Exhibit
4.4


 


EXECUTION COPY


 


 


STATION
CASINOS, INC.


 


 












 


 


$350,000,000


 


 


67/8% SENIOR SUBORDINATED NOTES DUE 2016


 


 












 


 


INDENTURE


 


 


DATED AS
OF FEBRUARY 27, 2004


 


 












 


 


LAW
DEBENTURE TRUST COMPANY 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.

  
	
   

  	
  (b)

  	
   

  	
  7.08; 7.10; 11.02

  
	
   

  	
  (c)

  	
   

  	
  N.A.

  
	
  311

  	
  (a)

  	
   

  	
  7.11

  
	
   

  	
  (b)

  	
   

  	
  7.11

  
	
   

  	
  (c)

  	
   

  	
  N.A.

  
	
  312

  	
  (a)

  	
   

  	
  2.05

  
	
   

  	
  (b)

  	
   

  	
  11.03

  
	
   

  	
  (c)

  	
   

  	
  11.03

  
	
  313

  	
  (a)

  	
   

  	
  7.06

  
	
   

  	
  (b)(1)

  	
   

  	
  N.A.

  
	
   

  	
  (b)(2)

  	
   

  	
  7.06

  
	
   

  	
  (c)

  	
   

  	
  7.06; 11.02

  
	
   

  	
  (d)

  	
   

  	
  7.06

  
	
  314

  	
  (a)

  	
   

  	
  4.02; 11.02

  
	
   

  	
  (b)

  	
   

  	
  N.A.

  
	
   

  	
  (c)(1)

  	
   

  	
  11.04

  
	
   

  	
  (c)(2)

  	
   

  	
  11.04

  
	
   

  	
  (c)(3)

  	
   

  	
  N.A.

  
	
   

  	
  (d)

  	
   

  	
  N.A.

  
	
   

  	
  (e)

  	
   

  	
  11.05

  
	
   

  	
  (f)

  	
   

  	
  N.A.

  
	
  315

  	
  (a)

  	
   

  	
  7.01(b)

  
	
   

  	
  (b)

  	
   

  	
  7.05; 11.02

  
	
   

  	
  (c)

  	
   

  	
  7.01(a)

  
	
   

  	
  (d)

  	
   

  	
  7.01(c)

  
	
   

  	
  (e)

  	
   

  	
  6.11

  
	
  316

  	
  (a) (last sentence)

  	
   

  	
  2.09

  
	
   

  	
  (a)(1)(A)

  	
   

  	
  6.05

  
	
   

  	
  (a)(1)(B)

  	
   

  	
  6.04

  
	
   

  	
  (a)(2)

  	
   

  	
  N.A.

  
	
   

  	
  (b)

  	
   

  	
  6.04; 6.07

  
	
  317

  	
  (a)(1)

  	
   

  	
  6.08

  
	
   

  	
  (a)(2)

  	
   

  	
  6.09

  
	
   

  	
  (b)

  	
   

  	
  2.04

  
	
  318

  	
  (a)

  	
   

  	
  11.01

  



 


N.A. means not applicable.


 












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


 

















 


TABLE OF
CONTENTS


 


	
  ARTICLE 1. DEFINITIONS AND INCORPORATION BY
  REFERENCE

  	
   

  
	
   

  	
   

  
	
  Section 1.01.

  	
  Definitions

  	
   

  
	
  Section 1.02.

  	
  Other Definitions

  	
   

  
	
  Section 1.03.

  	
  Incorporation by Reference of Trust
  Indenture Act

  	
   

  
	
  Section 1.04.

  	
  Rules of Construction

  	
   

  
	
   

  	
   

  
	
  ARTICLE 2. THE NOTES

  	
   

  
	
   

  	
   

  
	
  Section 2.01.

  	
  Form and Dating

  	
   

  
	
  Section 2.02.

  	
  Execution and Authentication

  	
   

  
	
  Section 2.03.

  	
  Registrar; Paying Agent; Depository; Note
  Custodian

  	
   

  
	
  Section 2.04.

  	
  Paying Agent to Hold Money in Trust

  	
   

  
	
  Section 2.05.

  	
  Noteholder Lists

  	
   

  
	
  Section 2.06.

  	
  Transfer and Exchange

  	
   

  
	
  Section 2.07.

  	
  Replacement Notes

  	
   

  
	
  Section 2.08.

  	
  Outstanding Notes

  	
   

  
	
  Section 2.09.

  	
  Treasury Notes

  	
   

  
	
  Section 2.10.

  	
  Temporary Notes

  	
   

  
	
  Section 2.11.

  	
  Cancellation

  	
   

  
	
  Section 2.12.

  	
  Defaulted Interest

  	
   

  
	
  Section 2.13.

  	
  CUSIP Numbers

  	
   

  
	
   

  	
   

  
	
  ARTICLE 3. REDEMPTION

  	
   

  
	
   

  	
   

  
	
  Section 3.01.

  	
  Notices to Trustee

  	
   

  
	
  Section 3.02.

  	
  Selection of Notes to Be Redeemed

  	
   

  
	
  Section 3.03.

  	
  Notice of Redemption

  	
   

  
	
  Section 3.04.

  	
  Effect of Notice of Redemption

  	
   

  
	
  Section 3.05.

  	
  Deposit of Redemption Price

  	
   

  
	
  Section 3.06.

  	
  Notes Redeemed in Part

  	
   

  
	
  Section 3.07.

  	
  Mandatory Disposition Pursuant to Gaming
  Laws

  	
   

  
	
   

  	
   

  
	
  ARTICLE 4. COVENANTS

  	
   

  
	
   

  	
   

  
	
  Section 4.01.

  	
  Payment of Notes

  	
   

  
	
  Section 4.02.

  	
  SEC Reports, Financial Reports

  	
   

  
	
  Section 4.03.

  	
  Compliance Certificate

  	
   

  
	
  Section 4.04.

  	
  Stay, Extension and Usury Laws

  	
   

  
	
  Section 4.05.

  	
  Limitation on Indebtedness

  	
   

  
	
  Section 4.06.

  	
  Limitation on Capital Stock of Restricted
  Subsidiaries

  	
   

  
	
  Section 4.07.

  	
  Corporate Existence

  	
   

  
	
  Section 4.08.

  	
  Taxes

  	
   

  
	
  Section 4.09.

  	
  Investment Company Act

  	
   

  



 


i

















 


	
  Section 4.10.

  	
  Limitation on Transactions with Affiliates

  	
   

  
	
  Section 4.11.

  	
  Change of Control and Rating Decline

  	
   

  
	
  Section 4.12.

  	
  Limitation on Dividends and Other Payment
  Restrictions Affecting Restricted Subsidiaries

  	
   

  
	
  Section 4.13.

  	
  Restriction on Layering Debt

  	
   

  
	
   

  	
   

  
	
  ARTICLE 5. SUCCESSORS

  	
   

  
	
   

  	
   

  
	
  Section 5.01.

  	
  When Company May Merge, etc

  	
   

  
	
  Section 5.02.

  	
  Successor Corporation Substituted

  	
   

  
	
   

  	
   

  
	
  ARTICLE 6. DEFAULTS AND REMEDIES

  	
   

  
	
   

  	
   

  
	
  Section 6.01.

  	
  Events of Default

  	
   

  
	
  Section 6.02.

  	
  Acceleration

  	
   

  
	
  Section 6.03.

  	
  Other Remedies

  	
   

  
	
  Section 6.04.

  	
  Waiver of Past Defaults

  	
   

  
	
  Section 6.05.

  	
  Control by Majority

  	
   

  
	
  Section 6.06.

  	
  Limitation on Suits

  	
   

  
	
  Section 6.07.

  	
  Rights of Holders to Receive Payment

  	
   

  
	
  Section 6.08.

  	
  Collection Suit by Trustee

  	
   

  
	
  Section 6.09.

  	
  Trustee May File Proofs of Claim

  	
   

  
	
  Section 6.10.

  	
  Priorities

  	
   

  
	
  Section 6.11.

  	
  Undertaking for Costs

  	
   

  
	
   

  	
   

  
	
  ARTICLE 7. TRUSTEE

  	
   

  
	
   

  	
   

  
	
  Section 7.01.

  	
  Duties of Trustee

  	
   

  
	
  Section 7.02.

  	
  Rights of Trustee

  	
   

  
	
  Section 7.03.

  	
  Individual Rights of Trustee

  	
   

  
	
  Section 7.04.

  	
  Trustee’s Disclaimer

  	
   

  
	
  Section 7.05.

  	
  Notice of Defaults

  	
   

  
	
  Section 7.06.

  	
  Reports by Trustee to Holders.

  	
   

  
	
  Section 7.07.

  	
  Compensation and Indemnity

  	
   

  
	
  Section 7.08.

  	
  Replacement of Trustee

  	
   

  
	
  Section 7.09.

  	
  Successor Trustee by Merger, etc

  	
   

  
	
  Section 7.10.

  	
  Eligibility; Disqualification

  	
   

  
	
  Section 7.11.

  	
  Preferential Collection of Claims Against
  Company

  	
   

  
	
   

  	
   

  
	
  ARTICLE 8. DISCHARGE OF INDENTURE

  	
   

  
	
   

  	
   

  
	
  Section 8.01.

  	
  Termination of Company’s Obligations

  	
   

  
	
  Section 8.02.

  	
  Application of Trust Money

  	
   

  
	
  Section 8.03.

  	
  Repayment to Company

  	
   

  
	
  Section 8.04.

  	
  Reinstatement

  	
   

  



 


ii

















 


	
  ARTICLE 9. AMENDMENTS

  	
   

  
	
   

  	
   

  
	
  Section 9.01.

  	
  Without Consent of Holders

  	
   

  
	
  Section 9.02.

  	
  With Consent of Holders

  	
   

  
	
  Section 9.03.

  	
  Compliance with Trust Indenture Act

  	
   

  
	
  Section 9.04.

  	
  Revocation and Effect of Consents

  	
   

  
	
  Section 9.05.

  	
  Notation on or Exchange of Notes

  	
   

  
	
  Section 9.06.

  	
  Trustee Protected

  	
   

  
	
   

  	
   

  
	
  ARTICLE 10. SUBORDINATION

  	
   

  
	
   

  	
   

  
	
  Section 10.01.

  	
  Notes Subordinated to Senior Indebtedness

  	
   

  
	
  Section 10.02.

  	
  Liquidation; Dissolution; Bankruptcy

  	
   

  
	
  Section 10.03.

  	
  Default on Senior Indebtedness

  	
   

  
	
  Section 10.04.

  	
  When Distribution Must Be Paid Over

  	
   

  
	
  Section 10.05.

  	
  Notice by Company

  	
   

  
	
  Section 10.06.

  	
  Subrogation

  	
   

  
	
  Section 10.07.

  	
  Relative Rights

  	
   

  
	
  Section 10.08.

  	
  Subordination May Not Be Impaired by
  Company

  	
   

  
	
  Section 10.09.

  	
  Distribution or Notice to Representatives

  	
   

  
	
  Section 10.10.

  	
  Rights of Trustee and Paying Agent

  	
   

  
	
  Section 10.11.

  	
  Trustee Entitled to Assume Payments Not
  Prohibited in Absence of Notice

  	
   

  
	
  Section 10.12.

  	
  Application by Trustee of Monies Deposited
  With It

  	
   

  
	
  Section 10.13.

  	
  Trustee’s Compensation Not Prejudiced

  	
   

  
	
  Section 10.14.

  	
  Officers’ Certificate

  	
   

  
	
  Section 10.15.

  	
  Certain Payments

  	
   

  
	
  Section 10.16.

  	
  Names of Representatives

  	
   

  
	
  Section 10.17.

  	
  Article 10 Not to Prevent Events of Default
  or Limit Right to Accelerate

  	
   

  
	
  Section 10.18.

  	
  Reliance By Holders of Senior Indebtedness
  on Subordination Provisions

  	
   

  
	
  Section 10.19.

  	
  Proof of Claim

  	
   

  
	
  Section 10.20.

  	
  No Fiduciary Duty Created to Holders of
  Senior Indebtedness

  	
   

  
	
   

  	
   

  
	
  ARTICLE 11. MISCELLANEOUS

  	
   

  
	
   

  	
   

  
	
  Section 11.01.

  	
  Trust Indenture Act Controls

  	
   

  
	
  Section 11.02.

  	
  Notices

  	
   

  
	
  Section 11.03.

  	
  Communication by Holders with Other Holders

  	
   

  
	
  Section 11.04.

  	
  Certificate and Opinion as to Conditions
  Precedent

  	
   

  
	
  Section 11.05.

  	
  Statements Required in Certificate or
  Opinion

  	
   

  
	
  Section 11.06.

  	
  Rules by Trustee and Agents

  	
   

  
	
  Section 11.07.

  	
  Legal Holidays

  	
   

  
	
  Section 11.08.

  	
  No Recourse Against Others

  	
   

  
	
  Section 11.09.

  	
  Counterparts

  	
   

  
	
  Section 11.10.

  	
  Variable Provisions

  	
   

  
	
  Section 11.11.

  	
  Governing Law

  	
   

  
	
  Section 11.12.

  	
  No Adverse Interpretation of Other
  Agreements

  	
   

  



 


iii

















 


	
  Section 11.13.

  	
  Successors

  	
   

  
	
  Section 11.14.

  	
  Severability

  	
   

  
	
  Section 11.15.

  	
  Qualification of Indenture

  	
   

  
	
  Section 11.16.

  	
  Table of Contents, Headings, etc

  	
   

  



 


iv

















 


	
  Exhibit
  A

  	
   

  	
  Form
  of Global Note

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  Exhibit
  B

  	
   

  	
  Form
  of Regulation S Temporary Note

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  Exhibit
  C

  	
   

  	
  Form
  of Certificate of Transfer

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  Exhibit
  D

  	
   

  	
  Form
  of Certificate for Transfer or Exchange

  	
   

  



 


v

















 


INDENTURE dated as of February 27, 2004 among STATION
CASINOS, INC., a Nevada corporation (the “Company”), and LAW DEBENTURE TRUST
COMPANY OF NEW YORK, a New York banking corporation, as Trustee (the
“Trustee”).


 


Each party agrees as follows for the benefit of the
other parties and for the equal and ratable benefit of the Holders of the
Company’s 67/8% Series A Senior
Subordinated Notes due 2016 (the “Series A Notes”) and the Company’s 67/8%
Series B Senior Notes due 2016 (the “Series B Notes” and, together with the
Series A Notes, the “Notes”).


 


ARTICLE 1.

DEFINITIONS AND INCORPORATION  

BY REFERENCE


 


Section 1.01.          Definitions.


 


“Affiliate”
of any specified person means any other person (i) which directly or indirectly
through one or more intermediaries controls, or is controlled by, or is under
common control with, such specified person, (ii) which directly or indirectly
through one or more intermediaries beneficially owns or holds 10% or more of
any class of the Voting Stock of such specified person (or a 10% or greater
equity interest in such person which is not a corporation) or (iii) of which
10% or more of any class of the Voting Stock (or, in the case of a person which
is not a corporation, 10% or more of the equity interest) is beneficially owned
or held directly or indirectly through one or more intermediaries by such
person.  The term “control” means the
possession, directly or indirectly, of the power to direct or cause the
direction of the management and policies of a person, whether through the
ownership of voting securities, by contract or otherwise.


 


“Agent” means any Registrar, Paying Agent or
co-registrar.


 


“Amortization
Expense” means, for any period, amounts recognized during such
period as amortization of all goodwill and other assets classified as
intangible assets in accordance with GAAP.


 


“Applicable Procedures” means, with respect
to any transfer or exchange of beneficial interests in a Global Note, the rules
and procedures of the Depository, Euroclear or Clearstream that are applicable
to such transfer or exchange.


 


“Average Life” means, as of the date of
determination, with reference to any Indebtedness, the quotient obtained by
dividing (i) the sum of the products of the number of years from the date of
determination to the dates of each successive scheduled principal payment of
such Indebtedness multiplied by the amount of such principal payment by (ii)
the sum of all such principal payments.


 


“Bank Facility” means the Amended and
Restated Loan Agreement dated as of September 18, 2002, and amended by the
First Amendment to Amended and Restated Loan Agreement, as of January 24, 2003,
by the Second Amendment to Amended and Restated Loan Agreement, as of July 14,
2003, and by that Third Amendment to Amended and Restated Loan Agreement, as of
December 18, 2003, by and among Palace, Boulder, Texas, Sunset, Santa Fe,


 

















 


Lake Mead Holdings, Lake Mead, Fiesta Holdings and
Fiesta, the Lenders party thereto and Bank of Scotland, Deutsche Bank Trust
Company Americas, Dresdner Bank AG, New York and Grand Cayman Branches, Lehman
Commercial Paper Inc. and Wells Fargo Bank, N.A., as Syndication Agents, and
Bank of America, N.A., as Administrative Agent, as amended, modified or
refinanced from time to time, provided that the managing agent for the lenders
under such refinancing is a banking institution with over $500 million in
assets and subject to supervision and examination by federal or state banking
authorities.


 


“Board of Directors” or “Board” means the Board of Directors of the
Company.


 


“Boulder”
means Boulder Station, Inc.


 


“Business Day” means any day other than a
Legal Holiday.


 


“Capital Lease Obligations” of a person
means any obligation that is required to be classified and accounted for as a
capital lease on the face of a balance sheet of such person prepared in
accordance with GAAP; the amount of such obligation shall be the capitalized
amount thereof, determined in accordance with GAAP; the stated maturity thereof
shall be the date of the last payment of rent or any other amount due under
such lease prior to the first date upon which such lease may be terminated by
the lessee without payment of a penalty; and such obligation shall be deemed
secured by a Lien on any property or assets to which such lease relates.


 


“Capital Stock” means, with respect to any
person, any and all shares, interests, rights to purchase, warrants, options,
participations or other equivalents (including partnerships or partnership
interests), or ownership interests (however designated) of such person,
including each class of common stock and preferred stock of such person, but
excluding convertible Indebtedness.


 


“Certificated Note”
means a certificated Note registered in the name of the Holder thereof and
issued in accordance with Section 2.06 hereof, in the form of Exhibit A hereto
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.


 


“Change of Control” means an event or series
of events by which (i) the Company sells, conveys, transfers or leases,
directly or indirectly, all or substantially all of the properties and assets
of the Company and its Restricted Subsidiaries to any person, corporation,
entity or group, (ii) any “person” (as such term is used in Sections 13(d) and
14(d) of the Exchange Act) (other than the Existing Equity Holders) is or
becomes the “beneficial owner” (as defined in Rules 13d-3 and 13d-5 under the
Exchange Act, except that a person shall be deemed to have “beneficial
ownership” of all shares that any such person has the right to acquire, whether
such right is exercisable immediately or only after the passage of time),
directly or indirectly of securities representing 40% or more of the combined
voting power of the Company’s Voting Stock and at such time as the Existing
Equity Holders together shall fail to beneficially own, directly or indirectly,
securities representing at least the same percentage of the combined voting
power of the Company’s Voting Stock as is “beneficially owned” by such
“person,” (iii) the Company consolidates with or merges into another
corporation, or any


 


2

















 


corporation consolidates with or merges into the
Company, in either event pursuant to a transaction in which the outstanding
Voting Stock of the Company is changed into or exchanged for cash, securities
or other property, other than any such transactions between the Company and its
wholly-owned Restricted Subsidiaries, with the effect that any “person” (other
than the Existing Equity Holders) becomes the “beneficial owner,” directly or
indirectly, of securities representing 40% or more of the combined voting power
of the Company’s Voting Stock and at such time as the Existing Equity Holders
together shall fail to beneficially own, directly or indirectly, securities
representing at least the same percentage of the combined voting power of the
Company’s Voting Stock as is “beneficially owned” by such “person,” or (iv)
during any period of 24 consecutive months, individuals who at the beginning of
such period constituted the Company’s Board of Directors (together with any new
or replacement directors whose election by the Company’s Board of Directors, or
whose nomination for election by the Company’s stockholders, was approved by a
vote of at least a majority of the directors then still in office who were
either directors at the beginning of such period or whose election or
nomination for election was previously so approved) cease for any reason to
constitute a majority of the directors then in office.


 


“Change of Control Triggering Event” is
defined as the occurrence of both (i) a Change of Control and (ii) a Rating
Decline.


 


“Clearstream”
means Clearstream Banking S.A., or its successors.


 


“Company” means the person named as such
above until a successor replaces it in accordance with Article 5 and thereafter
means the successor.


 


“Completion Guarantee and Keep-Well Agreement”
means (i) the guarantee by the Company or a Restricted Subsidiary of the
completion of the development, construction and opening of a new gaming
facility by an Affiliate of the Company, (ii) the agreement by the Company or a
Restricted Subsidiary to advance funds, property or services on behalf of an
Affiliate of the Company in order to maintain the financial condition of such
Affiliate in connection with the development, construction and opening of a new
gaming facility by such Affiliate and (iii) performance bonds incurred in the
ordinary course of business; provided
that, in the case of clauses (i) and (ii) above, such guarantee or agreement is
entered into in connection with obtaining financing for such gaming facility or
is required by a Gaming Authority.


 


“Consolidated Coverage Ratio” means, for any
period, for any person, the ratio of the aggregate amount of Operating Cash
Flow of such person for such period to the aggregate amount of Consolidated
Interest Expense of such person for such period.


 


“Consolidated Interest Expense” means, for
any period, the total interest expense of a person and its consolidated
Restricted Subsidiaries, including (i) interest expense attributable to Capital
Lease Obligations, (ii) amortization of debt discount, (iii) capitalized
interest, (iv) cash and noncash interest payments, (v) commissions, discounts
and other fees and charges owed with respect to letters of credit and bankers’
acceptance financing, (vi) net costs under Interest Rate Protection Agreements
(including amortization of discount) and (vii) interest expense in respect of
obligations of other persons deemed to be Indebtedness of the Company or its
Restricted Subsidiaries under clause (v) or (vi) of the definition of
Indebtedness.


