anything in this Indenture or in the Notes to the contrary notwithstanding. If an
Event of Default occurs prior to September 1, 2005 by reason of any willful action (or inaction) taken (or not taken) by or on behalf of the Company with the intention of avoiding the
prohibition on redemption of the Notes prior to such date, then, upon acceleration of the Notes, an additional premium shall also become and be immediately due and payable in an amount, for each of
the years beginning on September 1 of the years set forth below, as set forth below (expressed as a percentage of the principal amount of the Notes on the date of payment that would otherwise
be due but for the provisions of this sentence): 



	Year
 
	 	Percentage
	 
	2001	 	16.125	%
	2002	 	13.438	%
	2003	 	10.750	%





64




	Year
 
	 	Percentage
	 
	2004	 	8.063	%






Section 6.03. OTHER REMEDIES.  


    If an Event of Default occurs and is continuing, the Trustee may pursue any available remedy to collect the payment of principal, premium, if any, and interest
on the Notes or to enforce the performance of any provision of the Notes or this Indenture. 


    The
Trustee may maintain a proceeding even if it does not possess any of the Notes or does not produce any of them in the proceeding. A delay or omission by the Trustee or any Holder
of a Note in exercising any right or remedy accruing upon an Event of Default shall not impair the right or remedy or constitute a waiver of or acquiescence in the Event of Default. All remedies are
cumulative to the extent permitted by law. 


Section 6.04. WAIVER OF PAST DEFAULTS.  


    Holders of not less than a majority in aggregate principal amount of the then outstanding Notes by notice to the Trustee may on behalf of the Holders of all of
the Notes waive an existing Default or 








Event of Default and its consequences hereunder, except (i) as otherwise noted in Section 9.02 hereof and (ii) a continuing Default or Event of Default in the payment of the
principal of, premium and Liquidated Damages, if any, or interest on, the Notes (including in connection with an offer to purchase); provided, however,
that the Holders of a majority in aggregate principal amount of the then outstanding Notes may rescind an acceleration and its consequences, including any related payment default that resulted from
such acceleration. Upon any such waiver, such Default shall cease to exist, and any Event of Default arising therefrom shall be deemed to have been cured for every purpose of this Indenture, but no
such waiver shall extend to any subsequent or other Default or impair any right consequent thereon. 


Section 6.05. CONTROL BY MAJORITY.  


    Holders of a majority in principal amount of the then outstanding Notes may direct the time, method and place of conducting any proceeding for exercising any
remedy available to the Trustee or exercising any trust or power conferred on it. However, the Trustee may refuse to follow any direction that conflicts with law or this Indenture that the Trustee
determines may be unduly prejudicial to the rights of other Holders of Notes or that may involve the Trustee in personal liability. 


Section 6.06. LIMITATION ON SUITS.  


    A Holder of a Note may pursue a remedy with respect to this Indenture or the Notes only if: 


    (a) the
Holder of a Note gives to the Trustee written notice of a continuing Event of Default; 


65



    (b) the
Holders of at least 25% in principal amount of the then outstanding Notes make a written request to the Trustee to pursue the remedy; 



    (c) such
Holder of a Note or Holders of Notes offer and, if requested, provide to the Trustee indemnity satisfactory to the Trustee against any loss, liability or
expense; 


    (d) the
Trustee does not comply with the request within 60 days after receipt of the request and the offer and, if requested, the provision of indemnity; and 


    (e) during
such 60-day period the Holders of a majority in principal amount of the then outstanding Notes do not give the Trustee a direction inconsistent
with the request. 



    A
Holder of a Note may not use this Indenture to prejudice the rights of another Holder of a Note or to obtain a preference or priority over another Holder of a Note. 


Section 6.07. RIGHTS OF HOLDERS OF NOTES TO RECEIVE PAYMENT.  


    Notwithstanding any other provision of this Indenture, the right of any Holder of a Note to receive payment of principal, premium and Liquidated Damages, if
any, and interest on the Note, on or after the respective due dates expressed in the Note (including in connection with an offer to purchase), or to bring suit for the enforcement of any such payment
on or after such respective dates, shall not be impaired or affected without the consent of such Holder; provided that a Holder shall not have the right
to institute any such suit for the enforcement of payment if and to the extent that the institution or prosecution thereof or the entry of judgment therein would, under applicable law, result in the
surrender, impairment, waiver or loss of the Lien of this Indenture upon any property subject to such Lien. 


Section 6.08. COLLECTION SUIT BY TRUSTEE.  


    If an Event of Default specified in Section 6.01(a) or (b) occurs and is continuing, the Trustee is authorized to recover judgment in its own
name and as trustee of an express trust against the Company for the whole amount of principal of, premium and Liquidated Damages, if any, and interest remaining 







unpaid on the Notes and interest on overdue principal and, to the extent lawful, interest and such further amount as shall be sufficient to cover the costs and expenses of collection, including the
reasonable compensation, expenses, disbursements and advances of the Trustee, its agents and counsel. 


Section 6.09. TRUSTEE MAY FILE PROOFS OF CLAIM.  


    The Trustee is authorized to file such proofs of claim and other papers or documents as may be necessary or advisable in order to have the claims of the
Trustee (including any claim for the reasonable compensation, expenses, disbursements and advances of the Trustee, its agents and counsel) and the Holders of the Notes allowed in any judicial
proceedings relative to the Company (or any other obligor upon the Notes), its creditors or its property and shall be entitled and empowered to collect, receive and distribute any money or other
property payable or deliverable on any such claims and any custodian in any such judicial proceeding is hereby authorized by each Holder to make such payments to the Trustee, and in the event that the
Trustee shall consent to the making of such payments directly to the Holders, to pay to the 


66



Trustee
any amount due to it for the reasonable compensation, expenses, disbursements and advances of the Trustee, its agents and counsel, and any other amounts due the Trustee under
Section 7.07 hereof. To the extent that the payment of any such compensation, expenses, disbursements and advances of the Trustee, its agents and counsel, and any other amounts due the Trustee
under Section 7.07 hereof out of the estate in any such proceeding, shall be denied for any reason, payment of the same shall be secured by a Lien on, and shall be paid out of, any and all
distributions, dividends, money, securities and other properties that the Holders may be entitled to receive in such proceeding whether in liquidation or under any plan of reorganization or
arrangement or otherwise. Nothing herein contained shall be deemed to authorize the Trustee to authorize or consent to or accept or adopt on behalf of any Holder any plan of reorganization,
arrangement, adjustment or composition affecting the Notes or the rights of any Holder, or to authorize the Trustee to vote in respect of the claim of any Holder in any such proceeding. 


Section 6.10. PRIORITIES.  


    If the Trustee collects any money pursuant to this Article, it shall pay out the money in the following order: 



    First: to the Trustee, its agents and attorneys for amounts due under Section 7.07 hereof, including payment of all
compensation, expense and liabilities incurred, and all advances made, by the Trustee and the costs and expenses of collection; 



    Second: to Holders of Notes for amounts due and unpaid on the Notes for principal, premium and Liquidated Damages, if any, and
interest, ratably, without preference or priority of any kind, according to the amounts due and payable on the Notes for principal, premium and Liquidated Damages, if any and interest, respectively;
and 


    Third: to the Company or to such party as a court of competent jurisdiction shall direct. 




    The
Trustee may fix a record date and payment date for any payment to Holders of Notes pursuant to this Section 6.10. 



Section 6.11. UNDERTAKING FOR COSTS.  


    In any suit for the enforcement of any right or remedy under this Indenture or in any suit against the Trustee for any action taken or omitted by it as a
Trustee, a court in its discretion may require the filing by any party litigant in the suit of an undertaking to pay the costs of the suit, and the court in its discretion may assess reasonable costs,
including reasonable attorneys' fees and expenses, against any party litigant in the suit, having due regard to the merits and good faith of the claims or defenses made 








by the party litigant. This Section does not apply to a suit by the Trustee, a suit by a Holder of a Note pursuant to Section 6.07 hereof, or a suit by Holders of more than 10% in principal
amount of the then outstanding Notes. 


67



 
 

ARTICLE VII.
  
    TRUSTEE    




Section 7.01. DUTIES OF TRUSTEE.  


    (a) If
an Event of Default has occurred and is continuing, the Trustee shall exercise such of the rights and powers vested in it by this Indenture, and use the same
degree of care and skill in its exercise, as a prudent person would exercise or use under the circumstances in the conduct of such person's own affairs. 


    (b) Except
during the continuance of an Event of Default: 



     (i) the
duties of the Trustee shall be determined solely by the express provisions of this Indenture and the Trustee need perform only those duties that are
specifically set forth in this Indenture and no others, and no implied covenants or obligations shall be read into this Indenture against the Trustee; and 


    (ii) in
the absence of bad faith on its part, the Trustee may conclusively rely, as to the truth of the statements and the correctness of the opinions expressed
therein, upon certificates or opinions furnished to the Trustee and conforming to the requirements of this Indenture. However, the Trustee shall examine the certificates and opinions specifically
required to be furnished to it hereunder to determine whether or not they substantially conform to the requirements of this Indenture. 




    (c) The
Trustee may not be relieved from liabilities for its own negligent action, its own negligent failure to act, or its own willful misconduct, except that: 



     (i) this
paragraph does not limit the effect of paragraph (b) of this Section; 


    (ii) the
Trustee shall not be liable for any error of judgment made in good faith by a Responsible Officer, unless it is proved that the Trustee was negligent in
ascertaining the pertinent facts; and 


    (iii) the
Trustee shall not be liable with respect to any action it takes or omits to take in good faith in accordance with a direction received by it pursuant to
Section 6.05 hereof. 




    (d) Whether
or not therein expressly so provided, every provision of this Indenture that in any way relates to the Trustee is subject to paragraphs (a), (b), and
(c) of this Section. 


    (e) No
provision of this Indenture shall require the Trustee to expend or risk its own funds or incur any liability. The Trustee shall be under no obligation to
exercise any of its rights and powers under this Indenture at the request of any Holders, unless such Holder shall have offered to the Trustee security and indemnity satisfactory to it against any
loss, liability or expense. 


68 


    (f)  The
Trustee shall not be liable for interest on any money received by it except as the Trustee may agree in writing with the Company. Money held in trust by the
Trustee need not be segregated from other funds except to the extent required by law. 







Section 7.02. RIGHTS OF TRUSTEE.  


    (a) The
Trustee may conclusively rely upon any document (whether in its original or facsimile form) believed by it to be genuine and to have been signed or presented by
the proper Person. The Trustee need not investigate any fact or matter stated in the document. 


    (b) Before
the Trustee acts or refrains from acting, it may require an Officers' Certificate or an Opinion of Counsel or both. The Trustee shall not be liable for any
action it takes or omits to take in good faith in reliance on such Officers' Certificate or Opinion of Counsel. The Trustee may consult with counsel of its own selection and the advice of such counsel
or any Opinion of Counsel shall be full and complete authorization and protection from liability in respect of any action taken, suffered or omitted by it hereunder in good faith and in reliance
thereon. 


    (c) The
Trustee may act through its attorneys and agents and shall not be responsible for the misconduct or negligence of any agent appointed with due care. 


    (d) The
Trustee shall not be liable for any action it takes or omits to take in good faith that it believes to be authorized or within the rights or powers conferred
upon it by this Indenture. 


    (e) Unless
otherwise specifically provided in this Indenture, any demand, request, direction or notice from the Company shall be sufficient if signed by an Officer of
the Company. 


    (f)  The
Trustee shall be under no obligation to exercise any of the rights or powers vested in it by this Indenture at the request or direction of any of the Holders
unless such Holders shall have offered to
the Trustee reasonable security or indemnity reasonably satisfactory to it against the costs, expenses and liabilities that might be incurred by it in compliance with such request or direction. 


    (g) The
Trustee will provide a list of the Holders or Beneficial Owners of Notes to any Gaming Authority upon request. 








Section 7.03. INDIVIDUAL RIGHTS OF TRUSTEE.  


    The Trustee in its individual or any other capacity may become the owner or pledgee of Notes and may otherwise deal with the Company or any Affiliate of the
Company with the same rights it would have if it were not Trustee. However, in the event that the Trustee acquires any conflicting interest it must eliminate such conflict within 90 days, apply
to the SEC for permission to continue as trustee or resign. Any Agent may do the same with like rights and duties. The Trustee is also subject to Sections 7.10 and 7.11 hereof. 


69



Section 7.04. TRUSTEE'S DISCLAIMER.  


    The Trustee shall not be responsible for and makes no representation as to the validity or adequacy of this Indenture or the Notes, it shall not be accountable
for the Company's use of the proceeds from the Notes or any money paid to the Company or upon the Company's direction under any provision of this Indenture, it shall not be responsible for the use or
application of any money received by any Paying Agent other than the Trustee, and it shall not be responsible for any statement or recital herein or any statement in the Notes or any other document in
connection with the sale of the Notes or pursuant to this Indenture other than its certificate of authentication. 


Section 7.05.  NOTICE OF DEFAULTS.  


    If a Default or Event of Default occurs and is continuing and if it is known to the Trustee, the Trustee shall mail to Holders of Notes a notice of the Default
or Event of Default within 90 days after it occurs. Except in the case of a Default or Event of Default in payment of principal of, premium, if any, or interest on any Note, the Trustee may
withhold the notice if and so long as a committee of its Responsible Officers in good faith determines that withholding the notice is in the interests of the Holders of the Notes. 


Section 7.06.  REPORTS BY TRUSTEE TO HOLDERS OF THE NOTES.  


    Within 60 days after each May 15 beginning with the May 15 following the date of this Indenture, and for so long as Notes remain
outstanding, the Trustee shall mail to the Holders of the Notes a brief report dated as of such reporting date that complies with TIA § 313(a) (but if no event described in TIA
§ 313(a) has occurred within the twelve months preceding the reporting date, no report need be transmitted). The Trustee also shall comply with TIA § 313(b)(2). The Trustee
shall also transmit by mail all reports as required by TIA § 313(c). 


    A
copy of each report at the time of its mailing to the Holders of Notes shall be mailed to the Company and filed with the SEC and each stock exchange on which the Notes are listed in
accordance with TIA § 313(d). The Company shall promptly notify the Trustee when the Notes are listed on any stock exchange or delisted therefrom. 



Section 7.07.  COMPENSATION AND INDEMNITY.  


    The Company shall pay to the Trustee from time to time reasonable compensation for its acceptance of this Indenture and services hereunder. The Trustee's
compensation shall not be limited by any law on compensation of a trustee of an express trust. The Company shall reimburse the Trustee promptly upon request for all reasonable disbursements, advances
and expenses incurred or made by it in addition to the compensation for its services. Such expenses shall include the reasonable compensation, disbursements and expenses of the Trustee's agents and
counsel. 


    The
Company shall indemnify the Trustee against any and all losses, liabilities, claims, damages or expenses (including reasonable legal fees and expenses) incurred by it arising out
of or in connection with the acceptance or administration of its duties under this Indenture, including the costs and 







expenses of enforcing this Indenture against the Company (including this Section 7.07) and defending itself against any claim (whether asserted by the Company or any 


70 


Holder
or any other person) or liability in connection with the exercise or performance of any of its powers or duties hereunder, except to the extent any such loss, liability or expense determined by
a court of competent jurisdiction to have been caused by its own negligence or willful misconduct. The Trustee shall notify the Company promptly of any claim for which it may seek indemnity. Failure
by the Trustee to so notify the Company shall not relieve the Company of its obligations hereunder. The Company shall defend the claim and the Trustee shall cooperate in the defense. The Trustee may
have separate counsel and the Company shall pay the reasonable fees and expenses of such counsel. The Company need not pay for any settlement made without its consent, which consent shall not be
unreasonably withheld. 


    The
obligations of the Company under this Section 7.07 shall survive the satisfaction and discharge of this Indenture and resignation or removal of the Trustee. 


    To
secure the Company's payment obligations in this Section, the Trustee shall have a Lien prior to the Notes on all money or property held or collected by the Trustee, except that
held in trust to pay principal and interest on particular Notes. Such Lien shall survive the satisfaction and discharge of this Indenture. 


    When
the Trustee incurs expenses or renders services after an Event of Default specified in Section 6.01(1) or (m) hereof occurs, the expenses and the compensation for
the services (including the fees and expenses of its agents and counsel) are intended to constitute expenses of administration under any Bankruptcy Law. 


    The
Trustee shall comply with the provisions of TIA § 313(b)(2) to the extent applicable. 


Section 7.08.  REPLACEMENT OF TRUSTEE.  


    A resignation or removal of the Trustee and appointment of a successor Trustee shall become effective only upon the successor Trustee's acceptance of
appointment as provided in this Section. 


    The
Trustee may resign in writing at any time and be discharged from the trust hereby created by so notifying the Company. The Holders of a majority in principal amount of the then
outstanding Notes may remove the Trustee by so notifying the Trustee and the Company in writing. The Company may remove the Trustee if: 



    (a) the
Trustee fails to comply with Section 7.10 hereof; 


    (b) the
Trustee is adjudged a bankrupt or an insolvent or an order for relief is entered with respect to the Trustee under any Bankruptcy Law; 



    (c) a
custodian or public officer takes charge of the Trustee or its property; or 


    (d) the
Trustee becomes incapable of acting. 




    If
the Trustee resigns or is removed or if a vacancy exists in the office of Trustee for any reason, the Company shall promptly appoint a successor Trustee. Within one year after the
successor Trustee takes office, the Holders of a majority in principal amount of the then 


71



outstanding
Notes may appoint a successor Trustee to replace the successor Trustee appointed by the Company. 



    If
a successor Trustee does not take office within 60 days after the retiring Trustee resigns or is removed, the retiring Trustee, the Company, or the Holders of at least 10%
in principal amount of the 







then outstanding Notes may petition at the expense of the Company any court of competent jurisdiction for the appointment of a successor Trustee. 



    If
the Trustee, after written request by any Holder who has been a Holder for at least six months, fails to comply with Section 7.10, such Holder may petition any court of
competent jurisdiction for the removal of the Trustee and the appointment of a successor Trustee. 


    A
successor Trustee shall deliver a written acceptance of its appointment to the retiring Trustee and to the Company. Thereupon, the resignation or removal of the retiring Trustee
shall become effective, and the successor Trustee shall have all the rights, powers and duties of the Trustee under this Indenture.
The successor Trustee shall mail a notice of its succession to Holders. The retiring Trustee shall promptly transfer all property held by it as Trustee to the successor Trustee,  provided all sums owing
to the Trustee hereunder have been paid and subject to the Lien provided for in Section 7.07 hereof. Notwithstanding
replacement of the Trustee pursuant to this Section 7.08, the Company's obligations under Section 7.07 hereof shall continue for the benefit of the retiring Trustee. 


Section 7.09.  SUCCESSOR TRUSTEE BY MERGER, ETC.  


    If the Trustee consolidates, merges or converts into, or transfers all or substantially all of its corporate trust business to, another corporation, the
successor corporation without any further act shall be the successor Trustee. 


Section 7.10.  ELIGIBILITY; DISQUALIFICATION.  


    There shall at all times be a Trustee hereunder that is a corporation organized and doing business under the laws of the United States of America or of any
state thereof that is authorized under such laws to exercise corporate trustee power, that is subject to supervision or examination by federal or state authorities and that has a combined capital and
surplus of at least $100 million as set forth in its most recent published annual report of condition. 


    This
Indenture shall always have a Trustee who satisfies the requirements of TIA § 310(a)(1), (2) and (5). The Trustee is subject to TIA § 310(b). 


Section 7.11.  PREFERENTIAL COLLECTION OF CLAIMS AGAINST COMPANY.  



    The Trustee is subject to TIA § 311(a), excluding any creditor relationship listed in TIA § 311(b). A Trustee who has resigned or been
removed shall be subject to TIA § 311(a) to the extent indicated therein. 


72



Section 7.12.  NO LIABILITY FOR CLEAN-UP OF HAZARDOUS MATERIALS.  


    In the event that the Trustee is required to acquire title to an asset for any reason, or take any managerial action of any kind in regard thereto, in order to
carry out any fiduciary or trust obligation for the benefit of another, which in the Trustee's sole discretion may cause the Trustee to be considered an "owner or operator" under the provisions of the
Comprehensive Environmental Response, Compensation and Liability Act (CERCLA), 42 U.S.C. §9601. et seq., or otherwise cause the Trustee to
incur liability under CERCLA or any other federal, state or local law, the Trustee reserves the right to, instead of taking such action, either resign as Trustee or arrange for the transfer of the
title or control of the asset to a court appointed receiver. 


    The
Trustee shall not be liable to the Company or the Holders or any other person for any environmental claims or contribution actions under any federal, state or local law, rule or
regulation by reason of the Trustee's actions and conduct as authorized, empowered and directed hereunder or relating to the discharge, release or threatened release of hazardous materials into the
environment. 





