**Exhibit 10.2****AMENDED AND RESTATED SECURITY AGREEMENT****dated as of August 21, 2007****between****EACH OF THE GRANTORS PARTY HERETO****and****GENERAL ELECTRIC CAPITAL CORPORATION,****as Collateral Agent**SecurityAgreement
 

 
**TABLE OF CONTENTS**       PAGE SECTION 1. DEFINITIONS  2 1.1 General Definitions  2 1.2 Definitions; Interpretation  3      SECTION 2. GRANT OF SECURITY  4 2.1 Grant of Security  4 2.2 [Intentionally Reserved]  4      SECTION 3. SECURITY FOR OBLIGATIONS; GRANTORS REMAIN LIABLE  4 3.1 Security for Obligations  4 3.2 Continuing Liability Under Collateral  4      SECTION 4. REPRESENTATIONS AND WARRANTIES AND COVENANTS  5 4.1 Representations and Warranties  5      SECTION 5. FURTHER ASSURANCES; ADDITIONAL GRANTORS  7 5.1 Further Assurances  7 5.2 Additional Grantors  8      SECTION 6. COLLATERAL AGENT APPOINTED ATTORNEY-IN-FACT  9 6.1 Power of Attorney  9 6.2 No Duty on the Part of Collateral Agent or Secured Parties  10      SECTION 7. REMEDIES  10 7.1 Generally  10 7.2 Application of Proceeds  13 7.3 Sales on Credit  13 7.4 [Intentionally Reserved]  13 7.5 Grant of License to Use Intellectual Property  13 7.6 Cash Proceeds  14      SECTION 8. COLLATERAL AGENT  14      SECTION 9. CONTINUING SECURITY INTEREST; TRANSFER OF LOANS  15      SECTION 10. STANDARD OF CARE; COLLATERAL AGENT MAY PERFORM  16      SECTION 11. MISCELLANEOUS  16      SECTION 12. AMENDMENT AND RESTATEMENT  18 Security Agreement
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SCHEDULE 4.1 — GENERAL INFORMATIONEXHIBIT A — COLLATERAL SCHEDULEEXHIBIT B — PLEDGE SUPPLEMENTEXHIBIT C — COUNTERPART AGREEMENTSecurity Agreement
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     This**SECURITY AGREEMENT**, dated as of August 21, 2007 (this **“Agreement”**), between **EACH OF THEUNDERSIGNED**(other than the Collateral Agent (as herein defined)), whether as an original signatoryhereto or as an Additional Grantor (as herein defined) (each, a **“Grantor”**), and **GENERAL ELECTRICCAPITAL CORPORATION**(“**GE Capital**”), as collateral agent for the Secured Parties (as herein defined)(in such capacity as collateral agent, the **“Collateral Agent”**).**RECITALS:**     **WHEREAS,**Las Vegas Sands, LLC (**“Borrower”**), Venetian Casino Resorts, LLC (“**VCR**”), certainother affiliates of Borrower, certain financial institutions, GE Capital Markets, Inc., asarranger, and GE Capital, as administrative agent, are parties to that certain FF&E CreditAgreement, dated as of December 14, 2006 (as amended prior to the date hereof, the “**Existing FF&ECredit Agreement**”);     **WHEREAS**, in connection with the Existing FF&E Credit Agreement, Borrower and VCR entered intothat certain Master Security Agreement, dated as of December 14, 2006 (as amended prior to the datehereof, the “**Existing Security Agreement”**);     **WHEREAS**, the parties hereto are amending and restating the terms of the Existing FF&E CreditAgreement pursuant to the terms of that certain Amended and Restated FF&E Credit Agreement, datedas of the date hereof (as it may be amended, restated, supplemented or otherwise modified from timeto time, the **“Credit Agreement”**);     **WHEREAS**, in connection with the amendment and restatement of the Existing FF&E CreditAgreement pursuant to the Credit Agreement, the parties hereto desire to amend and restate theExisting Security Agreement, all as set forth herein;     **WHEREAS**, it is the intent of the parties hereto that this Agreement not constitute a novationof the obligations and liabilities under the Existing Security Agreements and related LoanDocuments (as defined in the Existing FF&E Credit Agreement), but rather that this Agreement amend,restate and consolidate in their entirety the Existing Security Agreement and re-evidence theObligations of Borrower and VCR to Collateral Agent and Lenders outstanding thereunder, as well asevidence the additional obligations of Borrower and VCR to Collateral Agent and Lenders providedfor herein; and     **WHEREAS**, in consideration of the extensions of credit and other accommodations of Lenders asset forth in the Credit Agreement, each Grantor has agreed to secure such Grantor’s Obligations andGuaranteed Obligations under the Credit Documents as set forth herein.     **NOW, THEREFORE**, in consideration of the premises and the agreements, provisions and covenantsherein contained, each Grantor and the Collateral Agent agree as follows:Security Agreement
 

 
**SECTION 1. DEFINITIONS.**     **1.1 General Definitions**. In this Agreement, the following terms shall have the followingmeanings:          **“Additional Grantors”**shall have the meaning assigned in Section 5.3.          **“Agreement”**shall have the meaning set forth in the preamble.          **“Bankruptcy Code”**shall mean Title 11 of the United States Code entitled “Bankruptcy”, as nowand hereafter in effect, or any successor statute.          **“Borrower”**shall have the meaning set forth in the recitals.          **“Cash Proceeds”**shall have the meaning assigned in Section 7.6.          **“Collateral”**shall have the meaning assigned in Section 2.1.          **“Collateral Account”**shall mean any account established by the Collateral Agent.          **“Collateral Agent”**shall have the meaning set forth in the preamble.          **“Collateral Records”**shall mean books, records, ledger cards, files, correspondence, customerlists, blueprints, technical specifications, manuals, computer software, computer printouts, tapes,disks and related data processing software and similar items that at any time evidence or containinformation relating to any of the Collateral or are otherwise necessary or helpful in thecollection thereof or realization thereupon.          **“Collateral Schedule”**shall mean any collateral schedule in the form of Exhibit Ahereto (or such other form as may be reasonably acceptable to Collateral Agent) that may beexecuted at any time now or hereafter by the Grantors and Collateral Agent in connection herewithin accordance with the terms of this Agreement and the Credit Agreement.          **“Collateral Support”**shall mean all property (real or personal) assigned, hypothecated orotherwise securing any Collateral and shall include any security agreement or other agreementgranting a lien or security interest in such real or personal property.          **“Credit Agreement”**shall have the meaning set forth in the recitals.          **“Event of Default”**shall have the meaning set forth in the Credit Agreement.          **“Grantors”**shall have the meaning set forth in the preamble.Security Agreement
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          **“Lender”**shall have the meaning set forth in the recitals.          “**Obligations”**shall have the meaning set forth in the Credit Agreement.          **“Person”**shall mean and include natural persons, corporations, limited partnerships, generalpartnerships, limited liability companies, limited liability partnerships, joint stock companies,joint ventures, associations, companies, trusts, banks, trust companies, land trusts, businesstrusts or other organizations, whether or not legal entities, and governmental authorities.          **“Pledge Supplement”**shall mean any supplement to this agreement in substantially the form ofExhibit B hereto.          **“Record”**shall have the meaning specified in Article 9 of the UCC.          **“Secured Obligations”**shall have the meaning assigned in Section 3.1.          **“Secured Parties”**shall mean the Agents and Lenders party to the Credit Agreement from time totime and shall include, without limitation, all former Agents and Lenders to the extent that anyObligations owing to such Persons were incurred while such Persons were Agents or Lenders and suchObligations have not been paid or satisfied in full.          **“Designated FF&E”**shall have the meaning assigned in Section 2.1.          **“UCC”**shall mean the Uniform Commercial Code as in effect from time to time in the State ofNew York or, when the context implies, the Uniform Commercial Code as in effect from time to timein any other applicable jurisdiction.          **“United States”**shall mean the United States of America.     **1.2 Definitions; Interpretation**. All capitalized terms used herein (including the preambleand recitals hereto) and not otherwise defined herein shall have the meanings ascribed thereto inthe Credit Agreement or, if not defined therein, in the UCC. References to “Sections,” “Exhibits”and “Schedules” shall be to Sections, Exhibits and Schedules, as the case may be, of this Agreementunless otherwise specifically provided. Section headings in this Agreement are included herein forconvenience of reference only and shall not constitute a part of this Agreement for any otherpurpose or be given any substantive effect. Any of the terms defined herein may, unless thecontext otherwise requires, be used in the singular or the plural, depending on the reference. Theuse herein of the word “include” or “including”, when following any general statement, term ormatter, shall not be construed to limit such statement, term or matter to the specific items ormatters set forth immediately following such word or to similar items or matters, whether or notnonlimiting language (such as “without limitation” or “but not limited to” or words of similarimport) is used with reference thereto, but rather shall be deemed to refer to all other items ormatters that fall within the broadest possible scope of such general statement, term or matter. Ifany conflict or inconsistency exists between thisSecurity Agreement
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Agreement and the Credit Agreement, the Credit Agreement shall govern. All references hereinto provisions of the UCC shall include all successor provisions under any subsequent version oramendment to any Article of the UCC.**SECTION 2. GRANT OF SECURITY.**     **2.1 Grant of Security.**Subject to compliance with applicable Nevada Gaming Laws, each Grantorhereby grants to the Collateral Agent, on behalf of all Secured Parties, a security interest in andcontinuing lien on all of such Grantor’s right, title and interest in, to and under all equipment,fixtures, furniture, furnishings, and goods as described in any Collateral Schedule now orhereafter executed in connection herewith or in connection with the Credit Agreement (**“DesignatedFF&E”**), plus all items or units of equipment, fixtures, furniture, furnishings, and goods acquiredat any time in substitution thereof or replacement therefor, spare and other parts, attachments,components, substitutes accessories, accessions (which term shall not include the removablecontents (not financed by the Lenders) of any of the foregoing, for example, and by way ofillustration, cash in slot machines and contents of minibars), manuals, installation kits,manufacturers’ and other warranties and guarantees and service contracts and similar rights relatedto the foregoing, and rights in any software and firmware, trademark licenses and otherintellectual property affixed to, embedded in, or necessary to the operation of, the foregoing, andall documents of title (including, without limitation, warehouse receipts, dock receipts, bills oflading and the like) covering any of the foregoing (provided, that, to the extent anytrademarks, service marks, logos or other indicia are affixed to any Designated FF&E, theCollateral Agent acknowledges that this grant of Lien does not include a lien on such intangibleproperty or the goodwill associated therewith), and all proceeds (including, without limitation,cash collateral from time to time held by the Collateral Agent under any provision of the CreditAgreement or any other Credit Document, insurance and condemnation proceeds and proceeds of otherproceeds) of the foregoing (all of which being hereinafter collectively referred to as the**“Collateral”**).     **2.2**[Intentionally Reserved].**SECTION 3. SECURITY FOR OBLIGATIONS; GRANTORS REMAIN LIABLE.**     **3.1 Security for Obligations**. This Agreement secures, and the Collateral is collateralsecurity for, the prompt and complete payment or performance in full when due, whether at statedmaturity, by required prepayment, declaration, acceleration, demand or otherwise (including thepayment of amounts that would become due but for the operation of the automatic stay under Section362(a) of the Bankruptcy Code, 11 U.S.C. §362(a) (and any successor provision thereof)), of allObligations and Guaranteed Obligations with respect to every Grantor(the **“Secured Obligations”**).     **3.2 Continuing Liability Under Collateral.**Notwithstanding anything herein to the contrary,(i) each Grantor shall remain liable for all obligations under the Collateral and nothing containedherein is intended or shall be a delegation of duties to the Collateral Agent or any Secured Party,(ii) each Grantor shall remain liable under anySecurity Agreement
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of the agreements included in the Collateral, to perform all of the obligations undertaken byit thereunder all in accordance with and pursuant to the terms and provisions thereof and neitherthe Collateral Agent nor any Secured Party shall have any obligation or liability under any of suchagreement by reason of or arising out of this Agreement or any other document related thereto norshall the Collateral Agent nor any Secured Party have any obligation to make any inquiry as to thenature or sufficiency of any payment received by it or have any obligation to take any action tocollect or enforce any rights under any agreement included in the Collateral, and (iii) theexercise by the Collateral Agent of any of its rights hereunder shall not release any Grantor fromany of its duties or obligations under any contracts and agreements included in the Collateral.Each Grantor, at its own expense, shall deliver to Collateral Agent the results of each physicalverification, if any, which such Grantor may in its discretion have made, or caused any otherPerson to have made on its behalf, of all or any portion of its Collateral.**SECTION 4. REPRESENTATIONS AND WARRANTIES AND COVENANTS.**     **4.1 Representations and Warranties.