 


3

















 


“Consolidated Net Income” means, for any
period, the net income of a person and its consolidated Restricted Subsidiaries
determined on a consolidated basis in accordance with GAAP; provided, however,
that there shall not be included in such Consolidated Net Income:  (i) any net income (loss) of any person if
such person is not a Restricted Subsidiary, except that (A) the Company’s
equity in the net income of any such person (including, without limitation, an
Unrestricted Subsidiary) for such period shall be included in such Consolidated
Net Income up to the aggregate amount of cash actually distributed by such
person during such period to the Company or a Restricted Subsidiary as a
dividend or other distribution (subject, in the case of a dividend or other
distribution to a Restricted Subsidiary, to the limitations contained in clause
(iii) below); and (B) the Company’s equity in the net loss of any such person
for such period shall be included in determining such Consolidated Net Income
(subject, with respect to the net loss of an Unrestricted Subsidiary, to clause
(vi) below); (ii) any net income (loss) of any person acquired by the Company
or a Restricted Subsidiary in a pooling of interests transaction for any period
prior to the date of such acquisition; (iii) any net income (loss) of any
Restricted Subsidiary if such Restricted Subsidiary is subject to restrictions,
directly or indirectly, on the payment of dividends or the making of distributions
by such Restricted Subsidiary, directly or indirectly, to the Company, except
that (A) the Company’s equity in the net income of any such Restricted
Subsidiary for such period shall be included in such Consolidated Net Income up
to the aggregate amount of cash which could have been distributed by such
Restricted Subsidiary during such period to the Company or another Restricted
Subsidiary as a dividend or other distribution (subject, in the case of a
dividend or other distribution to another Restricted Subsidiary, to the
limitation contained in this clause) unless at the time of computation no cash
would be permitted to be distributed and (B) the Company’s equity in the net
loss of any such Restricted Subsidiary for such period shall be included in
determining such Consolidated Net Income; (iv) any gain or loss realized upon
the sale or other disposition of any property, plant or equipment of the
Company or its consolidated Restricted Subsidiaries which is not sold or
otherwise disposed of in the ordinary course of business and any gain or loss
realized upon the sale or other disposition of any Capital Stock of any person;
(v) the cumulative effect of a change in accounting principles; (vi) the net
loss of any Unrestricted Subsidiary; and (vii) extraordinary or nonrecurring
gains or losses.


 


“Consolidated Net
Tangible Assets” means the total amount of assets (including
investments in Joint Ventures) of the Company and its Subsidiaries (less
applicable depreciation, amortization and other valuation reserves) after
deducting therefrom (i) all current liabilities of the Company and its
Subsidiaries (excluding (A) the current portion of long-term indebtedness, (B)
intercompany liabilities and (C) any liabilities which are by their terms
renewable or extendible at the option of the obligor thereon to a time more
than 12 months from the time as of which the amount thereof is being computed)
and (ii) all goodwill, trade names, trademarks, patents, unamortized debt
discount and any other like intangibles, all as set forth on the most recent
consolidated balance sheet of the Company and computed in accordance with GAAP.


 


“Consolidated Net Worth” of any person means
the total of the amounts shown on the balance sheet of such person and its
consolidated Restricted Subsidiaries, determined on a consolidated basis in
accordance with GAAP, as of any date selected by the Company not more than 90
days prior to the taking of any action for the purpose of which the
determination is being made (and adjusted for any material events since such
date), as (i) the par or stated value of all outstanding Capital Stock plus
(ii) paid-in capital or capital surplus relating to such Capital Stock


 


4

















 


plus (iii) any retained earnings or earned surplus, less (A) any
accumulated deficit, (B) any amounts attributable to Redeemable Stock and (C)
any amounts attributable to Exchangeable Stock.


 


“Default” means any event which is, or after
notice or passage of time would be, an Event of Default.


 


“Depository” 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 Depository with respect to the Notes,
until a successor shall have been appointed and become such Depository pursuant
to the applicable provision of this Indenture, and, thereafter, “Depository”
shall mean or include such successor.


 


“Designated Senior
Indebtedness” shall mean each issue of Senior Indebtedness that: (i)
has an outstanding principal amount of at least $25,000,000 (including the
amount of all reimbursement obligations pursuant to letters of credit
thereunder and the maximum principal amount available to be drawn thereunder,
assuming in the case of the Bank Facility that all conditions precedent to any
such drawing could be satisfied); and (ii) has been designated as Designated
Senior Indebtedness pursuant to an Officer’s Certificate of the Company
received by the Trustee.


 


“Euroclear”
means Euroclear Bank S.A./N.V., or its successor, as operator of the Euroclear
system.


 


“Exchange Act” means the Securities Exchange
Act of 1934, as amended.


 


“Exchange Offer” means the offer that may be
made by the Company pursuant to the Registration Rights Agreement to exchange
Series B Notes for Series A Notes.


 


“Exchangeable Stock” means any Capital Stock
of a corporation that is exchangeable or convertible into another security
(other than into Capital Stock of such corporation that is neither Exchangeable
Stock or Redeemable Stock).


 


“Existing Equity Holders” means Frank J.
Fertitta III, Blake L. Sartini, Delise F. Sartini, Lorenzo J. Fertitta, Glenn
C. Christenson, Scott M Nielson, Stephen L. Cavallaro, William W. Warner and
the Former Equity Holder and their executors, administrators or the legal
representatives of their estates, their heirs, distributees and beneficiaries,
any trust as to which any of the foregoing is a settlor or co-settlor and any
corporation, partnership or other entity which is an Affiliate of any of the
foregoing.  Existing Equity Holders
shall also mean any lineal descendants of such persons, but only to the extent
that the beneficial ownership of the Voting Stock held by such lineal
descendants was directly received (by gift, trust or sale) from any such
person.


 


“Existing Notes”
means
the $400,000,000 8 3/8% Senior Notes of the Company due 2008 and the Existing
Senior Subordinated Notes.


 


“Existing Senior
Subordinated Notes” means the $400,000,000 61⁄2% Senior Subordinated
Notes of the Company due 2014, the 9 7/8% Senior
Subordinated Notes of the


 


5

















 


Company due 2010 outstanding immediately following the issuance of the
Notes and the application of the net proceeds thereof, and the 87/8%
Senior Subordinated Notes due 2008 for so long as they remain outstanding, it
being agreed that such notes shall be redeemed on or about February 27, 2004.


 


“FF&E Financing” means Indebtedness
which is non-recourse to the borrower, the proceeds of which will be used to
finance the acquisition or lease by the Company or its Restricted Subsidiaries
of furniture, fixtures or equipment (“FF&E”) used in the operation of its
business and secured by a Lien on such FF&E.


 


“Fiesta” means Fiesta Station, Inc.


 


“Fiesta Holdings” means Fiesta Station
Holdings, LLC.


 


“Former Equity Holder” means Frank J.
Fertitta, Jr.


 


“GAAP” means generally accepted accounting
principles as in effect in the United States of America on the date of this
Indenture.


 


“Gaming Authority” means the Nevada Gaming
Commission, the Nevada Gaming Control Board or any agency of any state, county,
city or other political subdivision which has, or may at any time after the
date of the Indenture have, jurisdiction over all or any portion of the gaming
activities of the Company or any of its Subsidiaries or any successor to such
authority.


 


“Gaming Control Act” means the Nevada Gaming
Control Act, as from time to time amended, or any successor provision of law,
and the regulations promulgated thereunder.


 


“Gaming License” of any person means every
license, franchise or other authorization on the date of the Indenture or
thereafter required to own, lease, operate or otherwise conduct the gaming
operations of such person, including, without limitation, all such licenses
granted under the Gaming Control Act, as from time to time amended, or any
successor provision at law, the regulations of Gaming Authorities and other
applicable laws.


 


“Global Notes” means, individually and
collectively, each of the Restricted Global Notes and the Unrestricted Global
Notes, in the form of Exhibit
A or Exhibit B hereto issued in
accordance with Section 2.01, 2.06(b), 2.06(d) 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.


 


“Governmental Authority” means any agency,
authority, board, bureau, commission, department, office or instrumentality of
any nature whatsoever of any city or other political subdivision or otherwise
and whether now or hereafter in existence, or any officer or official thereof.


 


“Holder” or “Noteholder” means a person in whose name a Note is registered
on the register maintained by the Registrar.


 


6

















 


“Indebtedness” of any person means, without
duplication, (i) the principal of and premium (if any) in respect of (A)
indebtedness of such person for money borrowed and (B) indebtedness evidenced
by notes, debentures, bonds or other similar instruments for the payment of
which such person is responsible or liable; (ii) all Capital Lease Obligations
of such person; (iii) all obligations of such person issued or assumed as the
deferred purchase price of property, assets or services, all conditional sale
obligations and all obligations under any title retention agreement (but
excluding operating leases and trade accounts payable arising in the ordinary
course of business); (iv) all obligations of such person for the reimbursement
of any obligor on any letter of credit, banker’s acceptance or similar credit
transaction (other than obligations with respect to letters of credit securing
obligations (other than obligations described in (i) through (iii) above)
entered into in the ordinary course of business of such person to the extent
such letters of credit are not drawn upon or, if and to the extent drawn upon,
such drawing is reimbursed no later than the third Business Day following
receipt by such person of a demand for reimbursement following payment on the
letter of credit); (v) all obligations of the type referred to in clauses (i)
through (iv) of other persons and all dividends of other persons for the
payment of which, in either case, such person is responsible or liable as
obligor, guarantor or otherwise; and (vi) all obligations of the type referred
to in clauses (i) through (v) of other persons secured by any Lien on any
property or asset of such person (whether or not such obligation is assumed by
such person), the amount of such obligation being deemed to be the lesser of
the value of such property or asset or the amount of the obligation so secured.


 


“Indenture” means this Indenture as amended
or supplemented from time to time.


 


“Indirect
Participant” means a person who holds a beneficial interest in a
Global Note through a Participant.


 


“Interest Payment Date” means the dates on
which the Company shall pay interest on the Notes to Noteholders, as described
in the Notes.


 


“Interest Rate Protection Agreement” means
any interest rate swap agreement, interest rate cap agreement or other
financial agreement or arrangement designed to protect the Company or any
Subsidiary against fluctuations in interest rates.


 


“Investment Grade” designates a rating of
BBB- or higher by S&P or Baa3 or higher by Moody’s or the equivalent of
such ratings by S&P or Moody’s.  In
the event that the Company shall select any other Rating Agency, the equivalent
of such ratings by such Rating Agency shall be used.


 


“Joint Venture” means any partnership,
corporation or other entity, in which up to and including 50% of the partnership
interests, outstanding voting stock or other equity interests is owned,
directly or indirectly, by the Company and/or one or more Subsidiaries.


 


“Lake Mead”
means Lake Mead Station, Inc.


 


“Lake Mead Holdings”
means Lake Mead Station Holdings, LLC.


 


7

















 


“Lien” means, with respect to any asset, any
mortgage, lien, pledge, charge, security interest or encumbrance of any kind in
respect of such asset (including any agreement to give any security
interest).  For all purposes under this
Indenture, a person shall be deemed to own subject to a Lien any asset that it
has acquired or holds subject to the interest of a vendor or lessor under any
conditional sale agreement, Capital Lease Obligation or other title retention
agreement (other than operating leases) relating to such asset.


 


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


 


“Moody’s” means Moody’s Investors Service,
Inc. and its successors.


 


“Non-U.S. person”
means a person who is not a U.S. person.


 


“Note Custodian” means the person specified
in Section 2.03, as custodian with respect to the Global Notes, or any
successor entity thereto.


 


“Officer” means the Chairman of the Board,
the President, any Vice President, the Treasurer, the Secretary, the Chief
Financial Officer, any Assistant Treasurer or any Assistant Secretary of the
Company.


 


“Officers’ Certificate” means a certificate
signed by any two Officers, one of whom must be the Chairman of the Board, the
President, the Treasurer or a Vice President of the Company.


 


“Operating Cash Flow” means, for any period,
for any person, the aggregate amount of Consolidated Net Income of such person
before Consolidated Interest Expense, income taxes, depreciation expense,
Amortization Expense and any noncash amortization of debt issuance cost.  Notwithstanding the foregoing, the
Consolidated Interest Expense, income taxes, depreciation expense, Amortization
Expense and any noncash amortization of debt issuance cost of a subsidiary of a
person shall be added to Consolidated Net Income to compute Operating Cash Flow
in the same proportion that the net income of such subsidiary was included in
calculating the Consolidated Net Income of such person.


 


“Opinion of Counsel” means a written opinion
from legal counsel who is reasonably acceptable to the Trustee.  Unless otherwise required by the Trustee,
the counsel may be an employee of or counsel to the Company or the Trustee.


 


“Palace”
means Palace Station Hotel & Casino, Inc.


 


“Participant”
means, with respect to DTC, Euroclear or Clearstream, a person who has an
account with DTC, Euroclear or Clearstream, respectively (and, with respect to
DTC, shall include Euroclear and Clearstream).


 


“Permitted Refinancing Indebtedness” means
Indebtedness of the Company or a Restricted Subsidiary (i) issued in exchange
for, or the proceeds from the issuance and sale or disbursement of which are
used to substantially concurrently repay, redeem, refund, refinance, discharge
or otherwise retire for value, in whole or in part (collectively, “repay”), or
(ii)


 


8

















 


constituting an amendment, modification or supplement to, or a deferral
or renewal of (collectively, an “amendment”), any Indebtedness of the Company
or a Restricted Subsidiary (and any premiums, penalties, fees and expenses
actually incurred by the Company or such Restricted Subsidiary in connection
with the repayment or amendment thereof) existing immediately after the
original issuance of the Series A Notes or incurred pursuant to clauses (iii),
(vi), (vii) and (viii) (subject to proviso (C) below) of Section 4.05, in a
principal amount (or, if such Permitted Refinancing Indebtedness provides for
an amount less than the principal amount thereof to be due and payable upon the
acceleration thereof, with an original issue price) not in excess of (1) the
principal amount of the Indebtedness so refinanced (or, if such Permitted
Refinancing Indebtedness refinances Indebtedness under an agreement providing a
commitment for subsequent borrowings, with a maximum commitment not to exceed
the maximum commitment under such agreement) plus (2) unpaid accrued interest
on such Indebtedness plus (3) premiums, penalties, fees and expenses actually
incurred by the Company or such Restricted Subsidiary, as the case may be, in
connection with the repayment or amendment thereof; provided that (A) Permitted Refinancing Indebtedness of the
Company that repays or constitutes an amendment to Subordinated Indebtedness
shall not have an Average Life less than the Indebtedness to be so refinanced
at the time of such incurrence, and shall contain subordination and default
provisions no less favorable in any material respect to the Noteholders than those
contained in such repaid or amended Indebtedness, (B) notwithstanding the
foregoing, any Permitted Refinancing Indebtedness incurred to repay all of the
Notes then outstanding shall not be limited in principal amount or otherwise if
the Company, contemporaneously with such issuance, irrevocably deposits with
the Trustee or Paying Agent an amount of the proceeds of such Permitted
Refinancing Indebtedness sufficient to redeem or repay each installment of the
outstanding principal amount of the Notes on, and all interest accrued to, the
date fixed for such repayment, together with irrevocable instructions to redeem
and repay the Notes on the stated redemption date and (C) to the extent that
Permitted Refinancing Indebtedness includes Indebtedness incurred in connection
with the refinancing of the Bank Facility (whether or not such Indebtedness is
existing on or after the date of the Indenture) and the managing agent for the
lenders under such refinancing Indebtedness is a person other than a banking
institution with over $500 million in assets and subject to supervision and
examination by federal or state banking authorities, the provisions of clause
(viii) of Section 4.05 shall terminate and be of no further force and effect
with respect to such refinancing Indebtedness.


 


“person” means any individual, corporation,
partnership, joint venture, association, joint stock company, trust,
unincorporated organization or government or any agency or political
subdivision thereof.


 


“principal” of any Indebtedness means the
principal amount thereof plus the premium, if any, thereon.


 


“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.


 


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


 


9

















 


“Qualified 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 guarantor or otherwise), or (c)
constitutes the lender; and (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 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, other than by a pledge by the Company or a Restricted
Subsidiary of the stock of an Unrestricted Subsidiary; provided, however,
that the Company or any of its Restricted Subsidiaries may (x) execute a
Completion Guarantee and Keep-Well Agreement for an Unrestricted Subsidiary
whose sole purpose is to develop, construct and operate a new gaming facility
or (y) make a loan to an Unrestricted Subsidiary and such actions referred to in
the foregoing clauses (x) and (y) shall not constitute Indebtedness which is
not Qualified Non-Recourse Debt.


 


“Rating Agencies” means (i) S&P and (ii)
Moody’s or (iii) if S&P or Moody’s or both shall not make a rating of the
Notes publicly available, a nationally recognized securities rating agency or
agencies, as the case may be, selected by the Company, which shall be
substituted for S&P or Moody’s or both, as the case may be.


 


“Rating Category” means (i) with respect to
S&P, any of the following categories: 
BB, B, CCC, CC, C and D (or equivalent successor categories); and (ii)
with respect to Moody’s, any of the following categories:  Ba, B, Caa, Ca, C and D (or equivalent
successor categories); and (iii) the equivalent of any such category of S&P
or Moody’s used by another Rating Agency. 
In determining whether the rating of the Notes has decreased by one or
more gradation, gradations within Rating Categories (+ and - for S&P; l, 2
and 3 for Moody’s; or the equivalent gradations for another Rating Agency)
shall be taken into account (e.g., with respect to S&P, a decline in a
rating from BB+ to BB, as well as from BB- to B+, will constitute a decrease of
one gradation).


 


“Rating Date” means the date which is 90
days prior to the earlier of (i) a Change of Control or (ii) public notice of
the occurrence of a Change of Control or of the intention by the Company to
effect a Change of Control.


 


“Rating Decline” shall be deemed to occur
if, within 90 days of public notice of the occurrence of a Change of Control
(which period shall be extended so long as the rating of the Notes is under
publicly announced consideration for possible downgrade by either of the Rating
Agencies):  (a) in the event the Notes
are rated by either Rating Agency on the Rating Date as Investment Grade the
rating of the Notes by both Rating Agencies shall be below Investment Grade, or
(b) in the event the Notes are rated below Investment Grade by both Rating
Agencies on the Rating Date, the rating of the Notes by either Rating Agency shall
be decreased by one or more gradations (including gradations within Rating
Categories as well as between Rating Categories).


 


10

















 


“Redeemable Stock” means any Capital Stock
that by its terms or otherwise (other than in consideration of Capital Stock
that is not Redeemable Stock) is, or upon the happening of an event would be,
required to be redeemed or repurchased, pursuant to a sinking fund obligation
or otherwise, or is redeemable at the option of the holder thereof, in whole or
in part, at any time prior to the first anniversary of the stated maturity of
the Notes; provided, however, that any Capital Stock that would
constitute Redeemable Stock solely because the holders thereof (or of any
security into which it is convertible or for which it is exchangeable) have the
right to require the issuer to repurchase such Capital Stock (or such security
into which it is convertible or for which it is exchangeable) upon the
occurrence of any of the events constituting a Change of Control shall not
constitute Redeemable Stock if such Capital Stock (and all such securities into
which it is convertible or for which it is exchangeable) provides that the
issuer thereof will not repurchase or redeem any such Capital Stock (or any
such security into which it is convertible or for which it is exchangeable)
pursuant to Section 4.11.


 


“Registration Rights Agreement” means the
Registration Rights Agreement, dated as of February 27, 2004, by and among the
Company and Banc of America Securities LLC, Deutsche Bank Securities Inc.,
Lehman Brothers Inc., Wells Fargo Securities, LLC and Credit Lyonnais
Securities (USA) Inc., as such agreement may be amended, modified or
supplemented from time to time.


 


“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 A 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 Depository 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 B hereto bearing the Global Note
Legend, the Private Placement Legend and the legend set forth in Section
2.06(g)(iii) hereto, and deposited with or on behalf of and registered in the
name of the Depository 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 Person” of any person means (i) (A)
if such person is a corporation, any person who is a director, officer or
employee (x) of such person, (y) of any subsidiary of such person or (z) of any
Affiliate of such person or (B) if such person is an individual, any immediate
family member or lineal descendent of such person or spouse of such immediate
family member or of such lineal descendant, or (ii) any Affiliate of any person
included in clause (i) and any person who is a director, officer or employee of
such Affiliate.


 


“Representative” means the indenture trustee
or other trustee, agent or representative, if any, for an issue of Senior
Indebtedness.


 


11

















 


“Required Rating” means ratings on the Notes
of at least BBB- by S&P and Baa3 by Moody’s.


 


“Responsible Officer” when used with respect
to the Trustee, means any officer within the corporate trust administration
group of the Trustee (or any successor group of the Trustee) with direct
responsibility for the administration of this Indenture 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.


 


“Restricted
Broker-Dealer” means a Broker-Dealer (as defined in the Registration
Rights Agreement) engaged in activities contemplated by Section 3(c) of the
Registration Rights Agreement.


 


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


 


“Restricted
Certificated Note” means a Certificated Note bearing the Private
Placement Legend.


 


“Restricted Global
Note” means a Global Note bearing the Private Placement Legend.


 


“Restricted Subsidiary” of a person means
any subsidiary of the referent person that is not an Unrestricted Subsidiary.


 


“Rule 144A” means Rule 144A promulgated
under the Securities Act, as it may be amended from time to time, and any
successor provision thereto.


 


“Rule 144A Global Note” means the Global
Note in the form of Exhibit
A 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 Depository 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.


 


“S&P” means Standard & Poor’s
Corporation and its successors.


 


“Santa Fe”
means Santa Fe Station, Inc.