 
 

ARTICLE VIII.
  
    LEGAL DEFEASANCE AND COVENANT DEFEASANCE    




Section 8.01.  OPTION TO EFFECT LEGAL DEFEASANCE OR COVENANT DEFEASANCE.  


    The Company may, at the option of its Board of Directors evidenced by a resolution set forth in an Officers' Certificate, at any time, elect to have either
Section 8.02 or 8.03 hereof be applied to all outstanding Notes upon compliance with the conditions set forth below in this Article Eight. 


Section 8.02.  LEGAL DEFEASANCE AND DISCHARGE.  


    Upon the Company's exercise under Section 8.01 hereof of the option applicable to this Section 8.02, the Company shall, subject to the
satisfaction of the conditions set forth in Section 8.04 hereof, be deemed to have been discharged from all of its obligations with respect to the outstanding Notes and all obligations of its
Subsidiaries shall be discharged with respect to the Note Guarantees on the date the conditions set forth below are satisfied (hereinafter, "Legal
Defeasance"). For this purpose, Legal
Defeasance means that the Company shall be deemed to have paid and discharged the entire Indebtedness represented by the outstanding Notes, which shall thereafter be deemed to be "outstanding" only
for the purposes of Section 8.05 hereof and the other Sections of this Indenture referred to in (a) and (b) below, and to have satisfied all its other obligations under such Notes
and this Indenture (and the Trustee, on demand of and at the expense of the Company, shall execute proper instruments acknowledging the same), except for the following provisions which shall survive
until otherwise terminated or discharged hereunder: (a) the rights of Holders of outstanding Notes to receive solely from the trust fund described in Section 8.04 hereof, and as more
fully set forth in such Section, payments in respect of the principal of, interest or premium, if any, on such Notes when such payments are due from said trust fund, (b) the Company's
obligations with respect to such Notes under Article 2 and Section 


73



4.02
hereof, (c) the rights, powers, trusts, duties and immunities of the Trustee hereunder and the Company's and its Subsidiaries' obligations in connection therewith and (d) this
Article Eight. Subject to compliance with this Article Eight, the Company may exercise its option under this Section 8.02 notwithstanding the prior exercise of its option under
Section 8.03 hereof. 


Section 8.03.  COVENANT DEFEASANCE.  


    Upon the Company's exercise under Section 8.01 hereof of the option applicable to this Section 8.03, the Company and its Subsidiaries shall,
subject to the satisfaction of the conditions set forth in Section 8.04 hereof, be released from its obligations under the covenants contained in Sections 4.07, 4.08, 4.09, 4.10, 4.11, 4.12,
4.13, 4.15, 4.16, 4.17, 4.18, 4.19, 4.20, 4.21, 4.22, 4.23, 4.24, 4.25, 4.26, 4.27 hereof and clause (e) of Section 5.01 hereof with respect to the outstanding Notes on and after the
date the conditions set forth in Section 8.04 are satisfied (hereinafter, "Covenant Defeasance"), and the Notes shall thereafter be deemed not
"outstanding" for the purposes of any direction, waiver, consent or declaration or act of Holders (and the consequences of any thereof) in connection with such covenants, but shall continue to be
deemed "outstanding" for all other purposes hereunder (it being understood that such Notes shall not be deemed outstanding for accounting purposes). For this purpose, Covenant Defeasance means that,
with respect to the outstanding Notes, the Company may omit to comply with and shall have no liability in respect of any term, condition or limitation set forth in any such covenant, whether directly
or indirectly, by reason of any reference elsewhere herein to any such covenant or by reason of any reference in any such covenant to any other provision herein or in any other document and such
omission to comply shall not constitute a Default or an Event of Default under Section 6.01 hereof, but, except as specified above, the remainder of this Indenture and such Notes shall be
unaffected thereby. In addition, upon the Company's exercise under Section 8.01 hereof of the option applicable to this Section 8.03 hereof, subject to the satisfaction of the conditions
set 







forth in Section 8.04 hereof, Sections 6.01(c) through 6.01(k) hereof shall not constitute Events of Default. 



Section 8.04.  CONDITIONS TO LEGAL OR COVENANT DEFEASANCE.  


    The following shall be the conditions to the application of either Section 8.02 or 8.03 hereof to the outstanding Notes: 


    In
order to exercise either Legal Defeasance or Covenant Defeasance: 



    (a) the
Company must irrevocably deposit with the Trustee, in trust, for the benefit of the Holders, cash in United States dollars, non-callable Government
Securities, or a combination thereof, in such amounts as will be sufficient, in the opinion of a nationally recognized firm of independent public accountants, to pay the principal of, interest,
premium and Liquidated Damages, if any, on the outstanding Notes on the stated date for payment thereof or on the applicable redemption date, as the case may be and the Company must specify whether
the Notes are being defeased to maturity or to a particular redemption date; 


    (b) in
the case of an election under Section 8.02 hereof, the Company shall have delivered to the Trustee an Opinion of Counsel in the United States reasonably
acceptable to the Trustee confirming that (A) the Company has received from, or there has been published by, the 



74




Internal
Revenue Service a ruling or (B) since the date of this Indenture, there has been a change in the applicable federal income tax law, in either case to the effect that, and based thereon
such Opinion of Counsel shall confirm that, the Holders of the outstanding Notes will not recognize income, gain or loss for federal income tax purposes as a result of such Legal Defeasance and will
be subject to federal income tax on the same amounts, in the same manner and at the same times as would have been the case if such Legal Defeasance had not occurred; 


    (c) in
the case of an election under Section 8.03 hereof, the Company shall have delivered to the Trustee an Opinion of Counsel in the United States reasonably
acceptable to the Trustee confirming that the Holders of the outstanding Notes will not recognize income, gain or loss for federal income tax purposes as a result of such Covenant Defeasance and will
be subject to federal income tax on the same amounts, in the same manner and at the same times as would have been the case if such Covenant Defeasance had not occurred; 



    (d) no
Default or Event of Default shall have occurred and be continuing either (i) on the date of such deposit (other than a Default or Event of Default
resulting from the incurrence of Indebtedness to be applied to such deposit) or (ii) insofar as Sections 6.01(l) or 6.01(m) hereof is concerned, at any time in the period ending on the 91st day
after the date of deposit; 


    (e) such
Legal Defeasance or Covenant Defeasance shall not result in a breach or violation of, or constitute a default under, any material agreement or instrument
(other than this Indenture) to which the Company or any of its Subsidiaries is a party or by which the Company or any of its Subsidiaries is bound; 



    (f)  the
Company shall have delivered to the Trustee an Officers' Certificate stating that the deposit was not made by the Company with the intent of preferring the
Holders over any other creditors of the Company or with the intent of defeating, hindering, delaying or defrauding any other creditors of the Company or others; and 


    (g) the
Company shall have delivered to the Trustee an Officers' Certificate and an Opinion of Counsel, each stating that all conditions precedent relating to the Legal
Defeasance or the Covenant Defeasance have been complied with. 







Section 8.05.  DEPOSITED MONEY AND GOVERNMENT SECURITIES TO BE HELD IN TRUST; OTHER MISCELLANEOUS PROVISIONS.  


    Subject to Section 8.06 hereof, all money and non-callable Government Securities (including the proceeds thereof) deposited with the Trustee
(or other qualifying trustee, collectively for purposes of this Section 8.05, the "Trustee") pursuant to Section 8.04 hereof in respect of the outstanding Notes shall be held in trust
and applied by the Trustee, in accordance with the provisions of such Notes and this Indenture, to the payment, either directly or through any Paying Agent (including the Company acting as Paying
Agent) as the Trustee may determine, to the Holders of such Notes of all sums due and to
become due thereon in respect of principal, premium, if any, and interest, but such money need not be segregated from other funds except to the extent required by law. 


    The
Company shall pay and indemnify the Trustee against any tax, fee or other charge imposed on or assessed against the cash or non-callable Government Securities
deposited 


75 


pursuant
to Section 8.04 hereof or the principal and interest received in respect thereof other than any such tax, fee or other charge which by law is for the account of the Holders of the
outstanding Notes. 


    Anything
in this Article Eight to the contrary notwithstanding, the Trustee shall deliver or pay to the Company from time to time upon the request of the Company any money or
non-callable Government Securities held by it as provided in Section 8.04 hereof which, in the opinion of a nationally recognized firm of independent public accountants expressed in
a written certification thereof delivered to the Trustee (which may be the opinion delivered under Section 8.04(a) hereof), are in excess of the amount thereof that would then be required to be
deposited to effect an equivalent Legal Defeasance or Covenant Defeasance. 


Section 8.06.  REPAYMENT TO COMPANY.  


    Any money deposited with the Trustee or any Paying Agent, or then held by the Company, in trust for the payment of the principal of, premium, if any, or
interest on any Note and remaining unclaimed for two years after such principal, and premium, if any, or interest has become due and payable shall be paid to the Company on its request or (if then
held by the Company) shall be discharged from such trust; and the Holder of such Note shall thereafter look only to the Company for payment thereof, and all liability of the Trustee or such Paying
Agent with respect to such trust money, and all liability of the Company as trustee thereof, shall thereupon cease; provided, however, that the Trustee
or such Paying Agent, before being required to make any such repayment, may at the expense of the Company cause to be published once, in the New York Times and The Wall Street Journal (national
edition), notice that such money remains unclaimed and that, after a date specified therein, which shall not be less than 30 days from the date of such notification or publication, any
unclaimed balance of such money then remaining will be repaid to the Company. 



Section 8.07.  REINSTATEMENT.  


    If the Trustee or Paying Agent is unable to apply any United States dollars or non-callable Government Securities in accordance with
Section 8.02 or 8.03 hereof, as the case may be, by reason of any order or judgment of any court or governmental authority enjoining, restraining or otherwise prohibiting such application, then
the Company's obligations under this Indenture and the Notes shall be revived and reinstated as though no deposit had occurred pursuant to Section 8.02 or 8.03 hereof until such time as the
Trustee or Paying Agent is permitted to apply all such money in accordance with Section 8.02 or 8.03 hereof, as the case may be; provided,
however, that, if the Company makes any payment of principal of, premium, if any, or interest on any Note following the reinstatement of its obligations, the Company shall be
subrogated to the rights of the Holders of such Notes to receive such payment from the money held by the Trustee or Paying Agent. 






76 


 
 

ARTICLE IX.
  
    AMENDMENT, SUPPLEMENT AND WAIVER    



Section 9.01.  WITHOUT CONSENT OF HOLDERS OF NOTES.  


    Notwithstanding Section 9.02 of this Indenture, the Company, the Restricted Subsidiaries and the Trustee may amend or supplement this Indenture, the
Notes, the Note Guarantees or the Collateral Documents without the consent of any Holder of a Note: 



    (a) to
cure any ambiguity, defect or inconsistency; 


    (b) to
provide for uncertificated Notes in addition to or in place of certificated Notes or to alter the provisions of Article 2 hereof (including the related
definitions) in a manner that does not materially adversely affect any Holder; 


    (c) to
provide for the assumption of the Company's or a Subsidiary Guarantor's obligations to the Holders of the Notes by a successor to the Company pursuant to
Article 5 or Article 11 hereof; 


    (d) to
make any change that would provide any additional rights or benefits to the Holders of the Notes or that does not adversely affect the legal rights hereunder of
any such Holder; 


    (e) to
comply with requirements of the SEC in order to effect or maintain the qualification of this Indenture under the TIA; 


    (f)  to
provide for the issuance of Additional Notes in accordance with the limitations set forth in this Indenture as of the date hereof; 


    (g) to
allow any Subsidiary Guarantor to execute a supplemental indenture and/or a Note Guarantee with respect to the Notes; or 


    (h) to
enter into additional or supplemental Collateral Documents. 




    Upon
the request of the Company accompanied by a resolution of its Board of Directors authorizing the execution of any such amended or supplemental Indenture, and upon receipt by the
Trustee of the documents described in Section 7.02 hereof, the Trustee shall join with the Company and the Subsidiary Guarantors in the execution of any amended or supplemental Indenture
authorized or permitted by the terms of this Indenture and to make any further appropriate agreements and stipulations that may be therein contained, but the Trustee shall not be obligated to enter
into such amended or supplemental Indenture that affects its own rights, duties or immunities under this Indenture or otherwise. 



Section 9.02.  WITH CONSENT OF HOLDERS OF NOTES.  


    Except as provided below in this Section 9.02, the Company and the Trustee may amend or supplement this Indenture (including Sections 3.10, 4.10, 4.15
and 4.19 hereof), the Note Guarantees and the Notes with the consent of the Holders of at least a majority in principal 


77



amount
of the Notes (including Additional Notes, if any) then outstanding voting as a single class (including consents obtained in connection with a tender offer or exchange offer for, or purchase of,
the Notes), and, subject to Sections 6.04 and 6.07 hereof, any existing Default or Event of Default (other than a Default or Event of Default in the payment of the principal of, premium, if any, or
interest on the Notes, except a payment default resulting from an acceleration that has been rescinded) or compliance with any provision of this Indenture, the Note Guarantees or the Notes may be
waived 







with the consent of the Holders of a majority in principal amount of the then outstanding Notes (including Additional Notes, if any) voting as a single class (including consents obtained in connection
with a tender offer or exchange offer for, or purchase of, the Notes). Notwithstanding the foregoing, any amendment to, or waiver of, the provisions of any of the Collateral Documents relating to
Section 4.12 or Article 10 of this Indenture or any release, termination or reconveyance of any of the Collateral Documents or any of the Liens created or perfected thereby shall require
the consent of the Holders of at least 66?% in aggregate principal amount of the Notes then outstanding. 


    Upon
the request of the Company accompanied by a resolution of its Board of Directors authorizing the execution of any such amended or supplemental Indenture, and upon the filing with
the Trustee of evidence satisfactory to the Trustee of the consent of the Holders of Notes as aforesaid, and upon receipt by the Trustee of the documents described in Section 7.02 hereof, the
Trustee shall join with the Company in the execution of such amended or supplemental Indenture unless such amended or supplemental Indenture directly affects the Trustee's own rights, duties or
immunities under this Indenture or otherwise, in which case the Trustee may in its discretion, but shall not be obligated to, enter into such amended or supplemental Indenture. 


    It
shall not be necessary for the consent of the Holders of Notes under this Section 9.02 to approve the particular form of any proposed amendment or waiver, but it shall be
sufficient if such consent approves the substance thereof. 


    After
an amendment, supplement or waiver under this Section becomes effective, the Company shall mail to the Holders of Notes affected thereby a notice briefly describing the
amendment, supplement or waiver. Any failure of the Company to mail such notice, or any defect therein, shall not, however, in any way impair or affect the validity of any such amended or supplemental
Indenture or waiver. Subject to Sections 6.04 and 6.07 hereof, the Holders of a majority in aggregate principal amount of the Notes then outstanding voting as a single class may waive compliance in a
particular instance by the Company with any provision of this Indenture or the Notes. However, without the consent of each Holder
affected, an amendment or waiver under this Section 9.02 may not (with respect to any Notes held by a non-consenting Holder): 



    (a) reduce
the principal amount of Notes whose Holders must consent to an amendment, supplement or waiver; 



    (b) reduce
the principal of or change the fixed maturity of any Note or alter or waive any of the provisions with respect to the redemption of the Notes (except as
provided above with respect to Sections 3.10, 4.10, 4.15 and 4.19 hereof); 



78




    (c) reduce
the rate of or change the time for payment of interest, including default interest, on any Note; 


    (d) waive
a Default or Event of Default in the payment of principal of or premium, if any, or interest on the Notes (except a rescission of acceleration of the Notes by
the Holders of at least a majority in aggregate principal amount of the then outstanding Notes (including Additional Notes, if any) and a waiver of the payment default that resulted from such
acceleration); 


    (e) make
any Note payable in money other than that stated in the Notes; 


    (f)  make
any change in the provisions of this Indenture relating to waivers of past Defaults or the rights of Holders of Notes to receive payments of principal of or
interest on the Notes; 


    (g) make
any change in Section 6.04 or 6.07 hereof or in the foregoing amendment and waiver provisions; or 


    (h) release
any Subsidiary Guarantor from any of its obligations under its Note Guarantee or this Indenture, except in accordance with the terms of this Indenture. 








Section 9.03.  COMPLIANCE WITH TRUST INDENTURE ACT.  


    Every amendment or supplement to this Indenture or the Notes shall be set forth in an amended or a supplemental Indenture that complies with the TIA as then in
effect. 


Section 9.04.  REVOCATION AND EFFECT OF CONSENTS.  


    Until an amendment, supplement or waiver becomes effective, a consent to it by a Holder of a Note is a continuing consent by the Holder of a Note and every
subsequent Holder of a Note or portion of a Note that evidences the same debt as the consenting Holder's Note, even if notation of the consent is not made on any Note. However, any such Holder of a
Note or subsequent Holder of a Note may revoke the consent as to its Note if the Trustee receives written notice of revocation before the date the waiver, supplement or amendment becomes effective. An
amendment, supplement or waiver becomes effective in accordance with its terms and thereafter binds every Holder. 


Section 9.05.  NOTATION ON OR EXCHANGE OF NOTES.  


    The Trustee may place an appropriate notation about an amendment, supplement or waiver on any Note thereafter authenticated. The Company in exchange for all
Notes may issue and the Trustee shall, upon receipt of an Authentication Order, authenticate new Notes that reflect the amendment, supplement or waiver. 



    Failure
to make the appropriate notation or issue a new Note shall not affect the validity and effect of such amendment, supplement or waiver. 


79



Section 9.06.  TRUSTEE TO SIGN AMENDMENTS, ETC.  


    The Trustee shall sign any amended or supplemental Indenture authorized pursuant to this Article Nine if the amendment or supplement does not adversely affect
the rights, duties, liabilities or immunities of the Trustee. The Company may not sign an amendment or supplemental Indenture until the Board of Directors approves it. In executing any amended or
supplemental indenture, the Trustee shall be entitled to receive and (subject to Section 7.01 hereof) shall be fully protected in relying upon, in addition to the documents required by
Section 13.04 hereof, an Officer's Certificate and an Opinion of Counsel stating that the execution of such amended or supplemental indenture is authorized or permitted by this Indenture. 


 
 

ARTICLE X.
  
    COLLATERAL AND SECURITY    



Section 10.01. COLLATERAL DOCUMENTS.  


    (a) The
due and punctual payment of the principal of and interest and Liquidated Damages, 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 and Liquidated Damages (to the extent permitted by
law), if any, on the Notes and performance of all other obligations of the Company to the Holders of Notes or the Trustee under this Indenture and the Notes, according to the terms hereunder or
thereunder, shall be secured as provided in the Collateral Documents which the Company and certain of the Subsidiary Guarantors have entered into simultaneously with the execution of this Indenture
and which the Company and the Subsidiary Guarantors may enter into after the date of this Indenture in accordance with the terms hereof. 



    (b) Each
Holder of Notes, by its acceptance thereof, consents and agrees to the terms of the Collateral Documents (including, without limitation, the provisions
providing for foreclosure and 







release of Collateral) as the same may be in effect or may be amended from time to time in accordance with its terms and the terms of this Indenture and authorizes and directs the Trustee to enter
into the Collateral Documents and to perform its obligations and exercise its rights thereunder in
accordance therewith. The Company and the Subsidiary Guarantors shall deliver to the Trustee copies of all documents executed pursuant to this Indenture or the Collateral Documents, and shall do or
cause to be done all such acts and things as may be necessary or proper, or as may be required by the provisions of the Collateral Documents, to assure and confirm to the Trustee the security interest
in the Collateral contemplated hereby, by the Collateral Documents or any part thereof, as from time to time constituted, so as to render the same available for the security and benefit of this
Indenture and of the Notes secured hereby, according to the intent and purposes herein expressed. 


    (c) The
Company shall take, or shall cause its Subsidiaries to take, upon request of the Trustee, any and all actions reasonably required to cause the Collateral
Documents to create and maintain, as security for the Obligations of the Company and the Subsidiary Guarantors hereunder, a valid and enforceable perfected first priority Lien in and on all the
Collateral, in favor of the Trustee for the benefit of the Holders of Notes, superior to and prior to the rights of all third Persons and subject to no other Liens than Permitted Liens. 


80



Section 10.02.  RECORDING AND OPINIONS.  


    (a) The
Company and the Subsidiary Guarantors will cause the applicable Collateral Documents and any other mortgages, deeds of trust or financing statements, and all
amendments or supplements to each of the foregoing and any other similar security documents as necessary, to be registered, recorded and filed and/or re-recorded, re-filed and
renewed in such manner and in such place or places, if any, as may be required by law or reasonably requested by the Trustee in order fully to preserve and protect the Liens securing the obligations
under the Notes and any Note Guarantees pursuant to the Collateral Documents, except as otherwise provided herein and therein. 