**          (a) Each Grantor hereby represents and warrants, on the Restatement Effective Date, that:     (i) except as otherwise permitted by the Credit Agreement, it owns the Collateralpurported to be owned by it or otherwise has the rights it purports to have in each item ofCollateral and, as to all Collateral whether now existing or hereafter acquired, willcontinue to own or have such rights in each item of the Collateral, in each case free andclear of any and all Liens, rights or claims of all other Persons, other than PermittedLiens;     (ii) the full legal name of such Grantor is as set forth on such Grantor’s respectiveSchedule 4.1(A) and it has not done in the last five (5) years, and does not do, businessunder any other name except for those names set forth on such Grantor’s respective Schedule4.1(B) (as such schedule may be amended or supplemented from time to time without theconsent of any party hereto);     (iii) except as provided on such Grantor’s respective Schedule 4.1(C), it has notchanged its name, jurisdiction of organization, chief executive office or principal placeof business or its corporate structure in any way (e.g., by merger, consolidation, changein corporate form or otherwise) within the past five (5) years;     (iv) upon the filing of all UCC financing statements naming each Grantor as “debtor”and the Collateral Agent as “secured party” and describing the Collateral in the filingoffices set forth opposite such Grantor’s name on such Grantor’s respective Schedule 4.1(D)hereof (as such schedule may be amended or supplemented from time to time) and otherfilings delivered by each Grantor, the security interests granted to the Collateral Agenthereunder constitute valid and perfected first priority Liens (subject in the case ofprioritySecurity Agreement
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only to Permitted Liens) on all of the Collateral to the extent a security interest inthe Collateral can be perfected by filing under Article 9 of the UCC;     (v) except as set forth on such Grantor’s respective Schedule 4.1(E), all actions andconsents, including all filings, notices, registrations and recordings necessary ordesirable for the exercise by the Collateral Agent of the rights provided for in thisAgreement or the exercise of remedies in respect of the Collateral have been made orobtained;     (vi) except as set forth on such Grantor’s respective Schedule 4.1(E), noauthorization, approval or other action by, and no notice to or filing with, anyGovernmental Authority or regulatory body is required for either (i) the pledge or grant byany Grantor of the Liens purported to be created in favor of the Collateral Agent hereunderor (ii) the exercise by Collateral Agent of any rights or remedies in respect of anyCollateral (whether specifically granted or created hereunder or created or provided for byapplicable law), except for the filings contemplated by clause (v) above;     (vii) such Grantor has been duly organized as an entity of the type as set forthopposite such Grantor’s name on such Grantor’s respective Schedule 4.1(A) under the laws ofthe jurisdiction as set forth opposite such Grantor’s name on such Grantor’s respectiveSchedule 4.1(A). Such Grantor has not filed any certificates of domestication, transfer orcontinuance in any other jurisdiction; and     (viii) with respect to any Collateral granted hereunder, (i) such Collateral islocated at one of the applicable Grantor’s locations set forth on such Grantor’s respectiveSchedule 4.1(F), as such Schedule 4.1(F) may be updated from time to time, (ii) except aspermitted by the Credit Agreement, no material Collateral is now, or shall at any time ortimes hereafter be stored at any other location without Collateral Agent’s prior consent(such consent not be unreasonably withheld or delayed), and if Collateral Agent gives suchconsent, each applicable Grantor will promptly obtain, to the extent required by the CreditAgreement, bailee, landlord and mortgagee agreements, (iii) except as described on theapplicable Grantor’s Schedule 4.1(G), such Collateral is not subject to any licensing,patent, royalty, trademark, trade name or copyright agreements with any third parties whichwould require any consent of any third party upon sale or disposition of that Collateral orthe payment of any monies to any third party upon such sale or other disposition, andexcept as described on Schedule 4.1(G), (v) the completion of sale or other disposition ofsuch Collateral by Collateral Agent following an Event of Default shall not require theconsent of any Person and shall not constitute a breach or default under any contract oragreement to which any Grantor is a party or to which such property is subject.          (b) Covenants and Agreements. Each Grantor hereby covenants and agrees that:Security Agreement
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     (i) except for the security interest created by this Agreement, it shall not create orsuffer to exist any Lien upon or with respect to any of the Collateral, except PermittedLiens arising solely by operation of law, and such Grantor shall defend the Collateralagainst all Persons at any time claiming any interest therein not permitted under theCredit Documents;     (ii) unless waived by the Collateral Agent or otherwise permitted by the CreditAgreement, it shall not change such Grantor’s name, identity, corporate structure (e.g., bymerger, consolidation, change in corporate form or otherwise), sole place of business,chief executive office, type of organization or jurisdiction of organization unless itshall have (a) notified the Collateral Agent in writing, by executing and delivering to theCollateral Agent a completed Pledge Supplement, substantially in the form of ExhibitB attached hereto, together with all Supplements to Schedules thereto, at least 15 daysprior to any such change or establishment, identifying such new proposed name, identity,corporate structure, sole place of business, chief executive office, jurisdiction oforganization or trade name and providing such other information in connection therewith asthe Collateral Agent may reasonably request and (b) taken all actions necessary oradvisable to maintain the continuous validity, perfection and the same or better priorityof the Collateral Agent’s security interest in the Collateral intended to be granted andagreed to hereby;     (iii) except as permitted by the Credit Documents, it shall not take or permit anyaction which could impair the Collateral Agent’s rights in the Collateral in any materialrespect; and     (iv) it shall not sell, transfer or assign any Collateral except as permitted by theCredit Agreement.**SECTION 5. FURTHER ASSURANCES; ADDITIONAL GRANTORS.**     **5.1 Further Assurances**.          (a) Each Grantor agrees that from time to time, at the expense of such Grantor, that it shallpromptly execute and deliver all further instruments and documents, and take all further actionthat may be necessary or that the Collateral Agent may reasonably request, in order to createand/or maintain the validity, perfection or priority of and protect any security interest grantedhereby or to enable the Collateral Agent to exercise and enforce its rights and remedies hereunderwith respect to any Collateral. Without limiting the generality of the foregoing, each Grantorshall file such financing or continuation statements, or amendments thereto, and execute anddeliver such other agreements, instruments, endorsements, powers of attorney or notices, as may benecessary or desirable, or as the Collateral Agent may reasonably request, in order to perfect andpreserve the security interests granted or purported to be granted hereby.          (b) Each Grantor hereby authorizes the Collateral Agent to file a Record or Records,including, without limitation, financing or continuation statements,Security Agreement