 


“Senior Indebtedness”
means: (x) all obligations of the Company now or hereafter existing to pay the
principal of, and interest (including interest accruing on or after the filing
of any petition in bankruptcy or for reorganization to the extent a claim for
post-filing interest is allowed in such proceedings) on, any Indebtedness
(other than Capital Lease Obligations) of the Company, whether outstanding on
the date of the Indenture or thereafter created, incurred, assumed, guaranteed
or in effect guaranteed by the Company; (y) Indebtedness of the Company
represented by Capital Lease Obligations if the instrument creating or
evidencing the same expressly provides that such Indebtedness shall be senior
in right of payment to the Notes; and 
(z) Indebtedness of the Company with respect to Interest Rate Protection
Agreements.  Notwithstanding the
foregoing, Senior Indebtedness shall not include:


 


12

















 


(a) any Indebtedness, if the instrument creating or
evidencing the same or the assumption or guarantee thereof expressly provides
that such Indebtedness shall not be senior in right of payment to the Notes;
(b) in the case of each Note, the other Notes; (c) the Existing Senior
Subordinated Notes; (d) Indebtedness of the Company to, or guaranteed on behalf
of, an Affiliate of the Company (other than a Restricted Subsidiary); (e) Indebtedness
to trade creditors incurred or assumed in the ordinary course of business in
connection with obtaining goods, materials or services; (f) Indebtedness
represented by Exchangeable Stock or Redeemable Stock; (g) any liability for
federal, state, local or other taxes owed or owing by the Company; (h)
Indebtedness incurred in violation of Section 4.05 hereof and (i) any
Indebtedness which is, by its express terms, subordinated in right of payment
to any other Indebtedness of the Company.


 


“SEC” means the Securities and Exchange
Commission.


 


“Securities Act” means the Securities Act of
1933, as amended.


 


“Subordinated Indebtedness” means any
Indebtedness of the Company (whether outstanding on the date hereof or
hereafter incurred) which is subordinate or junior in right of payment to the
Notes.


 


“subsidiary” of a person means any
corporation, association, partnership, limited liability company or other
business entity of which 50% or more of the Voting Stock is at the time of
determination owned or controlled, directly or indirectly, by such person or by
one or more of the other subsidiaries of that person (or a combination
thereof); provided that with
respect to any such corporation, association, partnership, limited liability
company or other business entity of which no more than 50% of the total Voting
Stock is so owned or controlled, then such corporation, association,
partnership, limited liability company or other business entity shall not be
deemed to be a subsidiary of such person unless such person has the power to
direct the policies or management of such corporation, association,
partnership, limited liability company or other business entity.


 


“Subsidiary” means any subsidiary of the
Company.


 


“Sunset” means Sunset Station, Inc.


 


“Texas”
means Texas Station, LLC.


 


“TIA” means the Trust Indenture Act of 1939
(15 U.S. Code §§ 77aaa-77bbbb) as in effect on the date on which this Indenture
is first qualified under the TIA, except as provided in Section 9.03.


 


“Transfer Restricted
Securities” shall have the meaning assigned to such term in the
Registration Rights Agreement.


 


“Trustee” means the person named as such
above until a successor replaces it in accordance with the applicable
provisions of this Indenture, and thereafter means the successor.


 


“Trust Officer” means the Chairman of the
Board, the President or any other officer of the Trustee assigned by the
Trustee to administer its corporate trust matters.


 


13

















 


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


 


“Unrestricted Global
Note” means a permanent Global Note in the form of Exhibit A 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 Depository, but does not bear the Private
Placement Legend.


 


“Unrestricted
Subsidiary” means any Subsidiary (other than Palace, Boulder, Texas,
Sunset, Santa Fe, Fiesta, Fiesta Holdings, Lake Mead, Lake Mead Holdings or any
successor to any of them) that at the time of determination shall be designated
by the Board of Directors of the Company as an Unrestricted Subsidiary of the
Company by a Board Resolution and any Subsidiary of an Unrestricted Subsidiary,
but only to the extent and so long as such Subsidiary (and any Subsidiary of
such Subsidiary): (a) has no Indebtedness other than Qualified Non-Recourse Debt;  and (b) has not guaranteed or otherwise
directly or indirectly provided credit support for any Indebtedness of the
Company or any of its Restricted Subsidiaries; provided, however, that the
Company or any of its Restricted Subsidiaries may execute a Completion
Guarantee and Keep-Well Agreement for an Unrestricted Subsidiary whose sole
purpose is to develop, construct and operate a new gaming facility, and the
execution and performance (if such performance is permitted under Section 4.05)
of such Completion Guarantee and Keep-Well Agreement shall not prevent a
Subsidiary from becoming or remaining an Unrestricted Subsidiary. Any such
designation by the Board of Directors 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 foregoing conditions.  If, at any time, any Unrestricted Subsidiary would fail to meet
the foregoing requirements as an Unrestricted Subsidiary, it shall thereafter
cease to be an Unrestricted Subsidiary for purposes of the 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 4.05, the Company shall
be in Default of such section). 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 Subsidiary of the Company of any outstanding
Indebtedness of such Unrestricted Subsidiary and such designation shall only be
permitted if no Default or Event of Default would be in existence following
such designation.


 


“U.S. person”
shall have the meaning assigned to such term in Regulation S.


 


“Voting Stock” means any class of Capital
Stock of any person then outstanding normally entitled (without regard to the
occurrence of any contingency) to vote in the elections of directors, managers,
managing partners or trustees.


 


14

















 


Section 1.02.          Other
Definitions.


 


	
  Term

  	
   

  	
  Defined in Section

  	
   

  
	
  “Bankruptcy Law”

  	
   

  	
  6.01

  	
   

  
	
  “Custodian”

  	
   

  	
  6.01

  	
   

  
	
  “DTC”

  	
   

  	
  2.03

  	
   

  
	
  “Event of Default”

  	
   

  	
  6.01

  	
   

  
	
  “Legal Holiday”

  	
   

  	
  11.07

  	
   

  
	
  “Paying Agent”

  	
   

  	
  2.03

  	
   

  
	
  “Payment Blockage Period”

  	
   

  	
  10.03

  	
   

  
	
  “Registrar”

  	
   

  	
  2.03

  	
   

  
	
  “Repurchase Date”

  	
   

  	
  4.11

  	
   

  
	
  “Repurchase Offer”

  	
   

  	
  4.11

  	
   

  
	
  “Repurchase Price”

  	
   

  	
  4.11

  	
   

  
	
  “U.S. Government Obligations”

  	
   

  	
  8.01

  	
   

  



 


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;


 


“obligor” on the Notes means the Company and
any other obligor upon the Notes.


 


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 and not otherwise defined herein have the meanings
assigned to them therein.


 


Section 1.04.          Rules
of Construction.


 


Unless the context otherwise requires:


 


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


 


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


 


(3)           “or” is not exclusive;


 


15

















 


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


 


(5)           provisions apply to
successive events and transactions.


 


ARTICLE 2.

THE NOTES


 


Section 2.01.          Form
and Dating.


 


The Notes and the Trustee’s certificate of
authentication shall be substantially in the form set forth in Exhibit A or
Exhibit B hereto.  The Notes may have
notations, legends or endorsements required by law, stock exchange rules,
agreements to which the Company is subject, or usage, as designated by the
Company.  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 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.


 


Notes issued in global form shall be substantially in
the form set forth in Exhibit A or B attached hereto (including the Global Note
Legend and the “Schedule of Exchanges in the Global Note” attached thereto).
Notes issued in definitive form shall be substantially in the form of Exhibit A
attached hereto (but without the Global Note Legend 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 Note Custodian, at the
direction of the Trustee, in accordance with instructions given by the Holder
thereof as required by Section 2.06 hereof. 
Notes offered and sold to QIBs shall be issued initially in the form of
one or more Global Notes, which shall be deposited with the Trustee, as
custodian for DTC, in New York, New York, and registered in the name of DTC or
its nominee, in each case for credit to the accounts of Participants.


 


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 Depository, and registered in the name of the Depository or the nominee of
the Depository 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.  Within
a reasonable time after expiration of the Restricted Period the Regulation S
Temporary Global Notes will be exchanged for the Regulation S Permanent Global
Notes upon the receipt by the


 


16

















 


Trustee of (i) a written certificate from the Depository, 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 Rule 144A Global Note or a Restricted 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 such 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 Depository or its
nominee, as the case may be, in connection with transfers of interest as
hereinafter provided.


 


(a)  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 Note
that are held by the agent members through Euroclear or Clearstream.


 


Section 2.02.          Execution
and Authentication.


 


One Officer of the Company shall sign the Notes for
the Company by manual or facsimile signature, which signature shall be attested
to by any other person.  Such signatures
and attestation may be in counterparts, all of which taken together shall
constitute one and the same instrument.


 


If an Officer whose signature is on a Note no longer
holds that office at the time such 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, authenticate the Series A Notes for original issue in
an aggregate principal amount as shall be specified in such written order and
shall authenticate the Series B Notes for original issue in an aggregate
principal amount as shall be specified in such written order; provided that the
Series B Notes shall be issuable only upon the valid surrender for cancellation
of Series A Notes of a like aggregate principal amount.  The aggregate principal amount of Notes that
may be issued under the indenture shall be unlimited.


 


The Trustee may appoint an authenticating agent
acceptable to the Company to authenticate Notes.  An authenticating agent may authenticate Notes whenever the
Trustee may


 


17

















 


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.


 


Notes shall be issuable only in fully registered form,
without coupons, in denominations of $1,000 and integral multiples thereof.


 


Section 2.03.          Registrar;
Paying Agent; Depository; Note Custodian.


 


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


 


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


 


The Company initially appoints the Trustee to act as
the Registrar and Paying Agent and to act as Note Custodian with respect to the
Global Notes.  The Company initially
appoints the Trustee to act as the Registrar and Paying Agent with respect to
the Certificated 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 Noteholders or the Trustee all money held by the Paying Agent
for the payment of principal, interest or Liquidated Damages, if any, on the
Notes (whether such money has been paid to it by the Company or any other
obligor on the Notes), and will notify the Trustee of any default by the
Company (or any other obligor on the Notes) 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 Noteholders all money held by it as Paying
Agent.  Upon any bankruptcy or reorganization
proceedings relating to the Company, the Trustee or its agent shall serve as
Paying Agent for the Notes.


 


Section 2.05.          Noteholder
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 Noteholders.  If the
Trustee is not


 


18

















 


the Registrar, the Company and any other obligor 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, but in any event at
least semi-annually, a list in such form and as of such date as the Trustee may
reasonably require of the names and addresses of Noteholders.


 


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 Depository
to a nominee of the Depository, by a nominee of the Depository to the
Depository or to another nominee of the Depository or any such nominee to a
successor Depository or a nominee of such successor Depository.  All Global Notes will be exchanged by the
Company for Certificated Notes if (i) the Company delivers to the Trustee
notice from the Depository that it is unwilling or unable to continue to act as
Depository or that it is no longer a clearing agency registered under the
Exchange Act and, in either case, a successor Depository is not appointed by
the Company within 90 days after the date of such notice from the Depository,
(ii)  the Company in its sole discretion
determines that the Global Notes (in whole but not in part) should be exchanged
for Certificated Notes and delivers a written notice to such effect to the
Trustee or (iii) there shall have occurred and be continuing an Event of
Default with respect to the Notes and the Trustee has received a request from
the Depository to issue Certificated Notes; provided that in no event
shall the Regulation S Temporary Global Note be exchanged by the Company for
Certificated Notes prior to (x) the expiration of the Restricted Period and (y)
the receipt by the Registrar of any certificates determined by the Company to
be required pursuant to Rule 903 under the Securities Act.  Upon the occurrence of either of the
preceding events in (i) or (ii) above, the Company will notify the Trustee in
writing that Certificated Notes shall be issued in such
names as the Depository and the Participants shall instruct the Trustee. Global
Notes also may be exchanged or replaced, in whole or in part, as provided in
Sections 2.7 and 2.11 hereof. Every Note authenticated and delivered in
exchange for, or in lieu of, a Global Note or any portion thereof, pursuant to
Section 2.07 or 2.11 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 Depository, 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 subparagraph (iii) or (iv), 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


 


19

















 


beneficial interests in the Regulation S Temporary 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 only 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 (other than a transfer of a
beneficial interest in a Global Note to a person who takes delivery thereof in
the form of a beneficial interest in the same Global Note), the transferor of
such beneficial interest must deliver to the Registrar either (1)(A) a written
order from a Participant or an Indirect Participant given to the Depository in
accordance with the Applicable Procedures directing the Depository 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 (B)
instructions given in accordance with the Applicable Procedures containing
information regarding the Participant account to be credited with such increase
or (2)(A) a written order from a Participant or an Indirect Participant given
to the Depository in accordance with the Applicable Procedures directing the
Depository to cause to be issued a Certificated Note in an amount equal to the
beneficial interest to be transferred or exchanged and (B) instructions given
by the Depository to the Registrar containing information regarding the person
in whose name such Certificated Note shall be registered to effect the transfer
or exchange referred to in (1) above; provided that in no event shall
Certificated Notes be issued upon the transfer or exchange of beneficial
interests in the Regulation S Temporary Global Note prior to (x) the expiration
of the Restricted Period and (y) the receipt by the Registrar of any
certificates determined by the Company to be required pursuant to Rule 903
under the Securities Act; provided, further, that in no event
shall an Indirect Participant who holds a beneficial interest in the Regulation
S Temporary Global Note transfer or exchange such interest to a U.S. person who
takes delivery in the form of an interest in Rule 144A Global Notes prior to
the satisfaction of clauses (x) and (y) in the immediately preceding proviso.
Upon 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, the Notes and otherwise
applicable under the Securities Act, the Trustee shall adjust the principal
amount of the relevant Global Note or Notes 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 clause (ii) above and the Registrar receives the following:


 


20

















 


(A)          if the transferee will take delivery in the form of a
beneficial interest in the Rule 144A Global Note, then the transferor must
deliver a certificate in the form of Exhibit C 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 C 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 Restricted Global Note, then the transferor must
deliver a certificate in the form of Exhibit C hereto, including the certifications
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 clause (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, is
not (1) a broker-dealer, (2) a person participating in the distribution of the
Series B 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 Restricted
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 D hereto, including the certifications in item 1(a)
thereof;


 


(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 C hereto, including the certifications
in item 4 thereof; and


 


21

















 


(3)           in each such case set forth in this subparagraph (D),
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 not 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 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
Certificated Notes.


 


(i)            If any holder of a beneficial interest in a Restricted
Global Note proposes to exchange such beneficial interest for a Certificated
Note or to transfer such beneficial interest to a person who takes delivery
thereof in the form of a Certificated 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
Certificated Note, a certificate from such holder in the form of Exhibit D 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 C 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 C 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 C hereto, including the certifications in item 3(a)
thereof;


 


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


 


22

















 


(F)           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 C 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
Certificated Note in the appropriate principal amount.  Any Certificated 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 Depository and the
Participant or Indirect Participant. 
The Trustee shall deliver such Certificated Notes to the persons in
whose names such Notes are so registered. 
Any Certificated 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)           Notwithstanding Sections 2.06(c)(i)(A) and (C) hereof,
a beneficial interest in the Regulation S Temporary Global Note may not be (A)
exchanged for a Certificated Note prior to (x) the expiration of the Restricted
Period and (y) the receipt by the Registrar of any certificates determined by
the Company to be required pursuant to Rule 903(c)(3)(B) under the Securities
Act or (B) transferred to a person who takes delivery thereof in the form of a
Certificated Note prior to the conditions set forth in clause (A) above or
unless the transfer is pursuant to an exemption from the registration
requirements of the Securities Act other than Rule 903 or Rule 904.


 


(iii)          Notwithstanding 2.6(c)(i) hereof, a holder of a
beneficial interest in a Restricted Global Note may exchange such beneficial
interest for an Unrestricted Certificated Note or may transfer such beneficial
interest to a person who takes delivery thereof in the form of an Unrestricted
Certificated 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, is not (1) a broker-dealer, (2)  a person participating in the distribution
of the Series B 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 Restricted
Broker-Dealer pursuant to the Exchange Offer Registration Statement in
accordance with the Registration Rights Agreement; or


 


(D)          the Registrar receives the following:


 


23

















 


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


 


(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 Certificated 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 4
thereof; and


 


(3)           in each such case set forth in this subparagraph (D),
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
and that the restrictions on transfer contained herein and in the Private
Placement Legend are not required in order to maintain compliance with the
Securities Act or any Gaming


 


(iv)          If any holder of a beneficial interest in an
Unrestricted Global Note proposes to exchange such beneficial interest for a
Certificated Note or to transfer such beneficial interest to a person who takes
delivery thereof in the form of a Certificated 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 Certificated Note in the appropriate principal amount.  Any Certificated 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 Depository and the Participant or Indirect
Participant.  The Trustee shall deliver
such Certificated Notes to the persons in whose names such Notes are so
registered.  Any Certificated Note
issued in exchange for a beneficial interest pursuant to this Section
2.06(c)(iv) shall not bear the Private Placement Legend.  A beneficial interest in an Unrestricted
Global Note cannot be exchanged for a Certificated Note bearing the Private
Placement Legend or transferred to a person who takes delivery thereof in the
form of a Certificated Note bearing the Private Placement Legend.


 


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


 


(i)            If any Holder of a Restricted Certificated Note
proposes to exchange such Note for a beneficial interest in a Restricted Global
Note or to transfer such Certificated 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:


 


24

















 


(A)          if the Holder of such Restricted Certificated 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 D hereto, including the certifications
in item 2(b) thereof;


 


(B)           if such Certificated 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 C hereto, including the certifications in item 1
thereof;


 


(C)           if such Certificated 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 C hereto, including the certifications
in item 2 thereof;


 


(D)          if such Certificated 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 C hereto, including the certifications in item 3(a)
thereof;


 


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


 


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


 


the Trustee shall cancel the Certificated 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 Rule 144A Global Note, in the case of clause (C)
above, the Regulation S Global Note, and in all other cases, the Restricted
Global Note.


 


(ii)           A Holder of a Restricted Certificated Note may
exchange such Note for a beneficial interest in an Unrestricted Global Note or
transfer such Restricted Certificated 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, is not (1) a broker-dealer, (2) a person participating in the
distribution of the Series B 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;


 


25

















 


(C)           any such transfer is effected by a Restricted
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 Certificated 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 D hereto, including the certifications
in Item 1(c) thereof;


 


(2)           if the Holder of such Certificated 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 C hereto, including the certifications in item 4
thereof, and


 


(3)           in each such case set forth in this subparagraph (D),
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,
that the restrictions on transfer contained herein and in the Private Placement
Legend are not required in order to maintain compliance with the Securities
Act, and such Certificated Notes are being exchanged or transferred in
compliance with any applicable blue sky securities laws of any State of the
United States.


 


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


 


(iii)          A Holder of an Unrestricted Certificated Note may
exchange such Note for a beneficial interest in an Unrestricted Global Note or
transfer such Certificated 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
Certificated 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 Certificated
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 beneficial interests transferred pursuant to
subparagraphs (ii)(B), (ii)(D) or (iii) above.


 


(e)           Transfer and Exchange of Certificated Notes for
Certificated Notes.  Upon request by a Holder of Certificated
Notes and such Holder’s compliance with the provisions of this Section 2.06(e),
the Registrar shall register the transfer or exchange of Certificated Notes.
Prior to such registration of transfer or exchange, the requesting Holder shall
present on


 


26

















 


surrender to the
Registrar the Certificated Notes duly endorsed or accompanied by a written
instruction of transfer in form satisfactory to the Registrar duly executed by
such Holder or by his attorney, duly authorized in writing.  In addition, the requesting Holder shall
provide any additional certifications, documents and information, as
applicable, pursuant to the provisions of this Section 2.06(e).


 


(i)            Restricted Certificated Notes may be
transferred to and registered in the name of persons who take delivery thereof
if the Registrar receives the following:


 


(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 C
hereto, including the certifications in item 1 thereof;


 


(B)           if the transfer will be made pursuant to Rule 903 or
Rule 904 under the Securities Act, then the transferor must deliver a
certificate in the form of Exhibit C 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 C hereto, including the certifications,
required by item 3 thereof.


 


(ii)           Any Restricted Certificated Note may be exchanged by
the Holder thereof for an Unrestricted Certificated Note or transferred to a
person or persons who take delivery thereof in the form of an Unrestricted
Certificated 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, is not (1) a broker-dealer, (2) a person participating in the distribution
of the Series B 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 Restricted
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 Certificated Notes
proposes to exchange such Notes for an Unrestricted Certificated Note, a
certificate from such Holder in the form of Exhibit D hereto, including the certifications
in item 1 (a) thereof,


 


(2)           if the Holder of such Restricted Certificated Notes proposes
to transfer such Notes to a person who shall take delivery thereof in the


 


27

















 


form of an
Unrestricted Certificated Note, a certificate from such Holder in the form of Exhibit C hereto, including the certifications
in item 4 thereof, and


 


(3)           in each such case set forth in this subparagraph (D),
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,
that the restrictions on transfer contained herein and in the Private Placement
Legend are not required in order to maintain compliance with the Securities
Act, and such Restricted Certificated Note is being exchanged or transferred in
compliance with any applicable blue sky securities laws of any State of the
United States.


 


(iii)          A
Holder of Unrestricted Certificated Notes may transfer such Notes to a person
who takes delivery thereof in the form of an Unrestricted Certificated
Note.  Upon receipt of a request for
such a transfer, the Registrar shall register the Unrestricted Certificated
Notes pursuant to the instructions from the Holder thereof.  Unrestricted Certificated
Notes cannot be exchanged for or transferred to persons who take delivery
thereof in the form of a Restricted Certificated Note.


 


(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 and an Officers’ Certificate, 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 are not (x)
broker-dealers, (y) persons participating in the distribution of the Series B
Notes or (z) persons who are affiliates (as defined in Rule 144) of the Company
and accepted for exchange in the Exchange Offer and (ii) Certificated Notes in
an aggregate principal amount equal to the principal amount of the Restricted
Certificated Notes tendered for acceptance by persons that are not (x)
broker-dealers, (y) persons participating in the distribution of the Series B
Notes or (z) persons who are affiliates (as defined in Rule 144) of the Company
and accepted for exchange in the Exchange Offer. Concurrent 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 Certificated Notes so accepted Certificated Notes
in the appropriate principal amount.


 


Concurrent with the issuance of the Series B Notes in
the Exchange Offer, the Company shall deliver an Opinion of Counsel to the
Trustee to the effect that the Series B Notes have been duly authorized and,
when executed and authenticated in accordance with the provisions of this Indenture
and delivered in exchange for Series A Notes in accordance with this Indenture
and the Exchange Offer, will be entitled to the benefits of this Indenture and
will be valid and binding obligations of the Company, enforceable in accordance
with their terms except as (x) the enforceability thereof may be limited by
bankruptcy, insolvency or similar laws affecting creditors’ rights generally
and (y) rights of acceleration and the availability of equitable remedies may
be limited by equitable principles of general applicability.


