Exhibit 4.5


 


EXECUTION COPY


 




 





ARGOSY GAMING COMPANY


 


 


7% SENIOR SUBORDINATED NOTES DUE 2014


 












 


INDENTURE


 


Dated as of February 12, 2004


 












 


J.P. Morgan Trust Company,


National Association


 


Trustee




 












 





 

















 


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 and Paying Agent.

  	
   

  
	
  Section 2.04

  	
  Paying Agent to Hold Money in Trust.

  	
   

  
	
  Section 2.05

  	
  Holder 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.

  	
   

  
	
  Section 2.14

  	
  Issuance of
  Additional Notes.

  	
   

  
	
   

  	
   

  	
   

  
	
  ARTICLE
  3

  
	
  REDEMPTION AND PREPAYMENT

  
	
   

  	
   

  	
   

  
	
  Section 3.01

  	
  Notices to Trustee.

  	
   

  
	
  Section
  3.02

  	
  Selection
  of Notes to Be Redeemed or Purchased.

  	
   

  
	
  Section 3.03

  	
  Notice of
  Redemption.

  	
   

  
	
  Section
  3.04

  	
  Effect of
  Notice of Redemption.

  	
   

  
	
  Section
  3.05

  	
  Deposit
  of Redemption or Purchase Price.

  	
   

  
	
  Section
  3.06

  	
  Notes
  Redeemed or Purchased in Part.

  	
   

  
	
  Section 3.07

  	
  Optional Redemption.

  	
   

  
	
  Section 3.08

  	
  Gaming Redemption.

  	
   

  
	
  Section 3.09

  	
  Mandatory Redemption.

   

  	
   

  
	
   

  	
   

  	
   

  
	
  ARTICLE
  4

  
	
  COVENANTS

  
	
   

  	
   

  	
   

  
	
  Section 4.01

  	
  Payment of Notes.

  	
   

  
	
  Section
  4.02

  	
  Maintenance
  of Office or Agency.

  	
   

  
	
  Section
  4.03

  	
  Reports.

  	
   

  
	
  Section 4.04

  	
  Compliance
  Certificate.

  	
   

  
	
  Section
  4.05

  	
  Taxes.

  	
   

  
	
  Section 4.06

  	
  Stay, Extension and Usury Laws.

  	
   

  
	
  Section 4.07

  	
  Restricted Payments.

  	
   

  
	
  Section
  4.08

  	
  Dividend
  and Other Payment Restrictions Affecting Subsidiaries.

  	
   

  



 


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  Section
  4.09

  	
  Incurrence
  of Indebtedness and Issuance of Preferred Stock.

  	
   

  
	
  Section
  4.10

  	
  Asset
  Sales.

  	
   

  
	
  Section 4.11

  	
  Transactions
  with Affiliates.

  	
   

  
	
  Section
  4.12

  	
  Liens.

  	
   

  
	
  Section 4.13

  	
  Corporate Existence.

  	
   

  
	
  Section
  4.14

  	
  Offer
  to Repurchase Upon Change of Control.

  	
   

  
	
  Section
  4.15

  	
  Limitation
  on Senior Subordinated Indebtedness.

  	
   

  
	
  Section 4.16

  	
  Payments for Consent.

  	
   

  
	
  Section
  4.17

  	
  Designation
  of Restricted and Unrestricted Subsidiaries.

  	
   

  
	
  Section
  4.18

  	
  Limitation
  on Status as Investment Company.

  	
   

  
	
  Section 4.19

  	
  Certain
  Suspended Covenants

  	
   

  
	
   

  	
   

  	
   

  
	
  ARTICLE
  5

  
	
  SUCCESSORS

  
	
   

  	
   

  	
   

  
	
  Section 5.01

  	
  Merger, Consolidation, or Sale of Assets.

  	
   

  
	
  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

  
	
  LEGAL DEFEASANCE AND
  COVENANT DEFEASANCE

  
	
   

  	
   

  	
   

  
	
  Section 8.01

  	
  Option to Effect Legal Defeasance or
  Covenant Defeasance.

  	
   

  
	
  Section 8.02

  	
  Legal Defeasance and Discharge.

  	
   

  
	
  Section 8.03

  	
  Covenant Defeasance.

  	
   

  
	
  Section 8.04

  	
  Conditions to Legal or Covenant
  Defeasance.