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and amendments thereto, in any jurisdictions and with any filing offices as the CollateralAgent may determine, in its reasonable discretion, are necessary or advisable to perfect thesecurity interest granted to the Collateral Agent herein. Such financing statements may describethe Collateral in the same manner as described herein or may contain an indication or descriptionof collateral that describes such property in any other manner as the Collateral Agent maydetermine, in its sole discretion, is necessary, advisable or prudent to ensure the perfection ofthe security interest in the Collateral granted to the Collateral Agent herein. Each Grantor shallfurnish to the Collateral Agent from time to time, if so requested by Collateral Agent, statementsand schedules further identifying and describing the Collateral and such other reports inconnection with the Collateral as the Collateral Agent may reasonably request, all in reasonabledetail.          (c) Grantors shall in accordance with their customary practice keep and maintain, at their owncost and expense, records of the Collateral. Grantors shall mark their books and recordspertaining to the Collateral to evidence this Security Agreement and the Liens granted hereby.          (d) Each Grantor will defend the Collateral against, and take such other action as isnecessary to remove, any Lien on the Collateral except Permitted Liens, and will defend the right,title and interest of Collateral Agent and the other Secured Parties in and to any of suchGrantor’s rights under the Collateral against the claims and demands of all Persons whomsoever.          (e) [Intentionally Reserved]          (f) Grantors will advise Collateral Agent promptly, in reasonable detail, (i) of any Lien(other than Permitted Liens) or claim made or asserted against any of the Collateral, and (ii) ofthe occurrence of any other event which would have a material adverse effect on the aggregate valueof the Collateral or on the Liens created hereunder or under any other Credit Document.     **5.2 Additional Grantors**. From time to time subsequent to the date hereof, additional Personsmay become parties hereto as additional Grantors (each, an “**Additional Grantor**”), by executing aCounterpart Agreement substantially in the form of Exhibit C attached hereto. Upon delivery of anysuch counterpart agreement to the Collateral Agent, notice of which is hereby waived by Grantors,each Additional Grantor shall be a Grantor and shall be as fully a party hereto as if AdditionalGrantor were an original signatory hereto. Each Grantor expressly agrees that its obligationsarising hereunder shall not be affected or diminished by the addition or release of any otherGrantor hereunder, nor by any election of Collateral Agent not to cause any Subsidiary of Borrowerto become an Additional Grantor hereunder. This Agreement shall be fully effective as to anyGrantor that is or becomes a party hereto regardless of whether any other Person becomes or failsto become or ceases to be a Grantor hereunder.Security Agreement
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**SECTION 6. COLLATERAL AGENT APPOINTED ATTORNEY-IN-FACT.**     **6.1 Power of Attorney**. Subject to compliance with applicable Nevada Gaming Laws, each Grantorhereby irrevocably appoints the Collateral Agent (such appointment being coupled with an interestand shall be irrevocable until the Termination Date) as such Grantor’s attorney-in-fact, with fullauthority in the place and stead of such Grantor and in the name of such Grantor, the CollateralAgent or otherwise, subject to the terms of the Credit Agreement, this Agreement and applicableLegal Requirements, from time to time upon and following the occurrence and continuation of anEvent of Default, in the Collateral Agent’s discretion to take any action and to execute anyinstrument that the Collateral Agent may deem reasonably necessary or advisable to accomplish thepurposes of this Agreement, including, without limitation, the following:          (a) upon the occurrence and during the continuance of any Event of Default, to obtain andadjust insurance required to be maintained by such Grantor (if not so obtained by such Grantor) orpaid to the Collateral Agent pursuant to this Agreement;          (b) upon the occurrence and during the continuance of any Event of Default, to ask for,demand, collect, sue for, recover, compound, receive and give acquittance and receipts for moneysdue and to become due under or in respect of any of the Collateral;          (c) upon the occurrence and during the continuance of any Event of Default, to receive,endorse and collect any drafts or other instruments, documents and chattel paper in connection withclause (b) above;          (d) upon the occurrence and during the continuance of any Event of Default, to file any claimsor take any action or institute any proceedings that the Collateral Agent may deem necessary ordesirable for the collection of any of the Collateral or otherwise to enforce the rights of theCollateral Agent with respect to any of the Collateral;          (e) to prepare and file any UCC financing statements against such Grantor as debtor;          (f) to the extent permitted by the Credit Agreement, to take or cause to be taken all actionsnecessary to perform or comply or cause performance or compliance with the terms of this Agreement,including, without limitation, access to pay or discharge taxes or Liens (other than PermittedLiens arising solely by operation of law) levied or placed upon or threatened against theCollateral, the legality or validity thereof and the amounts necessary to discharge the same to bedetermined by the Collateral Agent in its sole discretion, any such payments made by the CollateralAgent to become obligations of such Grantor to the Collateral Agent, due and payable immediatelywithout demand; and          (g) generally to sell, transfer, pledge, make any agreement with respect to or otherwise dealwith any of the Collateral as fully and completely as though theSecurity Agreement
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Collateral Agent were the absolute owner thereof for all purposes, and to do, at theCollateral Agent’s option and such Grantor’s expense, at any time or from time to time, all actsand things that the Collateral Agent deems reasonably necessary to protect, preserve or realizeupon the Collateral and the Collateral Agent’s security interest therein in order to effect theintent of this Agreement, all as fully and effectively as such Grantor might do.     **6.2 No Duty on the Part of Collateral Agent or Secured Parties**. The powers conferred on theCollateral Agent hereunder are solely to protect the interests of the Secured Parties in theCollateral and shall not impose any duty upon the Collateral Agent or any Secured Party to exerciseany such powers or pursue or exhaust any of their rights against any Grantor, any other obligor,guarantor, pledgor or any other Person with respect to the payment of the Obligations or to pursueor exhaust any of their rights or remedies with respect to any Collateral therefore or any director indirect guarantee thereof. The Collateral Agent and the Secured Parties shall be accountableonly for amounts that they actually receive as a result of the exercise of such powers, and neitherthey nor any of their officers, directors, employees or agents shall be responsible to any Grantorfor any act or failure to act hereunder, except for their own gross negligence or willfulmisconduct.