 


28

















 


(g)           Legends.  The
following legends shall appear on the face of all Global Notes and Certificated
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 Certificated 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
THE 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 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)
INSIDE THE UNITED STATES TO A PERSON WHO THE SELLER REASONABLY BELIEVES IS A
QUALIFIED INSTITUTIONAL BUYER WITHIN THE MEANING OF RULE 144A UNDER THE
SECURITIES ACT IN A TRANSACTION MEETING THE REQUIREMENTS OF RULE 144A, OR IN
ACCORDANCE WITH RULE 144 UNDER THE SECURITIES ACT, OR PURSUANT TO ANOTHER
EXEMPTION FROM THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT (AND BASED
UPON AN OPINION OF COUNSEL IF THE COMPANY SO REQUESTS), (B) TO THE COMPANY, (C)
OUTSIDE THE UNITED STATES TO A FOREIGN PERSON IN A TRANSACTION MEETING THE
REQUIREMENTS OF RULE 904 UNDER THE SECURITIES ACT OR (D) PURSUANT TO AN
EFFECTIVE REGISTRATION STATEMENT UNDER THE SECURITIES ACT AND (2) 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 SECURITY
EVIDENCED HEREBY OF THE RESALE RESTRICTIONS SET FORTH IN (A) ABOVE.”


 


(B)           Notwithstanding the foregoing, any Global Note or
Certificated 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:


 


29

















 


UNLESS AND UNTIL IT IS EXCHANGED IN WHOLE OR IN PART
FOR A NOTE IN DEFINITIVE FORM, THIS NOTE MAY NOT BE TRANSFERRED EXCEPT AS A
WHOLE BY THE DEPOSITORY TO A NOMINEE OF THE DEPOSITORY OR BY A NOMINEE OF THE
DEPOSITORY TO THE DEPOSITORY OR ANOTHER NOMINEE OF THE DEPOSITORY OR BY THE
DEPOSITORY OR ANY SUCH NOMINEE TO A SUCCESSOR DEPOSITORY OR A NOMINEE OF SUCH
SUCCESSOR DEPOSITORY.  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.


 


(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 Certificated Notes or a particular Global Note has been
redeemed, repurchased or cancelled in whole and not in part, each such Global
Note shall be returned to or retained and cancelled 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 Certificated
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 Depository 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 Depository at the direction of the Trustee, to reflect
such increase.


 


(i)            General Provisions Relating to Transfers and Exchanges.


 


30

















 


(i)            To permit registrations of transfers and
exchanges, the Company shall execute and the Trustee shall authenticate Global
Notes and Certificated 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 Certificated Note for
any registration of transfer or exchange, but 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, 4.11 and 9.05 hereof).


 


(iii)          The Registrar shall not be required (A) to register
the transfer of or to exchange Notes during a period beginning at the opening
of business 15 days before the day of mailing of notice of redemption and
ending at the close of business on the day of such mailing, (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.


 


(iv)          All Global Notes and Certificated Notes issued upon
any registration of transfer or exchange of Global Notes or Certificated 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
Certificated Notes surrendered upon such registration of transfer or exchange.


 


(v)           The Company shall not be required (1) to issue, to
register the transfer of or to exchange Notes during a period beginning at the
opening of business 15 days before the day of mailing of notice of redemption
and ending at the close of business on the day of such mailing, (2) 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 Note is registered as the absolute owner of such
Note for the purpose of receiving payment of principal of, premium, if any,
Liquidated Damages, if any, 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
Certificated 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 transfer or exchange may be submitted by facsimile, provided
original copies are promptly sent to the Registrar.


 


31

















 


(ix)           Each Holder of a Note agrees to indemnify the Company
and the Trustee against any liability that may result from the transfer,
exchange or assignment of such Holder’s Note in violation of any provision of
this Indenture and/or applicable United States federal or state securities law.


 


(x)            The Trustee shall have no obligation or duty to
monitor, determine or inquire as to compliance with any restrictions on
transfer imposed under this Indenture or under applicable law with respect to
any transfer of any interest in any Note (including any transfers between or
among Participants or beneficial owners of interests in any Global Note) other
than to require delivery of such certificates and other documentation or
evidence as are expressly required by, and to do so if and when expressly
required by the terms of, this Indenture, and to examine the same to determine
substantial compliance as to form with the express requirements hereof.


 


Section 2.07.          Replacement
Notes.


 


If the Holder of a Note claims that the Note has been
lost, destroyed or wrongfully taken, the Company shall issue and the Trustee
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 provided which is sufficient in the judgment
of both to protect the Company, the Trustee, any Agent or any authenticating
agent from any loss which 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 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 cancelled by it, those delivered
to it for cancellation and those described in this Section as not outstanding.


 


If a Note is replaced pursuant to Section 2.07, 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 Notes are considered paid under Section 4.01, they
cease to be outstanding and interest on them ceases to accrue.


 


Subject to Section 2.09, a Note does not cease to be
outstanding because the Company or an Affiliate of the Company holds the Note.


 


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 any other obligor or an Affiliate of the Company
or any other obligor shall be considered as though they


 


32

















 


are 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 which the Trustee knows are so owned
shall be so disregarded. 
Notwithstanding the foregoing, Notes that are to be acquired by the
Company or an Affiliate of the Company pursuant to an exchange offer, tender
offer or other agreement shall not be deemed to be owned by the Company or an
Affiliate of the Company until legal title to such Notes passes to the Company
or Affiliate, as the case may be.


 


Section 2.10.          Temporary
Notes.


 


Until definitive Notes are ready for delivery, the
Company may prepare and the Trustee shall authenticate temporary Notes.  Temporary Notes shall be substantially in
the form of definitive Notes but may have variations that the Company considers
appropriate for temporary Notes. 
Without unreasonable delay, the Company shall prepare and the Trustee
shall authenticate definitive Notes in exchange for temporary Notes without
charge to the Noteholders.


 


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 shall cancel all Notes surrendered for registration of
transfer, exchange, payment, replacement or cancellation and shall dispose of
cancelled Notes as the Company directs. 
Subject to Section 2.07 hereof, the Company may not issue new Notes to
replace Notes that it has paid or that have been delivered to the Trustee for
cancellation.  All cancelled Notes held
by the Trustee shall be destroyed and certification of their destruction
delivered to the Company, unless by a written order, signed by two Officers of
the Company, the Company shall direct that cancelled Notes be returned to it.


 


Section 2.12.          Defaulted
Interest.


 


If the Company fails to make a payment of interest on
the Notes, it shall pay such defaulted interest plus any interest payable on
the defaulted interest, if any, in any lawful manner.  It may pay such defaulted interest, plus any such interest
payable on it, to the persons who are Noteholders on a subsequent special
record date.  The Company shall fix any
such record date and payment date.  At
least 15 days before any such record date, the Company shall mail to
Noteholders a notice that states the record date, payment date and amount of
such interest to be paid.


 


Section 2.13.          CUSIP
Numbers.


 


The Company in issuing the Notes may use  “CUSIP” numbers and if so the Trustee shall
use the CUSIP numbers in notices of redemption or exchange as a convenience to
Holders, provided that any such
notice may state that no representation is made as to the correctness or
accuracy of the CUSIP numbers printed in the notice or on the Notes and that


 


33

















 


reliance may be placed only on the other
identification numbers printed on the Notes. 
The Company shall promptly notify the Trustee of any change in the CUSIP
numbers.


 


ARTICLE 3.

REDEMPTION


 


Section 3.01.          Notices
to Trustee.


 


If the Company elects to redeem the Notes pursuant to
the optional redemption provisions of paragraph 5 of the Notes, it shall notify
the Trustee in writing of the redemption date and the principal amount of the
Notes to be redeemed.


 


The Company shall give each notice provided for in
this Section at least 60 days before the redemption date (unless a shorter
notice period shall be satisfactory to the Trustee, but in no event less than
30 days); provided, however, that the Trustee shall have no
liability to any Holder if it deems such shorter notice period satisfactory to
it.


 


Section 3.02.          Selection
of Notes to Be Redeemed.


 


Except as provided below, if less than all of the
Notes are to be redeemed, the Trustee shall select the Notes or portions
thereof to be redeemed on a pro rata basis or by lot among the Holders of the
Notes in accordance with a method the Trustee considers fair and appropriate (in
such manner as complies with applicable legal and stock exchange requirements,
if any).


 


The amount of Notes shall be calculated as the
aggregate principal amount of Notes originally issued hereunder less the
aggregate principal amount of any Notes previously redeemed.  The Trustee shall make the selection not
more than 60 days and not less than 30 days before the redemption date from
outstanding Notes not previously called for redemption.


 


The Trustee shall promptly notify the Company of the
Notes or portions of Notes to be called for redemption.  The Trustee may select for redemption
portions of the principal of Notes that have denominations larger than
$1,000.  Notes and portions of them it
selects shall be in amounts of $1,000 or integral multiples of $1,000.  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.


 


At least 30 days but not more than 60 days before a
redemption date, the Company shall mail by first class mail, postage prepaid a
notice of redemption to each Holder whose Notes are to be redeemed at its
address of record.


 


The notice shall identify the Notes to be redeemed and
shall state:


 


(1)           the redemption date;


 


(2)           the redemption price;


 


34

















 


(3)           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 will be
issued;


 


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


 


(5)           that Notes called for
redemption must be surrendered to the Paying Agent to collect the redemption
price plus accrued interest;


 


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


 


(7)           the paragraph of the
Notes pursuant to which the Notes called for redemption are being redeemed.


 


At the Company’s written request, the Trustee shall
give the notice of redemption in the Company’s name and at its expense.


 


Section 3.04.          Effect
of Notice of Redemption.


 


Once notice of redemption is mailed, Notes called for
redemption become due and payable on the redemption date at the price set forth
in the Note.  Unless the Company
defaults in making the redemption payment, on and after the redemption date,
interest ceases 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 thereof for redemption, the principal (and premium,
if any) shall, until paid, bear interest from the redemption date at the rate
borne by the Note.


 


Section 3.05.          Deposit
of Redemption Price.


 


No later than 10:00 a.m. Eastern Time on the
redemption date, the Company shall deposit with the Trustee or with the Paying
Agent immediately available funds sufficient to pay the redemption price of and
accrued interest and Liquidated Damages, if any, on all Notes to be redeemed on
that date.  The Trustee or the Paying
Agent shall promptly return to the Company any money not required for that
purpose.


 


Section 3.06.          Notes
Redeemed in Part.


 


Upon surrender of a Note that is redeemed in part, the
Company shall issue and 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.


 


35

















 


Section 3.07.          Mandatory
Disposition Pursuant to Gaming Laws.


 


Notwithstanding any other provision of this Article 3,
if a record or beneficial owner of a Note is required by any Gaming Authority
to be found suitable, such owner shall apply for a finding of suitability
within 30 days after request of such Gaming Authority.  The applicant for a finding of suitability
must pay all costs of the investigation for such finding of suitability.  If a record or beneficial owner is required
to be found suitable and is not found suitable by such Gaming Authority, (i)
such owner shall, upon request of the Company, dispose of such owner’s Notes
within 30 days or within that time prescribed by such Gaming Authority,
whichever is earlier, or (ii) the Company may, at its option, redeem such
owner’s Notes at the lesser of (x) the principal amount thereof or (y) the
price at which the Notes were acquired by such owner, together with, in either
case, accrued and unpaid interest and Liquidated Damages, if any, thereon to
the date of the finding of unsuitability by such Gaming Authority.


 


ARTICLE 4.

COVENANTS


 


Section 4.01.          Payment
of Notes.


 


The Company shall pay the principal of and interest on
the Notes on the dates and in the manner provided in the Notes.  Principal and interest shall be considered
paid on the date due if the Paying Agent (other than the Company or any
Subsidiary or Affiliate of the Company) holds by 10:00 a.m. New York time on
that date money in immediately available funds designated for and sufficient to
pay all principal 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.


 


To the extent lawful, the Company shall pay interest
(including post-petition interest in any proceeding under any Bankruptcy Law)
on (i) overdue principal at the rate borne by the Notes compounded
semiannually; and (ii) overdue installments of interest and Liquidated Damages
(without regard to any applicable grace period) at the same rate, compounded
semiannually.


 


Section 4.02.          SEC
Reports, Financial Reports.


 


The Company shall file with the Trustee and shall
provide Holders within 15 days after it files them with the SEC copies of the
quarterly and annual reports and of the information, documents and other
reports (or copies of such portions of any of the foregoing as the SEC may by
rules and regulations prescribe) which the Company files with the SEC pursuant
to Sections 13(a) and 13(c) or 15(d) of the Exchange Act.  The Company will continue to file with the
SEC and the Trustee, and to provide to Holders, on the same timely basis such
reports, information and other documents as the Company would be required to
file with the SEC as if the Company were subject to the requirements of such
Sections 13(a) and 13(c) or 15(d) of the Exchange Act, notwithstanding that the
Company may no longer be subject to Section 13(a) and 13(c) or 15(d) of the
Exchange Act and that the Company would be entitled not to file such reports, information
and other documents with the SEC.  In
addition, if the Company has any Unrestricted Subsidiaries at such time, it
shall also file with the Trustee, and provide to the Holders, on the


 


36

















 


same timely basis, all quarterly and annual financial
statements (which statements may be unaudited) that would be required by Forms
10-Q and 10-K if the Company did not have such Unrestricted Subsidiaries.


 


The Company also shall comply with the provisions of
TIA § 314(a).  The Company shall timely
comply with its reporting and filing obligations under applicable federal
securities law.  For so long as any
Transfer Restricted Securities remain outstanding, the Company shall furnish to
the Holders and to prospective purchasers of the Notes designated by the
Holders of Transfer Restricted Securities, upon their request, the information
required to be delivered pursuant to Rule 144A(d)(4) under the Securities Act.


 


Section 4.03.          Compliance
Certificate.


 


(a)  The Company shall deliver to the Trustee,
within 120 days after the end of each fiscal year of the Company (which
currently is December 31), 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 further stating, as to each such Officer
signing such certificate, that to the best of his knowledge the Company has
kept, observed, performed and fulfilled each and every covenant contained in
this Indenture and is not in default in the performance or observance of any of
the terms, provisions and conditions hereof (or, if a Default or Event of
Default shall have occurred, describing all such Defaults or Events of Default
of which he may have knowledge) and that to the best of his 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 are prohibited, or if such
event has occurred, a description of the event.


 


(b)  So long as not contrary to the then current
recommendations of the American Institute of Certified Public Accountants or to
a written policy adopted by the Company’s independent public accountants which
has been previously applied (a copy of which shall be delivered to the
Trustee), the audited financial statements delivered pursuant to Section 4.02
shall be accompanied by a written statement of the Company’s independent public
accountants (which 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 which would lead them to believe that the
Company has violated any provisions of Article 4 or 5 of this Indenture 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 will, so long as any of the
Notes are outstanding, deliver to the Trustee, forthwith upon becoming aware of
(i) any Default or Event of Default in the performance of any covenant,
agreement or condition contained in this Indenture or (ii) any event of default
under any other mortgage, indenture or instrument governing other Indebtedness
of the Company aggregating in excess of $5,000,000, an Officers’ Certificate
specifying such Default, Event of Default or default.


 


37

















 


Section 4.04.          Stay,
Extension and Usury Laws.


 


The Company covenants (to the extent that it may
lawfully do so) that it will 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,
which may affect the covenants or the performance of this Indenture; and the
Company (to the extent it may lawfully do so) hereby expressly waives all
benefit or advantage of any such law, and covenants that it will not, by resort
to any such law, hinder, delay or impede the execution of any power herein
granted to the Trustee, but will suffer and permit the execution of every such
power as though no such law has been enacted.


 


Section 4.05.          Limitation
on Indebtedness.


 


Unless the Notes are rated the Required Rating (during
which such time this Section 4.05 will not be in effect), the Company will not,
and will not permit any of its Subsidiaries to, directly or indirectly, create,
incur, issue, assume, guarantee, or otherwise in any manner become liable,
directly or indirectly, with respect to any Indebtedness, except, without
duplication, for (i) the incurrence by the Company’s Unrestricted Subsidiaries
of Qualified Non-Recourse Debt, provided,
however, that if any such
Indebtedness ceases to be Qualified 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; (ii) FF&E Financing incurred by the
Company or its Restricted Subsidiaries; (iii) the Notes; (iv) all Existing
Notes; (v) provided no Event of Default shall have occurred and be continuing,
other Indebtedness of the Company and its Restricted Subsidiaries in an amount
not to exceed $15,000,000 in aggregate principal amount; (vi) additional
Indebtedness of the Company and its Restricted Subsidiaries, if at the time of
the incurrence of such Indebtedness, the pro forma Consolidated Coverage Ratio
of the Company, calculated cumulatively for the four most recent consecutive
fiscal quarters of the Company and ending prior to the date of incurrence (the
“Reference Period”), is not less than 2.00 to 1.00, after giving effect to (A)
the incurrence of such Indebtedness as if such Indebtedness was incurred at the
beginning of the Reference Period and (if applicable) the application of the
net proceeds thereof to refinance other Indebtedness as if the application of
such proceeds occurred at the beginning of the Reference Period and (B) the
acquisition or disposition of any company or business acquired or disposed of
by the Company or any Restricted Subsidiary since the first day of the
Reference Period, including any acquisition or disposition which will be
consummated contemporaneously with the incurrence of such Indebtedness, as if
such acquisition or disposition occurred at the beginning of the Reference
Period; (vii) Permitted Refinancing Indebtedness; (viii) Indebtedness incurred
under the Bank Facility not to exceed the greater of (A) $200 million or (B)
1.5 times Operating Cash Flow calculated cumulatively for the four most recent
consecutive fiscal quarters of the Company immediately preceding the date on
which such Indebtedness is incurred, provided
that the exception in this clause (viii) shall not be applicable to any
Indebtedness incurred in refinancing the Bank Facility if the managing agent
for the lenders of such refinancing Indebtedness is a person other than a
banking institution with over $500 million in assets and subject to supervision
and examination by federal or state banking authorities; (ix) Interest Rate
Protection Agreements of the Company or any Restricted Subsidiary covering
solely Indebtedness of the Company or any Restricted Subsidiary which is
otherwise permitted to be incurred pursuant to this paragraph; (x) Indebtedness
to the Company or a wholly-owned


 


38

















 


Restricted Subsidiary; or (xi) to the extent that such
incurrence does not result in the incurrence by the Company or any Restricted
Subsidiary of any obligation for the payment of borrowed money of others,
Indebtedness incurred solely as a result of the execution by the Company or its
Restricted Subsidiaries of a Completion Guarantee and Keep-Well Agreement.


 


For purposes of determining compliance with this
covenant, in the event that an item of Indebtedness meets the criteria of more
than one of the categories of Indebtedness described in clauses (i) through
(xi) of the first paragraph of this covenant, the Company will, in its sole
discretion, classify such item of Indebtedness in any manner that complies with
this covenant and such item of Indebtedness will be treated as having been
incurred pursuant to only one of such clauses. 
The Company may reclassify such Indebtedness from time to time in its
sole discretion.


 


Section 4.06.          Limitation
on Capital Stock of Restricted Subsidiaries.


 


The Company will not permit any Restricted Subsidiary
to issue any Capital Stock to any person (other than to the Company or any
wholly-owned Restricted Subsidiary) that shall entitle the holder of such
Capital Stock to a preference in right of payment in the event of liquidation,
dissolution or winding-up of such Restricted Subsidiary or with respect to
dividends of such Restricted Subsidiary.


 


Section 4.07.          Corporate
Existence.


 


Subject to Article 5 hereof, the Company will do or
cause to be done all things necessary to preserve and keep in full force and
effect its corporate existence and the corporate, partnership or other
existence of each Subsidiary, if any, in accordance with the respective
organizational documents of each Subsidiary and 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 Subsidiary,
if the Board of Directors of the Company shall determine in good faith, which
determination shall be evidenced by a board resolution, 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.


 


Section 4.08.          Taxes.


 


The Company shall, and shall cause each of its
subsidiaries to, pay prior to delinquency all taxes, assessments and
governmental levies, except as contested in good faith and by appropriate
proceedings or where the failure to pay would not have a material adverse
effect on the Company and its Subsidiaries taken as a whole.


 


Section 4.09.          Investment
Company Act.


 


The Company shall not become an investment company
subject to registration under the Investment Company Act of 1940, as amended.


 


39

















 


Section 4.10.          Limitation
on Transactions with Affiliates.


 


Unless the Notes are rated the Required Rating (during
which such time this Section 4.10 will not be in effect), the Company will not,
and will not permit any Restricted Subsidiary to, directly or indirectly,
conduct any business or enter into any transaction or series of related
transactions (including the purchase, sale, lease or exchange of any property
or the rendering of any service), pursuant to which the Company or any
Restricted Subsidiary shall receive or render value exceeding $1,000,000, with
any Affiliate or Related Person of the Company or of the Existing Equity
Holders (other than the Company or a wholly-owned Restricted Subsidiary of the
Company), unless (i) the terms of such business, transaction or series of
related transactions are (A) set forth in writing and (B) fair and reasonable
to the Company or such Restricted Subsidiary, and no less favorable to the
Company or such Restricted Subsidiary, as the case may be, as terms that would
be obtainable at the time for a comparable transaction or series of related transactions
with an unrelated third person and (ii) the disinterested directors of the
Board of Directors of the Company have, by resolution, determined in good faith
that such business or transaction or series of related transactions meets the
criteria set forth in (i)(B) above, which determination shall be conclusive and
(iii) with respect to any transaction or series of related transactions
otherwise permitted under this paragraph pursuant to which the Company or any
Restricted Subsidiary shall receive or render value exceeding $15,000,000, such
transaction or series of related transactions shall not be permitted unless,
prior to consummation thereof, the Company shall have received an opinion, from
an independent nationally recognized firm experienced in the appraisal or
similar review of similar types of transactions, that such transaction or
series of related transactions is on terms which are fair, from a financial
point of view, to the Company or such Restricted Subsidiary.  Notwithstanding the foregoing, the Company
or any of its Restricted Subsidiaries shall be entitled to provide management
services to an Unrestricted Subsidiary whose sole purpose is to develop,
construct and operate a new gaming facility, provided that the Company or such
Restricted Subsidiary, as the case may be, is reimbursed by the Unrestricted
Subsidiary for all costs and expenses (including without limitation payroll) it
incurs in providing such services.