  	
   

  



 


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  Section 8.05

  	
  Deposited Money and Government Securities
  to be Held in Trust; Other Miscellaneous Provisions.

  	
   

  
	
  Section 8.06

  	
  Repayment to Company.

  	
   

  
	
  Section 8.07

  	
  Reinstatement.

  	
   

  
	
   

  	
   

  	
   

  
	
  ARTICLE
  9

  
	
  AMENDMENT, SUPPLEMENT AND
  WAIVER

  
	
   

  
	
  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 to Sign Amendments, etc.

  	
   

  
	
   

  	
   

  	
   

  
	
  ARTICLE
  10

  
	
  SUBORDINATION

  
	
   

  	
   

  	
   

  
	
  Section 10.01

  	
  Agreement to Subordinate.

  	
   

  
	
  Section 10.02

  	
  Liquidation; Dissolution; Bankruptcy.

  	
   

  
	
  Section 10.03

  	
  Default on Designated Senior
  Indebtedness.

  	
   

  
	
  Section 10.04

  	
  Acceleration of Notes.

  	
   

  
	
  Section 10.05

  	
  When Distribution Must Be Paid Over.

  	
   

  
	
  Section 10.06

  	
  Notice by Company.

  	
   

  
	
  Section 10.07

  	
  Subrogation.

  	
   

  
	
  Section 10.08

  	
  Relative Rights.

  	
   

  
	
  Section 10.09

  	
  Subordination May Not Be Impaired by
  Company.

  	
   

  
	
  Section 10.10

  	
  Distribution or Notice to Representative.

  	
   

  
	
  Section 10.11

  	
  Rights of Trustee and Paying Agent.

  	
   

  
	
  Section 10.12

  	
  Authorization to Effect Subordination.

  	
   

  
	
  Section 10.13

  	
  Amendments.

  	
   

  
	
   

  	
   

  	
   

  
	
  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

  	
  No Personal Liability of Directors,
  Officers, Employees and Stockholders.

  	
   

  
	
  Section 11.08

  	
  Governing Law.

  	
   

  
	
  Section 11.09

  	
  No Adverse Interpretation of Other
  Agreements.

  	
   

  
	
  Section 11.10

  	
  Successors.

  	
   

  
	
  Section 11.11

  	
  Severability.

  	
   

  
	
  Section 11.12

  	
  Counterpart Originals.

  	
   

  
	
  Section 11.13

  	
  Table of Contents, Headings, etc.

  	
   

  



 


iii

















 


	
  EXHIBITS

  	
   

  	
   

  
	
  Exhibit A

  	
  FORM OF NOTE

  	
   

  
	
  Exhibit B

  	
  FORM OF CERTIFICATE OF TRANSFER

  	
   

  
	
  Exhibit C

  	
  FORM OF CERTIFICATE OF EXCHANGE

  	
   

  
	
  Exhibit D

  	
  FORM OF CERTIFICATE FROM ACQUIRING
  INSTITUTIONAL ACCREDITED INVESTOR

  	
   

  



 


iv

















 


INDENTURE dated as of
February 12, 2004 between Argosy Gaming Company, a Delaware corporation (the “Company”), and J.P. Morgan Trust Company,
National Association, as trustee (the “Trustee”).


 


The Company and the Trustee
agree as follows for the benefit of each other and for the equal and ratable
benefit of the Holders (as defined) of the  7%
Senior Subordinated Notes due 2014 (the “Notes”):


 


ARTICLE 1

DEFINITIONS AND INCORPORATION

BY REFERENCE


 


Section
1.01                                Definitions.


 


“9% Notes” means the 9% Senior Subordinated Notes due 2011 of
the Company.


 


“103/4% Notes” means the 103/4%
Senior Subordinated Notes due 2009 of the Company.


 


“144A Global Note” means a Global Note substantially 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 Depositary or its nominee that will be issued in a denomination equal
to the outstanding principal amount of the Notes sold in reliance on Rule 144A.


 


“Acquired Indebtedness” means Indebtedness of a Person
existing at the time such Person becomes a Restricted Subsidiary or assumed in
connection with an Asset Acquisition by a Restricted Subsidiary; provided that Indebtedness of such Person
which is redeemed, defeased, retired or otherwise repaid at the time of or
immediately upon consummation of the transactions by which such Person becomes
a Restricted Subsidiary or such Asset Acquisition shall not be Acquired
Indebtedness.