**SECTION 7. REMEDIES.**     **7.1 Generally.**          (a) In addition to all other rights and remedies granted to it under this Security Agreement,the Credit Agreement, the other Credit Documents and under any other instrument or agreementsecuring, evidencing or relating to any of the Obligations, if any Event of Default shall haveoccurred and be continuing**,**subject to the terms of the Bank Intercreditor Agreement and subject tocompliance with applicable Nevada Gaming Law, Collateral Agent may exercise all rights and remediesof a secured party under the UCC. Without limiting the generality of the foregoing, each Grantorexpressly agrees that in any such event Collateral Agent, without demand of performance or otherdemand, advertisement or notice of any kind (except for any notices which may be expressly requiredunder this Agreement, any other Credit Document, or the Bank Intercreditor Agreement and for thenotice specified below of time and place of public or private sale) to or upon such Grantor or anyother Person (all and each of which demands, advertisements and other notices are hereby expresslywaived to the maximum extent permitted by the UCC and other applicable law), may forthwith enterupon the premises of such Grantor where any Collateral is located through self-help, withoutjudicial process, without first obtaining a final judgment or giving such Grantor or any otherPerson notice and opportunity for a hearing on Collateral Agent’s claim or action and mayuninstall, remove, collect, receive, assemble, process, appropriate and realize upon theCollateral, or any part thereof, and may forthwith inspect, sell, lease, license, assign, give anoption or options to purchase, or sell or otherwise dispose of or otherwise realize upon(including, without limitation, by making, adjusting or settling any claim related to any insuranceor condemnation proceeds which may be payable with respect to any of theSecurity Agreement
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Collateral) and deliver said Collateral (or contract to do so), or any part thereof, in one ormore parcels at a public or private sale or sales, at any exchange at such prices as it may deemacceptable, for cash or on credit or for future delivery without assumption of any credit risk.Collateral Agent or any other Secured Party shall have the right upon any such public sale or salesand, to the extent permitted by law, upon any such private sale or sales, to purchase for thebenefit of Collateral Agent and the other Secured Parties, the whole or any part of said Collateralso sold, free of any right or equity of redemption, which equity of redemption each Grantor herebyreleases. Such sales may be adjourned and continued from time to time with or without notice.Collateral Agent shall have the right to conduct such sales on any Grantor’s premises or elsewhereand shall have the right to use any Grantor’s premises without charge for such time or times asCollateral Agent deems necessary or advisable.     If any Event of Default shall have occurred and be continued, each Grantor further agrees, atCollateral Agent’s request, to assemble the Collateral and make it available to Collateral Agent ata place or places designated by Collateral Agent which are reasonably convenient to CollateralAgent and such Grantor, whether at such Grantor’s premises or elsewhere. Until Collateral Agent isable to effect a sale, lease, or other disposition of Collateral, Collateral Agent shall have theright to hold or use Collateral, or any part thereof, to the extent that it deems appropriate forthe purpose of preserving Collateral or its value or for any other purpose deemed appropriate byCollateral Agent. Collateral Agent shall have no obligation to any Grantor to maintain or preservethe rights of such Grantor as against third parties with respect to Collateral while Collateral isin the possession of Collateral Agent. Collateral Agent may, if it so elects, seek the appointmentof a receiver or keeper to take possession of Collateral and to enforce any of Collateral Agent’sremedies (for the benefit of Collateral Agent and the other Secured Parties), with respect to suchappointment without prior notice or hearing as to such appointment. Collateral Agent shall applythe net proceeds of any such collection, recovery, receipt, appropriation, realization or sale tothe Obligations as provided in the Section 7.2 of this Agreement. To the maximum extent permittedby applicable law, each Grantor waives all claims, damages, and demands against Collateral Agent orany other Secured Party arising out of the repossession, retention or sale of the Collateral exceptsuch as arise solely out of the gross negligence or willful misconduct of Collateral Agent or suchSecured Party as finally determined by a court of competent jurisdiction. Each Grantor agrees thatten (10) days prior notice by Collateral Agent of the time and place of any public sale or of thetime after which a private sale may take place is reasonable notification of such matters.Grantors shall remain liable for any deficiency if the proceeds of any sale or disposition of theCollateral are insufficient to pay all Obligations, including any attorneys’ fees and otherexpenses incurred by Collateral Agent or any other Secured Party to collect such deficiency.          (b) Except as otherwise specifically provided herein, each Grantor hereby waives presentment,demand, protest or any notice (to the maximum extent permitted by applicable law) of any kind inconnection with this Security Agreement or any Collateral.Security Agreement
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          (c) To the extent that applicable law imposes duties on the Collateral Agent to exerciseremedies in a commercially reasonable manner, each Grantor acknowledges and agrees that it is notcommercially unreasonable for the Collateral Agent (i) to fail to incur expenses reasonably deemedsignificant by the Collateral Agent to prepare Collateral for disposition or otherwise to completeraw material or work in process into finished goods or other finished products for disposition,(ii) to fail to obtain third party consents for access to Collateral to be disposed of, or toobtain or, if not required by other law, to fail to obtain governmental or third party consents forthe collection or disposition of Collateral to be collected or disposed of, (iii) to fail toexercise collection remedies against any other Persons obligated on Collateral or to remove Lienson or any adverse claims against Collateral, (iv) to exercise collection remedies against any otherPersons obligated on Collateral directly or through the use of collection agencies and othercollection specialists, (v) to advertise dispositions of Collateral through publications or mediaof general circulation, whether or not the Collateral is of a specialized nature, (vi) to contactother Persons, whether or not in the same business as the Grantor, for expressions of interest inacquiring all or any portion of such Collateral, (vii) to hire one or more professional auctioneersto assist in the disposition of Collateral, whether or not the Collateral is of a specializednature, (viii) to dispose of Collateral by utilizing internet sites that provide for the auction ofassets of the types included in the