 


Section 4.11.          Change
of Control and Rating Decline.


 


Upon the occurrence of a Change of Control Triggering
Event, each Holder shall have the right to require that the Company repurchase
all or any part of such Holder’s Notes at a repurchase price in cash (the
“Repurchase Price”) equal to 101% of the principal amount thereof, plus
Liquidated Damages, if any, and accrued interest to the date of repurchase.


 


Within 30 days following the date of a Change of
Control Triggering Event, the Company shall mail a notice to each Holder at its
last registered address, with a copy to the Trustee, of the Company’s offer to
repurchase (the “Repurchase Offer”) Notes pursuant to this Section 4.11.  The Repurchase Offer shall remain open from
the time of mailing of such notice until the repurchase date (which shall be no
earlier than 30 days nor later than 60 days from the date of such mailing) (the
date on which the Repurchase Offer closes being the “Repurchase Date”).  The notice shall contain all instructions
and materials necessary to enable such Holders to tender Notes pursuant to the
Repurchase Offer.  The notice, which
shall govern the terms of the Repurchase Offer, shall state:


 


40

















 


(i)            that
a Change of Control Triggering Event has occurred and that such Holder has the
right to require the Company to repurchase all or any part of such Holder’s
Notes at a repurchase price in cash equal to 101% of the principal amount, plus
accrued and unpaid interest and Liquidated Damages thereon, if any, to the date
of repurchase thereof;


 


(ii)           the
circumstances and relevant facts regarding such Change of Control Triggering
Event (including information with respect to pro forma historical income, cash
flow and capitalization after giving effect to such Change of Control
Triggering Event);


 


(iii)          the
Repurchase Date;


 


(iv)          that
any Note not tendered will continue to accrue interest;


 


(v)           that,
unless the Company defaults in paying the Repurchase Price, any Note accepted
for payment pursuant to the Repurchase Offer shall cease to accrue interest
from and after the Repurchase Date;


 


(vi)          that
Holders electing to have a Note purchased pursuant to the Repurchase Offer will
be required to surrender the Note, with the form entitled “Option of Holder to
Elect Repurchase” on the reverse of the Note duly completed, to the Company at
the address specified in the notice at least three Business Days prior to the
Repurchase Date;


 


(vii)         that
Holders will be entitled to withdraw their election if the Paying Agent
receives, not later than three Business Days prior to the Repurchase Date, a
telegram, telex, facsimile transmission or letter setting forth the name of the
Holder, the principal amount of Notes the Holder delivered for repurchase and a
statement that such Holder is withdrawing such Holder’s election to have such
Notes repurchased; and


 


(viii)        that
Holders whose Notes are purchased only in part will be issued new Notes equal
in principal amount to the unpurchased portion of the Notes surrendered.


 


If any consent under the Bank Facility is necessary to
permit the Company to effect the Repurchase Offer, the Company will (i) repay
in full or offer to repay in full all Indebtedness under the Bank Facility or
(ii) obtain the requisite consent under the Bank Facility; provided, however,
that the failure to repay such Indebtedness or obtain such consent will not in
any event excuse any failure by the Company to perform its obligations under
this Section 4.11.


 


On the Repurchase Date, the Company shall, to the
extent lawful, (i) accept for payment Notes or portions thereof tendered
pursuant to the Repurchase Offer and (ii) deliver to the Trustee Notes so
tendered together with an Officers’ Certificate stating the Notes or portions
thereof accepted for payment by the Company. 
The Paying Agent shall promptly mail or deliver to Holders of Notes so
accepted payment in an amount equal to the Repurchase Price.  The Trustee shall promptly authenticate and
mail or deliver to each Holder who tendered a Note a new Note or Notes equal in
principal amount to any untendered portion of the Note surrendered.  The Paying Agent shall invest funds
deposited with it pursuant to this Section 4.11 for the benefit of, and at the
written direction of, the Company to the Repurchase Date.


 


41

















 


Section 4.12.          Limitation
on Dividends and Other Payment Restrictions Affecting Restricted Subsidiaries.


 


Unless the Notes are rated the Required Rating (during
which such time this Section 4.12 will not be in effect), the Company will not,
and will not permit any Restricted Subsidiary to, directly or indirectly,
create or otherwise cause or suffer to exist or become effective any
encumbrance or restriction on the ability of any Restricted Subsidiary to:  (i) pay dividends or make any other
distribution on its Capital Stock or any other interest or participation in, or
measured by, its profits, or pay any interest or principal due on 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, other than (a) any such encumbrance or restriction
imposed by any Gaming Authority; (b) any encumbrance or restriction existing on
February 27, 2004 contained in the Bank Facility relating to Indebtedness that
does not exceed the greater of (1) $200 million or (2) 1.5 times Operating Cash
Flow calculated cumulatively for the four most recent consecutive fiscal
quarters of the Company immediately preceding the date on which such
Indebtedness is incurred; (c) any encumbrance or restriction with respect to a
Restricted Subsidiary pursuant to an agreement relating to any Indebtedness
(other than Indebtedness incurred in anticipation of, as consideration in, or
to provide all or any portion of the funds utilized to consummate, the
transaction or series of related transactions pursuant to which such Restricted
Subsidiary became a Subsidiary of the Company) incurred by such Restricted
Subsidiary on or prior to the date on which such Restricted Subsidiary became a
Restricted Subsidiary of the Company and outstanding on such date; (d) any
pledge by the Company or a Restricted Subsidiary of the stock of an
Unrestricted Subsidiary if such pledge is made in connection with the
incurrence of Qualified Non-Recourse Debt by such Unrestricted Subsidiary; and
(e) any encumbrance or restriction pursuant to an agreement relating to
Indebtedness issued to repay or amend Indebtedness referred to in clause (b),
(c) or (e) of this paragraph, provided,
however, that any such
encumbrance or restriction is no less favorable to the Noteholders than
encumbrances and restrictions contained in agreements relating to the
Indebtedness so repaid or amended, and provided
further, that in the event that Indebtedness is issued to repay or
amend the Bank Facility, the aggregate principal amount of such Indebtedness
shall not exceed the greater of (A) $200 million or (B) 1.5 times Operating
Cash Flow calculated cumulatively for the four most recent consecutive fiscal
quarters of the Company immediately preceding the date on which such
Indebtedness is issued.


 


Section 4.13.          Restriction
on Layering Debt.


 


The Company shall not incur any Indebtedness that is
subordinate or junior in right of payment to Senior Indebtedness and senior in
any respect in right of payment to the Notes.


 


42

















 


ARTICLE 5.

SUCCESSORS


 


Section 5.01.          When
Company May Merge, etc.


 


The Company shall not consolidate with or merge with
or into any other entity (other than with a wholly-owned Restricted Subsidiary,
provided the Company is the continuing corporation) or sell, convey, assign,
transfer, lease or otherwise dispose of all or substantially all of its
properties and assets (determined on a consolidated basis for the Company and
its Restricted Subsidiaries taken as a whole) to any entity, unless:


 


(i)            either
(a) the Company shall be the continuing corporation or (b) the entity (if other
than the Company) formed by such consolidation or into which the Company is
merged or the entity that acquires, by sale, conveyance, assignment, transfer,
lease or disposition, all or substantially all of the properties and assets of
the Company shall be a corporation, partnership or trust organized and validly
existing under the laws of the United States or any state thereof or the
District of Columbia, and shall expressly assume by a supplemental indenture
the due and punctual payment of the principal of and premium, if any, and
interest on all the Notes and the performance and observance of every covenant
of the Indenture on the part of the Company to be performed or observed;


 


(ii)           immediately
thereafter, no Event of Default (and no event that, after notice or lapse of
time, or both, would become an Event of Default) shall have occurred and be
continuing;


 


(iii)          immediately
after giving effect to any such transaction involving the incurrence by the
Company or any Restricted Subsidiary, directly or indirectly, of additional
Indebtedness (and treating any Indebtedness not previously an obligation of the
Company or any of its Restricted Subsidiaries incurred in connection with or as
a result of such transaction as having been incurred at the time of such
transaction), the Company (if it is the continuing corporation) or such other
entity could incur at least $1.00 of additional Indebtedness pursuant to
Section 4.05(vi); and


 


(iv)          immediately
thereafter, the Company (if it is the continuing corporation) or such other
entity shall have a Consolidated Net Worth equal to or greater than the
Consolidated Net Worth of the Company immediately prior to such transaction.


 


The Company shall deliver to the Trustee prior to the
consummation of the proposed transaction an Officers’ Certificate to the foregoing
effect and an Opinion of Counsel stating that the proposed transaction and such
supplemental indenture comply with this Indenture.


 


Section 5.02.          Successor
Corporation Substituted.


 


Upon any consolidation or merger, or any sale, lease,
conveyance or other disposition of all or substantially all of the assets of
the Company in accordance with Section 5.01, the successor corporation formed
by such consolidation or into or with which the Company is merged or to which
such sale, lease, conveyance or other disposition is made shall succeed to,


 


43

















 


and be substituted for, 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 herein.  When a successor corporation assumes all of
the obligations of the Company hereunder and under the Notes and agrees to be
bound hereby and thereby, the predecessor shall be released from such
obligations.


 


ARTICLE 6.

DEFAULTS AND REMEDIES


 


Section 6.01.          Events
of Default.


 


An “Event of Default” occurs if:


 


(a)           the
Company defaults in the payment of interest on any Note when the same becomes
due and payable and such Default continues for a period of 30 days after the
date due and payable;


 


(b)           the
Company defaults in the payment of the principal of any Note when the same
becomes due and payable at maturity, upon optional redemption of the Notes by
the Company, upon exercise by the Holder of the Repurchase Offer upon a Change
of Control Triggering Event, upon declaration or otherwise;


 


(c)           the
Company fails to observe, perform or comply with Article 5;


 


(d)           the
Company fails to observe, perform or comply with any of its other agreements or
covenants in, or provisions of, the Notes or this Indenture and such failure to
observe, perform or comply continues for a period of 60 days after receipt by
the Company of notice of Default from the Trustee or the Holders of at least
25% in principal amount of the Notes;


 


(e)           the
Company fails, after any applicable grace period, to make any payment of
principal of, premium in respect of, or interest on, any Indebtedness when due,
or any Indebtedness of the Company or any of its Restricted Subsidiaries is
accelerated because of a default and the aggregate principal amount of such
Indebtedness with respect to which any such failure to pay or acceleration has
occurred exceeds the greater of (a) $10,000,000 and (ii) 5% of Consolidated Net
Tangible Assets;


 


(f)            any
encumbrance or restriction of the type described in Section 4.12 becomes
applicable to any Restricted Subsidiary;


 


(g)           the
Company or any Restricted Subsidiary pursuant to or within the meaning of any
Bankruptcy Law:


 


(A)          commences a voluntary
case,


 


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


 


44

















 


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


 


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


 


(E)           admits in writing its
inability generally to pay its debts as the same become due;


 


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


 


(A)          is for relief against
the Company or any Restricted Subsidiary in an involuntary case,


 


(B)           appoints a Custodian of
the Company or any Restricted Subsidiary or for all or substantially all of the
property of the Company or any Restricted Subsidiary, or


 


(C)           orders the liquidation
of the Company or any Restricted Subsidiary, and the order or decree remains
unstayed and in effect for 60 days;


 


(i)            one
or more judgments, orders or decrees are rendered against the Company or any of
its Restricted Subsidiaries in an aggregate amount in excess of (x) $10,000,000
and (y) 5% of Consolidated Net Tangible Assets (in each case, to the extent not
covered by insurance) and, in each case, that are not discharged for a period
of 60 days during which a stay of enforcement of such judgments, orders or
decrees, by reason of a pending appeal or otherwise, is not in effect; or


 


(j)            any
Gaming License of the Company or any of its Restricted Subsidiaries is revoked,
terminated or suspended or otherwise ceases to be effective, resulting in the
cessation or suspension of operation for a period of more than 90 days of the
casino business of any casino-hotel owned, leased or operated directly or
indirectly by the Company or any of its Restricted Subsidiaries (other than any
voluntary relinquishment of a Gaming License if such relinquishment is, in the
reasonable, good faith judgment of the Board of Directors of the Company,
evidenced by a resolution of such Board, 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).


 


The term “Bankruptcy Law” means title 11, U.S. Code or
any similar federal or state law for the relief of debtors.  The term “Custodian” means any receiver,
trustee, assignee, liquidator or similar official under any Bankruptcy Law.


 


In the case of any Event of Default pursuant to the
provisions of this Section 6.01 occurring 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 which the Company would have had
to pay if the Company then had elected to redeem the Notes pursuant to
paragraph 5 of the Notes, an equivalent premium (or, in the event that the
Company would not be permitted to redeem the Notes pursuant to paragraph 5 of
the Notes, the premium payable on the first date


 


45

















 


thereafter on which such redemption would be
permissible) shall also become and be immediately due and payable to the extent
permitted by law, anything in this Indenture or in the Notes contained to the
contrary notwithstanding.


 


Section 6.02.          Acceleration.


 


If an Event of Default (other than an Event of Default
specified in clause (g) or (h) of Section 6.01) occurs and is continuing, the
Trustee by notice to the Company, or the Holders of at least 25% in principal
amount of the then outstanding Notes by notice to the Company and the Trustee,
may declare the unpaid principal of and all accrued and unpaid interest,
Liquidated Damages, if any, and premium, if any, on the Notes to be immediately
due and payable.  Upon such declaration,
the principal, interest, Liquidated Damages, if any, and premium, if any, shall
be due and payable immediately.  If an
Event of Default specified in clause (g) or (h) of Section 6.01 occurs, such an
amount shall ipso facto become
and be immediately due and payable without any declaration or other act on the
part of the Trustee or any Holder.  The
Holders of a majority in principal amount of the then outstanding Notes, by
notice to the Trustee, may rescind an acceleration and its consequences if the
rescission would not conflict with any judgment or decree and if all existing
Events of Default have been cured or waived, except non-payment of principal or
interest that has become due solely because of the acceleration.


 


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 or
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 Noteholder 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.


 


The Holders of a majority in principal amount of the
then outstanding Notes, by notice to the Trustee, may waive an existing Default
or Event of Default and its consequences, except a continuing Default or Event
of Default in the payment of the principal of any Note.


 


Section 6.05.          Control
by Majority.


 


The Holders of a majority in principal amount of the
then outstanding Notes may direct the time, method and place of conducting any
proceeding for 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 is unduly prejudicial to the rights of other Noteholders, or
would involve the Trustee in personal liability.


 


46

















 


Section 6.06.          Limitation
on Suits.


 


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


 


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


 


(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 or Holders offer 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 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 Noteholder may not use this Indenture to prejudice
the rights of another Noteholder or to obtain a preference or priority over
another Noteholder.


 


Section 6.07.          Rights
of Holders to Receive Payment.


 


Notwithstanding any other provision of this Indenture,
the right of any Holder of a Note to receive payment of principal of,
Liquidated Damages, if any, and interest on the Note, on or after the
respective due dates expressed in the Note, 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 the Holder.


 


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 may recover judgment as permitted
under applicable law in its own name and as trustee of an express trust against
the Company or any other obligor on the Notes for the whole amount of principal
of, Liquidated Damages, if any, and interest remaining unpaid on the Notes and
interest on overdue principal and interest and such further amount as shall be
sufficient to cover the costs and, to the extent lawful, 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 may 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 and the Noteholders allowed in any judicial proceedings
relative to the Company or any other obligor or their respective creditors or
property.  Nothing herein contained
shall be deemed to authorize the Trustee to authorize or consent to or accept
or adopt on behalf of any Noteholder any plan of


 


47

















 


reorganization, arrangement, adjustment or composition
affecting the Notes or the rights of any Holder thereof, or to authorize the
Trustee to vote in respect of the claim of any Noteholder 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 for
amounts due under Section 7.07;


 


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


 


Third:             to the Company or any
other obligors on the Notes, as their interests may appear, or as a court of
competent jurisdiction may direct.


 


The Trustee may fix a record date and payment date for
any payment to Noteholders.


 


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


 


ARTICLE 7.

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 their
exercise, as a prudent person would exercise or use under the circumstances in
the conduct of his or her own affairs.


 


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


 


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(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.


 


(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 to
determine whether or not they conform to the requirements of this Indenture
(but need not confirm or investigate the accuracy of any mathematical
calculations or other facts stated therein).


 


(c)  The Trustee may not be relieved from
liability 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
Trust Officer, unless it is proved that the Trustee was negligent in
ascertaining the pertinent facts.


 


(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.


 


(d)  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)  The Trustee may refuse to perform any duty
or exercise any right or power unless it receives indemnity satisfactory to it
against any loss, liability or expense.


 


(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.


 


(g)  None of the provisions of this Indenture
shall require the Trustee to expend or risk its own funds or otherwise incur
financial liability in the performance of any of its duties hereunder or in the
exercise of any of its rights or powers.


 


(h)  The Trustee shall not be bound to make any
investigation into the facts or matters stated in any resolution, certificate,
statement, instrument, opinion, report, notice, request, direction, consent,
order, bond, debenture or other paper or documents.


 


Section 7.02.          Rights
of Trustee.


 


(a)  The Trustee may rely on, and shall be
protected in acting or refraining from acting upon, any document (whether in
original, facsimile or electronic form) believed by it to be


 


49

















 


genuine and to have been signed or presented
by the proper person.  The Trustee shall
not be bound to make any investigation into the facts or matters stated in any
resolution, certificate, statement, instrument, opinion, report, notice,
request, direction, consent, order, bond, debenture or other paper or document,
but the Trustee, in its discretion, may make such further inquiry or
investigation into such facts or matters as it may see fit, and, if the Trustee
shall determine to make such further inquiry or investigation, it shall be
entitled to examine the books, records and premises of the Company, personally
or by agent or attorney.


 


(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
written advice or opinion of such counsel or 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 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 which it believes to be
authorized or within its rights or powers.


 


(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 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 shall not be charged with
knowledge of any Default or Event of Default unless either (i) a Responsible
Officer of the Trustee shall have actual knowledge of such Default or Event of
Default or (ii) written notice of such Default or Event of Default shall have
been given to and received by a Responsible Officer of the Trustee by the
Company or any Holder.


 


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 an Affiliate of the Company with the same rights it would have if it
were not Trustee.  Any Agent may do the
same with like rights.  However, the
Trustee is subject to Sections 7.10 and 7.11.


 


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


 


50

















 


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 or the Notes, 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 authentication of the Notes.


 


Section 7.05.          Notice
of Defaults.


 


If a Default or Event of Default occurs and is
continuing and if it is actually known to the Trustee, the Trustee shall mail
to Note holders 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 on any Note, the Trustee may withhold
the notice if and so long as a committee of its Trust Officers in good faith
determines that withholding the notice is in the interests of Noteholders.


 


Section 7.06.          Reports
by Trustee to Holders.


 


Within 60 days after the reporting date stated in
Section 11.10, the Trustee shall, to the extent required, mail to Noteholders a
brief report dated as of such reporting date that complies with TIA §
313(a).  The Trustee also shall comply
with TIA § 313(b).  The Trustee shall
also transmit by mail all reports as required by TIA § 313(c).


 


Commencing at the time this Indenture is qualified
under the TIA, a copy of each report at the time of its mailing to Noteholders
shall be filed with the SEC and each stock exchange on which the Notes are
listed of which the Company has notified the Trustee in writing.  The Company shall promptly notify the
Trustee when the Notes are listed on any stock exchange.


 


Section 7.07.          Compensation
and Indemnity.


 


The Company shall pay to the Trustee from time to time
upon demand by the Trustee reasonable compensation established by the Trustee
for its 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 upon request for all reasonable
out-of-pocket expenses incurred by it. 
Such expenses shall include the reasonable compensation and
out-of-pocket expenses of the Trustee’s agents and counsel.


 


The Company shall indemnify the Trustee, its officers,
directors, employees and agents 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 Holder or any other person) or liability in connection with the
exercise or performance of any of its powers or duties hereunder.  The Trustee shall notify the Company
promptly of any claim for which it may seek indemnity.  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


 


51

















 


counsel.  The
Company need not pay for any settlement made without its consent, which consent
shall not be unreasonably withheld.


 


The Company need not reimburse any expense or
indemnify against any loss or liability incurred by the Trustee through gross
negligence or willful misconduct.


 


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 resignation or removal of the Trustees and
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(g) or (h) 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.


 


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 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.  The Company
may remove the Trustee by notice to the Trustee if:


 


(1)           the Trustee fails to
comply with Section 7.10;


 


(2)           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;


 


(3)           a Custodian or public
officer takes charge of the Trustee or its property; or


 


(4)           the Trustee becomes
otherwise 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 and any other
obligor 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 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 30
days after the retiring Trustee resigns or is removed, the retiring Trustee (at
the expense of the Company), the Company or the Holders of at least 10% in
principal amount of the then outstanding Notes may petition any court of
competent jurisdiction for the appointment of a successor Trustee.


 


52

















 


If the Trustee fails to comply with Section 7.10, any
Noteholder 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 Noteholders.  The
retiring Trustee shall promptly transfer all property held by it as Trustee to
the successor Trustee, subject to the lien provided for in Section 7.07.  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 with respect to
expenses and liabilities incurred by it prior to such replacement.


 


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.


 


This Indenture shall always have a Trustee who
satisfies the requirements of TIA § 310(a)(1).  The Trustee shall always have a combined capital and surplus as
stated in Section 11.10.  The Trustee is
subject to TIA § 310(b), including the optional provision permitted by the
proviso in the second sentence of 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.


 


ARTICLE 8.

DISCHARGE OF INDENTURE


 


Section 8.01.          Termination
of Company’s Obligations.