 


“Additional Interest” means all additional interest then
owing pursuant to the Registration Rights Agreement.


 


“Additional Notes” means additional Notes (other than the
Initial Notes) issued under this Indenture in accordance with Sections 2.02,
2.14 and Article 4 hereof, as part of the same series as the Initial Notes.


 


“Adjusted Consolidated Net Income” means, for any period, the
aggregate net income (or loss) of the Company and its Restricted Subsidiaries
for such period determined in conformity with GAAP; provided that the following items shall be excluded in
computing Adjusted Consolidated Net Income (without duplication):


 


(1)                                  the net income of any Person that is not a
Restricted Subsidiary, except to the extent of the amount of dividends or other
distributions actually paid to the Company or any of its Restricted
Subsidiaries by such Person during such period;


 


(2)                                  the net income (or loss) of any Person prior
to the date it becomes a Restricted Subsidiary or is merged into or
consolidated with the Company or any of its Restricted Subsidiaries or all or
substantially all of the property and assets of such Person are acquired by the
Company or any of its Restricted Subsidiaries;


 


(3)                                  any net income of any Restricted Subsidiary
if the declaration or payment of dividends or similar distributions by such
Restricted Subsidiary of such net income is not at the time


 


1

















 


permitted by the operation
of the terms of its charter or any agreement, instrument, judgment, decree,
order, statute, rule or governmental regulation applicable to such Restricted
Subsidiary, 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 that could have been
paid or distributed 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 (3) and provided such ability is not due to a waiver
of such restriction) and


 


(B)                                the Company’s equity in a net loss of any
such Restricted Subsidiary for such period shall be included in determining
Adjusted Consolidated Net Income regardless of such restriction;


 


(3)                                  any gains or losses (on an after-tax basis)
attributable to Asset Sales;


 


(4)                                  all extraordinary gains and extraordinary
losses and any premium, fees and expenses payable in connection with the
offering of the Notes and the 9% Notes, the repurchase of the 103/4%
Notes and the initial establishment of the Credit Facility;


 


(5)                                  any non cash impairment loss determined in
accordance with GAAP related to the carrying value of assets owned by the
Company or its Restricted Subsidiaries as of July 31, 2001 that are recorded in
the ordinary course of business and are being used by the Company or have been
replaced by other comparable assets of the Company or its Restricted
Subsidiaries;


 


(6)                                  the cumulative effect of a change in
accounting principles; and


 


(7)                                  upon the occurrence and during the
continuance of a Trigger Event, the net income of Empress Casino Corporation,
except to the extent of the management fee paid to the Company or a Restricted
Subsidiary of the Company other than Empress Casino Corporation pursuant to the
terms of the Management Agreement during such period.


 


“Affiliate” means, as applied to any Person, any other Person
directly or indirectly controlling, controlled by, or under direct or indirect
common control with, such Person.  For
purposes of this definition, “control” (including, with correlative meanings,
the terms “controlling,” “controlled by” and “under common control with”), as
applied to any Person, means the possession, directly or indirectly, of the
power to direct or cause the direction of the management and policies of such
Person, whether through the ownership of voting securities, by contract or
otherwise.


 


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


 


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


 


“Asset Acquisition” means


 


2

















 


(1)                                  an investment by the Company or any of its
Restricted Subsidiaries in any other Person pursuant to which such Person shall
become a Restricted Subsidiary or shall be merged into or consolidated with the
Company or any of its Restricted Subsidiaries;


 


(2)                                  an acquisition by the Company or any of its
Restricted Subsidiaries of the property and assets of any Person other than the
Company or any of its Restricted Subsidiaries that constitute substantially all
of a division or line of business of such Person; or


 


(3)                                  the occurrence of a Reverse Trigger Event.


 


“Asset Disposition” means


 


(1)                                  the sale or other disposition by the Company
or any of its Restricted Subsidiaries (other than to the Company or another
Restricted Subsidiary) of


 


(A)                              all or substantially all of the Capital Stock
of any Restricted Subsidiary; or


 


(B)                                all or substantially all of the assets that
constitute a division or line of business of the Company or any of its
Restricted Subsidiaries; or


 


(2)                                  the occurrence of a Trigger Event.