    (b) The
Company and the Subsidiary Guarantors shall furnish to the Trustee: 



     (i) simultaneously
with the execution and delivery of this Indenture an Opinion of Counsel either (A) stating that in the opinion of such counsel all action has
been taken with respect to the recording, registering and filing of this Indenture, financing statements or other instruments necessary to make effective the Lien intended to be created by the
Collateral Documents, and reciting with respect to the
security interests in the Collateral, the details of such action, or (B) stating that, in the opinion of such counsel, no such action is necessary to make such Lien effective; and 


    (ii) within
30 days after January 1 in each year beginning with January 1, 2002, an Opinion of Counsel, dated as of such date, either
(A) (1) stating that, in the opinion of such counsel, action has been taken with respect to the recording, registering, filing, re-recording, re-registering and refiling
of all supplemental indentures, financing statements, continuation statements or other instruments of further assurance as is necessary to maintain the Lien of the Collateral Documents and reciting
with respect to the security interests in the Collateral the details of such action or referring to prior Opinions of Counsel in which such details are given and (2) stating that, based on
relevant laws as in effect on the date of such Opinion of Counsel, all financing statements and continuation statements have been executed and filed that are necessary as of such date and during the
succeeding 12 months fully to preserve and protect, to the extent such protection and preservation are possible by filing, the rights of the Holders of Notes and the Collateral Agent and the
Trustee hereunder and under the Collateral Documents with respect to the security interests in the Collateral, or (B) stating that, in the opinion of such counsel, no such action is necessary
to maintain such Lien and assignment. 







    (c) The
Company shall otherwise comply with the provisions of TIA §314(b). The Company and the Subsidiary Guarantors shall furnish to the Trustee the
certificates or opinions, as the case may be, required by TIA Section 314(d). Such certificates or opinions will be subject to the terms of TIA Section 314(e). 








Section 10.03.  RELEASE OF COLLATERAL.  


    (a) Subject
to subsections (b), (c) and (d) of this Section 10.03, Collateral may be released from the Lien and security interest created by the
Collateral Documents at any time or from time to time in accordance with the provisions of the Collateral Documents or as provided 


81



hereby.
In addition, upon the request of the Company pursuant to an Officers' Certificate certifying that all conditions precedent hereunder have been met and stating whether or not such release is in
connection with an Asset Sale or an Event of Loss, then (at the sole cost and expense of the Company) the Trustee shall release (or caused to be released) (i) Collateral that is sold, conveyed
or disposed of in compliance with the provisions of this Indenture; provided, that if such sale, conveyance or disposition constitutes an Asset Sale,
the Company shall apply the Net Proceeds in accordance with Section 4.10 hereof, (ii) Collateral that is condemned, seized or taken by the power of eminent domain or otherwise
confiscated pursuant to an Event of Loss; provided that the Net Proceeds, if any, from such Event of Loss are or will be applied in accordance with
Section 4.19 hereof; (iii) all Collateral (except as provided in Article 8 hereof) upon discharge or defeasance of this Indenture in accordance with Article 8 or
Article 12 hereof, (iv) the assets and Capital Stock and related Collateral of a Subsidiary Guarantor whose Note Guarantee is released pursuant to Section 11.05 hereof; and
(v) Collateral to be released pursuant to the consent of the Holders of the Notes pursuant to Section 9.02 hereof. Upon receipt of such Officers' Certificate the Collateral Agent shall
execute, deliver or acknowledge any necessary or proper instruments of termination, satisfaction or release to evidence the release of any Collateral permitted to be released pursuant to this
Indenture or the Collateral Documents. 


    (b) No
Collateral shall be released from the Lien and security interest created by the Collateral Documents pursuant to the provisions of the Collateral Documents
unless there shall have been delivered to the Collateral Agent the certificate required by this Section 10.03. 


    (c) At
any time when a Default or Event of Default shall have occurred and be continuing and the maturity of the Notes shall have been accelerated (whether by
declaration or otherwise) and the Trustee shall have delivered a notice of acceleration to the Collateral Agent, no release of Collateral pursuant to the provisions of the Collateral Documents shall
be effective as against the Holders of Notes. 


    (d) The
release of any Collateral from the terms of this Indenture and the Collateral Documents shall not be deemed to impair the security under this Indenture in
contravention of the provisions hereof if and to the extent the Collateral is released pursuant to the terms hereof. To the extent applicable, the Company shall cause TIA § 313(b),
relating to reports, and TIA § 314(d), relating to the release of property or securities from the Lien and security interest of the Collateral Documents and relating to the substitution
therefor of any property or securities to be subjected to the Lien and security interest of the Collateral Documents, to be complied with. Any certificate or opinion required by TIA §
314(d) may be made by an Officer of the Company except in cases where TIA § 314(d) requires that such certificate or opinion be made by an independent Person, which Person shall be an
independent engineer, appraiser or other expert selected or approved by the Trustee and the Collateral Agent in the exercise of reasonable care. 


Section 10.04.  CERTIFICATES OF THE COMPANY.  


    The Company shall furnish to the Trustee and the Collateral Agent, prior to each proposed release of Collateral pursuant to the Collateral Documents,
(i) all documents required by TIA §314(d) and (ii) an Opinion of Counsel, which may be rendered by internal counsel to the Company, to the effect that such accompanying
documents constitute all documents required by TIA §314(d). The Trustee may, to the extent permitted by Sections 7.01 and 7.02 hereof, 






82 



accept
as conclusive evidence of compliance with the foregoing provisions the appropriate statements contained in such documents and such Opinion of Counsel. 


Section 10.05.  AUTHORIZATION OF ACTIONS TO BE TAKEN BY THE TRUSTEE UNDER THE COLLATERAL DOCUMENTS.  


    Subject to the provisions of Section 7.01 and 7.02 hereof, the Trustee may, but it is not obligated, in its sole discretion and without the consent of
the Holders of Notes, direct, on behalf of the Holders of Notes, the Collateral Agent to, take all actions it deems necessary or appropriate in order to (a) enforce any of the terms of the
Collateral Documents and (b) collect and receive any and all amounts payable in respect of the Obligations of the Company hereunder. The Trustee shall have power, but it is not
obligated, to institute and maintain such suits and proceedings as it may deem expedient to prevent any impairment of the Collateral by any acts that may be unlawful or in violation of the Collateral
Documents or this Indenture, and such suits and proceedings as the Trustee may deem expedient to preserve or protect its interests and the interests of the Holders of Notes in the Collateral
(including power to institute and maintain suits or proceedings to restrain the enforcement of or compliance with any legislative or other governmental enactment, rule or order that may be
unconstitutional or otherwise invalid if the enforcement of, or compliance with, such enactment, rule or order would impair the security interest hereunder or be prejudicial to the interests of the
Holders of Notes or of the Trustee). 


Section 10.06.  AUTHORIZATION OF RECEIPT OF FUNDS BY THE TRUSTEE UNDER THE COLLATERAL DOCUMENTS.  


    The Trustee is authorized to receive any funds for the benefit of the Holders of Notes distributed under the Collateral Documents, and to make further
distributions of such funds to the Holders of Notes according to the provisions of this Indenture. 


Section 10.07.  TERMINATION OF SECURITY INTEREST.  


    Upon the payment in full of all Obligations of the Company under this Indenture and the Notes, or upon Legal Defeasance, the Trustee shall, at the request of
the Company, deliver a certificate to the Collateral Agent stating that such Obligations have been paid in full, and instruct the Collateral Agent to release the Liens pursuant to this Indenture and
the Collateral Documents. 


 
 

ARTICLE XI.
  NOTE GUARANTEES    



Section 11.01.  NOTE GUARANTEES.  


    Subject to this Article 11, each of the Subsidiary Guarantors hereby, jointly and severally, unconditionally guarantees to each Holder of a Note
authenticated and delivered by the Trustee and to the Trustee and its successors and assigns, irrespective of the validity and enforceability of this Indenture, the Notes or the obligations of the
Company hereunder or thereunder, that: (a) the principal of and interest on the Notes will be promptly paid in full when due, whether at maturity, by acceleration, redemption or otherwise, and
interest on the overdue principal of and 


83



interest
on the Notes, if any, if lawful, and all other obligations of the Company to the Holders or the Trustee hereunder or thereunder will be promptly paid in full or performed, all in accordance
with the terms hereof and thereof; and (b) in case of any extension of time of payment or renewal of any Notes or any of such other obligations, that same will be promptly paid in full when due
or performed in accordance with the terms of the extension or renewal, whether at stated maturity, by acceleration or 







otherwise. Failing payment when due of any amount so guaranteed or any performance so guaranteed for whatever reason, the Subsidiary Guarantors shall be jointly and severally obligated to pay the same
immediately. Each Subsidiary Guarantor agrees that this is a guarantee of payment and not a guarantee of collection. 



    The
Subsidiary Guarantors hereby agree that their obligations hereunder shall be unconditional, irrespective of the validity, regularity or enforceability of the Notes or this
Indenture, the absence of any action to enforce the same, any waiver or consent by any Holder of the Notes with respect to any provisions hereof or thereof, the recovery of any judgment against the
Company, any action to enforce the same or any other circumstance which might otherwise constitute a legal or equitable discharge or defense of a guarantor. Each Subsidiary Guarantor hereby waives
diligence, presentment, demand of payment, filing of claims with a court in the event of insolvency or bankruptcy of the Company, any right to require a proceeding first against the Company, protest,
notice and all demands whatsoever and covenant that this Note Guarantee shall not be discharged except by complete performance of the obligations contained in the Notes and this Indenture. 


    If
any Holder or the Trustee is required by any court or otherwise to return to the Company, the Subsidiary Guarantors or any custodian, trustee, liquidator or other similar official
acting in relation to either the Company or the Subsidiary Guarantors, any amount paid by either to the Trustee or such Holder, this Note Guarantee, to the extent theretofore discharged, shall be
reinstated in full force and effect. 


    Each
Subsidiary Guarantor agrees that it shall not be entitled to any right of subrogation in relation to the Holders in respect of any obligations guaranteed hereby until payment in
full of all obligations guaranteed hereby. Each Subsidiary Guarantor further agrees that, as between the Subsidiary Guarantors, on the one hand, and the Holders and the Trustee, on the other hand,
(x) the maturity of the obligations guaranteed hereby may be accelerated as provided in Article 6 hereof for the purposes of this Note Guarantee, notwithstanding any stay, injunction or
other prohibition preventing such acceleration in respect of the obligations guaranteed hereby, and (y) in the event of any declaration of acceleration of such obligations as provided in
Article 6 hereof, such obligations (whether or not due and payable) shall forthwith become due and payable by the Subsidiary Guarantors for the purpose of
this Note Guarantee. The Subsidiary Guarantors shall have the right to seek contribution from any non-paying Subsidiary Guarantor so long as the exercise of such right does not impair the
rights of the Holders under the Guarantee. 


Section 11.02.  LIMITATION ON SUBSIDIARY GUARANTOR LIABILITY.  


    Each Subsidiary Guarantor, and by its acceptance of Notes, each Holder, hereby confirms that it is the intention of all such parties that the Note Guarantee of
such Subsidiary Guarantor not constitute a fraudulent transfer or conveyance for purposes of Bankruptcy Law, the Uniform Fraudulent Conveyance Act, the Uniform Fraudulent Transfer Act or any similar
federal or state 


84



law
to the extent applicable to any Note Guarantee. To effectuate the foregoing intention, the Trustee, the Holders and the Subsidiary Guarantors hereby irrevocably agree that the obligations of such
Subsidiary Guarantor will, after giving effect to such maximum amount and all other contingent and fixed liabilities of such Subsidiary Guarantor that are relevant under such laws, and after giving
effect to any collections from, rights to receive contribution from or payments made by or on behalf of any other Subsidiary Guarantor in respect of the obligations of such other Subsidiary Guarantor
under this Article 11, result in the obligations of such Subsidiary Guarantor under its Note Guarantee not constituting a fraudulent transfer or conveyance. 







Section 11.03.  EXECUTION AND DELIVERY OF NOTE GUARANTEE.  


    To evidence its Note Guarantee set forth in Section 11.01, each Subsidiary Guarantor hereby agrees that a notation of such Note Guarantee substantially
in the form included in Exhibit E hereof shall be endorsed by an Officer of such Subsidiary Guarantor on each Note authenticated and delivered by the Trustee and that this Indenture shall be
executed on behalf of such Subsidiary Guarantor by its President or one of its Vice Presidents. 


    Each
Subsidiary Guarantor hereby agrees that its Note Guarantee set forth in Section 11.01 shall remain in full force and effect notwithstanding any failure to endorse on each
Note a notation of such Note Guarantee. 


    If
an Officer whose signature is on this Indenture or on the Note Guarantee no longer holds that office at the time the Trustee authenticates the Note on which a Note Guarantee is
endorsed, the Note Guarantee shall be valid nevertheless. 


    The
delivery of any Note by the Trustee, after the authentication thereof hereunder, shall constitute due delivery of the Note Guarantee set forth in this Indenture on behalf of the
Subsidiary Guarantors. 


    In
the event that the Company creates or acquires any new Subsidiaries subsequent to the date of this Indenture, if required by Section 4.22 hereof, the Company shall cause
such Subsidiaries to execute supplemental indentures to this Indenture and Note Guarantees in accordance with Section 4.22 hereof and this Article 11, to the extent applicable. 


Section 11.04.  SUBSIDIARY GUARANTORS MAY CONSOLIDATE, ETC., ON CERTAIN TERMS.  


    In case of any such consolidation, merger, sale or conveyance and upon the assumption by the successor Person, by supplemental indenture, executed and
delivered to the Trustee and satisfactory in form to the Trustee, of the Note Guarantee endorsed upon the Notes and the due and punctual performance of all of the covenants and conditions of this
Indenture to be performed by the Subsidiary Guarantor, such successor Person shall succeed to and be substituted for the Subsidiary Guarantor with the same effect as if it had been named herein as a
Subsidiary Guarantor. Such successor Person thereupon may cause to be signed any or all of the Note Guarantees to be endorsed upon all of the Notes issuable hereunder which theretofore shall not have
been signed by the Company and delivered to the Trustee. All the Note Guarantees so issued shall in all respects have the same legal rank and benefit under this Indenture as the Note Guarantees
theretofore and thereafter issued in accordance with the terms of this Indenture as though all of such Note Guarantees had been issued at the date of the execution hereof. 


85



    Except
as set forth in Articles 4 and 5 hereof, and notwithstanding clauses (a) and (b) above, nothing contained in this Indenture or in any of the Notes shall prevent
any consolidation or merger of a
Subsidiary Guarantor with or into the Company or another Subsidiary Guarantor, or shall prevent any sale or conveyance of the property of a Subsidiary Guarantor as an entirety or substantially as an
entirety to the Company or another Subsidiary Guarantor. 


Section 11.05.  RELEASES OF NOTE GUARANTEES.  


    (a) In
the event of a sale or other disposition of substantially all of the assets of any Subsidiary Guarantor (including by way of merger or consolidation), or a sale
or other disposition of all of the Capital Stock of any Subsidiary Guarantor, in each case to a Person that is not (either before or after giving effect to such transactions) a Restricted Subsidiary
of the Company, then such Subsidiary Guarantor (in the event of a sale or other disposition, by way of merger, consolidation or otherwise, of all of the capital stock of such Subsidiary Guarantor) or
the corporation acquiring the property (in the event of a sale or other disposition of all or substantially all of the assets of such Subsidiary Guarantor) 







shall be released and relieved of any obligations under its Note Guarantee; provided that the Net Proceeds of such sale or other disposition are applied
in accordance with the applicable provisions of this Indenture, including without limitation Section 4.10 hereof. Upon delivery by the Company to the Trustee of an Officers' Certificate and an
Opinion of Counsel to the effect that such sale or other disposition was made by the Company in accordance with the provisions of this Indenture, including without limitation Section 4.10
hereof, the Trustee shall execute any documents reasonably required in order to evidence the release of any Subsidiary Guarantor from its obligations under its Note Guarantee. 


    (b) In
the event the Company properly designates any Restricted Subsidiary that is a Subsidiary Guarantor as an Unrestricted Subsidiary pursuant to the terms of this
Indenture, such Subsidiary Guarantor shall be released and relieved of any obligations under its Note Guarantee. 



    (c) Any
Subsidiary Guarantor not released from its obligations under its Note Guarantee shall remain liable for the full amount of principal of and interest on the
Notes and for the other obligations of any Subsidiary Guarantor under this Indenture as provided in this Article 11. 


 
 

ARTICLE XII.
  SATISFACTION AND DISCHARGE    




Section 12.01.  SATISFACTION AND DISCHARGE.  


    This Indenture will be discharged and will cease to be of further effect as to all Notes issued hereunder, when: 



    (1) either:




    (a) all
Notes that have been authenticated (except lost, stolen or destroyed Notes that have been replaced or paid and Notes for whose payment money has theretofore 




86





been
deposited in trust and thereafter repaid to the Company) have been delivered to the Trustee for cancellation; or 



    (b) all
Notes that have not been delivered to the Trustee for cancellation have become due and payable by reason of the making of a notice of redemption or otherwise or
will become due and payable within one year and the Company or any Subsidiary Guarantor has irrevocably deposited or caused to be deposited with the Trustee as trust funds in trust solely for the
benefit of the Holders, cash in U.S. dollars, non-callable Government Securities, or a combination thereof, in such amounts as will be sufficient without consideration of any reinvestment
of interest, to pay and discharge the entire indebtedness on the Notes not delivered to the Trustee for cancellation for principal, premium and Liquidated Damages, if any, and accrued interest to the
date of maturity or redemption; 




    (2) no
Default or Event of Default shall have occurred and be continuing on the date of such deposit or shall occur as a result of such deposit and such deposit will
not result in a breach or violation of, or constitute a default under, any other instrument to which the Company or any Subsidiary Guarantor is a party or by which the Company or any Subsidiary
Guarantor is bound; 


    (3) the
Company or any Subsidiary Guarantor has paid or caused to be paid all sums payable by it under this Indenture; and 



    (4) the
Company has delivered irrevocable instructions to the Trustee under this Indenture to apply the deposited money toward the payment of the Notes at maturity or
the redemption date, as the case may be. 




In
addition, the Company must deliver an Officers' Certificate and an Opinion of Counsel to the Trustee stating that all conditions precedent to satisfaction and discharge have been satisfied. 







    Notwithstanding the satisfaction and discharge of this Indenture, if money shall have been deposited with the Trustee pursuant to subclause (b) of clause (1) of this
Section, the provisions of Section 12.02 and Section 8.06 shall survive such satisfaction and discharge. 


Section 12.02.  APPLICATION OF TRUST MONEY.  


    Subject to the provisions of Section 8.06, all money deposited with the Trustee pursuant to Section 12.01 shall be held in trust and applied by
it, in accordance with the provisions of the Notes and this Indenture, to the payment, either directly or through any Paying Agent (including the Company acting as its own Paying Agent) as the Trustee
may determine, to the Persons entitled thereto, of the principal (and premium, if any) and interest for whose payment such money has been deposited with the Trustee;  provided, however, such money need not be segregated from other funds except to the extent required by
law. 


    If
the Trustee or Paying Agent is unable to apply any money or Government Securities in accordance with Section 12.01 by reason of any legal proceeding or by reason of any
order or judgment of any court or governmental authority enjoining, restraining or otherwise prohibiting such application, the Company's and any Subsidiary Guarantor's obligations under this 


87 


Indenture
and the Notes shall be revived and reinstated as though no deposit had occurred pursuant to Section 12.01; provided that if the Company
has made any payment of principal of, premium, if any, or
interest on any Notes because of the reinstatement of its obligations, the Company shall be subrogated to the rights of the Holders of such Notes to receive such payment from the money or Government
Securities held by the Trustee or Paying Agent. 


 
 

ARTICLE XIII.
  MISCELLANEOUS    



Section 13.01.  TRUST INDENTURE ACT CONTROLS.  


    If any provision of this Indenture limits, qualifies or conflicts with the duties imposed by TIA §318(c), the imposed duties shall control. 


Section 13.02.  NOTICES.  


    Any notice, request or communication by the Company, any Subsidiary Guarantor or the Trustee to the others is duly given if in writing and delivered in Person
or mailed by first class mail (registered or certified, return receipt requested), telex, telecopier or overnight air courier guaranteeing next day delivery, to the others' address: 


    If
to the Company and/or any Subsidiary Guarantor: 



Herbst
Gaming, Inc.

3440 West Russell Road

Las Vegas, Nevada 89118

Telecopier No.: (702) 740-4630

Attention: Mary E. Higgins 




    With
a copy to: 



Kummer
Kaempfer Bonner & Renshaw

3800 Howard Hughes Parkway

Seventh Floor

Las Vegas, Nevada 89109

Telecopier No.: (702) 796-7181

Attention: John N. Brewer, Esq. 