 


This Indenture shall cease to be of further effect
(except that the Company’s obligations under Sections 7.07 and 8.03, and
application of funds to the payment of Notes, shall survive) when all
outstanding Notes theretofore authenticated and issued have been delivered to
the Trustee for cancellation, and the Company has paid all sums payable
hereunder.  In addition, the Company may
terminate all of its obligations under this Indenture (except the Company’s
obligations under Sections 7.07 and 8.03) if:


 


(1)           the Company irrevocably
deposits in trust with the Trustee money or non-callable U.S. Government
Obligations maturing as to principal and interest in such amounts and at such
times as are sufficient, as certified by an Officers’ Certificate, to pay


 


53

















 


principal of, Liquidated
Damages, if any, and interest on the Notes to maturity or redemption, as the
case may be, and to pay all other sums payable by it hereunder; and


 


(2)           the Company delivers to
the Trustee an Opinion of Counsel satisfactory to the Trustee that the Holders
of the Notes should not recognize income, gain or loss for federal income tax
purposes as a result of the Company’s exercise of its option under this Section
8.01 and will be subject to federal income tax on the same amount and in the
same manner and at the same times as would have been the case if such option
had not been exercised.


 


However, the Company’s obligations in Sections 2.03,
2.04, 2.05, 2.06, 2.07, 4.01, 7.07, 8.03 and 8.04 shall survive until the Notes
are no longer outstanding.  Thereafter,
only the Company’s obligations in Sections 7.07 and 8.03 shall survive.


 


After a deposit made pursuant to this Section 8.01,
the Trustee upon request shall acknowledge in writing the discharge of the
Company’s obligations under this Indenture, except for those surviving
obligations specified above.


 


“U.S. Government Obligations” means direct obligations
of the United States of America, or obligations unconditionally guaranteed by
the United States of America, for the payment of which the full faith and
credit of the United States of America is pledged.  In order to have money available on a payment date to pay
principal of or interest on the Notes, the U.S. Government Obligations shall be
payable as to principal or interest on or before such payment date in such
amounts as will provide the necessary money. 
U.S. Government Obligations shall not be callable at the issuer’s
option.


 


Section 8.02.          Application
of Trust Money.


 


The Trustee shall hold in trust money or U.S.
Government Obligations deposited with it pursuant to Section 8.01.  It shall apply the deposited money and the
money from U.S. Government Obligations through the Paying Agent and in
accordance with this Indenture to the payment of principal and interest and
Liquidated Damages, if any, on the Notes.


 


Section 8.03.          Repayment
to Company.


 


The Trustee and the Paying Agent shall promptly pay to
the Company upon request any excess money or securities held by them at any time.


 


The Trustee and the Paying Agent shall pay to the
Company upon request any money held by them for the payment of principal of,
Liquidated Damages, if any, or interest on any Note that remains unclaimed for
two years after the date upon which such payment shall have become due; provided, however,
that the Company shall have first caused notice of such payment to the Company
to be mailed to each Noteholder entitled thereto no less than 30 days prior to
such payment.  After payment to the
Company, Noteholders entitled to the money must look to the Company for payment
as general creditors unless an applicable abandoned property law designates
another person.


 


54

















 


Section 8.04.          Reinstatement.


 


If (i) the Trustee or Paying Agent is unable to apply
any money in accordance with Section 8.02 by reason of any order or judgment of
any court or governmental authority (other than any order of the Nevada Gaming
Commission restricting the payment of such money to any particular Holder)
enjoining, restraining or otherwise prohibiting such application and (ii) the
Holders of at least a majority in principal amount of the then outstanding
Notes so request by written notice to the Trustee, the Company’s obligations
under this Indenture and the Notes shall be revived and reinstated as though no
deposit had occurred pursuant to Section 8.01 until such time as the Trustee or
Paying Agent is permitted to apply all such money in accordance with Section
8.02; provided, however, that if the Company makes any
payment of principal of, Liquidated Damages, if any, or interest on any Note
following the reinstatement of its obligations, the Company shall be subrogated
to the right of the Holders of such Notes to receive such payment from the
money held by the Trustee or Paying Agent.


 


ARTICLE 9.

AMENDMENTS


 


Section 9.01.          Without
Consent of Holders.


 


The Company and the Trustee may amend this Indenture
or the Notes without the consent of any Noteholder:


 


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


 


(2)           to comply with Section
5.01;


 


(3)           to comply with any
requirements of the SEC in connection with the qualification or requalification
of this Indenture under the TIA;


 


(4)           to provide for
uncertificated Notes in addition to certificated Notes; or


 


(5)           to make any change that
does not adversely affect the rights hereunder of any Noteholder.


 


Section 9.02.          With
Consent of Holders.


 


Subject to Section 6.07, the Company and the Trustee
may amend this Indenture or the Notes with the written consent of the Holders
of at least a majority in principal amount of the then outstanding Notes.  Subject to Sections 6.04 and 6.07, the
Holders of a majority in principal amount of the Notes then outstanding may
also waive compliance in a particular instance by the Company with any
provision of this Indenture or the Notes.


 


However, without the consent of each Noteholder
affected, an amendment or waiver under this Section may not:


 


(1)           reduce the amount of
Notes whose Holders must consent to an amendment or waiver;


 


55

















 


(2)           reduce the rate of or
change the time for payment of interest or Liquidated Damages, if any, on any
Note;


 


(3)           the principal of or
change the fixed maturity of any Note or alter the redemption provisions with
respect thereto;


 


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


 


(5)           make any change in
Section 6.04, 6.07 or 9.02 (this sentence only); or


 


(6)           waive a default in the
payment of the principal of, or Liquidated Damages, if any, or interest on, any
Note.


 


To secure a consent of the Holders under this Section
it shall not be necessary for the Holders 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 or waiver under this Section
becomes effective, the Company shall mail to Noteholders a notice briefly
describing the amendment or waiver.


 


Section 9.03.          Compliance
with Trust Indenture Act.


 


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


 


Section 9.04.          Revocation
and Effect of Consents.


 


Until an amendment or waiver becomes effective, a
consent to it by a Holder of a Note is a continuing consent by the Holder and
every subsequent Holder of a Note or portion of a Note that evidences the same
Indebtedness as the consenting Holder’s Note, even if notation of the consent
is not made on any Note.  However, any
such Holder or subsequent Holder may revoke the consent as to his Note or
portion of a Note if the Trustee receives notice of revocation before the date
on which the Trustee receives an Officers’ Certificate certifying that the
Holders of the requisite principal amount of Notes have consented to the
amendment or waiver (or before such later date as may be required by law or
stock exchange rule).


 


The Company may, but shall not be obligated to, fix a
record date for the purpose of determining the Holders entitled to consent to
any amendment or waiver.  If a record
date is fixed, then notwithstanding the provisions of the immediately preceding
paragraph, those persons who were Holders at such record date (or their duly
designated proxies), and only those persons, shall be entitled to consent to
such amendment or waiver or to revoke any consent previously given, whether or
not such persons continue to be Holders after such record date.  No consent shall be valid or effective for
more than 90 days after such record date unless consents from Holders of the
principal amount of Notes required hereunder for such amendment or waiver to be
effective shall have also been given and not revoked within such 90-day period.


 


After an amendment or waiver becomes effective it
shall bind every Noteholder, unless it is of the type described in any of
clauses (1) through (6) of Section 9.02. 
In such case,


 


56

















 


the amendment or waiver shall bind each Holder of a
Note who has consented to it and every subsequent Holder of a Note that
evidences the same Indebtedness as the consenting Holder’s Note.


 


Section 9.05.          Notation
on or Exchange of Notes.


 


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


 


Section 9.06.          Trustee
Protected.


 


The Trustee shall sign all supplemental indentures,
except that the Trustee need not sign any supplemental indenture that adversely
affects its rights.  As a condition to
executing or accepting any supplemental indenture, the Trustee may request and
rely on an Opinion of Counsel and an Officers’ Certificate stating that such
supplemental indenture is permitted hereunder and all conditions precedent have
been complied with, in the form set forth in Sections 11.04 and 11.05.


 


ARTICLE 10.

SUBORDINATION


 


Section 10.01.        Notes Subordinated to Senior Indebtedness.


 


The Company agrees, and each Holder by accepting a
Note agrees, that the Indebtedness evidenced by the Notes, including for all
purposes of this Article 10, all repurchase and redemption obligations with
respect to the Notes, is subordinated in right of payment, to the extent and in
the manner provided in this Article 10, to the prior payment in full of all
existing and future Senior Indebtedness and that the subordination is for the
benefit of and enforceable by the holders of Senior Indebtedness, and
authorizes and directs the Trustee to take such action as may be necessary or
appropriate to acknowledge or effectuate the subordination as provided in this
Article 10 and appoints the Trustee as attorney-in-fact for any and all such
purposes.


 


Only Indebtedness of the Company which is Senior
Indebtedness shall rank senior to the Notes in accordance with the provisions
set forth herein.  This Article 10 shall
remain in full force and effect as long as any Senior Indebtedness is
outstanding or any commitment to advance Senior Indebtedness exists, assuming
in the case of the Bank Facility that all conditions precedent to any such
advance could be satisfied.


 


Section 10.02.        Liquidation; Dissolution; Bankruptcy.


 


Upon any payment or distribution, whether of cash,
securities or other property, to creditors of the Company in a liquidation
(total or partial), reorganization or dissolution of the Company, whether
voluntary or involuntary, or in a bankruptcy, reorganization, insolvency,
receivership, assignment for the benefit of creditors, marshalling of assets or
similar proceeding relating to the Company or its property:


 


57

















 


(1)  holders of Senior Indebtedness shall be
entitled to receive payment in full, in cash or cash equivalents, of such
Senior Indebtedness before Holders shall be entitled to receive any payment of
principal of, or interest or Liquidated Damages, if any, on, or any other
distribution with respect to, the Notes; and


 


(2)  until the Senior Indebtedness is paid in
full as provided in clause (1) above, any distribution to which Holders would
be entitled but for this Article 10 shall be made to the holders of Senior
Indebtedness as their interests may appear;


 


in each case except that Holders may receive shares of
stock and debt securities that are subordinated to Senior Indebtedness to at
least the same extent and pursuant to the same or more stringent terms as are
the Notes.


 


Upon any distribution of assets of the Company
referred to in this Section 10.02, the Trustee and the Holders shall be
entitled to rely upon any order or decree of a court of competent jurisdiction
in which such bankruptcy, reorganization, insolvency, receivership, assignment
for the benefit of creditors, marshalling of assets or similar proceedings are
pending, or a certificate of the liquidating trustee or agent or other such
person making any distribution to the Trustee or to the Holders, for the
purpose of ascertaining the persons entitled to participate in such
distribution, the holders of Senior Indebtedness, the amount thereof or payable
thereon, the amount or amounts paid or distributed thereon and all other facts
pertinent thereto or to this Section 10.02. 
The Trustee shall be entitled to rely on the delivery to it of a written
notice by a person representing himself to be a holder of Senior Indebtedness
or a Representative, as the case may be, to establish that such notice has been
given by a holder of Senior Indebtedness or a Representative, as the case may
be.  In the event that the Trustee
determines, in good faith, that further evidence is required with respect to
the right of any person, as a holder of Senior Indebtedness, to participate in
any payment or distribution pursuant to this Section 10.02, the Trustee may
request such person to furnish evidence to the reasonable satisfaction of the
Trustee as to the amount of such Senior Indebtedness held by such person, as to
the extent to which such person is entitled to participation in such payment or
distribution and as to other facts pertinent to the rights of such person under
this Section 10.02, and, if such evidence is not furnished, the Trustee may
defer any payment to such person (or to the Noteholder) pending judicial
determination as to the right of such person to receive such payment.


 


Section 10.03. 
Default on Senior Indebtedness.


 


No direct or indirect payment by or on behalf of the
Company under the Notes shall be made if (i) any Designated Senior Indebtedness
is not paid when due or (ii) any other default on Designated Senior
Indebtedness occurs and in the case of this clause (ii) the maturity of such
Designated Senior Indebtedness is accelerated in accordance with its terms,
unless, in either case, (x) the default has been cured or waived and any such
acceleration has been rescinded or (y) such Designated Senior Indebtedness has
been paid in full; provided, however, that the Company may make
any such direct or indirect payment under the Notes without regard to the
foregoing if the Company and the Trustee receive written notice approving such
payment from the Representative of such Designated Senior Indebtedness.  In addition, during the continuance of any
other event of default with respect to Designated Senior Indebtedness pursuant
to which the maturity of such Designated Senior Indebtedness may be accelerated


 


58

















 


immediately without further notice (except such notice
as may be required to effect such acceleration) or the expiration of any
applicable grace periods, upon the occurrence of (a) receipt by the Trustee of
written notice from the Representative with respect to, or the holders of at
least a majority in aggregate principal amount of, such Designated Senior
Indebtedness then outstanding or (b) if such event of default results from the
acceleration of the Notes, the date of such acceleration, no direct or indirect
payment may be made by the Company upon or in respect of the Notes for a period
(a “Payment Blockage Period”) commencing on the earlier of the date of receipt
of such notice by the Trustee or the date of such acceleration and ending 180
days thereafter (unless such Payment Blockage Period shall be terminated by
written notice to the Trustee from such Representative or such holders).  Not more than one Payment Blockage Period in
the aggregate may be commenced with respect to the Notes during any period of
360 consecutive days, irrespective of the number of defaults with respect to
Senior Indebtedness during such period. 
In no event will a Payment Blockage Period extend beyond 179 days from
the date such payment upon or in respect of the Notes was due, and there must
be 180 days in any 360-day period in which no Payment Blockage Period is in
effect as to the Company.  For all
purposes of this Section 10.03, no default or event of default which existed or
was continuing on the date of the commencement of the Payment Blockage Period
with respect to the Designated Senior Indebtedness initiating such Payment
Blockage Period shall be, or be made, the basis for the commencement of a
subsequent Payment Blockage Period by the Representative or requisite holders
of such Designated Senior Indebtedness whether or not within a period of 360
consecutive days unless such default or event of default shall have been cured
or waived for a period of not less than 90 consecutive days.


 


Section 10.04.        When Distribution Must Be Paid Over.


 


In the event that the Company shall make any payment
to the Trustee pursuant to the Notes at a time when such payment is prohibited
by Section 10.02 or 10.03, such payment shall be held by the Trustee, in trust
for the benefit of, and shall be paid forthwith over and delivered to, the
holders of Senior Indebtedness (pro rata as to each of such holders on the
basis of the respective amounts of Senior Indebtedness held by them) or their
Representatives, as their respective interests may appear, for application to
the payment of all Senior Indebtedness remaining unpaid to the extent necessary
to pay all Senior Indebtedness in full in accordance with its terms, after
giving effect to any concurrent payment or distribution to or for the holders
of Senior Indebtedness.


 


If a distribution is made to Holders that because of
this Article 10 should not have been made to them, the Holders who receive the
distribution shall hold it in trust for holders of Senior Indebtedness and pay
it over to them as their interests may appear.


 


Section 10.05.        Notice by Company.


 


The Company shall promptly notify the Trustee and any
Paying Agent by an appropriate Officers’ Certificate of the Company delivered
to a Trust Officer and the Paying Agent of any facts known to the Company that
would cause a payment under the Notes of principal of or interest or Liquidated
Damages, if any, on the Notes to violate this Article 10, but failure to give
such notice shall not affect the subordination of the Notes to the Senior
Indebtedness provided in this Article 10.


 


59

















 


Section 10.06.        Subrogation.


 


After all Senior Indebtedness is paid in full and all
commitments to advance Senior Indebtedness have been terminated, and until the
Notes are paid in full pursuant to the Notes and this Indenture or otherwise,
Holders shall be subrogated to the rights of holders of Senior Indebtedness to
receive distributions applicable to Senior Indebtedness to the extent that
distributions otherwise payable to Holders have been applied to payment of
Senior Indebtedness.  A distribution
made under this Article 10 to holders of Senior Indebtedness which otherwise
would have been made to Holders is not, as between the Company and the Holders,
a payment by the Company on Senior Indebtedness.


 


Section 10.07.        Relative Rights.


 


This Article 10 defines the relative rights of Holders
and holders of Senior Indebtedness. 
Nothing in this Indenture (but subject to the provisions of paragraph 5
of the Notes) shall:


 


(1)  impair, as between the Company and the
Holders, the obligation of the Company, which is absolute and unconditional, to
pay principal of and interest on the Notes in accordance with their terms;


 


(2)  affect the relative rights of Holders and
creditors of the Company other than such creditors as are holders of Senior
Indebtedness;


 


(3)  prevent the Trustee or any Holder from
exercising its available remedies upon a Default or Event of Default, subject
to the rights of holders of Senior Indebtedness to receive distributions
otherwise payable to Holders; or


 


(4)  create or imply the existence of any
commitment on the part of the holders of Senior Indebtedness to extend credit
to the Company, other than as set forth in the terms governing such Senior
Indebtedness.


 


Section 10.08.        Subordination May Not Be Impaired by Company.


 


No right of any present or future holder of Senior
Indebtedness to enforce the subordination of the Indebtedness evidenced by the
Notes and this Article 10 shall be impaired by any act or failure to act by the
Company or anyone in custody of its assets or property or by its failure to
comply with this Indenture.


 


Section 10.09.        Distribution or Notice to Representatives.


 


Whenever a distribution is to be made or a notice
given to holders of Senior Indebtedness, the distribution may be made and the
notice given to their Representatives, if any.


 


Section 10.10.        Rights of Trustee and Paying Agent.


 


Notwithstanding Section 10.02 or 10.03, the Trustee or
any Paying Agent may continue to make payments of principal of or interest on
the Notes unless, in the case of the


 


60

















 


Trustee, a Trust Officer or, in the case of a Paying
Agent other than the Trustee, an officer of such Paying Agent, shall have
received, at least three Business Days prior to the date such payments are due
and payable, written notice of the occurrence of an event under Section 10.02
or 10.03 and that any payment under the Notes would violate this Article
10.  Only the Company or a
Representative with respect to or holders of a least a majority in principal
amount of an issue of Designated Senior Indebtedness may give such notice.  Nothing contained in this Section 10.10
shall limit the right of any holder of Senior Indebtedness to recover payments
as contemplated by Section 10.04.


 


The Trustee in its individual or any other capacity
may hold Senior Indebtedness with the same rights it would have if it were not
Trustee.  Any Agent may do the same with
like rights.  The Trustee shall be
entitled to all the rights set forth in this Article 10 with respect to Senior
Indebtedness which may at any time be held by it, to the same extent as any
other holder of Senior Indebtedness; and nothing in Article 7 shall deprive the
Trustee of any of its rights as such holder, except as otherwise provided by
the TIA.


 


Section 10.11.        Trustee Entitled to Assume Payments Not
Prohibited in Absence of Notice.


 


Notwithstanding any of the provisions of this Article
10 or any other provision of this Indenture, unless a Trust Officer has
received a written notice pursuant to Section 10.10, the Trustee shall not at
any time be charged with knowledge of the existence of any facts which would
prohibit the making of any payment to or by the Trustee, and in the absence of
such written notice the Trustee may make such payment without liability or
obligation to the Senior Indebtedness.


 


Section 10.12.        Application by Trustee of Monies Deposited
With It.


 


Nothing contained in this Article 10 or elsewhere in
this Indenture, or in the Notes, shall (i) affect the obligation of the Company
to make, or prevent the Company from making, at any time except as specified in
Section 10.02 or 10.03 to the extent provided therein, payments at any time
pursuant to the Notes, (ii) prevent the application by the Trustee or any
Paying Agent of any monies or the proceeds of any U.S. Government Obligations
received from the Company and held by the Trustee or such Paying Agent in trust
for the benefit of the Holders of Notes as to which notice of redemption shall
have been given, to the payment of or on account of the principal of or
interest or Liquidated Damages, if any, on the Notes if, at the time such
notice was given, a payment by the Company under the Notes would not have been
prohibited by the foregoing provisions of this Article 10 or (iii) prevent the
application by the Trustee or any Paying Agent of any monies or the proceeds of
any U.S. Government Obligations deposited with it by the Company under Article
8 hereof to the payment of or on account of the principal of or interest or
Liquidated Damages, if any, on the Notes if, at the time of such deposit, a
payment by the Company under the Notes would not have been prohibited by the
foregoing provisions of this Article 10.


 


61

















 


Section 10.13.        Trustee’s Compensation Not Prejudiced.


 


Nothing in this Article 10 shall apply to claims of,
or payments to, the Trustee pursuant to Section 7.07.


 


Section 10.14.        Officers’ Certificate.


 


If there occurs any event referred to in Section
10.02, the Company shall promptly give to the Trustee an Officers’ Certificate
(on which the Trustee may conclusively rely) identifying all holders of Senior Indebtedness
and the principal amount of Senior Indebtedness then outstanding held by each
such holder and stating the reasons why such Officers’ Certificate is being
delivered to the Trustee.


 


Section 10.15.        Certain Payments.


 


Nothing in this Article 10 shall prevent or delay (i)
the Company from or in redeeming any Notes pursuant to paragraph 5 of the Notes
or otherwise purchasing any Notes pursuant to any legal requirement relating to
the gaming business of the Company and its Subsidiaries or (ii) the receipt by
the Holders of payments of principal of and interest and Liquidated Damages, if
any, on the Notes as provided in Section 8.02.


 


Section 10.16.        Names of Representatives.


 


The Company shall from time to time, upon request of
the Trustee, provide to the Trustee an Officers’ Certificate setting forth the
name and address of each Representative of all outstanding Senior Indebtedness.


 


Section 10.17.        Article 10 Not to Prevent Events of Default
or Limit Right to Accelerate.


 


The failure to make a payment pursuant to the Notes by
reason of any provision in this Article 10 shall not be construed as preventing
the occurrence of a Default.  Nothing in
this Article 10 shall have any effect on the right of the Holders or the
Trustee to accelerate the maturity of the Notes.


 


Section 10.18.        Reliance By Holders of Senior Indebtedness
on Subordination Provisions.