 


“Asset Sale” means any sale, transfer or other disposition
(including by way of merger, consolidation or sale-leaseback transaction) in
one transaction or a series of related transactions by the Company or any of
its Restricted Subsidiaries to any Person other than the Company or any of its
Restricted Subsidiaries of:


 


(1)                                  all or any of the Capital Stock of any
Restricted Subsidiary;


 


(2)                                  all or substantially all of the property and
assets of an operating unit or business of the Company or any of its Restricted
Subsidiaries; or


 


(3)                                  any other property and assets (other than the
Capital Stock of or other Investment in an Unrestricted Subsidiary) that is
outside the ordinary course of business of the Company or any of its Restricted
Subsidiaries,


 


in
each case, other than a sale of all or substantially all of the assets of the
Company in compliance with Section 5.01; provided
that “Asset Sale” shall not include:


 


(1)                                  sales or other dispositions of inventory,
receivables and other current assets in the ordinary course of business,


 


(2)                                  sales, transfers or other dispositions of
assets constituting a Restricted Payment permitted to be made under Section
4.07 or Investments permitted pursuant to clause (6) of the definition of
Permitted Investments,


 


(3)                                  sales or other dispositions of assets for
consideration at least equal to the fair market value of the assets sold or
disposed of, to the extent that the consideration received are invested in
accordance with Section 4.10(b)(1)(B),


 


(4)                                  the occurrence of a Trigger Event,


 


3

















 


(5)                                  sales, transfers or other dispositions of
assets with a Fair Market Value not in excess of $10.0 million in any
transaction or series of related transactions, or


 


(6)                                  sales, transfers or other dispositions of
furniture, fixtures or equipment that has become worn out, obsolete or damaged
or otherwise unsuitable for use in connection with the business of the Company
or its Restricted Subsidiaries.


 


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


 


“Average Life” means, at any date of
determination with respect to any debt security, the quotient obtained by
dividing (1) the sum of the products of (A) the number of years from such date
of determination to the dates of each successive scheduled principal payment of
such debt security and (B) the amount of such principal payment by (2) the sum
of all such principal payments.


 


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


 


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


 


“Board of Directors” means:


 


(1)                                  with respect to a corporation, the board of
directors of the corporation or any committee thereof duly authorized to act on
behalf of such board;


 


(2)                                  with respect to a partnership, the Board of
Directors of the general partner of the partnership;


 


(3)                                  with respect to a limited liability company,
the managing member or members or any controlling committee of managing members
thereof; and


 


(4)                                  with respect to any other Person, the board
or committee of such Person serving a similar function.


 


“Broker-Dealer” means any broker or dealer
registered under the Exchange Act.


 


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


 


“Capital Stock” means, with respect to any
Person, any and all shares, interests, participations or other equivalents
(however designated, whether voting or non-voting) in equity of such Person,
whether outstanding on the Closing Date or issued thereafter, including,
without limitation, all Common Stock and Preferred Stock.


 


4

















 


“Capitalized Lease” means, as applied to
any Person, any lease of any property (whether real personal or mixed) of which
the discounted present value of the rental obligations of such Person as
lessee, in conformity with GAAP, is required to be capitalized on the balance
sheet of such Person.


 


“Capitalized Lease Obligations” means the
discounted present value of the rental obligations under a Capitalized Lease.


 


“Change of Control” means the occurrence of
any of the following:


 


(1)                                  a “person” or “group” (within the meaning of
Sections 13(d) and 14(d)(2) of the Exchange Act) other than a group comprised
of one or more Excluded Persons becomes the ultimate “beneficial owner” (as
defined in Rule 13d-3 under the Exchange Act) of more than 50% of the total
voting power of the Voting Stock of the Company on a fully diluted basis;


 


(2)                                  individuals who on the Closing Date
constitute the Board of Directors of the Company (together with any new
directors whose election by the Board of Directors of the Company or whose
nomination by the Board of Directors of the Company for election by the
Company’s stockholders was approved by a vote of at least two-thirds of the
members of the Board of Directors of the Company then in office who either were
members of the Board of Directors of the Company on the Closing Date or whose
election or nomination for election was previously so approved) cease for any
reason to constitute a majority of the members of the Board of Directors of the
Company then in office;


 


(3)                                  the direct or indirect sale, transfer,
conveyance or other disposition (other than by way of merger or consolidation),
in one or a series of related transactions, of all or substantially all of the
properties or assets of the Company and its Subsidiaries taken as a whole to
any “person” (as that term is used in Section 13(d)(3) of the Exchange Act); or


 


(4)                                  the adoption of a plan relating to the
liquidation or dissolution of the Company.