    If
to the Trustee: 



The
Bank of New York

101 Barclay Street

New York, NY 10286

Telecopier No.: (212) 815-5915

Attention: Corporate Trust Administration 



88 


    The
Company, any Subsidiary Guarantor or the Trustee, by notice to the others may designate additional or different addresses for subsequent notices or communications. 


    All
notices, requests and communications (other than those sent to Holders) shall be deemed to have been duly given: at the time delivered by hand, if personally delivered; five
Business Days after being deposited in the mail, postage prepaid, if mailed; when answered back, if telexed; when receipt acknowledged, if telecopied; and the next Business Day after timely delivery
to the courier, if sent by overnight air courier guaranteeing next day delivery. 


    Any
notice or communication to a Holder shall be mailed by first class mail, certified or registered, return receipt requested, or by overnight air courier guaranteeing next day
delivery to its address shown on the register kept by the Registrar. Any notice or communication shall also be so mailed to any Person described in TIA § 313(c), to the extent required by
the TIA. Failure to mail a notice or communication to a Holder or any defect in it shall not affect its sufficiency with respect to other Holders. 


    If
a notice or communication is mailed in the manner provided above within the time prescribed, it is duly given, whether or not the addressee receives it. 



    If
the Company mails a notice or communication to Holders, it shall mail a copy to the Trustee and each Agent at the same time. 


Section 13.03.  COMMUNICATION BY HOLDERS OF NOTES WITH OTHER HOLDERS OF NOTES.  


    Holders may communicate pursuant to TIA § 312(b) with other Holders with respect to their rights under this Indenture or the Notes. The Company,
the Subsidiary Guarantors, the Trustee, the Registrar and anyone else shall have the protection of TIA § 312(c). 



Section 13.04.  CERTIFICATE AND OPINION AS TO CONDITIONS PRECEDENT.  


    Upon any request or application by the Company to the Trustee to take any action under this Indenture, the Company shall furnish to the Trustee: 


    (a) an
Officers' Certificate in form and substance reasonably satisfactory to the Trustee (which shall include the statements set forth in Section 13.05 hereof)
stating that, in the opinion of the signers, all conditions precedent and covenants, if any, provided for in this Indenture relating to the proposed action have been satisfied; and 



    (b) an
Opinion of Counsel in form and substance reasonably satisfactory to the Trustee (which shall include the statements set forth in Section 13.05 hereof)
stating that, in the opinion of such counsel, all such conditions precedent and covenants have been satisfied. 






Section 13.05.  STATEMENTS REQUIRED IN CERTIFICATE OR OPINION.  



    Each certificate or opinion with respect to compliance with a condition or covenant provided for in this Indenture (other than a certificate provided pursuant
to TIA § 314(a)(4)) shall comply with the provisions of TIA § 314(e) and shall include: 


89



    (c) a
statement that the Person making such certificate or opinion has read such covenant or condition; 


    (d) a
brief statement as to the nature and scope of the examination or investigation upon which the statements or opinions contained in such certificate or opinion are
based; 


    (e) a
statement that, in the opinion of such Person, he or she has made such examination or investigation as is necessary to enable him to express an informed opinion
as to whether or not such covenant or condition has been satisfied; and 


    (f)  a
statement as to whether or not, in the opinion of such Person, such condition or covenant has been satisfied. 


Section 13.06.  RULES BY TRUSTEE AND AGENTS.  


    The Trustee may make reasonable rules for action by or at a meeting of Holders. The Registrar or Paying Agent may make reasonable rules and set reasonable
requirements for its functions. 


Section 13.07.  NO PERSONAL LIABILITY OF DIRECTORS, OFFICERS, EMPLOYEES AND STOCKHOLDERS.  


    No past, present or future director, officer, employee, incorporator or stockholder of the Company or any Subsidiary Guarantor, as such, shall have any
liability for any obligations of the Company or such Subsidiary Guarantor under the Notes, the Note Guarantees, this Indenture or the Collateral Documents or for any claim based on, in respect of, or
by reason of, such obligations or their creation. Each Holder by accepting a Note waives and releases all such liability. The waiver and release are part of the consideration for issuance of the
Notes. 


Section 13.08.  GOVERNING LAW.  


    THE INTERNAL LAW OF THE STATE OF NEW YORK SHALL GOVERN AND BE USED TO CONSTRUE THIS INDENTURE, THE NOTES AND THE NOTE GUARANTEES WITHOUT GIVING EFFECT TO
APPLICABLE PRINCIPLES OF CONFLICTS OF LAW TO THE EXTENT THAT THE APPLICATION OF THE LAWS OF ANOTHER JURISDICTION WOULD BE REQUIRED THEREBY. 


Section 13.09.  NO ADVERSE INTERPRETATION OF OTHER AGREEMENTS.  


    This Indenture may not be used to interpret any other indenture, loan or debt agreement of the Company or its Subsidiaries or of any other Person. Any such
indenture, loan or debt agreement may not be used to interpret this Indenture. 


Section 13.10.  SUCCESSORS.  


    All agreements of the Company in this Indenture and the Notes shall bind its successors. All agreements of the Trustee in this Indenture shall bind its
successors. All agreements of each Subsidiary Guarantor in this Indenture shall bind its successors, except as otherwise provided in Section 11.05. 






90 


Section 13.11.  SEVERABILITY.  


    In case any provision in this Indenture or in the Notes 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. 


Section 13.12.  COUNTERPART ORIGINALS.  



    The parties may sign any number of copies of this Indenture. Each signed copy shall be an original, but all of them together represent the same agreement. 


Section 13.13.  TABLE OF CONTENTS, HEADINGS, ETC.  


    The Table of Contents, Cross-Reference Table and Headings of the Articles and Sections of this Indenture have been inserted for convenience of reference only,
are not to be considered a part of this Indenture and shall in no way modify or restrict any of the terms or provisions hereof. 


[Signatures
on following page] 


91 








  



 
 

SIGNATURES    




	Dated as of August 24, 2001	 	 	 	 
	 	 	HERBST GAMING, INC.
	

 	
 	

By:	
 	

/s/ EDWARD J. HERBST   

	 	 	Name: Edward J. Herbst

Title: President and CEO
	

 	
 	
E-T-T, INC.
	

 	
 	

By:	
 	

/s/ EDWARD J. HERBST   

	 	 	Name: Edward J. Herbst

Title: President and CEO
	

 	
 	
FLAMINGO PARADISE GAMING, LLC
	

 	
 	

By:	
 	

/s/ EDWARD J. HERBST   

	 	 	Name: Edward J. Herbst

Title: Managing Member
	

 	
 	
MARKET GAMING, INC.
	

 	
 	

By:	
 	

/s/ EDWARD J. HERBST   

	 	 	Name: Edward J. Herbst

Title: President and CEO
	

 	
 	
E-T-T ENTERPRISES, LLC
	

 	
 	

By:	
 	

/s/ EDWARD J. HERBST   

	 	 	Name: Edward J. Herbst

Title: Managing Member
	

 	
 	
CARDIVAN COMPANY
	

 	
 	

By:	
 	

/s/ EDWARD J. HERBST   

	 	 	Name: Edward J. Herbst

Title: President and CEO
	

 	
 	
CORRAL COIN, INC.
	

 	
 	

By:	
 	

/s/ EDWARD J. HERBST   

	 	 	Name: Edward J. Herbst

Title: President and CEO



S–1





 

	

 	
 	
CORRAL COUNTRY COIN, INC.
	

 	
 	

By:	
 	

/s/ EDWARD J. HERBST   

	 	 	Name: Edward J. Herbst

Title: President and CEO







	Attest:	 	 	 	 
	

/s/ JANICE R. DONELSON   
	
 	

 	
 	

 
	Name:	 	Janice R. Donelson	 	 	 	 
	Title:	 	Notary Public-Nevada

no. 99-39315-1

my appt. exp. nov. 20, 2003	 	 	 	 
	

 	
 	

 	
 	
THE BANK OF NEW YORK
	

 	
 	

 	
 	

By:	
 	

/s/ STACEY POINDEXTER   
 Name: Stacey Poindexter

Title: Assistant Treasurer






S–2







 
 

EXHIBIT A1    
  


    [Face of Note]
  




CUSIP/CINS _________ 


103/4%
[Series A] [Series B] Senior Secured Notes due 2008 



	No. ____	 	$_________
	[NAME OF COMPANY]



promises to pay to ________________________________________________________________________ 


or
registered assigns, 


the
principal sum of ________________________________________________________________________ 


Dollars
on September 1, 2008. 


Interest
Payment Dates: March 1 and September 1 


Record
Dates: February 15 and August 15 


Dated:
August 24, 2001 



	 	 	HERBST GAMING, INC.
	

 	
 	

By:	
 	

 
	 	 	 	 	

	 	 	 	 	Name:

Title:
	

 	
 	

By:	
 	

 
	 	 	 	 	

	 	 	 	 	Name:

Title:





	This is one of the Notes referred to in the within-mentioned Indenture:	 	 
	

THE BANK OF NEW YORK,

    as Trustee	
 	

 
	

By:	
 	

  
 Authorized Signatory	
 	

 
	










[Back of Note]

103/4% [Series A] [Series B] Senior Secured Notes due 2008 


THE
SECURITY (OR ITS PREDECESSOR) EVIDENCED HEREBY WAS ORIGINALLY ISSUED IN A TRANSACTION EXEMPT FROM REGISTRATION UNDER SECTION 5 OF THE UNITED STATES SECURITIES ACT OF 1933 (THE "SECURITIES ACT"),
AND THE SECURITY EVIDENCED HEREBY MAY NOT BE OFFERED, SOLD OR OTHERWISE TRANSFERRED IN ABSENCE OF SUCH REGISTRATION OR AN APPLICABLE EXEMPTION THEREFROM. EACH PURCHASER OF THE SECURITY EVIDENCED
HEREBY IS HEREBY NOTIFIED THAT THE SELLER MAY BE RELYING ON THE EXEMPTION FROM THE PROVISIONS OF SECTION 5 OF THE SECURITIES ACT PROVIDED BY RULE 144A THEREUNDER. THE HOLDER OF THE SECURITY EVIDENCED
HEREBY AGREES FOR THE BENEFIT OF THE COMPANY THAT (A) SUCH SECURITY MAY BE RESOLD, PLEDGED OR OTHERWISE TRANSFERRED, ONLY (1) (a) TO A PERSON WHO THE SELLER REASONABLY BELIEVES IS A
QUALIFIED INSTITUTIONAL BUYER (AS DEFINED IN RULE 144A UNDER THE SECURITIES ACT) IN A TRANSACTION MEETING THE REQUIREMENTS OF RULE 144A, (b) IN A TRANSACTION MEETING THE REQUIREMENTS OF RULE
144 UNDER THE SECURITIES ACT, (c) OUTSIDE THE UNITED STATES TO A NON-U.S. PERSON IN A
TRANSACTION MEETING THE REQUIREMENTS OF RULE 904 UNDER THE SECURITIES ACT OR (d) IN ACCORDANCE WITH ANOTHER EXEMPTION FROM THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT (AND BASED UPON AN
OPINION OF COUNSEL IF THE COMPANY SO REQUESTS), (2) TO THE COMPANY OR (3) PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT AND, IN EACH CASE, IN ACCORDANCE WITH ANY APPLICABLE SECURITIES
LAWS OF ANY STATE OF THE UNITED STATES OR ANY OTHER APPLICABLE JURISDICTION AND (B) THE HOLDER WILL, AND EACH SUBSEQUENT HOLDER IS REQUIRED TO, NOTIFY ANY PURCHASER FROM IT OF THE SECURITY
EVIDENCED HEREBY OF THE RESALE RESTRICTIONS SET FORTH IN (A) ABOVE.1 


THIS
GLOBAL NOTE IS HELD BY THE DEPOSITARY (AS DEFINED IN THE INDENTURE GOVERNING THIS NOTE) OR ITS NOMINEE IN CUSTODY FOR THE BENEFIT OF THE BENEFICIAL OWNERS HEREOF, AND IS NOT TRANSFERABLE TO ANY
PERSON UNDER ANY CIRCUMSTANCES EXCEPT THAT (I) THE TRUSTEE MAY MAKE SUCH NOTATIONS HEREON AS MAY BE REQUIRED PURSUANT TO SECTION 2.07 OF THE INDENTURE, (II) THIS GLOBAL NOTE MAY BE
EXCHANGED IN WHOLE BUT NOT IN PART PURSUANT TO SECTION 2.06(a) OF THE INDENTURE, (III) THIS GLOBAL NOTE MAY BE DELIVERED TO THE TRUSTEE FOR CANCELLATION PURSUANT TO SECTION 2.11 OF THE
INDENTURE AND (IV) THIS GLOBAL NOTE 




	1
	This legend should be included on the Restricted Global Notes and Restricted Definitive Notes and omitted from Unrestricted Global Notes and
Unrestricted Definitive Notes  


A1-2






MAY BE TRANSFERRED TO A SUCCESSOR DEPOSITARY WITH THE PRIOR WRITTEN CONSENT OF THE COMPANY.2 


    Capitalized
terms used herein shall have the meanings assigned to them in the Indenture referred to below unless otherwise indicated. 


    1.  INTEREST.  Herbst Gaming, Inc., a Nevada corporation (the "Company"), promises to pay interest
on the principal amount of this Note at 103/4% per annum from August 24, 2001 until maturity and shall pay the Liquidated Damages payable pursuant to Section 5 of the
Registration Rights Agreement referred to below. The Company will pay interest and Liquidated Damages semi-annually in arrears on March 1 and September 1 of each year, or if
any such day is not a Business Day, on the 







next succeeding Business Day (each an "Interest Payment Date"). Interest on the Notes will accrue from the most recent date to which interest has been paid or, if no interest has been paid, from the
date of issuance; provided that if there is no existing Default in the payment of interest, and if this Note is authenticated between a record date
referred to on the face hereof and the next succeeding Interest Payment Date, interest shall accrue from such next succeeding Interest Payment Date;  provided, further, that the first Interest Payment Date shall be March 1, 2002. The Company shall
pay interest (including post-petition interest in any proceeding under any Bankruptcy Law) on overdue principal and premium, if any, from time to time on demand at a rate that is 1% per
annum in excess of the rate then in effect; it shall pay interest (including post-petition interest in any proceeding under any Bankruptcy Law) on overdue installments of interest and
Liquidated Damages (without regard to any applicable grace periods) from time to time on demand at the same rate to the extent lawful. Interest will be computed on the basis of a 360-day
year of twelve 30-day months. 


    2.  METHOD OF PAYMENT.  The Company will pay interest on the Notes (except defaulted interest) and
Liquidated Damages to the Persons who are registered Holders of Notes at the close of business on the February 15 or August 15 next preceding the Interest Payment Date, even if such
Notes are canceled after such record date and on or before such Interest Payment Date, except as provided in Section 2.12 of the Indenture with respect to defaulted interest. The Notes will be
payable as to principal, premium and Liquidated Damages, if any, and interest at the office or agency of the Company maintained for such purpose within or without the City and State of New York, or,
at the option of the Company, payment of interest and Liquidated Damages may be made by check mailed to the Holders at their addresses set forth in the register of Holders, and  provided that payment by
wire transfer of immediately available funds will be required with respect to principal of and interest, premium and Liquidated
Damages on, all Global Notes and all other Notes held by a Holder of at least $2.5 million in aggregate principal amount of Notes if such Holder shall have provided wire transfer instructions
to the Company or the Paying Agent. Such payment shall be in such coin or currency of the United States of America as at the time of payment is legal tender for payment of public and private debts. 


    3.  PAYING AGENT AND REGISTRAR.  Initially, The Bank of New York, the Trustee under the Indenture, will
act as Paying Agent and Registrar. The Company may change any Paying Agent or Registrar without notice to any Holder. The Company or any of its Subsidiaries may act in any such capacity. 




	2
	This legend should be included on the Global Notes and omitted from Definitive Notes  


A1-3






    4.  INDENTURE AND COLLATERAL DOCUMENTS.  The Company issued the Notes under an
Indenture dated as of August 24, 2001 ("Indenture") among the Company, the Subsidiary Guarantors and the Trustee. The terms of the Notes include those stated in the Indenture and those made
part of the Indenture by reference to the Trust Indenture Act of 1939, as amended (15 U.S. Code §§ 77aaa-77bbbb). The Notes are subject to all such terms, and
Holders are referred to the Indenture and such Act for a statement of such terms. To the extent any provision of this Note conflicts with the express provisions of the Indenture, the provisions of the
indenture shall govern and be controlling. The Notes are secured obligations of the Company limited to $170.0 million in aggregate principal amount, plus the aggregate principal amount of
Additional Notes issued in accordance with the Indenture; provided, that the Company may only issue Additional Notes under the Indenture if at the time
of such issuance the Fixed Charge Coverage Ratio for the Company's most recently ended four full fiscal quarters for which internal financial statements are available immediately preceding the date on
which such Additional Notes are issued would have been at least 2.0 to 1.0, determined on a pro forma basis (including the pro forma application of the net proceeds therefrom) as if the Additional
Notes had been issued at the beginning of such four-quarter period. The Notes are secured by the collateral set forth in the Collateral Documents. 







    5.  OPTIONAL REDEMPTION.  


    (a) Except
as set forth in subparagraph (b) of this Paragraph 5, the Company shall not have the option to redeem the Notes prior to September 1,
2005. On or after September 1, 2005, the Company shall have the option to redeem the Notes, in whole or in part, at the redemption prices (expressed as percentages of principal amount) set
forth below plus accrued and unpaid interest and Liquidated Damages thereon, if any, to the applicable redemption date, if redeemed during the twelve-month period beginning on September 1 of
the years indicated below: 



	Year
 
	 	Percentage
	 
	2005	 	105.375	%
	2006	 	102.688	%
	2007 and thereafter	 	100.000	%






    (b) Notwithstanding
the provisions of subparagraph (a) of this Paragraph 5, at any time prior to September 1, 2004, the Company may redeem up to
35% of the aggregate principal amount of Notes at a redemption price equal to 110.75% of the aggregate principal amount thereof, plus accrued and unpaid interest and Liquidated Damages, if any, to the
redemption date, with the net proceeds of an Initial Public Offering by the Company; provided (i) that at least 65% of the aggregate principal
amount of the Notes remain outstanding immediately after the occurrence of such redemption and that (ii) the redemption occurs within 45 days of the date of the closing of such Initial
Public Offering. 


    6.  MANDATORY DISPOSITION OR REDEMPTION PURSUANT TO GAMING LAWS.  


    If
any Gaming Authority requires that a Holder or Beneficial Owner of Notes be licensed, qualified or found suitable under any applicable Gaming Law and such Holder or Beneficial
Owner (i) fails to apply for a license, qualification or a finding of suitability within 30 days (or such shorter period as may be required by the applicable Gaming Authority) after
being 


A1-4



requested
to do so by the Gaming Authority or (ii) is denied such license or qualification or not found suitable the Company shall have the right, at its option (1) to require any such
Holder or Beneficial Owner to dispose of its Notes within 30 days (or such earlier date as may be required by the applicable Gaming Authority) of the occurrence of the event described in
clause (i) or (ii) above or (2) to redeem the Notes of such Holder or Beneficial Owner at a redemption price equal to the least of (x) the principal amount thereof,
together with accrued and unpaid interest and Liquidated Damages, if any, to the earlier of the date of redemption or the date of the denial of license or qualification or of the finding of
unsuitability by such Gaming Authority (y) the price at which such Holder or Beneficial Owner acquired the Notes, together with accrued and unpaid interest and Liquidated Damages, if any, to
the earlier of the date of redemption or the date of the denial of license or qualification or of the
finding of unsuitability by such Gaming Authority; and (z) such other lesser amount as may be required by any Gaming Authority. The Company shall notify the Trustee in writing of any redemption
pursuant to this Section 3.09 as soon as practicable. 


    Immediately
upon a determination by a Gaming Authority that a Holder or Beneficial Owner of the Notes will not be licensed, qualified or found suitable, the Holder or Beneficial Owner
will, to the extent required by applicable law, have no further right (i) to exercise, directly or indirectly, through any trustee or nominee or any other person or entity, any right conferred
by the Notes; or (ii) to receive any interest, dividend, economic interests or any other distributions or payments with respect to the Notes or any remuneration in any form with respect to the
Notes from the Company, the Subsidiary Guarantors or the Trustee. 


    The
Holder or Beneficial Owner that is required to apply for a license, qualification or a finding of suitability shall pay all fees and costs of applying for and obtaining the
license, qualification or finding of suitability and of any investigation by the applicable Gaming Authorities. 








    7.  MANDATORY REDEMPTION.  Except as set forth in paragraph 8 below, the Company shall not be
required to make mandatory redemption payments with respect to the Notes. 