 


Each Holder by accepting a Note acknowledges and
agrees that the foregoing subordination provisions are, and are intended to be,
an inducement and a consideration to each holder of any Senior Indebtedness,
whether such Senior Indebtedness was created or acquired before or after the
issuance of the Notes, to acquire and continue to hold, or to continue to hold,
such Senior Indebtedness and such holder of Senior Indebtedness shall be deemed
conclusively to have relied on such subordination provisions in acquiring and
continuing to hold, or in continuing to hold, such Senior Indebtedness.  No provision in any supplemental indenture
which modifies this Article 10 in any manner adverse to the holders of Senior
Indebtedness shall be effective against the holders of Senior Indebtedness who
have not consented thereto in accordance with the provisions of the documents
governing such Senior Indebtedness.


 


62

















 


Section 10.19.        Proof of Claim.


 


In the event that the Company is subject to any
proceeding under any Bankruptcy Law and the Holders and the Trustee fail to
file any proof of claim permitted to be filed in such proceeding with respect
to the Notes, then any Representative of Designated Senior Indebtedness may
file such proof of claim no earlier than the later of (i) the expiration of 15
days after such Representative notifies the Trustee of its intention to do so
and (ii) 30 days preceding the last day permitted to file such claim.


 


Section 10.20.        No Fiduciary Duty Created to Holders of
Senior Indebtedness.


 


With respect to the holders of Senior Indebtedness,
the Trustee undertakes to perform or to observe only such of its covenants and
obligations as are specifically set forth in this Article 10, and no implied
covenants or obligations with respect to the holders of Senior Indebtedness
shall be read into this Indenture against the Trustee.  The Trustee shall not be deemed to owe any
fiduciary duty to the holders of Senior Indebtedness, and, subject to the
provisions of Article 7, the Trustee shall not be liable to any holder of
Senior Indebtedness if it shall mistakenly pay over or deliver to Holders, the
Company or any other person, monies or assets to which any holder of Senior
Indebtedness shall be entitled by virtue of this Article 10 or otherwise.


 


ARTICLE 11.

MISCELLANEOUS


 


Section 11.01.        Trust Indenture Act Controls.


 


If any provision of this Indenture limits, qualifies
or conflicts with another provision which is required to be included in this
Indenture by the TIA, the required provision shall control.


 


Section 11.02.        Notices.


 


Any notice or communication by the Company or the
Trustee to the other is duly given if in writing and delivered in person or
mailed by overnight delivery service to the recipient’s address stated in
Section 11.10.  The Company or the
Trustee by notice to the other may designate additional or different addresses
for subsequent notices or communications.


 


Any notice or communication to a Noteholder shall be
mailed by first-class mail to his address shown on the register kept by the
Registrar.  Failure to mail a notice or
communication to a Noteholder or any defect in it shall not affect its sufficiency
with respect to other Noteholders.


 


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


 


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


 


63

















 


If any notice is mailed to the Company in the manner
provided above, a copy of such notice shall be mailed, in the manner provided
above, to Milbank, Tweed, Hadley & McCloy LLP, 601 South Figueroa Street,
Los Angeles, California 90017, Attention: 
Kenneth J. Baronsky, Esq.


 


All other notices or communications shall be in
writing.


 


Section 11.03.        Communication by Holders with Other Holders.


 


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


 


Section 11.04.        Certificate and Opinion as to Conditions
Precedent.


 


Upon any request or application by the Company or any
other obligor to the Trustee to take any action under this Indenture, the
Company or any other obligor, as the case may be, shall furnish to the Trustee:


 


(i)            an
Officers’ Certificate stating that, in the opinion of the signers, all
conditions precedent, if any, provided for in this Indenture relating to the
proposed action have been complied with; and


 


(ii)           an
Opinion of Counsel stating that, in the opinion of such counsel, all such
conditions precedent have been complied with.


 


Section 11.05.        Statements Required in Certificate or
Opinion.


 


Each certificate or opinion with respect to compliance
with a condition or covenant provided for in this Indenture shall include:


 


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


 


(ii)           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;


 


(iii)          a
statement that, in the opinion of such person, he 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 complied with; and


 


(iv)          a
statement as to whether or not, in the opinion of such person, such condition
or covenant has been complied with.


 


64

















 


Section 11.06.        Rules by Trustee and Agents.


 


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


 


Section 11.07.        Legal Holidays.


 


A “Legal Holiday” is a Saturday, a Sunday or a day on
which banking institutions in the State of Nevada, New York or California are
not required to be open.  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 for the intervening period.


 


Section 11.08.        No Recourse Against Others.


 


A director, officer, employee or stockholder, as such,
of the Company shall not have any liability for any obligations of the Company
under the Notes or the Indenture or for any claim based on, in respect of or by
reason of such obligations or their creation. 
Each Noteholder by accepting a Note waives and releases all such
liability.  The waiver and release are
part of the consideration for the issue of the Notes.


 


Section 11.09.        Counterparts.


 


This Indenture may be executed in any number of
counterparts and by the parties hereto in separate counterparts, each of which
when so executed shall be deemed to be an original and all of which taken
together shall constitute one and the same agreement.


 


Section 11.10.        Variable Provisions.


 


The Company initially appoints the Trustee as Paying
Agent, Registrar and authenticating agent.


 


The first certificate pursuant to Section 4.03 shall
be for the fiscal year ending on the first December 31 to occur after the date
of this Indenture.


 


The reporting date for Section 7.06 is June 1 of each
year.  The first reporting date is June
1, 2001.


 


The Trustee shall always have a combined capital and
surplus (including subordinated capital notes) of at least $50,000,000 as set
forth in its most recent published annual report of condition.


 


The Company’s address is:


 


STATION CASINOS, INC.


2411 West Sahara Avenue


Las Vegas, Nevada  89102


 


65

















 


The Trustee’s address is:


 


LAW DEBENTURE TRUST
COMPANY OF NEW YORK


767 3rd Avenue


New York, New York  10017


 


Attention:  Patrick Healy


 


Section 11.11.        Governing Law.


 


THE INTERNAL LAWS OF THE STATE OF NEW
YORK SHALL GOVERN THIS INDENTURE AND THE NOTES, WITHOUT REGARD TO THE CONFLICTS
OF LAWS PROVISIONS THEREOF.


 


Section 11.12.        No Adverse Interpretation of Other
Agreements.


 


This Indenture may not be used to interpret another
indenture, loan or debt agreement of the Company or a Subsidiary.  Any such indenture, loan or debt agreement
may not be used to interpret this Indenture.


 


Section 11.13.        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
successor.


 


Section 11.14.        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 11.15.        Qualification of Indenture.


 


The Company shall qualify this Indenture under the TIA
and shall pay all costs and expenses (including attorneys’ fees for the
Company, the Trustee and the Holders of the Notes) incurred in connection
therewith, including, but not limited to, costs and expenses of qualification
of the, Indenture and the Notes and printing this Indenture and the Notes.  In connection with any such qualification of
this Indenture under the TIA, the Trustee shall be entitled to receive from the
Company any such Officers’ Certificates, Opinions of Counsel or other
documentation as it may reasonably request.


 


Section 11.16.        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 hereof, and
shall in no way modify or restrict any of the terms or provisions hereof.


 


66

















 


[SIGNATURE
PAGES FOLLOW]


 


67

















 


SIGNATURES


 


	
  Dated:  as of
  February 27, 2004

  	
  STATION CASINOS, INC.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By

  	
   

  	
   

  
	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
  Title:

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  Dated:  as of
  February 27, 2004

  	
  LAW DEBENTURE TRUST COMPANY OF NEW YORK

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By

  	
   

  	
   

  
	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
  Title:

  



 

















 


EXHIBIT
A


 


UNLESS AND UNTIL IT IS EXCHANGED IN WHOLE OR IN PART
FOR A NOTE IN DEFINITIVE FORM, THIS NOTE MAY NOT BE TRANSFERRED EXCEPT AS A
WHOLE BY THE DEPOSITORY TO A NOMINEE OF THE DEPOSITORY OR BY A NOMINEE OF THE
DEPOSITORY TO THE DEPOSITORY OR ANOTHER NOMINEE OF THE DEPOSITORY OR BY THE
DEPOSITORY OR ANY SUCH NOMINEE TO A SUCCESSOR DEPOSITORY OR A NOMINEE OF SUCH
SUCCESSOR DEPOSITORY.  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 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
THE 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
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) INSIDE THE UNITED STATES TO A PERSON WHO THE SELLER REASONABLY BELIEVES
IS A QUALIFIED INSTITUTIONAL BUYER WITHIN THE MEANING OF RULE 144A UNDER THE
SECURITIES ACT IN A TRANSACTION MEETING THE REQUIREMENTS OF RULE 144A, OR IN
ACCORDANCE WITH RULE 144 UNDER THE SECURITIES ACT, OR PURSUANT TO ANOTHER
EXEMPTION FROM THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT (AND BASED
UPON AN OPINION OF COUNSEL IF THE COMPANY SO REQUESTS), (B) TO THE COMPANY, (C)
OUTSIDE THE UNITED STATES TO A FOREIGN PERSON IN A TRANSACTION MEETING THE
REQUIREMENTS OF RULE 904 UNDER THE SECURITIES ACT OR (D) PURSUANT TO AN
EFFECTIVE REGISTRATION STATEMENT UNDER THE SECURITIES ACT AND (2) 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 SECURITY
EVIDENCED HEREBY OF THE RESALE RESTRICTIONS SET FORTH IN (A) ABOVE.


 


A-1

















 


STATION CASINOS, INC.


 


67/8%
Senior Subordinated Notes due 2016


 


CUSIP:     [857689AS2


[U8572MAE9]


 


	
  No.                             

  	
   

  	
  $                                              

  



 


Station Casinos, Inc., a Nevada corporation (the
“Company”), promises to pay to Cede & Co. or registered assigns, the
principal sum of
                                                     
Dollars on March 1, 2016.


 


Interest Payment Dates:  March 1 and September 1, commencing September 1, 2004


 


Record Dates: 
February 15 and August 15 (whether or not a Business Day)


 


Reference is hereby made
to the further provisions of this Security set forth on the reverse hereof,
which further provisions shall for all purposes have the same effect as if set
forth at this place.


 


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


 


IN WITNESS WHEREOF, the Company has caused this
instrument to be duly executed.


 


	
   

  	
  STATION CASINOS, INC.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
  Title:

  



 


 


	
  Attest:

  	
   

  
	
   

  	
   

  
	
  By:

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Name:

  	
   

  
	
   

  	
  Title:

  	
   

  



 


A-2

















 


TRUSTEE’S CERTIFICATE OF AUTHENTICATION


 


Law Debenture Trust Company of New York, as Trustee,
certifies that this is one of the 67/8%
Senior Subordinated Notes due 2016 referred to in the within-mentioned
Indenture.


 


 


LAW DEBENTURE
TRUST COMPANY OF NEW YORK

as Trustee


 


 


	
  By:

  	
   

  	
   

  	
  Dated:

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Authorized Signatory

  	
   

  
							



 


A-3

















 


[REVERSE OF SECURITY]


 


STATION CASINOS, INC.


 


67/8%
SENIOR SUBORDINATED NOTES DUE 2016


 


1.             Interest.  STATION CASINOS, INC., a Nevada corporation
(the “Company”), which term includes any successor corporation under the
Indenture referred to herein), promises to pay interest on the principal amount
of this Note at the rate per annum shown above and shall pay the Liquidated
Damages, if any, payable pursuant to Section 5 of the Registration Rights
Agreement referred to below.  The
Company will pay interest semi-annually on March 1 and September 1 of each
year, commencing September 1, 2004. 
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 of the Notes.  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, if any, to the persons who
are registered Holders of the Notes at the close of business on the record date
for the next interest payment date even though the Notes are cancelled after
the record date and on or before the interest payment date.  Holders must surrender the Notes to a Paying
Agent to collect principal payments. 
The Company will pay principal and interest and Liquidated Damages, if
any, in money of the United States that at the time of payment is legal tender
for payment of public and private debts. 
The Company, however, may pay principal and interest and Liquidated
Damages, if any, by check payable in such money, which shall be mailed to a
Holder’s registered address; provided
that payment by wire transfer of immediately available funds will be required
with respect to principal of and interest, premium and Liquidated Damages, if
any, on, all Global Notes and all other Certificated Notes the Holders of which
shall have provided wire transfer instructions to the Company or the Paying
Agent.


 


3.             Paying Agent and
Registrar.  Law Debenture Trust
Company of New York will initially act as Paying Agent and Registrar.  The Company may change any Paying Agent,
Registrar or co-registrar without prior notice to any Noteholder.  The Company or any of its Subsidiaries may
act in any such capacity.


 


4.             Indenture.  The Company issued the Notes under an
Indenture dated as of February 27, 2004 (the “Indenture”) by and between the
Company 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 (15 U.S. Code §§
77aaa-77bbbb) as in effect on the date of the Indenture.  The Notes are subject to, and qualified by,
all such terms, certain of which are summarized herein, and Noteholders are
referred to the Indenture and such Act for a statement of such terms.  The Notes are unsecured general obligations
of the Company limited to $350,000,000 in aggregate principal amount.  The Indenture imposes certain limitations
on, among other things, the incurrence of indebtedness by the Company or any of
its Restricted Subsidiaries.  In
addition, the Indenture imposes certain limitations on transactions by the


 


A-4

















 


Company or any of
its Restricted Subsidiaries with Affiliates and Related Persons and on the
ability of the Company or any of its Restricted Subsidiaries to restrict
distributions and dividends from Subsidiaries. 
The limitations are subject to a number of important qualifications and
exceptions.


 


5.             Optional Redemption.  The Company may redeem the Notes in whole or
in part, at redemption prices (expressed in percentages of principal amount)
set forth below, plus accrued and unpaid interest thereon, if any, and
Liquidated Damages, if any, to the redemption date, if redeemed during the
12-month period beginning March 1 of the years indicated below.  The Notes may not be so redeemed before
March 1, 2009.


 


	
  Year

  	
   

  	
  Redemption Prices

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  2009

  	
   

  	
  102.578

  	
  %

  
	
  2010

  	
   

  	
  101.719

  	
  %

  
	
  2011

  	
   

  	
  100.859

  	
  %

  
	
  2012 and
  thereafter

  	
   

  	
  100.000

  	
  %

  



 


Notwithstanding the
foregoing, each Holder by accepting a Note agrees that if a record or
beneficial owner of a Note is required by any Gaming Authority to be found
suitable, such owner shall apply for a finding of suitability within 30 days
after request of such Gaming Authority. 
The applicant for a finding of suitability must pay all costs of the
investigation for such finding of suitability. 
If a record or beneficial owner is required to be found suitable and is
not found suitable by such Gaming Authority, (a) such owner shall, upon request
of the Company, dispose of such owner’s Notes within 30 days or within that
time prescribed by such Gaming Authority, whichever is earlier, or (b) the
Company may, at its option, redeem such owner’s Notes at the lesser of (i) the
principal amount thereof or (ii) the price at which the Notes were acquired by
such owner, together with, in either case, Liquidated Damages, if any, and
accrued interest to the date of the finding of unsuitability by such Gaming
Authority, all as more fully provided in the Indenture.


 


6.             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 of Notes to be redeemed at his registered address.  Notes in denominations larger than $1,000
may be redeemed in part but only in whole multiples of $1,000.  In the event of a redemption of less than
all of the Notes, the Notes will be chosen for redemption by the Trustee in accordance
with the Indenture.  On and after the
redemption date, interest ceases to accrue on Notes or portions of the Notes
called for redemption.


 


If this Note is redeemed
subsequent to a record date with respect to any interest payment date specified
above and on or prior to such interest payment date, then any accrued interest
will be paid to the person in whose name this Note is registered at the close
of business on such record date.


 


7.             Subordination.  The Notes are subordinated to Senior
Indebtedness, as defined in the Indenture. 
To the extent provided in the Indenture, Senior Indebtedness must be
paid before payments in respect of the Notes may be made under the Notes and
the Indenture.


 


A-5

















 


The Company agrees, and each Noteholder by accepting a
Note agrees, to the subordination provisions contained in the Indenture and
authorizes the Trustee to give it effect and appoints the Trustee as
attorney-in-fact for such purpose.


 


8.             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 shall be registered, and Notes may only be exchanged, as provided in the
Indenture.  The Registrar may require a
holder, among other things, to furnish appropriate endorsements and transfer
documents and to pay any taxes and fees required by law or permitted by the
Indenture.  The Registrar need not
exchange or register the transfer of any Notes or portion of a Note selected
for redemption.  Also, the Registrar
need not exchange or register the transfer of any Note for a period of 15 days
before a selection of Note to be redeemed.


 


9.             Persons Deemed
Owners.  The registered Holder of a
Note may be treated as its owner for all purposes, except as provided in
paragraph 5 hereof.


 


10.           Amendments and
Waivers.  Subject to certain
exceptions, the Indenture or the Notes may be amended with the consent of the
Holders of at least a majority in principal amount of the then outstanding
Notes, and certain existing defaults may be waived with the consent of the
Holders of a majority in principal amount of the then outstanding Notes.  Without the consent of any Noteholder, the
Indenture or the Notes may be amended, among other things, to cure any
ambiguity, defect or inconsistency, to provide for assumption of the Company’s
obligations to Noteholders in the case of mergers and consolidations of the
Company or to make any change that does not adversely affect the rights of any
Noteholder.


 


11.           Defaults and
Remedies.  An Event of Default
is:  default in payment of interest on
the Notes for a period of 30 days; default in payment of principal on the
Notes; failure by the Company for 60 days after notice to it to comply with any
of its other agreements in the Indenture or the Notes or, in the case of the
failure to comply with certain specified covenants or agreements, without such
notice or passage of time; certain defaults under and acceleration prior to
maturity of certain other indebtedness of the Company; certain final judgments
which remain undischarged; certain events of bankruptcy or insolvency; or a
revocation, suspension, termination or involuntary loss of a Gaming License
which results in the cessation of operation of the Company’s casino business
for more than 90 consecutive days.  If
an 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 immediately, except that in the case of an Event of
Default arising from certain events of bankruptcy or insolvency, all
outstanding Notes become due and payable immediately without further action or
notice.  Noteholders may not enforce the
Indenture or the Notes except as provided in the Indenture.  The Trustee may require indemnity
satisfactory to it before it enforces the Indenture or the Notes.  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 Noteholders notice of any continuing
default (except a default in payment of principal or interest) if it determines
that withholding notice is in their interests. 
The Company must furnish an annual compliance certificate to the
Trustee.


 


A-6

















 


12.           Trustee Dealings
with Company.  Law Debenture Trust
Company of New York, the Trustee under the Indenture, 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 Trustee.


 


13.           Change of Control.  Upon the occurrence of a Change of Control
Triggering Event (as such term is defined in the Indenture), the Holders shall
have the right to require that the Company repurchase, and the Company shall
commence an offer to repurchase, all of the outstanding Notes at a Repurchase
Price in cash equal to 101% of the principal amount of such Notes plus
Liquidated Damages, if any, and accrued interest to the repurchase date, upon
the terms set forth in the Indenture.


 


14.           No Recourse Against
Others.  A director, officer,
employee or stockholder, as such, of the Company shall not have any liability
for any obligations of the Company under the Notes or the Indenture or for any
claim based on, in respect of or by reason of such obligations or their
creation.  Each Noteholder by accepting
a Note waives and releases all such liability. 
The waiver and release are part of the consideration for the issue of
the Notes.


 


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


 


16.           Additional Rights of
Holders of Transfer Restricted Securities. 
In addition to the rights provided to Holders of Notes under the
Indenture, Holders of Transferred Restricted Securities shall have all the
rights set forth in the Registration Rights Agreement dated as of the date of
the Indenture, between the Company and Banc of America Securities LLC, Deutsche
Bank Securities Inc., Lehman Brothers Inc., Wells Fargo Securities, LLC and
Credit Lyonnais Securities (USA) Inc. (the “Registration Rights Agreement”).


 


17.           Abbreviations.  Customary abbreviations may be used in the
name of a Noteholder 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).


 


Company will furnish to
any Noteholder upon written request and without charge a copy of the Indenture,
which has in it the text of this Note in larger type.  Request may be made to:


 


	
   

  	
  STATION CASINOS,
  INC.

  
	
   

  	
  2411 West Sahara
  Avenue

  
	
   

  	
  Las Vegas,
  Nevada  89102

  
	
   

  	
  Attn:  Chief Financial Officer

  



 


A-7

















 


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 Certificated Note, or exchanges
of a part of another Global Note or Certificated 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

  SIGNATORY OF TRUSTEE OR

  NOTE CUSTODIAN

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  



 


A-8

















 


ASSIGNMENT FORM


 


To assign this Note, fill in the form below: (I) or
(we) assign and transfer this Note to


 




	
   

  
	
  (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:

  	
   

  
						






 


A-9

















 


OPTION OF HOLDER TO ELECT
PURCHASE


 


If you want to elect to
have this Note repurchased by the Company pursuant to Section 4.11 of the
Indenture, check the box:  o


 


If you want to elect to
have only part of the Note purchased by the Company pursuant to Section 4.11 of
the Indenture, state the amount (which must be $1,000 or an integral multiple
of $1,000) 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:

  	
   

  	
   

  
									



 


A-10

















 


EXHIBIT
B


 


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 NOTES SHALL BE ENTITLED TO RECEIVE
PAYMENT OF INTEREST HEREON.