 


“Clearstream” means Clearstream Banking,
S.A.


 


“Closing Date” means the date on which the
Notes are originally issued under this Indenture.


 


“Company” means Argosy Gaming Company, and
any and all successors thereto.


 


“Consolidated EBITDA” means, for any
period, Adjusted Consolidated Net Income for such period plus, to the extent
such amount was deducted in calculating such Adjusted Consolidated Net Income:


 


(1)                                  Consolidated Interest Expense,


 


(2)                                  income taxes (other than income taxes (either
positive or negative) attributable to extraordinary and non-recurring gains or
losses or sales of assets),


 


(3)                                  depreciation expense,


 


(4)                                  amortization expense,


 


(5)                                  all other non-cash items reducing Adjusted
Consolidated Net Income (other than items that will require cash payments and
for which an accrual or reserve is, or is required by GAAP


 


5

















 


to be, made), less all
non-cash items increasing Adjusted Consolidated Net Income (other than normal
recurring accruals of revenue in the ordinary course of business and reversals
of prior accruals and reserves for cash items previously excluded from
Consolidated EBITDA pursuant to this clause (5)), all as determined on a
consolidated basis for the Company and its Restricted Subsidiaries in
conformity with GAAP and


 


(6)                                  any premium, fees and expenses payable in
connection with the repurchase and refinancing of the 9% Notes;


 


provided that, if any Restricted Subsidiary is not a Wholly Owned Restricted
Subsidiary, Consolidated EBITDA shall be reduced (to the extent not otherwise
reduced in accordance with GAAP) by an amount equal to (1) the amount of the
Adjusted Consolidated Net Income attributable to such Restricted Subsidiary
multiplied by (2) the percentage ownership interest in the income of such
Restricted Subsidiary not owned on the last day of such period by the Company
or any of its Restricted Subsidiaries.


 


Notwithstanding
the preceding provisions, upon the occurrence and during the continuance of a
Trigger Event for purposes of determining the Consolidated EBITDA attributable
to Empress Casino Corporation, the Company shall (i) add to Adjusted
Consolidated Net Income only the Consolidated Interest Expense and income taxes
of Empress Casino Corporation that are permitted to be distributed to the
Company pursuant to the Trust Agreements and (ii) not add to Adjusted
Consolidated Net Income any depreciation and amortization expenses or other non
cash items reducing Adjusted Consolidated Net Income of Empress Casino
Corporation.


 


“Consolidated Interest Expense” means, for
any period, the aggregate amount of:


 


(1)                                  interest in respect of Indebtedness of the
Company and its Restricted Subsidiaries (including, without limitation,
amortization of original issue discount on any such Indebtedness, the interest
portion of any deferred payment obligation and imputed interest with respect to
Attributable Debt, calculated in accordance with the effective interest method
of accounting; all commissions, discounts and other fees and charges owed with
respect to letters of credit and bankers’ acceptance financing; the net costs
associated with Interest Rate Agreements);


 


(2)                                  all but the principal component of rentals in
respect of Capitalized Lease Obligations paid, accrued or scheduled to be paid
or to be accrued by the Company and its Restricted Subsidiaries during such
period;


 


(3)                                  any interest expense on Indebtedness of
another Person that is Guaranteed by such Person or one of its Restricted
Subsidiaries or secured by a Lien on assets of such Person or one of its
Restricted Subsidiaries, whether or not such Guarantee or Lien is called upon;
and


 


(4)                                  the product of (1) all dividends, whether
paid or accrued and whether or not in cash, on any series of Preferred Stock of
such Person or any of its Restricted Subsidiaries, other than dividends on
Capital Stock payable solely in Capital Stock of the Company (other than
Disqualified Stock) or to the Company or a Restricted Subsidiary of the
Company, times (2) a fraction, the numerator of which is one and the
denominator of which is one minus the then current combined federal, state and
local statutory tax rate of such Person, expressed as a decimal, in each case,
on a consolidated basis and in accordance with GAAP;


 


6

















 


excluding,
however:


 


(1)                                  any amount of such interest of any Restricted
Subsidiary if the net income of such Restricted Subsidiary is excluded in the
calculation of Adjusted Consolidated Net Income pursuant to clause (3) of the
definition thereof (but only in the same proportion as the net income of such
Restricted Subsidiary is excluded from the calculation of Adjusted Consolidated
Net Income pursuant to clause (3) of the definition thereof); and


 


(2)                                  any premiums, fees and expenses (and any
amortization thereof) payable in connection with the offering of the Notes, the
repurchase of the 103/4% Notes and the 9% Notes and the
amendment of the Credit Facility on the date of this Indenture, any
amortization of premiums, fees and expenses incurred prior to the date of this
Indenture in connection with the initial establishment of, and subsequent
amendments to, the Credit Facility, the offering of the 9% Notes and any other
amortization of debt issuance costs, all as determined on a consolidated basis
(without taking into account Unrestricted Subsidiaries) in conformity with
GAAP.