Collateral or that have the reasonable capacity of doing so, orthat match buyers and sellers of assets, (ix) to dispose of assets in wholesale rather than retailmarkets, (x) to disclaim disposition warranties, such as title, possession or quiet enjoyment, (xi)to purchase insurance or credit enhancements to insure the Collateral Agent against risks of loss,collection or disposition of Collateral or to provide to the Collateral Agent a guaranteed returnfrom the removal, collection or disposition of Collateral, (xii) to uninstall or otherwise removeany Collateral (whether or not in the nature of a fixture) from any premises where the same mayhave been installed or otherwise located or to fail to sell or otherwise dispose of any Collateralas part of any sale or other disposition of such premises or any other assets of any Grantor or anySubsidiary of any Grantor, or (xiii) to the extent deemed appropriate by the Collateral Agent, toobtain the services of other brokers, investment bankers, consultants and other professionals toassist the Collateral Agent in the collection or disposition of any of the Collateral. EachGrantor acknowledges that the purpose of this Section 7(c) is to provide non-exhaustive indicationsof what actions or omissions by the Collateral Agent would not be commercially unreasonable in theCollateral Agent’s exercise of remedies against the Collateral and that other actions or omissionsby the Collateral Agent shall not be deemed commercially unreasonable solely on account of notbeing indicated in this Section 7(c). Without limitation upon the foregoing, nothing contained inthis Section 7(c) shall be construed to grant any rights to any Grantor or to impose any duties onCollateral Agent that would not have been granted or imposed by this Security Agreement or byapplicable law in the absence of this Section 7(c).          (d) Neither the Collateral Agent nor the other Secured Parties shall be required to make anydemand upon, or pursue or exhaust any of their rights or remedies against, any Grantor, any otherobligor, guarantor, pledgor or any other Person with respect to the payment of the Obligations orto pursue or exhaust any of their rights orSecurity Agreement
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remedies with respect to any Collateral therefore or any direct or indirect guarantee thereof.Neither the Collateral Agent nor the other Secured Parties shall be required to marshal theCollateral or any guarantee of the Obligations or to resort to the Collateral or any such guaranteein any particular order, and all of its and their rights hereunder or under any other CreditDocument shall be cumulative. To the extent it may lawfully do so, each Grantor absolutely andirrevocably waives and relinquishes the benefit and advantage of, and covenants not to assertagainst the Collateral Agent or any other Secured Party, any valuation, stay, appraisement,extension, redemption or similar laws and any and all rights or defenses it may have as a suretynow or hereafter existing which, but for this provision, might be applicable to the sale of anyCollateral made under the judgment, order or decree of any court, or privately under the power ofsale conferred by this Security Agreement, or otherwise.     **7.2 Application of Proceeds**. Except as expressly provided elsewhere in this Agreement, allproceeds received by the Collateral Agent in respect of any sale, any collection from, or otherrealization upon all or any part of the Collateral shall be applied in full or in part by theCollateral Agent against, the Secured Obligations in the following order of priority:first, to the payment of all costs and expenses of such sale, collection or otherrealization, including reasonable compensation to the Collateral Agent and its agents and counsel,and all other expenses, liabilities and advances made or incurred by the Collateral Agent inconnection therewith, and all amounts for which the Collateral Agent is entitled to indemnificationhereunder (in its capacity as the Collateral Agent and not as a Lender) and all advances made bythe Collateral Agent hereunder for the account of the applicable Grantor, and to the payment of allcosts and expenses paid or incurred by the Collateral Agent in connection with the exercise of anyright or remedy hereunder or under the Credit Agreement, all in accordance with the terms hereof orthereof; second, to the extent of any excess of such proceeds, to the payment of all otherSecured Obligations for the ratable benefit of all Secured Parties; and third, to theextent of any excess of such proceeds, to the payment to or upon the order of such Grantor or towhosoever may be lawfully entitled to receive the same or as a court of competent jurisdiction maydirect.     **7.3 Sales on Credit**. If Collateral Agent sells any of the Collateral upon credit, Grantorwill be credited only with payments actually made by purchaser and received by Collateral Agent andapplied to Indebtedness of the purchaser. In the event the purchaser fails to pay for theCollateral, Collateral Agent may resell the Collateral and Grantor shall be credited with proceedsof the sale.     **7.4 [Intentionally Reserved].**     **7.5 Grant of License to Use Intellectual Property**. Solely for the purpose of enabling theCollateral Agent to exercise rights and remedies under this Section 7 (including, without limitingthe terms this Section 7 hereof, in order to take possession of, hold, preserve, process, assemble,prepare for sale, market for sale, sell or otherwise dispose of Collateral) and at such time as theCollateral Agent shall be lawfully entitled to exercise such rights and remedies, each Grantorhereby grants to the Collateral Agent,Security Agreement
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for the benefit of Collateral Agent and the other Secured Parties, to the extent it has theright to do so, an irrevocable, nonexclusive license (exercisable without payment of royalty orother compensation to such Grantor), subject, in the case of trademarks, to sufficient rights ofquality control and inspection in favor of such Grantor to avoid the risk of invalidation of saidtrademarks, to use, operate under, license, or sublicense any intellectual property now owned orhereafter acquired by such Grantor that is affixed, embedded in, or otherwise necessary to theoperation of the Designated FF&E, and wherever the same may be located, and including in suchlicense access to all media in which any of the licensed items may be recorded or stored and to allcomputer software and programs used for the compilation or printout thereof, solely to the extentthat each Grantor has the right pursuant to the terms of the applicable license, contract oragreement to grant the Collateral Agent such irrevocable, non-exclusive license.     **7.6 Cash Proceeds**. During the continuance of an Event of Default any proceeds of anyCollateral received by any Grantor consisting of cash, checks and other similar non-cash items(collectively, “**Cash Proceeds**”) shall be held by such Grantor in trust for the Collateral Agent,segregated from other funds of such Grantor, and shall, promptly upon receipt by such Grantor, beturned over to the Collateral Agent in the exact form received by such Grantor (duly indorsed bysuch Grantor to the Collateral Agent, if required) and held by the Collateral Agent in theCollateral Account. Any Cash Proceeds received by the Collateral Agent from a Grantor when anEvent of Default shall have occurred and be continuing, may, in the sole discretion of theCollateral Agent, (A) be held by the Collateral Agent for the ratable benefit of the SecuredParties, as collateral security for the Secured Obligations (whether matured or unmatured) and/or(B) then or at any time thereafter may be applied by the Collateral Agent against the SecuredObligations then due and owing in accordance with the application of proceeds set forth in Section7.2.