    8.  REPURCHASE AT OPTION HOLDER.  


    (a) If
there is a Change of Control, the Company shall be required to make an offer (a "Change of Control Offer") to repurchase all or any part (equal to $1,000 or an
integral multiple thereof) of each Holder's Notes at a purchase price equal to 101% of the aggregate principal amount thereof plus accrued and unpaid interest and Liquidated Damages thereon, if any,
to the date of purchase (the "Change of Control Payment"). Within 10 days following any Change of Control, the Company shall mail a notice to each Holder setting forth the procedures governing
the Change of Control Offer as required by the Indenture. 


    (b) If
the Company or a Restricted Subsidiary consummates any Asset Sales, within five days of each date on which the aggregate amount of Excess Proceeds exceeds
$5.0 million, the Company shall commence an offer (an"Asset Sale Offer") to all Holders of Notes and all holders of other Indebtedness that is pari passu with the Notes containing provisions
similar to those set forth in the Indenture with respect to offers to purchase or redeem with the proceeds of sales of 


A1-5 


assets,
pursuant to Section 3.10 of the Indenture, to purchase the maximum principal amount of Notes and such other Indebtedness that may be purchased out of the Excess Proceeds at an offer
price in cash in an amount equal to 100% of the principal amount plus accrued and unpaid interest and Liquidated Damages, if any, to the date fixed for the closing of such offer, in accordance with
the procedures set forth in the Indenture. If any Excess Proceeds remain after consummation of an Asset Sale Offer, the Company may use such Excess Proceeds for any purpose not otherwise prohibited by
this Indenture and the Collateral Documents. If the aggregate principal amount of Notes and such other Indebtedness surrendered by Holders thereof exceeds the amount of Excess Proceeds, the Trustee
shall select the Notes and such other Indebtedness to be purchased on a pro rata basis based on the principal amount of Notes and any other Indebtedness tendered. Holders of Notes that are the subject
of an offer to purchase will receive an Asset Sale Offer from the Company prior to any related purchase date and may elect to have such Notes purchased by completing the form entitled "Option of
Holder to Elect Purchase" on the reverse of the Notes. 


    (c) If
the Company or a Restricted Subsidiary experiences an Event of Loss and, within five days of each date on which the aggregate amount of Excess Loss Proceeds
exceeds $5.0 million, the Company shall commence an offer (an"Event of Loss Offer") to all Holders of Notes and all holders of other Indebtedness that is pari
passu with the Notes containing provisions similar to those set forth in the Indenture with respect to offers to purchase or redeem with the proceeds of Events of Loss,
pursuant to Section 3.10 of the Indenture, to purchase the maximum principal amount of Notes and such other Indebtedness that may be purchased out of the Excess Loss Proceeds at an offer price
in cash in an amount equal to 100% of the principal amount plus accrued and unpaid interest and Liquidated Damages, if any, to the date fixed for the closing of such offer, in accordance with the
procedures set forth in the Indenture. If any Excess Loss Proceeds remain after consummation of an Event of Loss Offer, the Company may use such Excess Loss Proceeds for any purpose not otherwise
prohibited by this Indenture and the Collateral Documents. If the aggregate principal amount of Notes and such other Indebtedness surrendered by Holders thereof exceeds the amount of Excess Loss
Proceeds, the Trustee shall select the Notes and such other Indebtedness to be purchased on a pro rata basis based on the principal amount of Notes and
any other Indebtedness tendered. Holders of Notes that are the subject of an offer to purchase will receive an Event of Loss Offer from the Company prior to any related purchase date and may elect to
have such Notes purchased by completing the form entitled "Option of Holder to Elect Purchase" on the reverse of the Notes. 


    9.  NOTICE OF REDEMPTION.  Notice of redemption will be mailed at least 30 days but not more than
60 days before the redemption date to each Holder whose Notes are to be redeemed at its 







registered address. Notes in denominations larger than $1,000 may be redeemed in part but only in whole multiples of $1,000, unless all of the Notes held by a Holder are to be redeemed. On and after
the redemption date interest ceases to accrue on Notes or portions thereof called for redemption. 


    10.  DENOMINATIONS, TRANSFER, EXCHANGE.  The Notes are in registered form without coupons in
denominations of $1,000 and integral multiples of $1,000. The transfer of Notes may be registered and Notes may be exchanged as provided in the Indenture. The Registrar and the Trustee may require a
Holder, among other things, to furnish appropriate endorsements and transfer documents and the Company may require a Holder to pay any taxes and fees required by 


A1-6



law
or permitted by the Indenture. The Company need not exchange or register the transfer of any Note or portion of a Note selected for redemption, except for the unredeemed portion of any Note being
redeemed in part. Also, the Company need not exchange or register the transfer of any Notes for a period of 15 days before a selection of Notes to be redeemed or during the period between a
record date and the corresponding Interest Payment Date. 


    11.  PERSONS DEEMED OWNERS.  The registered Holder of a Note may be treated as its owner for all
purposes. 


    12.  AMENDMENT, SUPPLEMENT AND WAIVER.  Subject to certain exceptions, the Indenture, the Notes, the Note
Guarantees or the Collateral Documents may be amended or supplemented with the consent of the Holders of at least a majority in principal amount of the then outstanding Notes and any existing default
or compliance with any provision of the Indenture, the Notes, the Note Guarantees or the Collateral Documents may be waived with the consent of the Holders of a majority in principal amount of the
then outstanding Notes. Notwithstanding the foregoing, any amendment to, or waiver of, the provisions of any of the Collateral Documents relating to Section 4.12 or Article 10 of the
Indenture or any release, termination or reconveyance of any of the Collateral Documents or any of the Liens created or perfected thereby shall require the consent of the Holders of at least 66?% in
aggregate principal amount of the Notes then outstanding. Without the consent of any Holder of a Note, the Indenture, the Notes or the Note Guarantees may be amended or supplemented to cure any
ambiguity, defect or inconsistency, to provide for uncertificated Notes in addition to or in place of certificated Notes, to provide for the assumption of the Company's or Subsidiary Guarantor's
obligations to Holders of the Notes in case of a merger or consolidation, to make any change that would provide any additional rights or benefits to the Holders of the Notes or that does not adversely
affect the legal rights under the Indenture of any such Holder, to comply with the requirements of the SEC in order to effect or maintain the qualification of the Indenture under the Trust Indenture
Act, to provide for the Issuance of Additional Notes in accordance with the limitations set forth in the Indenture, to allow any Subsidiary Guarantor to execute a supplemental indenture to the
Indenture and/or a Note Guarantee with respect to the Notes, or to enter into additional or supplemental Collateral Documents. 


    13.  DEFAULTS AND REMEDIES.  Events of Default include: (i) default for 30 days in the
payment when due of interest or Liquidated Damages on the Notes; (ii) default in payment when due of principal of or premium, if any, on the Notes when the same becomes due and payable at
maturity, upon redemption (including in connection with an offer to purchase) or otherwise; (iii) failure by the Company or any of its Restricted Subsidiaries to comply with
Section 4.07, 4.09, 4.10, 4.19 or 5.01 of the Indenture; (iv) default or breach by the Company or any of its Restricted Subsidiaries of any material covenant, condition or agreement
contained in the Collateral Documents; (v) failure by the Company for 60 days after notice to the Company by the Trustee or the Holders of at least 25% in aggregate principal amount of
the Notes then outstanding voting as a single class to comply with certain other agreements in the Indenture or the Notes; (vi) default under certain other agreements relating to Indebtedness
of the Company which default is caused by a Payment Default or results in the acceleration of such Indebtedness prior to its express maturity, and, in each case, the principal amount of any such
Indebtedness, together with the principal amount of any other such Indebtedness under 







which there has been a Payment Default or the maturity of which has been so accelerated, is $5.0 million or more in the 


A1-7



aggregate;
(vii) certain final judgments for the payment of money that remain undischarged for a period of 60 days; (viii) any of the Collateral Documents ceasing, for any reason
(other than pursuant to the terms thereof), to be in full force and effect, or the Company so asserting, or any security interest created, or purported to be created, by any of the Collateral
Documents ceasing to be enforceable and of the same effect and priority purported to be created thereby, (ix) except as permitted by the Indenture, any Note Guarantee being held in any judicial
proceeding to be unenforceable or invalid or ceasing for any reason to be in full force and effect or any Subsidiary Guarantor, or any Person acting on behalf of a Subsidiary Guarantor, denying or
disaffirming its obligations under its Guarantee; (x) any representation or warranty made by the Company or any of its Restricted Subsidiaries in any Collateral Documents or that is contained
in any certificate, document or financial or other statement furnished by any of them at any time or in connection with any such Collateral Document proving to have been inaccurate in any material
respect on or as of the date made or deemed made; and (xi) certain events of bankruptcy or insolvency with respect to the Company or any of its Significant Subsidiaries. If any Event of Default
occurs and is continuing, the Trustee or the Holders of at least 25% in principal amount of the then outstanding Notes may declare all the Notes to be due and payable. Notwithstanding the foregoing,
in the case of an Event of Default arising from certain events of bankruptcy or insolvency, all outstanding Notes will become due and payable without further action or notice. Holders may not enforce
the Indenture or the Notes except as provided in the Indenture. Subject to certain limitations, Holders of a majority in principal amount of the then outstanding Notes may direct the Trustee in its
exercise of any trust or power. The Trustee may withhold from Holders of the Notes notice of any continuing Default or Event of Default (except a Default or Event of Default relating to the payment of
principal or interest) if it determines that withholding notice is in their interest. The Holders of a majority in aggregate principal amount of the Notes then outstanding by
notice to the Trustee may on behalf of the Holders of all of the Notes waive any existing Default or Event of Default and its consequences under the Indenture except a continuing Default or Event of
Default in the payment of interest on, or the principal of, the Notes. The Company is required to deliver to the Trustee annually a statement regarding compliance with the Indenture and the Collateral
Documents, and the Company is required upon becoming aware of any Default or Event of Default, to deliver to the Trustee a statement specifying such Default or Event of Default. 


    14.  TRUSTEE DEALINGS WITH COMPANY.  The Trustee, in its individual or any other capacity, may make loans
to, accept deposits from, and perform services for the Company or its Affiliates, and may otherwise deal with the Company or its Affiliates, as if it were not the Trustee. 


    15.  NO RECOURSE AGAINST OTHERS.  No past, present or future director, officer, employee, incorporator or
stockholder of the Company or any Subsidiary Guarantor, as such, shall have any liability for any obligations of the Company or such Subsidiary Guarantor under the Notes, the Note Guarantees, this
Indenture or the Collateral Documents or for any claim based on, in respect of, or by reason of, such obligations or their creation. Each Holder by accepting a Note waives and releases all such
liability. The waiver and release are part of the consideration for issuance of the Notes. 


    16.  AUTHENTICATION.  This Note shall not be valid until authenticated by the manual signature of the
Trustee or an authenticating agent. 


A1-8



    17.  ABBREVIATIONS.  Customary abbreviations may be used in the name of a Holder or an assignee, such as:
TEN COM (= tenants in common), TEN ENT (= tenants by the entireties), JT 







TEN (= joint tenants with right of survivorship and not as tenants in common), CUST (= Custodian), and U/G/M/A (= Uniform Gifts to Minors Act). 


    18.  ADDITIONAL RIGHTS OF HOLDERS OF RESTRICTED GLOBAL NOTES AND RESTRICTED DEFINITIVE NOTES.  In
addition to the rights provided to Holders of Notes under the Indenture, Holders of Restricted Global Notes and Restricted Definitive Notes shall have all the rights set forth in
the A/B Exchange Registration Rights Agreement dated as of August 24, 2001, among the Company and the parties named on the signature pages thereof (the "Registration Rights Agreement"). 



    19.  CUSIP NUMBERS.  Pursuant to a recommendation promulgated by the Committee on Uniform Security
Identification Procedures, the Company has caused CUSIP numbers to be printed on the Notes and the Trustee may use CUSIP numbers in notices of redemption as a convenience to Holders. No representation
is made as to the accuracy of such numbers either as printed on the Notes or as contained in any notice of redemption and reliance may be placed only on the other identification numbers placed
thereon. 


A1-9




    The
Company will furnish to any Holder upon written request and without charge a copy of the Indenture, the Registration Rights Agreement and/or the Collateral Documents. Requests may
be made to: 


Herbst
Gaming, Inc.

3440 West Russell Road 

Las Vegas, Nevada 89118 

Attention: Mary E. Higgins 


A1-10








ASSIGNMENT FORM 


    To
assign this Note, fill in the form below: 



	(I) or (we) assign and transfer this Note to:	 	 
	 	 	
 (Insert assignee's legal name)
	

 (Insert assignee's soc. sec. or tax I.D. no.)
	


	


	


	

 (Print or type assignee's name, address and zip code)
	

and irrevocably appoint ____________________________ to transfer this Note on the books of the Company. The agent may substitute another to act for him.
	

Date:______________	
 	

Your Signature: ____________________________________

(Sign exactly as your name appears on the face of this Note)
	

 	
 	

Signature Guarantee*:____________________________________




	*
	Participant
in a recognized Signature Guarantee Medallion Program (or other signature guarantor acceptable to the Trustee). 


A1-11









OPTION OF HOLDER TO ELECT PURCHASE 


    If
you want to elect to have this Note purchased by the Company pursuant to Section 4.10, 4.15 or 4.19 of the Indenture, check the appropriate box below: 



	/ / Section 4.10	 	/ / Section 4.15	 	/ / Section 4.19





    If
you want to elect to have only part of the Note purchased by the Company pursuant to Section 4.10, Section 4.15 or Section 4.19 of the Indenture, state the
amount you elect to have purchased: 


$____________




	Date: ____________	 	 
	 	 	Your Signature: ____________________________________

(Sign exactly as your name appears on the face of this Note)
	

 	
 	

Tax Identification No.: ________________________
	

Signature Guarantee*: ____________________________________




	*
	Participant
in a recognized Signature Guarantee Medallion Program (or other signature guarantor acceptable to the Trustee). 


A1-12









SCHEDULE OF EXCHANGES OF INTERESTS IN THE GLOBAL NOTE* 


    The
following exchanges of a part of this Global Note for an interest in another Global Note or for a Definitive Note, or exchanges of a part of another Global Note or Definitive Note
for an interest in this Global Note, have been made: 



	Date of

Exchange
	 	Amount of

decrease in

Principal

Amount

of

this Global Note
	 	Amount of

increase in

Principal

Amount

of

this Global Note
	 	Principal

Amount

of this Global

Note following

such decrease

(or increase)
	 	Signature of

authorized

officer of Trustee

or Note

Custodian






*  This schedule should be included only if the Note is issued in global form. 


A1-13










 
 

EXHIBIT A2    
  


[Face of Regulation S Temporary Global Note] 



	

 	

 	
 	

CUSIP/CINS	

  

	

103/4% [Series A] [Series B] Senior Secured Notes due 2008
	

No.  _______	

 	
 	

$	

  

	

[NAME OF COMPANY]
	

promises to pay to	

  

	

or registered assigns,	
 	

 	

 
	

the principal sum of	

  

	

Dollars on September 1, 2008.	
 	

 	

 
	

Interest Payment Dates: March 1 and September 1	
 	

 	

 
	

Record Dates: February 15 and August 15	
 	

 	

 
	

Dated: August 24, 2001	
 	

 	

 





	 	 	 	HERBST GAMING, INC.
	

 	

 	
 	

By:	

  
 Name:

Title:
	

 	

 	
 	

By:	

  
 Name:

Title:
	

This is one of the Notes referred to

in the within-mentioned Indenture:	
 	

 	

 
	

THE BANK OF NEW YORK,

as Trustee	
 	

 	

 
	

By:	

  
 Authorized Signatory	
 	

 	

 







[Back of Regulation S Temporary Global Note]

103/4% [Series A] [Series B] Senior Secured Notes due 2008 


THE
RIGHTS ATTACHING TO THIS REGULATION S TEMPORARY GLOBAL NOTE, AND THE CONDITIONS AND PROCEDURES GOVERNING ITS EXCHANGE FOR CERTIFICATED NOTES, ARE AS SPECIFIED IN THE INDENTURE (AS DEFINED HEREIN).
NEITHER THE HOLDER NOR THE BENEFICIAL OWNERS OF THIS REGULATION S TEMPORARY GLOBAL NOTE SHALL BE ENTITLED TO RECEIVE PAYMENT OF INTEREST HEREON. 


UNLESS
AND UNTIL IT IS EXCHANGED IN WHOLE OR IN PART FOR NOTES IN DEFINITIVE FORM, THIS NOTE MAY NOT BE TRANSFERRED EXCEPT AS A WHOLE BY THE DEPOSITARY TO A NOMINEE OF THE DEPOSITARY OR BY A NOMINEE
OF THE DEPOSITARY TO THE DEPOSITARY OR ANOTHER NOMINEE OF THE DEPOSITARY OR BY THE DEPOSITARY OR ANY SUCH NOMINEE TO A SUCCESSOR DEPOSITARY OR A NOMINEE OF SUCH SUCCESSOR DEPOSITARY. UNLESS THIS
CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY (55 WATER STREET, NEW YORK, NEW YORK) ("DTC"), TO THE COMPANY OR
ITS AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT, AND ANY CERTIFICATE ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR SUCH OTHER NAME AS MAY BE REQUESTED BY AN AUTHORIZED
REPRESENTATIVE OF DTC (AND ANY PAYMENT IS MADE TO CEDE & CO. OR SUCH OTHER ENTITY AS MAY BE REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE
OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL INASMUCH AS THE REGISTERED OWNER HEREOF, CEDE & CO., HAS AN INTEREST HEREIN. 


THE
NOTE (OR ITS PREDECESSOR) EVIDENCED HEREBY WAS ORIGINALLY ISSUED IN A TRANSACTION EXEMPT FROM REGISTRATION UNDER SECTION 5 OF THE UNITED STATES SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES
ACT"), AND THE NOTE EVIDENCED HEREBY MAY NOT BE OFFERED, SOLD OR OTHERWISE TRANSFERRED IN THE ABSENCE OF SUCH REGISTRATION OR AN APPLICABLE EXEMPTION THEREFROM. EACH PURCHASER OF THE NOTE EVIDENCED
HEREBY IS HEREBY NOTIFIED THAT THE SELLER MAY BE RELYING ON THE EXEMPTION PROVIDED BY RULE 144A UNDER THE SECURITIES ACT. THE HOLDER OF THE NOTE EVIDENCED HEREBY AGREES FOR THE BENEFIT OF THE COMPANY
THAT (A) SUCH NOTE MAY BE RESOLD, PLEDGED OR OTHERWISE TRANSFERRED, ONLY (1) (a) TO A PERSON WHO THE SELLER REASONABLY BELIEVES IS A QUALIFIED INSTITUTIONAL BUYER (AS DEFINED IN OF RULE
144A UNDER THE SECURITIES ACT) IN A TRANSACTION MEETING THE REQUIREMENTS OF RULE 144A, (b) IN A TRANSACTION MEETING THE REQUIREMENTS OF RULE 144 UNDER THE SECURITIES ACT, (c) OUTSIDE THE
UNITED STATES TO A FOREIGN PERSON IN A TRANSACTION MEETING THE REQUIREMENTS OF RULE 904 UNDER THE SECURITIES ACT OR (d) IN ACCORDANCE WITH ANOTHER EXEMPTION FROM THE REGISTRATION REQUIREMENTS
OF THE SECURITIES ACT (AND BASED UPON AN OPINION OF COUNSEL IF THE COMPANY SO REQUESTS), (2) TO THE COMPANY 


A2-2



OR
(3) PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT AND, IN EACH CASE, IN ACCORDANCE WITH THE APPLICABLE SECURITIES LAWS OF ANY STATE OF THE UNITED STATES OR ANY OTHER APPLICABLE
JURISDICTION AND (B) THE HOLDER WILL, AND EACH SUBSEQUENT HOLDER IS REQUIRED TO, NOTIFY ANY PURCHASER OF THE NOTE EVIDENCED HEREBY OF THE RESALE RESTRICTIONS SET FORTH IN (1) ABOVE. 







    Capitalized terms used herein shall have the meanings assigned to them in the Indenture referred to below unless otherwise indicated. 