 


UNLESS AND UNTIL IT IS EXCHANGED IN WHOLE OR IN PART
FOR A NOTE IN DEFINITIVE FORM, THIS NOTE MAY NOT BE TRANSFERRED EXCEPT AS A
WHOLE BY THE DEPOSITORY TO A NOMINEE OF THE DEPOSITORY OR BY A NOMINEE OF THE
DEPOSITORY TO THE DEPOSITORY OR ANOTHER NOMINEE OF THE DEPOSITORY OR BY THE
DEPOSITORY OR ANY SUCH NOMINEE TO A SUCCESSOR DEPOSITORY OR A NOMINEE OF SUCH
SUCCESSOR DEPOSITORY.  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 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
THE 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
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) INSIDE THE UNITED STATES TO A PERSON WHO THE SELLER REASONABLY BELIEVES
IS A QUALIFIED INSTITUTIONAL BUYER WITHIN THE MEANING OF RULE 144A UNDER THE
SECURITIES ACT IN A TRANSACTION MEETING THE REQUIREMENTS OF RULE 144A, OR IN
ACCORDANCE WITH RULE 144 UNDER THE SECURITIES ACT, OR PURSUANT TO ANOTHER
EXEMPTION FROM THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT (AND BASED
UPON AN OPINION OF COUNSEL IF THE COMPANY SO REQUESTS), (B) TO THE COMPANY, (C)
OUTSIDE THE UNITED STATES TO A FOREIGN PERSON IN A TRANSACTION MEETING THE
REQUIREMENTS OF RULE 904 UNDER THE SECURITIES ACT OR (D) PURSUANT TO AN
EFFECTIVE REGISTRATION


 


B-1

















 


STATEMENT UNDER THE SECURITIES ACT AND (2) 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 SECURITY
EVIDENCED HEREBY OF THE RESALE RESTRICTIONS SET FORTH IN (A) ABOVE.


 


 


STATION CASINOS, INC.


 


67/8%
Senior Subordinated Notes due 2016


 


CUSIP:  U8572MAE9


 


	
  No.

  	
                                

  	
   

  	
   

  	
  $                                                 

  



 


Station Casinos, Inc., a Nevada corporation (the
“Company”), promises to pay to Cede & Co. or registered assigns, the
principal sum of
                                                      
Dollars on March 1, 2016.


 


Interest Payment Dates:  March 1 and September 1, commencing September 1, 2004


 


Record Dates: 
February 15 and August 15 (whether or not a Business Day)


 


Reference is hereby made
to the further provisions of this Security set forth on the reverse hereof,
which further provisions shall for all purposes have the same effect as if set
forth at this place.


 


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


 


B-2

















 


IN WITNESS WHEREOF, the Company has caused this
instrument to be duly executed.


 


	
   

  	
  STATION CASINOS, INC.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
  Title:

  



 


 


	
  Attest:

  	
   

  
	
   

  	
   

  
	
  By:

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Name:

  	
   

  
	
   

  	
  Title:

  	
   

  



 


B-3

















 


TRUSTEE’S CERTIFICATE OF AUTHENTICATION


 


Law Debenture Trust Company of New York, as Trustee,
certifies that this is one of the 67/8%
Senior Subordinated Notes due 2016 referred to in the within-mentioned
Indenture.


 


LAW DEBENTURE
TRUST COMPANY OF NEW YORK

as Trustee


 


	
  By:

  	
   

  	
   

  	
  Dated:

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Authorized Signatory

  	
   

  



 


B-4

















 


[REVERSE OF SECURITY]


 


STATION CASINOS, INC.


 


67/8%
SENIOR SUBORDINATED NOTES DUE 2016


 


1.             Interest.  STATION CASINOS, INC., a Nevada corporation
(the “Company”), which term includes any successor corporation under the
Indenture referred to herein), promises to pay interest on the principal amount
of this Note at the rate per annum shown above and shall pay the Liquidated
Damages, if any, payable pursuant to Section 5 of the Registration Rights
Agreement referred to below.  The
Company will pay interest semi-annually on March 1 and September 1 of each
year, commencing September 1, 2004. 
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 of the Notes.  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, if any, to the persons who
are registered Holders of the Notes at the close of business on the record date
for the next interest payment date even though the Notes are cancelled after
the record date and on or before the interest payment date.  Holders must surrender the Notes to a Paying
Agent to collect principal payments. 
The Company will pay principal and interest and Liquidated Damages, if
any, in money of the United States that at the time of payment is legal tender
for payment of public and private debts. 
The Company, however, may pay principal and interest and Liquidated
Damages, if any, by check payable in such money, which shall be mailed to a
Holder’s registered address; provided
that payment by wire transfer of immediately available funds will be required
with respect to principal of and interest, premium and Liquidated Damages, if
any, on, all Global Notes and all other Certificated Notes the Holders of which
shall have provided wire transfer instructions to the Company or the Paying
Agent.


 


3.             Paying Agent and
Registrar.  Law Debenture Trust
Company of New York will initially act as Paying Agent and Registrar.  The Company may change any Paying Agent,
Registrar or co-registrar without prior notice to any Noteholder.  The Company or any of its Subsidiaries may
act in any such capacity.


 


4.             Indenture.  The Company issued the Notes under an
Indenture dated as of February 27, 2004 (the “Indenture”) by and between the
Company 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 (15 U.S. Code §§
77aaa-77bbbb) as in effect on the date of the Indenture.  The Notes are subject to, and qualified by,
all such terms, certain of which are summarized herein, and Noteholders are
referred to the Indenture and such Act for a statement of such terms.  The Notes are unsecured general obligations
of the Company limited to $350,000,000 in aggregate principal amount.  The Indenture imposes certain limitations
on, among other things, the incurrence of indebtedness by the Company or any of
its Restricted Subsidiaries.  In
addition, the Indenture imposes certain limitations on transactions by the


 


B-5

















 


Company or any of
its Restricted Subsidiaries with Affiliates and Related Persons and on the
ability of the Company or any of its Restricted Subsidiaries to restrict
distributions and dividends from Subsidiaries. 
The limitations are subject to a number of important qualifications and
exceptions.


 


5.             Optional
Redemption.  The Company may redeem
the Notes in whole or in part, at redemption prices (expressed in percentages
of principal amount) set forth below, plus accrued and unpaid interest thereon,
if any, and Liquidated Damages, if any, to the redemption date, if redeemed
during the 12-month period beginning March 1 of the years indicated below.  The Notes may not be so redeemed before
March 1, 2009.


 


	
  Year

  	
   

  	
  Redemption
  Prices

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  2009

  	
   

  	
  102.578

  	
  %

  
	
  2010

  	
   

  	
  101.719

  	
  %

  
	
  2011

  	
   

  	
  100.859

  	
  %

  
	
  2012 and
  thereafter

  	
   

  	
  100.000

  	
  %

  



 


Notwithstanding the
foregoing, each Holder by accepting a Note agrees that if a record or
beneficial owner of a Note is required by any Gaming Authority to be found
suitable, such owner shall apply for a finding of suitability within 30 days
after request of such Gaming Authority. 
The applicant for a finding of suitability must pay all costs of the
investigation for such finding of suitability. 
If a record or beneficial owner is required to be found suitable and is
not found suitable by such Gaming Authority, (a) such owner shall, upon request
of the Company, dispose of such owner’s Notes within 30 days or within that
time prescribed by such Gaming Authority, whichever is earlier, or (b) the
Company may, at its option, redeem such owner’s Notes at the lesser of (i) the
principal amount thereof or (ii) the price at which the Notes were acquired by
such owner, together with, in either case, Liquidated Damages, if any, and
accrued interest to the date of the finding of unsuitability by such Gaming
Authority, all as more fully provided in the Indenture.


 


6.             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 of Notes to be redeemed at his registered address.  Notes in denominations larger than $1,000
may be redeemed in part but only in whole multiples of $1,000.  In the event of a redemption of less than
all of the Notes, the Notes will be chosen for redemption by the Trustee in
accordance with the Indenture.  On and
after the redemption date, interest ceases to accrue on Notes or portions of
the Notes called for redemption.


 


If this Note is redeemed
subsequent to a record date with respect to any interest payment date specified
above and on or prior to such interest payment date, then any accrued interest
will be paid to the person in whose name this Note is registered at the close
of business on such record date.


 


7.             Subordination.  The Notes are subordinated to Senior
Indebtedness, as defined in the Indenture. 
To the extent provided in the Indenture, Senior Indebtedness must be
paid before payments in respect of the Notes may be made under the Notes and
the Indenture.


 


B-6

















 


The Company agrees, and each Noteholder by accepting a
Note agrees, to the subordination provisions contained in the Indenture and
authorizes the Trustee to give it effect and appoints the Trustee as
attorney-in-fact for such purpose.


 


8.             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 shall be registered, and Notes may only be exchanged, as provided in the
Indenture.  The Registrar may require a
holder, among other things, to furnish appropriate endorsements and transfer
documents and to pay any taxes and fees required by law or permitted by the
Indenture.  The Registrar need not
exchange or register the transfer of any Notes or portion of a Note selected
for redemption.  Also, the Registrar
need not exchange or register the transfer of any Note for a period of 15 days
before a selection of Note to be redeemed.


 


9.             Persons Deemed
Owners.  The registered Holder of a
Note may be treated as its owner for all purposes, except as provided in
paragraph 5 hereof.


 


10.           Amendments and
Waivers.  Subject to certain
exceptions, the Indenture or the Notes may be amended with the consent of the
Holders of at least a majority in principal amount of the then outstanding
Notes, and certain existing defaults may be waived with the consent of the
Holders of a majority in principal amount of the then outstanding Notes.  Without the consent of any Noteholder, the
Indenture or the Notes may be amended, among other things, to cure any
ambiguity, defect or inconsistency, to provide for assumption of the Company’s
obligations to Noteholders in the case of mergers and consolidations of the
Company or to make any change that does not adversely affect the rights of any
Noteholder.


 


11.           Defaults and
Remedies.  An Event of Default
is:  default in payment of interest on
the Notes for a period of 30 days; default in payment of principal on the
Notes; failure by the Company for 60 days after notice to it to comply with any
of its other agreements in the Indenture or the Notes or, in the case of the
failure to comply with certain specified covenants or agreements, without such
notice or passage of time; certain defaults under and acceleration prior to
maturity of certain other indebtedness of the Company; certain final judgments
which remain undischarged; certain events of bankruptcy or insolvency; or a
revocation, suspension, termination or involuntary loss of a Gaming License
which results in the cessation of operation of the Company’s casino business
for more than 90 consecutive days.  If
an 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 immediately, except that in the case of an Event of
Default arising from certain events of bankruptcy or insolvency, all
outstanding Notes become due and payable immediately without further action or
notice.  Noteholders may not enforce the
Indenture or the Notes except as provided in the Indenture.  The Trustee may require indemnity
satisfactory to it before it enforces the Indenture or the Notes.  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 Noteholders notice of any continuing
default (except a default in payment of principal or interest) if it determines
that withholding notice is in their interests. 
The Company must furnish an annual compliance certificate to the
Trustee.


 


B-7

















 


12.           Trustee Dealings
with Company.  Law Debenture Trust
Company of New York, the Trustee under the Indenture, 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 Trustee.


 


13.           Change of Control.              Upon the occurrence
of a Change of Control Triggering Event (as such term is defined in the
Indenture), the Holders shall have the right to require that the Company
repurchase, and the Company shall commence an offer to repurchase, all of the
outstanding Notes at a Repurchase Price in cash equal to 101% of the principal
amount of such Notes plus Liquidated Damages, if any, and accrued interest to
the repurchase date, upon the terms set forth in the Indenture.


 


14.           No Recourse Against
Others.  A director, officer,
employee or stockholder, as such, of the Company shall not have any liability
for any obligations of the Company under the Notes or the Indenture or for any
claim based on, in respect of or by reason of such obligations or their creation.  Each Noteholder by accepting a Note waives
and releases all such liability.  The
waiver and release are part of the consideration for the issue of the Notes.


 


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


 


16.           Additional Rights of
Holders of Transfer Restricted Securities. 
In addition to the rights provided to Holders of Notes under the
Indenture, Holders of Transferred Restricted Securities shall have all the rights
set forth in the Registration Rights Agreement dated as of the date of the
Indenture, between the Company and Banc of America Securities LLC, Deutsche
Bank Securities Inc., Lehman Brothers Inc., Wells Fargo Securities, LLC and
Credit Lyonnais Securities (USA) Inc. (the “Registration Rights Agreement”).


 


17.           Abbreviations.  Customary abbreviations may be used in the
name of a Noteholder 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).


 


Company will furnish to
any Noteholder upon written request and without charge a copy of the Indenture,
which has in it the text of this Note in larger type.  Request may be made to:


 


	
   

  	
  STATION CASINOS,
  INC.

  
	
   

  	
  2411 West Sahara
  Avenue

  
	
   

  	
  Las Vegas,
  Nevada  89102

  
	
   

  	
  Attn:  Chief Financial Officer

  



 


B-8

















 


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 Certificated Note, or exchanges
of a part of another Global Note or Certificated 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

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  



 


B-9

















 


ASSIGNMENT FORM


 


To assign this Note, fill in the form below: (I) or
(we) assign and transfer this Note to


 




	
   

  
	
  (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:

  	
   

  
						






 


B-10

















 


OPTION OF HOLDER TO ELECT PURCHASE


 


If you want to elect to
have this Note repurchased by the Company pursuant to Section 4.11 of the
Indenture, check the box:  o


 


If you want to elect to
have only part of the Note purchased by the Company pursuant to Section 4.11 of
the Indenture, state the amount (which must be $1,000 or an integral multiple
of $1,000) 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:

  	
   

  	
   

  
									



 


B-11

















 


EXHIBIT
C


 


FORM OF CERTIFICATE OF TRANSFER


 


STATION CASINOS,
INC.


2411 West Sahara
Avenue


Las Vegas,
Nevada  89102


 


Law Debenture Trust Company of New York

767 3rd Avenue

New York, New York  10017


 


Attention: Corporate Trust
Division


 


Re: 67/8%
SENIOR SUBORDINATED NOTES DUE 2016 OF STATION CASINOS, INC.


 


Reference is hereby made to the Indenture, dated as of
February 27, 2004 (the “INDENTURE”), between Station Casinos, Inc., as issuer
(the “COMPANY”), and Law Debenture Trust Company 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 or Notes or interest
in such Note or Notes specified in Annex A hereto, in the principal amount of
$                 
in such Note or Notes 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. o
CHECK IF TRANSFEREE WILL TAKE DELIVERY OF A BENEFICIAL INTEREST IN THE RULE 144A
GLOBAL NOTE OR A CERTIFICATED 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 Certificated Note is being
transferred to a person that the Transferor reasonably believed and believes is
purchasing the beneficial interest or Certificated 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 Certificated Note will be subject to the restrictions on transfer
enumerated in the Private Placement Legend printed on the Rule 144A Global Note
and/or the Certificated Note and in the Indenture and the Securities Act.


 


C-1

















 


2. o
CHECK IF TRANSFEREE WILL TAKE DELIVERY OF A BENEFICIAL INTEREST IN THE
REGULATION S TEMPORARY GLOBAL NOTE, THE REGULATION S GLOBAL NOTE OR A
CERTIFICATED 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 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 the Initial
Purchaser).  Upon consummation of the
proposed transfer in accordance with the terms of the Indenture, the
transferred beneficial interest or Certificated 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
Certificated Note and in the Indenture and the Securities Act.


 


3. o
CHECK AND COMPLETE IF TRANSFEREE WILL TAKE DELIVERY OF A BENEFICIAL INTEREST IN
THE RESTRICTED GLOBAL NOTE OR A CERTIFICATED 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 Certificated 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) o
such Transfer is being effected pursuant to and in accordance with Rule 144
under the Securities Act; or


 


(b) o
such Transfer is being effected to the Company or a subsidiary thereof; or


 


(c) o
such Transfer is being effect pursuant to an effective registration statement
under the Securities Act and in compliance with the prospectus delivery
requirements of the Securities Act.


 


4. o
CHECK IF TRANSFEREE WILL TAKE DELIVERY OF A BENEFICIAL INTEREST IN AN
UNRESTRICTED GLOBAL NOTE OR OF AN UNRESTRICTED CERTIFICATED NOTE.


 


(a) o
CHECK IF TRANSFER IF PURSUANT TO RULE 144. 
(i)  The Transfer is being
effected pursuant to and in accordance with Rule 144 under the Securities Act


 


C-2

















 


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 Certificated Note will
not longer be subject to the restrictions on transfer enumerated in the Private
Placement Legend printed on the Restricted Global Notes, on Restricted
Certificated Notes and in the Indenture.


 


(b) o
CHECK IF TRANSFER IS PURSUANT TO REGULATION S. 
(i) The Transfer is being effect 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 Indentures, the transferred beneficial interest or Certificated
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 Certificated Notes and in the Indenture.


 


(c) o
CHECK IF TRANSFER IF 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 144m, Rule 903 or Rule 904 and in compliance with the transfer
restrictions 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 Certificated Note will
not be subject to the restrictions on transfer enumerated in the Private
Placement Legend printed on the Restricted Global Notes or Restricted
Certificated Notes and in the Indenture.


 


This certificate and the statements contained herein
are made for your benefit and the benefit of the Trustee and the Company.


 


	
   

  	
   

  	
   

  	
   

  
	
   

  	
  [Insert Name of Transferor]

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  	
   

  
	
   

  	
  Name:

  	
   

  
	
   

  	
  Title:

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
  Dated:

  	
   

  	
   

  	
   

  
											



 


C-3

















 


ANNEX A TO CERTIFICATE OF TRANSFER


 


1.  The
Transferor owns and proposes to transfer the following:


 


[CHECK ONE OF (a) OR (b)]


 


(a)           o
a beneficial interest in the:


 


(i)            o
Rule 144A Global Note (CUSIP
         ), or


 


(ii)           o
Restricted Global Note (CUSIP
          ); or


 


(b)           o
a Restricted Certificated Note.


 


2.  After the
Transfer the Transferee will hold:


 


[CHECK ONE]


 


(a)           o
a beneficial interest in the:


 


(i)            o
Rule 144A Global Note (CUSIP
           ), or


 


(ii)           o
Regulation S Global Note (CUSIP
           ), or


 


(iii)          o Restricted
Global Note (CUSIP            );
or


 


(iv)          o
(CUSIP            ), or
Unrestricted Global Note (CUSIP
           ); or


 


(b)           o
a Restricted Certificated Note; or


 


(c)           o
an Unrestricted Certificated Note.


 


in accordance with the terms of the Indenture.


 


C-4

















 


EXHIBIT
D


 


FORM OF CERTIFICATE OF TRANSFER OR EXCHANGE


 


STATION CASINOS,
INC.


2411 West Sahara
Avenue


Las Vegas,
Nevada  89102


 


Law Debenture Trust Company of New York

767 3rd Avenue

New York, New York  10017


 


Attention: 
Patrick Healy


 


Re: 67/8%
SENIOR SUBORDINATED NOTES DUE 2016 OF STATION CASINOS, INC


 


Reference is hereby made to the Indenture, dated as of
February 27, 2004 (the “INDENTURE”), between Station Casinos, Inc., as issuer
(the “COMPANY”), and Law Debenture Trust Company 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 proposed to exchange the Note or Notes specified herein, in
the principal amount of
$                      
in such Note or Notes or interests (the “EXCHANGE”).  In connection with the Exchange, the Owner hereby certifies that:


 


1.  EXCHANGE OF
RESTRICTED CERTIFICATED NOTES OR BENEFICIAL INTERESTS IN A RESTRICTED GLOBAL
NOTE FOR UNRESTRICTED CERTIFICATED NOTES OR BENEFICIAL INTERESTS IN AN
UNRESTRICTED GLOBAL NOTE


 


(a)  o
CHECK IF EXCHANGE IS FROM BENEFICIAL INTEREST IN A RESTRICTED GLOBAL NOTE TO
BENEFICIAL INTEREST IN AN UNRESTRICTED GLOBAL NOTE.  In connection with he 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 he United States Securities Act of 1933, as amended (the “SECURITIES
ACT”), (iii) the restriction on transfer contained in the Indenture and the
Private Placement Legend are not 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)  o
CHECK IF EXCHANGE IS FROM BENEFICIAL INTEREST IN A RESTRICTED GLOBAL NOTE TO
UNRESTRICTED CERTIFICATED NOTE.  In


 


C-1

















 


connection with the Exchange of the Owner’s beneficial
interest in a Restricted Global Note for an Unrestricted Certificated Note, the
Owner hereby certifies (i) the Certificated 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 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 Certificated Note is being acquired in compliance with any
applicable blue sky securities laws of any state of the United States.


 


(c)  o
CHECK IF EXCHANGE IS FROM RESTRICTED CERTIFICATED NOTE TO BENEFICIAL INTEREST
IN AN UNRESTRICTED GLOBAL NOTE.  In
connection with the Owner’s Exchange of a Restricted Certificated 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 Certificated 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)  o
CHECK IF EXCHANGE IS FROM RESTRICTED CERTIFICATED NOTE TO UNRESTRICTED
CERTIFICATED NOTE.  In connection with
the Owner’s Exchange of a Restricted Certificated Note for n Unrestricted
Certificated Note, the Owner hereby certifies (i) the Unrestricted Certificated
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 Certificated 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
Certificated Note is being acquired in compliance with any applicable blue sky
securities laws of any state of the United States.


 


2.  EXCHANGE OF
RESTRICTED CERTIFICATED NOTES OR BENEFICIAL INTERESTS IN RESTRICTED GLOBAL
NOTES FOR RESTRICTED CERTIFICATED NOTE OR BENEFICIAL INTERESTS IN RESTRICTED
GLOBAL NOTE


 


(a)  o
CHECK IF EXCHANGE IS FROM BENEFICIAL INTEREST IN A RESTRICTED GLOBAL NOTE TO
RESTRICTED CERTIFICATED NOTE.  In
connection with the Exchange of the Owner’s beneficial interest in a Restricted
Global Note for a Restricted Certificated Note with an equal principal amount,
the Owner hereby certifies that the Restricted Certificated 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 Certificated Note
issued will continue to be subject to the restrictions on transfer enumerated
in the Private Placement Legend printed on the Restricted Certificated Note and
in the Indenture and the Securities Act.


 


(b)  o
CHECK IF EXCHANGE IS FROM RESTRICTED CERTIFICATED NOTE TO BENEFICIAL INTEREST
ON A RESTRICTED GLOBAL NOTE.  In
connection


 


2

















 


with the Exchange of the Owner’s Restricted
Certificated Note for a beneficial interest in the [CHECK ONE] o
Rule 144A Global Note, o Regulation S
Global Note, o Restricted
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 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 Trustee and the Company.


 


	
   

  	
   

  	
   

  	
   

  
	
   

  	
  [Insert Name of Owner]

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  	
   

  
	
   

  	
  Name:

  	
   

  
	
   

  	
  Title:

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
  Dated:

  	
   

  	
   

  	
   

  
									



 


3