**SECTION 8. COLLATERAL AGENT.**     The Collateral Agent has been appointed to act as Collateral Agent hereunder by Lenders and,by their acceptance of the benefits hereof, the other Secured Parties. The Collateral Agent shallbe obligated, and shall have the right hereunder, to make demands, to give notices, to exercise orrefrain from exercising any rights, and to take or refrain from taking any action (including,without limitation, the release or substitution of Collateral), solely in accordance with thisAgreement and the Credit Agreement. In furtherance of the foregoing provisions of this Section,each Secured Party, by its acceptance of the benefits hereof, agrees that it shall have no rightindividually to realize upon any of the Collateral hereunder, it being understood and agreed bysuch Secured Party that all rights and remedies hereunder may be exercised solely by the CollateralAgent for the benefit of Secured Parties in accordance with the terms of this Section. CollateralAgent may resign at any time by giving thirty (30) days’ prior written notice thereof to Lendersand the Grantors, and Collateral Agent may be removed at any time with or without cause by aninstrument or concurrent instruments in writing delivered to the Grantors and Collateral Agentsigned by the Requisite Lenders. Upon any such notice of resignation or any such removal,Requisite Lenders shall have the right, uponSecurity Agreement
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five (5) Business Days’ notice to the Administrative Agent and the Grantors, to appoint asuccessor Collateral Agent pursuant to the terms of the Credit Agreement. Upon the acceptance ofany appointment as Collateral Agent hereunder by a successor Collateral Agent, that successorCollateral Agent shall thereupon succeed to and become vested with all the rights, powers,privileges and duties of the retiring or removed Collateral Agent under this Agreement, and theretiring or removed Collateral Agent under this Agreement shall promptly (i) transfer to suchsuccessor Collateral Agent all sums and other items of Collateral held hereunder, together with allrecords and other documents necessary or appropriate in connection with the performance of theduties of the successor Collateral Agent under this Agreement, and (ii) execute and deliver to suchsuccessor Collateral Agent or otherwise authorize the filing of such amendments to financingstatements, and take such other actions, as may be necessary or appropriate in connection with theassignment to such successor Collateral Agent of the security interests created hereunder,whereupon such retiring or removed Collateral Agent shall be discharged from its duties andobligations under this Agreement. After any retiring or removed Collateral Agent’s resignation orremoval hereunder as the Collateral Agent, the provisions of this Agreement shall inure to itsbenefit as to any actions taken or omitted to be taken by it under this Agreement while it was theCollateral Agent hereunder. The Collateral Agent (including any successor Collateral Agent) shallenjoy the benefits afforded it under Section 9.6 of the Credit Agreement, it being understood thatthe indemnification provided thereunder shall come from the Lenders based on their Pro Rata Shareas set forth therein.**SECTION 9. CONTINUING SECURITY INTEREST; TRANSFER OF LOANS.**     This Agreement shall create a continuing security interest in the Collateral and shall remainin full force and effect until the Termination Date. Such security interests shall be binding uponeach Grantor, its successors and assigns, and inure, together with the rights and remedies of theCollateral Agent hereunder, to the benefit of the Collateral Agent and its successors, transfereesand assigns. Without limiting the generality of the foregoing, but subject to the terms of theCredit Agreement, any Lender may assign or otherwise transfer any Loans by it to any other Person,and such other Person shall thereupon become vested with all the benefits in respect thereofgranted to Lenders herein or otherwise. On the Termination Date, the security interest grantedhereby shall automatically terminate hereunder and of record and all rights to the Collateral shallrevert to Grantors. Upon any such termination the Collateral Agent shall, at Grantors’ expense,execute and deliver to Grantors or otherwise authorize the filing of such documents as Grantorsshall reasonably request, including financing statement amendments and UCC-3 termination statementsto evidence such termination. Upon any sale, transfer or other disposition of property permittedby the Credit Agreement (or agreed to by the Requisite Lenders and/or Administrative Agent underthe Credit Agreement in accordance with the terms thereof), the Liens granted herein shall bedeemed to be automatically released and such property shall automatically revert to the applicableGrantor with no further action on the part of any Person. To the extent any property (includingSpecified FF&E) is financed by any lender pursuant to an Other FF&E Facility in accordance with theCredit Agreement, the Collateral Agent shallSecurity Agreement
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release any Liens in favor of the Secured Parties on such assets (subject to the standstill orintercreditor agreement, if any, executed by the Collateral Agent or Administrative Agent inconnection with such Other FF&E Facility). The Collateral Agent shall, at Grantor’s expense,execute and deliver or otherwise authorize the filing of such documents as Grantors shallreasonably request, in form and substance reasonably satisfactory to the Collateral Agent,including financing statement amendments to evidence such releases.**SECTION 10. STANDARD OF CARE; COLLATERAL AGENT MAY PERFORM.**     The powers conferred on the Collateral Agent hereunder are solely to protect its interest inthe Collateral and shall not impose any duty upon it to exercise any such powers. Except for theexercise of reasonable care in the custody of any Collateral in its possession and the accountingfor moneys actually received by it hereunder, the Collateral Agent shall have no duty as to anyCollateral or as to the taking of any necessary steps to preserve rights against prior parties orany other rights pertaining to any Collateral. The Collateral Agent shall be deemed to haveexercised reasonable care in the custody and preservation of Collateral in its possession if suchCollateral is accorded treatment substantially equal to that which the Collateral Agent accords itsown property. Neither the Collateral Agent nor any of its directors, officers, employees or agentsshall be liable for failure to demand, collect or realize upon all or any part of the Collateral orfor any delay in doing so or shall be under any obligation to sell or otherwise dispose of anyCollateral upon the request of any Grantor or otherwise. If any Grantor fails to perform anyagreement contained herein, the Collateral Agent may (to the extent provided herein) itselfperform, or cause performance of, such agreement, and the expenses of the Collateral Agent incurredin connection therewith shall be payable by each Grantor under Section 10.2 of the CreditAgreement.