    1.  INTEREST.  Herbst Gaming, Inc., a Nevada corporation (the "Company"), promises to pay interest
on the principal amount of this Note at 103/4% per annum from August 24, 2001 until maturity and shall pay the Liquidated Damages payable pursuant to Section 5 of the
Registration Rights Agreement referred to below. The Company will pay interest and Liquidated Damages semi-annually in arrears on March 1 and September 1 of each year, or if
any such day is not a Business Day, on the next succeeding Business Day (each an "Interest Payment Date"). Interest on the Notes will accrue from the most recent date to which interest has been paid
or, if no interest has been paid, from the date of issuance; provided that if there is no existing Default in the payment of interest, and if this Note
is authenticated between a record date referred to on the face hereof and the next succeeding Interest Payment Date, interest shall accrue from such next succeeding Interest Payment Date;  provided,
further, that the first Interest Payment Date shall be March 1, 2002. The Company shall
pay interest (including post-petition interest in any proceeding under any Bankruptcy Law) on overdue principal and premium, if any, from time to time on demand at a rate that is 1% per
annum in excess of the rate then in effect; it shall pay interest (including post-petition interest in any proceeding under any Bankruptcy Law) on overdue installments of interest and
Liquidated Damages (without regard to any applicable grace periods) from time to time on demand at the same rate to the extent lawful. Interest will be computed on the basis of a 360-day
year of twelve 30-day months. 


    2.  METHOD OF PAYMENT.  The Company will pay interest on the Notes (except defaulted interest) and
Liquidated Damages to the Persons who are registered Holders of Notes at the close of business on the February 15 or August 15 next preceding the Interest Payment Date, even if such
Notes are canceled after such record date and on or before such Interest Payment Date, except as provided in Section 2.12 of the Indenture with respect to defaulted interest. The Notes will be
payable as to principal, premium and Liquidated Damages, if any, and interest at the office or agency of the Company maintained for such purpose within or without the City and State of New York, or,
at the option of the Company, payment of interest and Liquidated Damages may be made by check mailed to the Holders at their addresses set forth in the register of Holders, and  provided that payment by
wire transfer of immediately available funds will be required with respect to principal of and interest, premium and Liquidated
Damages on, all Global Notes and all other Notes held by a Holder of at least $2.5 million in aggregate principal amount of Notes if such Holder shall have provided wire transfer instructions
to the Company or the Paying Agent. Such payment shall be in such coin or currency of the United States of America as at the time of payment is legal tender for payment of public and private debts. 


    3.  PAYING AGENT AND REGISTRAR.  Initially, The Bank of New York, the Trustee under the Indenture, will
act as Paying Agent and Registrar. The Company may change any Paying Agent 


A2-3



or
Registrar without notice to any Holder. The Company or any of its Subsidiaries may act in any such capacity. 


    4.  INDENTURE AND COLLATERAL DOCUMENTS.  The Company issued the Notes under an Indenture dated as of
August 24, 2001 ("Indenture") among the Company, the Subsidiary Guarantors and the Trustee. The terms of the Notes include those stated in the Indenture and those made part of the Indenture by
reference to the Trust Indenture Act of 1939, as amended (15 U.S. Code §§ 77aaa-77bbbb). The Notes are subject to all such terms, and Holders are referred to the
Indenture and such Act for a statement of such terms. To the extent any provision of this Note conflicts with the express provisions of the Indenture, the provisions of the indenture shall govern and
be controlling. The Notes are secured obligations of the Company limited to $170.0 million in aggregate principal amount, plus the aggregate principal amount of Additional Notes issued in
accordance with the Indenture; provided, that the Company may only issue Additional Notes under the Indenture if at the time of such issuance the Fixed
Charge Coverage Ratio for the Company's most recently ended four 







full fiscal quarters for which internal financial statements are available immediately preceding the date on which such Additional Notes are issued would have been at least 2.0 to 1.0, determined on a
pro forma basis (including the pro forma application of the net proceeds therefrom) as if the Additional Notes had been issued at the beginning of such four-quarter period. The Notes are
secured by the collateral set forth in the Collateral Documents. 


    5.  OPTIONAL REDEMPTION.  


    (c) Except
as set forth in subparagraph (b) of this Paragraph 5, the Company shall not have the option to redeem the Notes prior to September 1,
2005. On or after September 1, 2005, the Company shall have the option to redeem the Notes, in whole or in part, at the redemption prices (expressed as percentages of principal amount) set
forth below plus accrued and unpaid interest and Liquidated Damages thereon, if any, to the applicable redemption date, if redeemed during the twelve-month period beginning on September 1 of
the years indicated below: 



	Year
 
	 	Percentage
	 
	2005	 	105.375	%
	2006	 	102.688	%
	2007 and thereafter	 	100.000	%






    (d) Notwithstanding
the provisions of subparagraph (a) of this Paragraph 5, at any time prior to September 1, 2004, the Company may redeem up to
35% of the aggregate principal amount of Notes at a redemption price equal to 110.75% of the aggregate principal amount thereof, plus accrued and unpaid interest and Liquidated Damages, if any, to the
redemption date, with the net proceeds of an Initial Public Offering by the Company; provided (i) that at least 65% of the aggregate principal
amount of the Notes remain outstanding immediately after the occurrence of such redemption and that (ii) the redemption occurs within 45 days of the date of the closing of such Initial
Public Offering. 


    6.  MANDATORY DISPOSITION OR REDEMPTION PURSUANT TO GAMING LAWS.  


A2-4



    If
any Gaming Authority requires that a Holder or Beneficial Owner of Notes be licensed, qualified or found suitable under any applicable Gaming Law and such Holder or Beneficial
Owner (i) fails to apply for a license, qualification or a finding of suitability within 30 days (or such shorter period as may be required by the applicable Gaming Authority) after
being requested to do so by the Gaming Authority or (ii) is denied such license or qualification or not found suitable the Company shall have the right, at its option (1) to require any
such Holder or Beneficial Owner to dispose of its Notes within 30 days (or such earlier date as may be required by the applicable Gaming Authority) of the occurrence of the event described in
clause (i) or (ii) above or (2) to redeem the Notes of such Holder or Beneficial Owner at a redemption price equal to the least of (x) the principal amount thereof,
together with accrued and unpaid interest and Liquidated Damages, if any, to the earlier of the date of redemption or the date of the denial of license or qualification or of the finding of
unsuitability by such Gaming Authority (y) the price at which such Holder or Beneficial Owner acquired the Notes, together with accrued and unpaid interest and Liquidated Damages, if any, to
the earlier of the date of redemption or the date of the denial of license or qualification or of the finding of unsuitability by such Gaming Authority; and (z) such other lesser amount as may
be required by any Gaming Authority. The Company shall notify the Trustee in writing of any redemption pursuant to this Section 3.09 as soon as practicable. 


    Immediately
upon a determination by a Gaming Authority that a Holder or Beneficial Owner of the Notes will not be licensed, qualified or found suitable, the Holder or Beneficial Owner
will, to the extent required by applicable law, have no further right (i) to exercise, directly or indirectly, through any trustee or nominee or any other person or entity, any right conferred
by the Notes; or (ii) to receive any interest, dividend, economic interests or any other distributions or payments with respect to the Notes or any remuneration in any form with respect to the
Notes from the Company, the Subsidiary Guarantors or the Trustee. 







    The Holder or Beneficial Owner that is required to apply for a license, qualification or a finding of suitability shall pay all fees and costs of applying for and obtaining the
license, qualification or finding of suitability and of any investigation by the applicable Gaming Authorities. 


    7.  MANDATORY REDEMPTION.  


    Except
as set forth in paragraph 8 below, the Company shall not be required to make mandatory redemption payments with respect to the Notes. 


    8.  REPURCHASE AT OPTION HOLDER.  


    (a) If
there is a Change of Control, the Company shall be required to make an offer (a "Change of Control Offer") to repurchase all or any part (equal to $1,000 or an
integral multiple thereof) of each Holder's Notes at a purchase price equal to 101% of the aggregate principal amount thereof plus accrued and unpaid interest and Liquidated Damages thereon, if any,
to the date of purchase (the "Change of Control Payment"). Within 10 days following any Change of Control, the Company shall mail a notice to each Holder setting forth the procedures governing
the Change of Control Offer as required by the Indenture. 


A2-5



    (b) If
the Company or a Restricted Subsidiary consummates any Asset Sales, within five days of each date on which the aggregate amount of Excess Proceeds exceeds
$5.0 million, the Company shall commence an offer (an"Asset Sale Offer") to all Holders of Notes and all holders of other Indebtedness that is pari passu with the Notes containing provisions
similar to those set forth in the Indenture with respect to offers to purchase or redeem with the proceeds of sales of assets, pursuant to Section 3.10 of the Indenture, to purchase the maximum
principal amount of Notes and such other Indebtedness that may be purchased out of the Excess Proceeds at an offer price in cash in an amount equal to 100% of the principal amount plus accrued and
unpaid interest and Liquidated Damages, if any, to the date fixed for the closing of such offer, in accordance with the procedures set forth in the Indenture. If any Excess Proceeds remain after
consummation of an Asset Sale Offer, the Company may use such Excess Proceeds for any purpose not otherwise prohibited by this Indenture and the Collateral Documents. If the aggregate principal amount
of Notes and such other Indebtedness
surrendered by Holders thereof exceeds the amount of Excess Proceeds, the Trustee shall select the Notes and such other Indebtedness to be purchased on a pro rata basis based on the principal amount
of Notes and any other Indebtedness tendered. Holders of Notes that are the subject of an offer to purchase will receive an Asset Sale Offer from the Company prior to any related purchase date and may
elect to have such Notes purchased by completing the form entitled "Option of Holder to Elect Purchase" on the reverse of the Notes. 


    (c) If
the Company or a Restricted Subsidiary experiences an Event of Loss and, within five days of each date on which the aggregate amount of Excess Loss Proceeds
exceeds $5.0 million, the Company shall commence an offer (an"Event of Loss Offer") to all Holders of Notes and all holders of other Indebtedness that is pari
passu with the Notes containing provisions similar to those set forth in the Indenture with respect to offers to purchase or redeem with the proceeds of Events of Loss,
pursuant to Section 3.10 of the Indenture, to purchase the maximum principal amount of Notes and such other Indebtedness that may be purchased out of the Excess Loss Proceeds at an offer price
in cash in an amount equal to 100% of the principal amount plus accrued and unpaid interest and Liquidated Damages, if any, to the date fixed for the closing of such offer, in accordance with the
procedures set forth in the Indenture. If any Excess Loss Proceeds remain after consummation of an Event of Loss Offer, the Company may use such Excess Loss Proceeds for any purpose not otherwise
prohibited by this Indenture and the Collateral Documents. If the aggregate principal amount of Notes and such other Indebtedness surrendered by Holders thereof exceeds the amount of Excess Loss
Proceeds, the Trustee shall select the Notes and such other Indebtedness to be purchased on a pro rata basis based on the principal amount of Notes and
any other Indebtedness tendered. Holders of Notes that are the subject of an offer to purchase will receive an Event of Loss Offer from the Company 







prior to any related purchase date and may elect to have such Notes purchased by completing the form entitled "Option of Holder to Elect Purchase" on the reverse of the Notes. 


    9.  NOTICE OF REDEMPTION.  Notice of redemption will be mailed at least 30 days but not more than
60 days before the redemption date to each Holder whose Notes are to be redeemed at its registered address. Notes in denominations larger than $1,000 may be redeemed in part but only in whole
multiples of $1,000, unless all of the Notes held by a Holder are to be redeemed. On and after the redemption date interest ceases to accrue on Notes or portions thereof called for redemption. 


A2-6



    10.  DENOMINATIONS, TRANSFER, EXCHANGE.  The Notes are in registered form without coupons in
denominations of $1,000 and integral multiples of $1,000. The transfer of Notes may be registered and Notes may be exchanged as provided in the Indenture. The Registrar and the Trustee may require a
Holder, among other things, to furnish appropriate endorsements and transfer documents and the Company may require a Holder to pay any taxes and fees required by law or permitted by the Indenture. The
Company need not exchange or register the transfer of any Note or portion of a Note selected for redemption, except for the unredeemed portion of any Note being redeemed in part. Also, the Company
need not exchange or register the transfer of any Notes for a period of 15 days before a selection of Notes to be redeemed or during the period between a record date and the corresponding
Interest Payment Date. 


    11.  PERSONS DEEMED OWNERS.  The registered Holder of a Note may be treated as its owner for all
purposes. 


    12.  AMENDMENT, SUPPLEMENT AND WAIVER.  Subject to certain exceptions, the Indenture, the Notes, the Note
Guarantees or the Collateral Documents may be amended or supplemented with the consent of the Holders of at least a majority in principal amount of the then outstanding Notes and any existing default
or compliance with any provision of the Indenture, the Notes, the Note Guarantees or the Collateral Documents may be waived with the consent of the Holders of a majority in principal amount of the
then outstanding Notes. Notwithstanding the foregoing, any amendment to, or waiver of, the provisions of any of the Collateral Documents relating to Section 4.12 or Article 10 of the
Indenture or any release, termination or reconveyance of any of the Collateral Documents or any of the Liens created or perfected thereby shall require the consent of the Holders of at least
662/3% in aggregate principal amount of the Notes then outstanding. Without the consent of any Holder of a Note, the Indenture, the Notes or the Note Guarantees may be amended or
supplemented to cure any ambiguity, defect or inconsistency, to provide for uncertificated Notes in addition to or in place of certificated Notes, to provide for the assumption of the Company's or
Subsidiary Guarantor's obligations to Holders of the Notes in case of a merger or consolidation, to make any change that would provide any additional rights or benefits to the Holders of the Notes or
that does not adversely affect the legal rights under the Indenture of any such Holder, to comply with the requirements of the SEC in order to effect or maintain the qualification of the Indenture
under the Trust Indenture Act, to provide for the Issuance of Additional Notes in accordance with the limitations set forth in the Indenture, to allow any Subsidiary Guarantor to execute a
supplemental indenture to the Indenture and/or a Note Guarantee with respect to the Notes, or to enter into additional or supplemental Collateral Documents. 


    13.  DEFAULTS AND REMEDIES.  Events of Default include: (i) default for 30 days in the
payment when due of interest or Liquidated Damages on the Notes; (ii) default in payment when due of principal of or premium, if any, on the Notes when the same becomes due and payable at
maturity, upon redemption (including in connection with an offer to purchase) or otherwise; (iii) failure by the Company or any of its Restricted Subsidiaries to comply with
Section 4.07, 4.09, 4.10, 4.19 or 5.01 of the Indenture; (iv) 


A2-7 







default or breach by the Company or any of its Restricted Subsidiaries of any material covenant, condition or agreement contained in the Collateral Documents; (v) failure by the Company for
60 days after notice to the Company by the Trustee or the Holders of at least 25% in aggregate principal amount of the Notes then outstanding voting as a single class to comply with certain
other agreements in the Indenture or the Notes; (vi) default under certain other agreements relating to Indebtedness of the Company which default is caused by a Payment Default or results in
the acceleration of such Indebtedness prior to its express maturity, and, in each case, the principal amount of any such Indebtedness, together with the principal amount of any other such Indebtedness
under which there has been a Payment Default or the maturity of which has been so accelerated, is $5.0 million or more in the aggregate; (vii) certain final judgments for the payment of
money that remain undischarged for a period of 60 days; (viii) any of the Collateral Documents ceasing, for any reason (other than pursuant to the terms thereof), to be in full force and
effect, or the Company so asserting, or any security interest created, or purported to be created, by any of the Collateral Documents ceasing to be enforceable and of the same effect and priority
purported to be created thereby, (ix) except as permitted by the Indenture, any Note Guarantee being held in any judicial proceeding to be unenforceable or invalid or ceasing for any reason to
be in full force and effect or any Subsidiary Guarantor, or any Person acting on behalf of a Subsidiary Guarantor, denying or disaffirming its obligations under its Guarantee; (x) any
representation or warranty made by the Company or any of its Restricted Subsidiaries in any Collateral Documents or that is contained in any certificate, document or financial or other statement
furnished by any of them at any time or in connection with any such Collateral Document proving to have been inaccurate in any material respect on or as of the date made or deemed made; and
(xi) certain events of bankruptcy or insolvency with respect to the Company or any of its Significant Subsidiaries. If any Event of Default occurs and is continuing, the Trustee or the Holders
of at least 25% in principal amount of the then outstanding Notes may declare all the Notes to be due and payable. Notwithstanding the foregoing, in the case of an Event of Default arising from
certain events of bankruptcy or insolvency, all outstanding Notes will become due and payable without further action or notice. Holders may not enforce the Indenture or the Notes except as provided in
the Indenture. Subject to certain limitations, Holders of a majority in principal amount of the then outstanding Notes may direct the Trustee in its exercise of any trust or power. The Trustee may
withhold from Holders of the Notes notice of any continuing Default or Event of Default (except a Default or Event of Default relating to the payment of principal or interest) if it determines that
withholding notice is in their interest. The Holders of a majority in aggregate principal amount of the Notes then outstanding by notice to the Trustee may on behalf of the Holders of all of the Notes
waive any existing Default or Event of Default and its consequences under the Indenture except a continuing Default or Event of Default in the payment of interest on, or the principal of, the Notes.
The Company is required to deliver to the Trustee annually a statement regarding compliance with the Indenture and the Collateral Documents, and the Company is required upon becoming aware of any
Default or Event of Default, to deliver to the Trustee a statement specifying such Default or Event of Default. 


    14.  TRUSTEE DEALINGS WITH COMPANY.  The Trustee, in its individual or any other capacity, may make loans
to, accept deposits from, and perform services for the Company or its Affiliates, and may otherwise deal with the Company or its Affiliates, as if it were not the Trustee. 



    15.  NO RECOURSE AGAINST OTHERS.  No past, present or future director, officer, employee, incorporator or
stockholder of the Company or any Subsidiary Guarantor, as such, shall have any liability for any obligations of the Company or such Subsidiary Guarantor under the Notes, the Note Guarantees, this
Indenture or the Collateral Documents or for any claim based on, in respect of, or by reason of, such obligations or their creation. Each Holder by 


A2-8



accepting
a Note waives and releases all such liability. The waiver and release are part of the consideration for issuance of the Notes. 







    16.  AUTHENTICATION.  This Note shall not be valid until authenticated by the manual signature of the
Trustee or an authenticating agent. 


    17.  ABBREVIATIONS.  Customary abbreviations may be used in the name of a Holder or an assignee, such as:
TEN COM (= tenants in common), TEN ENT (= tenants by the entireties), JT TEN (= joint tenants with right of survivorship and not as tenants in common), CUST (= Custodian), and U/G/M/A (= Uniform Gifts
to Minors Act). 


    18.  ADDITIONAL RIGHTS OF HOLDERS OF RESTRICTED GLOBAL NOTES AND RESTRICTED DEFINITIVE NOTES.  In
addition to the rights provided to Holders of Notes under the Indenture, Holders of Restricted Global Notes and Restricted Definitive Notes shall have all the rights set forth in the A/B Exchange
Registration Rights Agreement dated as of August 24, 2001, among the Company and the parties named on the signature pages thereof (the "Registration Rights Agreement"). 



    19.  CUSIP NUMBERS.  Pursuant to a recommendation promulgated by the Committee on Uniform Security
Identification Procedures, the Company has caused CUSIP numbers to be printed on the Notes and the Trustee may use CUSIP numbers in notices of redemption as a convenience to Holders. No representation
is made as to the accuracy of such numbers either as printed on the Notes or as contained in any notice of redemption and reliance may be placed only on the other identification numbers placed
thereon. 


A2-9




    The
Company will furnish to any Holder upon written request and without charge a copy of the Indenture, the Registration Rights Agreement and/or the Collateral Documents. Requests may
be made to: 


Herbst
Gaming, Inc.

3440 West Russell Road

Las Vegas, Nevada 89118

Attention: Mary E. Higgins 


A2-10








ASSIGNMENT FORM 


    To
assign this Note, fill in the form below: 



	(I) or (we) assign and transfer this Note to:	 	 
	 	 	
 (Insert assignee's legal name)
	

 (Insert assignee's soc. sec. or tax I.D. no.)
	


	


	


	

 (Print or type assignee's name, address and zip code)
	

and irrevocably appoint ____________________________ to transfer this Note on the books of the Company. The agent may substitute another to act for him.
	

Date:______________	
 	

Your Signature: ____________________________________

(Sign exactly as your name appears on the face of this Note)
	

Signature Guarantee*:____________________________________	
 	

 




	*
	Participant
in a recognized Signature Guarantee Medallion Program (or other signature guarantor acceptable to the Trustee). 


A2-11






OPTION OF HOLDER TO ELECT PURCHASE 


    If
you want to elect to have this Note purchased by the Company pursuant to Section 4.10, 4.15 or 4.19 of the Indenture, check the appropriate box below: 



	/ / Section 4.10	 	/ / Section 4.15	 	/ / Section 4.19





    If
you want to elect to have only part of the Note purchased by the Company pursuant to Section 4.10, Section 4.15 or Section 4.19 of the Indenture, state the
amount you elect to have purchased: 


$____________




	Date: ____________	 	 
	 	 	Your Signature: ____________________________________

(Sign exactly as your name appears on the face of this Note)
	

 	
 	

Tax Identification No.: ________________________
	

Signature Guarantee*: ____________________________________







	*
	Participant
in a recognized Signature Guarantee Medallion Program (or other signature guarantor acceptable to the Trustee). 


A2-12






SCHEDULE OF EXCHANGES OF REGULATION S TEMPORARY GLOBAL NOTE 



    The
following exchanges of a part of this Regulation S Temporary Global Note for an interest in another Global Note, or of other Restricted Global Notes for an interest in this
Regulation S Temporary Global Note, have been made: 



	Date of

Exchange
	 	Amount of

decrease in

Principal

Amount

of

this Global Note
	 	Amount of

increase in

Principal

Amount

of

this Global Note
	 	Principal

Amount

of this Global

Note following

such decrease

(or increase)
	 	Signature of

authorized

officer of Trustee

or Note

Custodian





A2-13










 
 

Exhibit B    
  


 
  FORM OF CERTIFICATE OF TRANSFER    



Herbst
Gaming, Inc.

3440 West Russell Road

Las Vegas, Nevada 89118

Attention: Mary E. Higgins 


[Registrar address block] 


    Re:  103/4 Senior Secured Notes due 2008 of Herbst Gaming, Inc.



    Reference
is hereby made to the Indenture, dated as of August 24, 2001 (the "Indenture"), between Herbst Gaming, Inc., as
issuer (the "Company"), Cardivan Company, Corral Coin, Inc., Corral Country Coin, Inc., E-T-T, Inc.,
E-T-T Enterprises, LLC, Flamingo Paradise Gaming, LLC and Market Gaming, Inc. (the "Subsidiary Guarantors") and The Bank
of New York, as trustee. Capitalized terms used but not defined herein shall have the meanings given to them in the Indenture. 


                            ,
(the "Transferor") owns and proposes to transfer the Note[s] or interest
in such Note[s] specified in Annex A hereto, in the principal amount of $            in such Note[s] or interests (the
"Transfer"), to                        (the "Transferee"), as further specified in
Annex A hereto. In connection with the Transfer, the Transferor hereby certifies that: 


[CHECK
ALL THAT APPLY] 


    1.  / /  Check if Transferee will take delivery of a beneficial interest in the 144A Global
Note or a Definitive Note Pursuant to Rule 144A.  The Transfer is being effected pursuant to and in accordance with Rule 144A under the United
States Securities Act of 1933, as amended (the "Securities Act"), and, accordingly, the Transferor hereby further certifies that the beneficial interest
or Definitive Note is being transferred to a Person that the Transferor reasonably believed and believes is purchasing the beneficial interest or Definitive Note for its own account, or for one or
more accounts with respect to which such Person exercises sole investment discretion, and such Person and each such account is a "qualified institutional buyer" within the meaning of Rule 144A
in a transaction meeting the requirements of Rule 144A and such Transfer is in compliance with any applicable blue sky securities laws of any state of the United States. Upon consummation of
the proposed Transfer in accordance with the terms of the Indenture, the transferred beneficial interest or Definitive Note will be subject to the restrictions on transfer enumerated in the Private
Placement Legend printed on the 144A Global Note and/or the Definitive Note and in the Indenture and the Securities Act. 


    2.  / /  Check if Transferee will take delivery of a beneficial interest in the Temporary
Regulation S Global Note, the Regulation S Global Note or a Definitive Note pursuant to Regulation S.  The Transfer is being effected
pursuant to and in accordance with Rule 903 or Rule 904 under the Securities Act and, accordingly, the Transferor hereby further certifies that (i) the Transfer is not being made
to a person in the United States and (x) at the time the buy order was originated, the Transferee was outside the United States or such Transferor 


B-1



and
any Person acting on its behalf reasonably believed and believes that the Transferee was outside the United States or (y) the transaction was executed in, on or through the facilities of a
designated offshore securities market and neither such Transferor nor any Person acting on its behalf knows that the transaction was prearranged with a buyer in the United States, (ii) no
directed selling efforts have been made in contravention of the requirements of Rule 903(b) or Rule 904(b) of Regulation S under the Securities Act, (iii) the transaction
is not part of a plan or scheme to evade the registration requirements of the Securities Act and (iv) if the proposed transfer is being made prior to the expiration of the Restricted Period,
the transfer is not being made to a U.S. Person or for the account 







or benefit of a U.S. Person (other than an Initial Purchaser). Upon consummation of the proposed transfer in accordance with the terms of the Indenture, the transferred beneficial interest or
Definitive Note will be subject to the restrictions on Transfer enumerated in the Private Placement Legend printed on the Regulation S Global Note, the Temporary Regulation S Global Note
and/or the Definitive Note and in the Indenture and the Securities Act. 


    3.  / /  Check and complete if Transferee will take delivery of a beneficial interest in the
IAI Global Note or a Definitive Note pursuant to any provision of the Securities Act other than Rule 144A or Regulation S.  The Transfer is being
effected in compliance with the transfer restrictions applicable to beneficial interests in Restricted Global Notes and Restricted Definitive Notes and pursuant to and in accordance with the
Securities Act and any applicable blue sky securities laws of any state of the United States, and accordingly the Transferor hereby further certifies that (check one): 



    (a) / / such
Transfer is being effected pursuant to and in accordance with Rule 144 under the Securities Act; 


or



    (b) / / such
Transfer is being effected to the Company or a subsidiary thereof; 


or



    (c) / / such
Transfer is being effected pursuant to an effective registration statement under the Securities Act and in compliance with the prospectus
delivery requirements of the Securities Act; 


or 


    (d) / / such
Transfer is being effected to an Institutional Accredited Investor and pursuant to an exemption from the registration requirements of the
Securities Act other than Rule 144A, Rule 144 or Rule 904, and the Transferor hereby further certifies that it has not engaged in any general solicitation within the meaning of
Regulation D under the Securities Act and the Transfer complies with the transfer restrictions applicable to beneficial interests in a Restricted Global Note or Restricted Definitive Notes and
the requirements of the exemption claimed, which certification is supported by (1) a certificate executed by the Transferee in the form of Exhibit D to the Indenture and (2) an
Opinion of Counsel provided by the Transferor or the Transferee (a copy of 



B-2




which
the Transferor has attached to this certification), to the effect that such Transfer is in compliance with the Securities Act. Upon consummation of the proposed transfer in accordance with the
terms of the Indenture, the transferred beneficial interest or Definitive Note will be subject to the restrictions on transfer enumerated in the Private Placement Legend printed on the IAI Global Note
and/or the Definitive Notes and in the Indenture and the Securities Act. 




    4.  / /  Check if Transferee will take delivery of a beneficial interest in an Unrestricted
Global Note or of an Unrestricted Definitive Note.  


    (a) / / Check if Transfer is pursuant to Rule 144. (i) The Transfer is being effected
pursuant to and in accordance with Rule 144 under the Securities Act and in compliance with the transfer restrictions contained in the Indenture and any applicable blue sky securities laws of
any state of the United States and (ii) the restrictions on transfer contained in the Indenture and the Private Placement Legend are not required in order to maintain compliance with the
Securities Act. Upon consummation of the proposed Transfer in accordance with the terms of the Indenture, the transferred beneficial interest or Definitive Note will no longer be subject to the
restrictions on transfer enumerated in the Private Placement Legend printed on the Restricted Global Notes, on Restricted Definitive Notes and in the Indenture. 







    (b) / / Check if Transfer is Pursuant to Regulation S. (i) The Transfer is being effected
pursuant to and in accordance with Rule 903 or Rule 904 under the Securities Act and in compliance with the transfer restrictions contained in the Indenture and any applicable blue sky
securities laws of any state of the United States and (ii) the restrictions on transfer contained in the Indenture and the Private Placement Legend are not required in order to maintain
compliance with the Securities Act. Upon consummation of the proposed Transfer in accordance with the terms of the Indenture, the transferred beneficial interest or Definitive Note will no longer be
subject to the restrictions on transfer enumerated in the Private Placement Legend printed on the Restricted Global Notes, on Restricted Definitive Notes and in the Indenture. 


    (c) / / Check if Transfer is Pursuant to Other Exemption. (i) The Transfer is being effected
pursuant to and in compliance with an exemption from the registration requirements of the Securities Act other than Rule 144, Rule 903 or Rule 904 and in compliance with the
transfer restrictions contained in the Indenture and any applicable blue sky securities laws of any State of the United States and (ii) the restrictions on transfer contained in the Indenture
and the Private Placement Legend are not required in order to maintain compliance with the Securities Act. Upon consummation of the proposed Transfer in accordance with the terms of the Indenture, the
transferred beneficial interest or Definitive Note will
not be subject to the restrictions on transfer enumerated in the Private Placement Legend printed on the Restricted Global Notes or Restricted Definitive Notes and in the Indenture. 



    This
certificate and the statements contained herein are made for your benefit and the benefit of the Company. 



	



	

 	
 	

 	

 
	 	 	 	
 [Insert Name of Transferor]




B-3




	



	

 	
 	

 	

 
	

 	

 	
 	

By:	

 
	 	 	 	 	

	 	 	 	 	Name:

Title:
	



	

 	
 	

 	

 
	Dated:	 	 	 	 
	 	
	 	 	 




B-4









	

 	

 	

 	

 	

 
	ANNEX A TO CERTIFICATE OF TRANSFER
	

1.	

The Transferor owns and proposes to transfer the following:
	

[CHECK ONE OF (a) OR (b)]
	

 	

(a)	

/ /	

a beneficial interest in the:
	

 	

 	

(i)	

/ /	

144A Global Note (CUSIP 42703XAA7), or
	

 	

 	

(ii)	

/ /	

Regulation S Global Note (CUSIP U42609AA2), or
	

 	

 	

(iii)	

/ /	

IAI Global Note (CUSIP            ); or
	

 	

(b)	

/ /	

a Restricted Definitive Note.
	

2.	

After the Transfer the Transferee will hold:
	

[CHECK ONE]
	

 	

(a)	

/ /	

a beneficial interest in the:
	

 	

 	

(i)	

/ /	

144A Global Note (CUSIP 42703XAA7), or
	

 	

 	

(ii)	

/ /	

Regulation S Global Note (CUSIP U42609AA2), or
	

 	

 	

(iii)	

/ /	

IAI Global Note (CUSIP            ); or
	

 	

 	

(iv)	

/ /	

Unrestricted Global Note (CUSIP            ); or
	

 	

(b)	

/ /	

a Restricted Definitive Note; or
	

 	

(c)	

/ /	

an Unrestricted Definitive Note,
	

 	

in accordance with the terms of the Indenture.





B-5










 
 

EXHIBIT C    
  


 
 

FORM OF CERTIFICATE OF EXCHANGE    



Herbst
Gaming, Inc.

3440 West Russell Road

Las Vegas, Nevada 89118

Attention: Mary E. Higgins 


[Registrar address block] 


    Re:  103/4 Senior Secured Notes due 2008 of Herbst Gaming, Inc.


(CUSIP
            ) 


    Reference
is hereby made to the Indenture, dated as of August 24, 2001 (the "Indenture"), between Herbst Gaming, Inc., as
issuer (the "Company"), Cardivan Company, Corral Coin, Inc., Corral Country Coin, Inc., E-T-T, Inc.,
E-T-T Enterprises, LLC, Flamingo Paradise Gaming, LLC and Market Gaming, Inc. (the "Subsidiary Guarantors") and The Bank
of New York, as trustee. Capitalized terms used but not defined herein shall have the meanings given to them in the Indenture. 



                            ,
(the "Owner") owns and proposes to exchange the
Note[s] or interest in such Note[s] specified herein, in the principal amount of $             in such
Note[s] or interests (the "Exchange"). In connection with the Exchange, the Owner hereby certifies that: 


    1.  Exchange of Restricted Definitive Notes or Beneficial Interests in a Restricted Global Note for Unrestricted
Definitive Notes or Beneficial Interests in an Unrestricted Global Note  



    (a)  / / Check if Exchange is from beneficial interest in a Restricted Global Note to beneficial interest in an Unrestricted
Global Note.  In connection with the Exchange of the Owner's beneficial interest in a Restricted Global Note for a beneficial interest in an Unrestricted Global
Note in an equal principal amount, the Owner hereby certifies (i) the beneficial interest is being acquired for the Owner's own account without transfer, (ii) such Exchange has been
effected in compliance with the transfer restrictions applicable to the Global Notes and pursuant to and in accordance with the United States Securities Act of 1933, as amended (the
"Securities Act"), (iii) the restrictions on transfer contained in the Indenture and the Private Placement Legend are not required in order to
maintain compliance with the Securities Act and (iv) the beneficial interest in an Unrestricted Global Note is being acquired in compliance with any applicable blue sky securities laws of any
state of the United States. 


    (b)  / / Check if Exchange is from beneficial interest in a Restricted Global Note to Unrestricted Definitive
Note.  In connection with the Exchange of the Owner's beneficial interest in a Restricted Global Note for an Unrestricted Definitive Note, the Owner hereby
certifies (i) the Definitive Note is being acquired for the Owner's own account without transfer, (ii) such Exchange has been effected in compliance with the transfer restrictions
applicable to the 


C-1 


Restricted
Global Notes and pursuant to and in accordance with the Securities Act, (iii) the restrictions on transfer contained in the Indenture and the Private Placement Legend are not
required in order to maintain compliance with the Securities Act and (iv) the Definitive Note is being acquired in compliance with any applicable blue sky securities laws of any state of the
United States. 


    (c)  / / Check if Exchange is from Restricted Definitive Note to beneficial interest in an Unrestricted Global
Note.  In connection with the Owner's Exchange of a Restricted Definitive Note for a beneficial interest in an Unrestricted Global Note, the Owner hereby
certifies (i) the beneficial interest is being acquired for the Owner's own account without transfer, (ii) such Exchange has been effected in compliance with the transfer restrictions
applicable to Restricted Definitive Notes and 







pursuant to and in accordance with the Securities Act, (iii) the restrictions on transfer contained in the Indenture and the Private Placement Legend are not required in order to maintain
compliance with the
Securities Act and (iv) the beneficial interest is being acquired in compliance with any applicable blue sky securities laws of any state of the United States. 



    (d)  / / Check if Exchange is from Restricted Definitive Note to Unrestricted Definitive
Note.  In connection with the Owner's Exchange of a Restricted Definitive Note for an Unrestricted Definitive Note, the Owner hereby certifies (i) the
Unrestricted Definitive Note is being acquired for the Owner's own account without transfer, (ii) such Exchange has been effected in compliance with the transfer restrictions applicable to
Restricted Definitive Notes and pursuant to and in accordance with the Securities Act, (iii) the restrictions on transfer contained in the Indenture and the Private Placement Legend are not
required in order to maintain compliance with the Securities Act and (iv) the Unrestricted Definitive Note is being acquired in compliance with any applicable blue sky securities laws of any
state of the United States. 


    2.  Exchange of Restricted Definitive Notes or Beneficial Interests in Restricted Global Notes for Restricted Definitive
Notes or Beneficial Interests in Restricted Global Notes  


    (a)  / / Check if Exchange is from beneficial interest in a Restricted Global Note to Restricted Definitive
Note.  In connection with the Exchange of the Owner's beneficial interest in a Restricted Global Note for a Restricted Definitive Note with an equal principal
amount, the Owner hereby certifies that the Restricted Definitive Note is being acquired for the Owner's own account without transfer. Upon consummation of the proposed Exchange in accordance with the
terms of the Indenture, the Restricted Definitive Note issued will continue to be subject to the restrictions on transfer enumerated in the Private Placement Legend printed on the Restricted
Definitive Note and in the Indenture and the Securities Act. 


    (b)  / / Check if Exchange is from Restricted Definitive Note to beneficial interest in a Restricted Global
Note.  In connection with the Exchange of the Owner's Restricted Definitive Note for a beneficial interest in the [CHECK
ONE] / / 144A Global Note, / / Regulation S Global Note, / / IAI Global Note with an equal principal amount, the Owner
hereby certifies (i) the beneficial interest is being acquired for the Owner's own account without transfer and (ii) such Exchange has been effected in compliance with the transfer
restrictions applicable to the Restricted Global Notes and pursuant to and in accordance with the Securities 


C-2



Act,
and in compliance with any applicable blue sky securities laws of any state of the United States. Upon consummation of the proposed Exchange in accordance with the terms of the Indenture, the
beneficial interest issued will be subject to the restrictions on transfer enumerated in the Private
Placement Legend printed on the relevant Restricted Global Note and in the Indenture and the Securities Act. 


    This
certificate and the statements contained herein are made for your benefit and the benefit of the Company. 



	



	

 	
 	

 	

 
	 	 	 	
 [Insert Name of Transferor]
	



	

 	
 	

 	

 
	

 	

 	
 	

By:	

 
	 	 	 	 	

	 	 	 	 	Name:

Title:
	



	

 	
 	

 	

 
	Dated:	 	 	 	 
	 	
	 	 	 







C-3









 
 

EXHIBIT D    
  


 
 

FORM OF CERTIFICATE FROM
  ACQUIRING INSTITUTIONAL ACCREDITED INVESTOR    



Herbst
Gaming, Inc.

3440 West Russell Road

Las Vegas, Nevada 89118

Attention: Mary E. Higgins 


[Registrar address block] 


    Re:  103/4 Senior Secured Notes due 2008 of Herbst Gaming, Inc.  



    Reference
is hereby made to the Indenture, dated as of August 24, 2001 (the "Indenture"), between Herbst Gaming, Inc., as
issuer (the "Company"), Cardivan Company, Corral Coin, Inc., Corral Country Coin, Inc., E-T-T, Inc.,
E-T-T Enterprises, LLC, Flamingo Paradise Gaming, LLC and Market Gaming, Inc. (the "Subsidiary Guarantors") and The Bank
of New York, as trustee. Capitalized terms used but not defined herein shall have the meanings given to them in the Indenture. 


    In
connection with our proposed purchase of $             aggregate principal amount of: 


    (a) / /    a
beneficial interest in a Global Note, or 


    (b) / /    a
Definitive Note, 


    we
confirm that: 


    1.  We
understand that any subsequent transfer of the Notes or any interest therein is subject to certain restrictions and conditions set forth in the Indenture and the
undersigned agrees to be bound by, and not to resell, pledge or otherwise transfer the Notes or any interest therein except in compliance with, such restrictions and conditions and the United States
Securities Act of 1933, as amended (the "Securities Act"). 


    2.  We
understand that the offer and sale of the Notes have not been registered under the Securities Act, and that the Notes and any interest therein may not be offered
or sold except as permitted in the following sentence. We agree, on our own behalf and on behalf of any accounts for which we are acting as hereinafter stated, that if we should sell the Notes or any
interest therein, we will do so only (A) to the Company or any subsidiary thereof, (B) in accordance with Rule 144A under the Securities Act to a "qualified institutional buyer"
(as defined therein), (C) to an institutional "accredited investor" (as defined below) that, prior to such transfer, furnishes (or has furnished on its behalf by a U.S. broker-dealer) to you
and to the Company a signed letter substantially in the form of this letter and an Opinion of Counsel in form reasonably acceptable to the Company to the effect that such transfer is in compliance
with the Securities Act, (D) outside the United States in accordance with Rule 904 of Regulation S under the Securities Act, (E) pursuant to the provisions of
Rule 144(k) under the Securities Act 


D-1



or
(F) pursuant to an effective registration statement under the Securities Act, and we further agree to provide to any person purchasing the Definitive Note or beneficial interest in a Global
Note from us in a transaction meeting the requirements of clauses (A) through (E) of this paragraph a notice advising such purchaser that resales thereof are restricted as stated
herein. 


    3.  We
understand that, on any proposed resale of the Notes or beneficial interest therein, we will be required to furnish to you and the Company such certifications,
legal opinions and other information as you and the Company may reasonably require to confirm that the proposed sale 





 


complies with the foregoing restrictions. We further understand that the Notes purchased by us will bear a legend to the foregoing effect. 


    4.  We
are an institutional "accredited investor" (as defined in Rule 501(a)(1), (2), (3) or (7) of Regulation D under the Securities Act)
and have such knowledge and experience in financial and business matters as to be capable of evaluating the merits and risks of our investment in the Notes, and we and any accounts for which we are
acting are each able to bear the economic risk of our or its investment. 


    5.  We
are acquiring the Notes or beneficial interest therein purchased by us for our own account or for one or more accounts (each of which is an institutional
"accredited investor") as to each of which we exercise sole investment discretion. 


    You
and the Company are entitled to rely upon this letter and are irrevocably authorized to produce this letter or a copy hereof to any interested party in any administrative or legal
proceedings or official inquiry with respect to the matters covered hereby. 