**SECTION 11. MISCELLANEOUS.**          (a) Any notice required or permitted to be given under this Agreement shall be given inaccordance with Section 10.1 of the Credit Agreement.          (b) No failure or delay on the part of the Collateral Agent in the exercise of any power,right or privilege hereunder or under any other Credit Document shall impair such power, right orprivilege or be construed to be a waiver of any default or acquiescence therein, nor shall anysingle or partial exercise of any such power, right or privilege preclude other or further exercisethereof or of any other power, right or privilege. All rights and remedies existing under thisAgreement and the other Credit Documents are cumulative to, and not exclusive of, any rights orremedies otherwise available.          (c) In case any provision in or obligation under this Agreement shall be invalid, illegal orunenforceable in any jurisdiction, the validity, legality and enforceability of the remainingprovisions or obligations, or of such provision or obligation in any other jurisdiction, shall notin any way be affected or impaired thereby.Security Agreement
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All covenants hereunder shall be given independent effect so that if a particular action orcondition is not permitted by any of such covenants, the fact that it would be permitted by anexception to, or would otherwise be within the limitations of, another covenant shall not avoid theoccurrence of a Potential Event of Default or an Event of Default if such action is taken orcondition exists.          (d) This Agreement shall be binding upon and inure to the benefit of the Collateral Agent andGrantors and their respective successors and assigns. No Grantor shall, without the prior writtenconsent of the Collateral Agent given in accordance with the Credit Agreement, assign any right,duty or obligation hereunder.          (e) This Agreement and the other Credit Documents embody the entire agreement andunderstanding between Grantors and the Collateral Agent and supersede all prior agreements andunderstandings between such parties relating to the subject matter hereof and thereof.Accordingly, the Credit Documents may not be contradicted by evidence of prior, contemporaneous orsubsequent oral agreements of the parties. There are no unwritten oral agreements between theparties.          (f) This Agreement may be amended only by a written amendment executed by all the partieshereto evidencing their consent to such amendments. The consent of the Collateral Agent shall bedirected by, to the extent required by the Credit Agreement, the vote of Required Lenders (or suchother group of Lenders as is required thereunder).          (g) This Agreement may be executed in one or more counterparts and by different parties heretoin separate counterparts, each of which when so executed and delivered shall be deemed an original,but all such counterparts together shall constitute but one and the same instrument; signaturepages may be detached from multiple separate counterparts and attached to a single counterpart sothat all signature pages are physically attached to the same document.          (h) **SUBJECT TO THE APPLICATION OF NEVADA GAMING LAWS, THIS AGREEMENT AND THE RIGHTS ANDOBLIGATIONS OF THE PARTIES HEREUNDER SHALL BE GOVERNED BY, AND SHALL BE CONSTRUED AND ENFORCED INACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK, WITHOUT REGARD TO ITS CONFLICTS OF LAWPROVISIONS (OTHER THAN SECTION 5-1401 AND SECTION 5-1402 OF THE NEW YORK GENERAL OBLIGATION LAWS).**          (i) Section headings herein are included herein for convenience of reference only and shallnot constitute a part hereof for any other purpose or be given any substantive effect.          (j) The parties hereto have participated jointly in the negotiation and drafting of thisSecurity Agreement. In the event an ambiguity or question of intent or interpretation arises, thisSecurity Agreement shall be construed as if drafted jointly by the parties hereto and nopresumption or burden of proof shall arise favoring orSecurity Agreement
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disfavoring any party by virtue of the authorship of any provisions of this SecurityAgreement.          (k) Each of the parties represents to each other party hereto that it has discussed thisSecurity Agreement and, specifically, but not limited to, the provisions of Section 11(h), with itscounsel.          (l) This Security Agreement shall remain in full force and effect and continue to be effectiveshould any petition be filed by or against any Grantor for liquidation or reorganization, shouldany Grantor become insolvent or make an assignment for the benefit of any creditor or creditors orshould a receiver or trustee be appointed for all or any significant part of any Grantor’s assets,and shall continue to be effective or be reinstated, as the case may be, if at any time payment andperformance of the Secured Obligations, or any part thereof, is, pursuant to applicable law,rescinded or reduced in amount, or must otherwise be restored or returned by any Secured Party,whether as a “voidable preference,” “fraudulent conveyance,” or otherwise, all as though suchpayment or performance had not been made. In the event that any payment, or any part thereof, isrescinded, reduced, restored or returned, the Secured Obligations shall be reinstated and deemedreduced only by such amount paid and not so rescinded, reduced, restored or returned.**SECTION 12. AMENDMENT AND RESTATEMENT.**     All obligations and liabilities of the Grantors under the Existing Security Agreement shall becontinued, extended as obligations and liabilities of the Grantors hereunder, and shall cover allObligations from and after the Restatement Effective Date, and shall not be deemed to be paid,released, discharged or otherwise satisfied by the execution of this Agreement, and this Agreementshall not be deemed to constitute a substitution or novation of such obligations and liabilities.This Agreement shall not in any way release or impair the rights, duties, obligations or Lienscreated pursuant to the Existing Security Agreement or any other Loan Document (as defined in theExisting FF&E Credit Agreement), whether or not such document is amended and restated in connectionwith this Agreement or otherwise, or affect the relative priorities thereof, in each case to theextent in force and effect thereunder as of the Closing Date, and except as modified hereby or bydocuments, instruments and agreements executed and delivered in connection herewith or therewith,and all of such rights, duties, obligations and Liens are continued, ratified and affirmed by theparties hereto.[remainder of page intentionally left blank]Security Agreement
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     IN WITNESS WHEREOF, each Grantor and the Collateral Agent have caused this Agreement to beduly executed and delivered by their respective officers thereunto duly authorized as of the datefirst written above.      **GRANTORS:**