	



	

 	
 	

 	

 
	 	 	 	
 [Insert Name of Transferor]
	



	

 	
 	

 	

 
	

 	

 	
 	

By:	

 
	 	 	 	 	

	 	 	 	 	Name:

Title:
	



	

 	
 	

 	

 
	Dated:	 	 	 	 
	 	
	 	 	 




D–2






  



 
 

EXHBIT E    
  


 
 

[FORM OF NOTE GUARANTEE]    



    For
value received, each Subsidiary Guarantor (which term includes any successor Person under the Indenture) has, jointly and severally, unconditionally guaranteed, to the extent set
forth in the Indenture and subject to the provisions in the Indenture dated as of August 24, 2001 (the "Indenture") among Herbst
Gaming, Inc., the Subsidiary Guarantors listed on the signature page thereto and The Bank of New York, as trustee (the "Trustee"), (a) the
due and punctual payment of the principal of, premium, if any, and interest on the Notes (as defined in the Indenture), whether at maturity, by acceleration, redemption or otherwise, the due and
punctual payment of interest on overdue principal and premium, and, to the extent permitted by law, interest, and the due and punctual performance of all other obligations of the Company to the
Holders or the Trustee all in accordance with the terms of the Indenture and (b) in case of any extension of time of payment or renewal of any Notes or any of such other obligations, that the
same will be promptly paid in full when due or performed in accordance with the terms of the extension or renewal, whether at stated maturity, by acceleration or otherwise. The obligations of the
Subsidiary Guarantors to the Holders of Notes and to the Trustee pursuant to the Note Guarantee and the Indenture are expressly set forth in Article 11 of the Indenture and reference is hereby
made to the Indenture for the precise terms of the Note Guarantee. Each Holder of a Note, by accepting the same, (a) agrees to and shall be bound by such provisions, (b) authorizes and
directs the Trustee, on behalf of such Holder, to take such action as may be necessary or appropriate to effectuate the subordination as provided in the Indenture and (c) appoints the Trustee
attorney-in-fact of such Holder for such purpose; provided, however, that the Indebtedness evidenced by this Note Guarantee
shall cease to be so subordinated and subject in right of payment upon any defeasance of this Note Guarantee in accordance with the provisions of the Indenture. 



	 	 	[NAME OF GUARANTOR(S)]
	



	
 	

 	

 
	 	 	By:	 
	 	 	 	
 Name:

Title:




E–1







 
 

EXHIBIT F    
  


[FORM
OF SUPPLEMENTAL INDENTURE

TO BE DELIVERED BY SUBSEQUENT SUBSIDIARY GUARANTORS] 


    SUPPLEMENTAL
INDENTURE (this "Supplemental Indenture"), dated as of             , among
             (the "Guaranteeing Subsidiary"), a subsidiary of
             (or its
permitted successor), a              corporation (the "Company"), the Company, the other Subsidiary Guarantors (as
defined in the Indenture referred to herein) and             , as trustee under the indenture referred to below (the
"Trustee"). 


W
I T N E S S E T H 


    WHEREAS,
the Company and the Subsidiary Guarantors have heretofore executed and delivered to the Trustee an indenture (the
"Indenture"), dated as of August 24, 2001 providing for the issuance of 103/4% Senior Secured Notes due 2008 (the
"Notes"); 


    WHEREAS,
the Indenture provides that under certain circumstances the Guaranteeing Subsidiary shall execute and deliver to the Trustee a supplemental indenture pursuant to which the
Guaranteeing Subsidiary shall unconditionally guarantee all of the Company's Obligations under the Notes and the Indenture on the terms and conditions set forth herein (the
"Note Guarantee"); and 


    WHEREAS,
pursuant to Section 9.01 of the Indenture, the Trustee is authorized to execute and deliver this Supplemental Indenture. 


    NOW
THEREFORE, in consideration of the foregoing and for other good and valuable consideration, the receipt of which is hereby acknowledged, the Guaranteeing Subsidiary and the
Trustee mutually covenant and agree for the equal and ratable benefit of the Holders of the Notes as follows: 



    1.  CAPITALIZED
TERMS.  Capitalized terms used herein without definition shall have the meanings assigned to them in the Indenture. 


    2.  AGREEMENT
TO GUARANTEE.  The Guaranteeing Subsidiary hereby agrees as follows: 



    (a) Along
with all Subsidiary Guarantors named in the Indenture, to jointly and severally Guarantee to each Holder of a Note authenticated and delivered by the Trustee
and to the Trustee and its successors and assigns, the Notes or the obligations of the Company hereunder or thereunder, that: 



     (i) the
principal of and interest on the Notes will be promptly paid in full when due, whether at maturity, by acceleration, redemption or otherwise, and interest on
the overdue principal of and interest on the Notes, if any, if lawful, and all other obligations of the Company to the Holders or the Trustee hereunder or 





F-1






    thereunder
will be promptly paid in full or performed, all in accordance with the terms hereof and thereof; and 


    (ii) in
case of any extension of time of payment or renewal of any Notes or any of such other obligations, that same will be promptly paid in full when due or performed
in accordance with the terms of the extension or renewal, whether at stated maturity, by acceleration or otherwise. Failing payment when due of any amount so guaranteed or any performance so
guaranteed for whatever reason, the Subsidiary Guarantors shall be jointly and severally obligated to pay the same immediately. 










    (b) The
obligations hereunder shall be unconditional, irrespective of the validity, regularity or enforceability of the Notes or the Indenture, the absence of any
action to enforce the same, any waiver or consent by any Holder of the Notes with respect to any provisions hereof or thereof, the recovery of any judgment against the Company, any action to enforce
the same or any other circumstance which might otherwise constitute a legal or equitable discharge or defense of a guarantor. 


    (c) The
following is hereby waived:  diligence presentment, demand of payment, filing of claims with a court in the event of insolvency or bankruptcy of
the Company, any right to require a proceeding first against the Company, protest, notice and all demands whatsoever. 



    (d) This
Note Guarantee shall not be discharged except by complete performance of the obligations contained in the Notes and the Indenture, and the Guaranteeing
Subsidiary accepts all obligations of a Subsidiary Guarantor under the Indenture. 


    (e) If
any Holder or the Trustee is required by any court or otherwise to return to the Company, the Subsidiary Guarantors, or any Custodian, Trustee, liquidator or
other similar official acting in relation to either the Company or the Subsidiary Guarantors, any amount paid by either to the Trustee or such Holder, this Note Guarantee, to the extent theretofore
discharged, shall be reinstated in full force and effect. 



    (f)  The
Guaranteeing Subsidiary shall not be entitled to any right of subrogation in relation to the Holders in respect of any obligations guaranteed hereby until
payment in full of all obligations guaranteed hereby. 


    (g) As
between the Subsidiary Guarantors, on the one hand, and the Holders and the Trustee, on the other hand, (x) the maturity of the obligations guaranteed
hereby may be accelerated as provided in Article 6 of the Indenture for the purposes of this Note Guarantee, notwithstanding any stay, injunction or other prohibition preventing such
acceleration in respect of the obligations guaranteed hereby, and (y) in the event of any declaration of acceleration of such obligations as provided in Article 6 of the Indenture, such
obligations (whether or not due and payable) shall forthwith become due and payable by the Subsidiary Guarantors for the purpose of this Note Guarantee. 




F-2





    (h) The
Subsidiary Guarantors shall have the right to seek contribution from any non-paying Subsidiary Guarantor so long as the exercise of such right does
not impair the rights of the Holders under the Guarantee. 


    (i)  Pursuant
to Section 11.02 of the Indenture, after giving effect to any maximum amount and any other contingent and fixed liabilities that are relevant under
any applicable Bankruptcy or fraudulent conveyance laws, and after giving effect to any collections from, rights to receive contribution from or
payments made by or on behalf of any other Subsidiary Guarantor in respect of the obligations of such other Subsidiary Guarantor under Article 11 of the Indenture, this new Note Guarantee shall
be limited to the maximum amount permissible such that the obligations of such Subsidiary Guarantor under this Note Guarantee will not constitute a fraudulent transfer or conveyance. 




    3.  EXECUTION
AND DELIVERY.  Each Guaranteeing Subsidiary agrees that the Note Guarantees shall remain in full force and effect notwithstanding any
failure to endorse on each Note a notation of such Note Guarantee. 


    4.  GUARANTEEING
SUBSIDIARY MAY CONSOLIDATE, ETC. ON CERTAIN TERMS. 



    (a) The
Guaranteeing Subsidiary may not consolidate with or merge with or into (whether or not such Subsidiary Guarantor is the surviving Person) another corporation, 










Person or entity whether or not affiliated with such Subsidiary Guarantor unless it complies with Article 5 of the Indenture. 


    (b) In
case of any such consolidation, merger, sale or conveyance and upon the assumption by the successor corporation, by supplemental indenture, executed and
delivered to the Trustee and satisfactory in form to the Trustee, of the Note Guarantee endorsed upon the Notes and the due and punctual performance of all of the covenants and conditions of the
Indenture to be performed by the Subsidiary Guarantor, such successor corporation shall succeed to and be substituted for the Subsidiary Guarantor with the same effect as if it had been named herein
as a Subsidiary Guarantor. Such successor corporation thereupon may cause to be signed any or all of the Note Guarantees to be endorsed upon all of the Notes issuable hereunder which theretofore shall
not have been signed by the Company and delivered to the Trustee. All the Note Guarantees so issued shall in all respects have the same legal rank and benefit under the Indenture as the Note
Guarantees theretofore and thereafter issued in accordance with the terms of the Indenture as though all of such Note Guarantees had been issued at the date of the execution hereof. 



    (c) Except
as set forth in Articles 4 and 5 and Section 11.05 of Article 11 of the Indenture, and notwithstanding clauses (a) and (b) above,
nothing contained in the Indenture or in any of the Notes shall prevent any consolidation or merger of a Subsidiary Guarantor with or into the Company or another Subsidiary Guarantor, or shall prevent
any sale or conveyance of the property of a Subsidiary Guarantor as an entirety or substantially as an entirety to the Company or another Subsidiary Guarantor. 




    5.  RELEASES.




F-3 




    (a) In
the event of a sale or other disposition of substantially all of the assets of any Subsidiary Guarantor (including by way of merger or consolidation), or a sale
or other disposition of all of the Capital Stock of any Subsidiary Guarantor, in each case to a Person that is not (either before or after giving effect to such transactions) a Restricted Subsidiary
of the Company, then such Subsidiary Guarantor (in the event of a sale or other disposition, by way of merger, consolidation or otherwise, of all of the capital stock of such Subsidiary Guarantor) or
the corporation acquiring the property (in the event of a sale or other disposition of all or substantially all of the assets of such Subsidiary Guarantor) shall be released and relieved of any
obligations under its Note Guarantee; provided that the Net Proceeds of such sale or other disposition are applied in accordance with the applicable
provisions of this Indenture, including without limitation Section 4.10 of the Indenture. Upon delivery by the Company to the Trustee of an Officers' Certificate and an Opinion of Counsel to
the effect that such sale or other disposition was made by the Company in accordance with the provisions of this Indenture, including without limitation Section 4.10 of the Indenture, the
Trustee shall execute any documents reasonably required in order to evidence the release of any Subsidiary Guarantor from its obligations under its Note Guarantee. 



    (b) In
the event the Company properly designates any Restricted Subsidiary that is a Subsidiary Guarantor as an Unrestricted Subsidiary pursuant to the terms of the
Indenture, such Subsidiary Guarantor shall be released and relieved of any obligations under its Note Guarantee. 


    (c) Any
Subsidiary Guarantor not released from its obligations under its Note Guarantee shall remain liable for the full amount of principal of and interest on the
Notes and for the other obligations of any Subsidiary Guarantor under the Indenture as provided in Article 11 of the Indenture. 











    6.  NO
RECOURSE AGAINST OTHERS.  No past, present or future director, officer, employee, incorporator or stockholder of the Company or any Subsidiary
Guarantor, as such, shall have any liability for any obligations of the Company or such Subsidiary Guarantor under the Notes, the Note Guarantees, this Indenture or the Collateral Documents or for any
claim based on, in respect of, or by reason of, such obligations or their creation. Each Holder by accepting a Note waives and releases all such liability. The waiver and release are part of the
consideration for issuance of the Notes. 


    7.  NEW
YORK LAW TO GOVERN.  THE INTERNAL LAW OF THE STATE OF NEW YORK SHALL GOVERN AND BE USED TO CONSTRUE THIS SUPPLEMENTAL INDENTURE BUT WITHOUT
GIVING EFFECT TO APPLICABLE PRINCIPLES OF CONFLICTS OF LAW TO THE EXTENT THAT THE APPLICATION OF THE LAWS OF ANOTHER JURISDICTION WOULD BE REQUIRED THEREBY. 


    8.  COUNTERPARTS.  The
parties may sign any number of copies of this Supplemental Indenture. Each signed copy shall be an original, but all of them
together represent the same agreement. 



F-4 



    9.  EFFECT
OF HEADINGS.  The Section headings herein are for convenience only and shall not affect the construction hereof. 


    10. THE
TRUSTEE.  The Trustee shall not be responsible in any manner whatsoever for or in respect of the validity or sufficiency of this Supplemental
Indenture or for or in respect of the recitals contained herein, all of which recitals are made solely by the Guaranteeing Subsidiary and the Company. 



F-5 


    IN
WITNESS WHEREOF, the parties hereto have caused this Supplemental Indenture to be duly executed and attested, all as of the date first above written. 



	 	 	[GUARANTEEING SUBSIDIARY]	 
	

Dated:	
 	

 	
 	

 	

 
	 	 	            ,     	 	By:	

	 	 	 	 	Name:
	 	 	 	 	Title:
	

 	
 	

 	
 	

HERBST GAMING, INC.
	

 	
 	

 	
 	

By:	


	 	 	 	 	Name:
	 	 	 	 	Title:
	

 	
 	

 	
 	

THE BANK OF NEW YORK, as Trustee
	

 	
 	

 	
 	

By:	

 
	 	 	 	 	 	
 Authorized Signatory







F-6








 
 

Schedule I
  
    SCHEDULE OF SUBSIDIARY GUARANTORS    



The
following schedule lists each Subsidiary Guarantor under the Indenture as of the Issue Date: 


    Cardivan
Company, a Nevada corporation 


    Corral
Coin, Inc., a Nevada corporation 


    Corral
Country Coin, Inc., a Nevada corporation 



    E-T-T, Inc.,
a Nevada corporation 


    E-T-T
Enterprises, LLC, a Nevada limited-liability company 


    Flamingo
Paradise Gaming, LLC, a Nevada limited-liability company 


    Market
Gaming, Inc., a Nevada corporation 


F-7









  



 
 

EXHIBIT G    
  


 
 

COLLATERAL DOCUMENTS    



     1. Deed
of Trust, Assignment of Leases and Rents, Security Agreement and Fixture Filing from Flamingo Paradise Gaming, LLC to The Bank of New York (4100 Paradise Road) 


     2. Deed
of Trust, Assignment of Leases and Rents, Security Agreement and Fixture Filing from E-T-T Enterprises L.L.C. to The Bank of New York
(5870 S. Homestead Road) 


     3. Deed
of Trust, Assignment of Leases and Rents, Security Agreement and Fixture Filing from Market Gaming, Inc. to The Bank of New York (Terrible's
Casino & Bowl) 


     4. Leasehold
Deed of Trust, Assignment of Leases and Rents, Security Agreement and Fixture Filing from E-T-T Enterprises L.L.C. to The Bank of
New York (Warehouse Property) 


     5. Leasehold
Deed of Trust, Assignment of Leases and Rents, Security Agreement and Fixture Filing from E-T-T, Inc. to The Bank of New
York (771 S. Nevada Highway) 


     6. Leasehold
Deed of Trust, Assignment of Leases and Rents, Security Agreement and Fixture Filing from Market Gaming, Inc. to The Bank of New York (Terrible's
Casino & Bowl) 


     7. Security
Agreement (executed by the Company and each Guarantor) 


     8. Pledge
and Security Agreement (executed by the Company and the Trustee) 


     9. Pledge
and Security Agreement (executed by E-T-T, Inc. and the Trustee) 


    10. Pledge
and Security Agreement (executed by Edward Herbst, Timothy Herbst, Troy Herbst and the Trustee) 


    11. Escrow
Agreement (executed by the Company, E-T-T, Inc., Edward Herbst, Timothy Herbst, Troy Herbst, the Trustee and Wilmington Trust
FSB) 


    12. Collateral
Assignment of Contracts and Documents (executed by the Company and each Guarantor) 


    13. Hazardous
Substances Indemnity Agreement (executed by the Company and each Guarantor) 


G–1







 
 

EXHIBIT H    
  


 
 

FORM OF INTERCOMPANY NOTE    




	$____________________________	 	Las Vegas, Nevada
	 	 	____________________________, ____________





    FOR
VALUE RECEIVED, the undersigned, [INSERT NAME OF SUBSIDIARY], a              ("Maker"), hereby promises to pay to the
order of HERBST GAMING, INC., a Nevada corporation ("Lender"), the principal amount of $             on
            ,
      , and to pay interest thereon from the date hereof, semiannually on              and
             of each year (each, an "Interest Payment Date"), commencing             , at the rate of
      % per annum, until the principal hereof is paid or duly made available for payment. Interest on this Note shall be calculated on the basis of a
360-day year consisting of twelve 30-day months. In no event shall interest be charged under this Note which would violate any applicable law. All such payments of principal
and interest shall be payable without defense, set-off or counterclaim, in lawful money of the United States of America, and delivered to Lender by good and sufficient funds by wire
transfer to Lender's account or by check delivered to Lender's address or at such other place as Lender or any holder hereof shall designate in writing for such purpose from time to time. If a payment
hereunder otherwise would become due and payable on a Saturday, Sunday or legal holiday, the due date thereof shall be extended to the next succeeding business day. 



    This
Note may be prepaid in whole or in part at any time. Any prepayment shall be without penalty. Any partial principal prepayment under this Note shall be applied against the
principal due hereunder at maturity. This Note shall be non-negotiable. 


    No
waiver or modification of any of the terms of this Note shall be valid or binding unless set forth in a writing specifically referring to this Note and signed by a duly authorized
officer of Lender or any holder hereof, and then only to the extent specifically set forth therein. 


    If
any default occurs in any payment due under this Note, Maker and all guarantors and endorsers hereof, if any, and their successors and assigns, promise to pay all costs and
expenses, including attorneys' fees, incurred by each holder hereof in collecting or attempting to collect the indebtedness under this Note, whether or not any action or proceeding is commenced. None
of the provisions hereof and none of the holder's rights or remedies hereunder on account of any past or future defaults shall be deemed to have been waived by the holder's acceptance of any past due
installments or by any indulgence granted by the holder to Maker. 


    This
Note shall inure to the benefit of Lender, its successors and assigns and shall bind the heirs, executors, administrators, successors and assigns of Maker. 



    In
the event that any one or more provisions of this Note shall be held to be illegal, invalid or otherwise unenforceable, the same shall not affect any other provision of this Note
and the remaining provisions of this Note shall remain in full force and effect. 


H-1



    This
Note shall be governed by and construed in accordance with the internal laws of the State of Nevada. 







    IN WITNESS WHEREOF, Maker has caused this Note to be duly executed the day and year first written above. 



	 	 	[INSERT NAME OF SUBSIDIARY]
	

 	
 	

 	
 	

 
	

 	
 	

By:	
 	

 
	 	 	 	 	

	 	 	Name:	 	 
	 	 	Title:	 	 




H-2












QuickLinks


EXHIBIT 4.1


TABLE OF CONTENTS

EXHIBITS


ARTICLE I. DEFINITIONS AND INCORPORATION BY REFERENCE


ARTICLE II. THE NOTES


ARTICLE III. REDEMPTION AND PREPAYMENT

ARTICLE IV. COVENANTS


ARTICLE V. SUCCESSORS

ARTICLE VI. DEFAULTS AND REMEDIES

ARTICLE VII. TRUSTEE


ARTICLE VIII. LEGAL DEFEASANCE AND COVENANT DEFEASANCE

ARTICLE IX. AMENDMENT, SUPPLEMENT AND WAIVER

ARTICLE X. COLLATERAL AND SECURITY


ARTICLE XI. NOTE GUARANTEES

ARTICLE XII. SATISFACTION AND DISCHARGE

ARTICLE XIII. MISCELLANEOUS



SIGNATURES


EXHIBIT A1


EXHIBIT A2



Exhibit B

FORM OF CERTIFICATE OF TRANSFER


EXHIBIT C

FORM OF CERTIFICATE OF EXCHANGE


EXHIBIT D

FORM OF CERTIFICATE FROM ACQUIRING INSTITUTIONAL ACCREDITED INVESTOR


EXHBIT E

[FORM OF NOTE GUARANTEE]


EXHIBIT F

Schedule I SCHEDULE OF SUBSIDIARY GUARANTORS


EXHIBIT G

COLLATERAL DOCUMENTS


EXHIBIT H

FORM OF INTERCOMPANY NOTE