 


“Corporate Trust Office of the Trustee”
will be at the address of the Trustee specified in Section 11.02 hereof or such
other address as to which the Trustee may give notice to the Company.


 


“Credit Facility” means the Second Amended
and Restated Credit Agreement dated as of July 31, 2001, among the Company,
certain subsidiaries of the Company, as co-borrowers, and Wells Fargo Bank,
N.A., as administrative agent and the lenders referred to therein, together
with any agreements, instruments and documents executed or delivered pursuant
to or in connection with such Credit Facility (including, without limitation,
any Guarantees and security documents), in each case as such Credit Facility or
such agreements, instruments or documents may be amended, supplemented,
extended, renewed, refinanced or otherwise modified from time to time.


 


“Currency Agreement” means any foreign
exchange contract, currency swap agreement or other similar agreement or
arrangement.


 


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


 


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


 


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


 


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


 


“Designated Senior Indebtedness” means


 


(1)                                  any Indebtedness outstanding under the Credit
Facility (except that any Indebtedness which represents a partial refinancing
of Indebtedness theretofore outstanding pursuant to the


 


7

















 


Credit Facility, rather than
a complete refinancing thereof, shall only constitute Designated Senior
Indebtedness if such partial refinancing meets the requirements of clause (2)
below) and


 


(2)                                  any other Senior Indebtedness that, at the
date of determination, has an aggregate principal amount outstanding of at
least $50 million and that had been specifically designated by the Company as
“Designated Senior Indebtedness.”


 


“Disqualified Stock” means any class or series of Capital
Stock of any Person that by its terms or otherwise is


 


(1)                                  required to be redeemed prior to the Stated
Maturity of the Notes,


 


(2)                                  redeemable at the option of the holder of
such class or series of Capital Stock at any time prior to the Stated Maturity
of the Notes or


 


(3)                                  convertible into or exchangeable for Capital
Stock referred to in clause (1) or (2) above or Indebtedness having a scheduled
maturity prior to the Stated Maturity of the Notes; provided that any Capital Stock that would not constitute
Disqualified Stock but for provisions thereof giving holders thereof the right
to require such Person to repurchase or redeem such Capital Stock upon the
occurrence of an “asset sale” or “change of control” occurring prior to the
Stated Maturity of the Notes shall not constitute Disqualified Stock if the
“asset sale” or “change of control” provisions applicable to such Capital Stock
are no more favorable to the holders of such Capital Stock than the provisions
contained in Section 4.10 and Section 4.14 such Capital Stock specifically
provides that such Person will not repurchase or redeem any such stock pursuant
to such provision prior to the Company’s repurchase of such Notes as are
required to be repurchased pursuant to Section 4.10 and Section 4.14.


 


“Empress Casino Joliet” means the Empress Casino and Hotel
located in Joliet, Illinois or any successor casino or hotel/casino.


 


“Empress Casino Corporation” means Empress Casino
Corporation, an Illinois corporation that owns and operates Empress Casino Joliet,
or any successor in interest thereto.


 


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


 


“Equity Offering” means an offer and sale of Capital Stock
(other than Disqualified Stock) of the Company pursuant to (1) an effective
registration statement under the Securities Act or (2) a private placement to
Persons who are not Affiliates of the Company.


 


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


 


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


 


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


 


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


 


8

















 


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


 


“Excluded Persons” means William F. Cellini, F. Lance Callis,
Jimmy F. Gallagher, James B. Perry, John B. Pratt, Sr. and Stephanie Pratt,
each of such person’s immediate family or a trust or similar entity existing
solely for the benefit of such person or such person’s immediate family.


 


“Existing Indentures” means collectively the July 2001
Indenture and that certain Indenture, dated as of June 8, 1999 (as such
Indenture may be amended or supplemented) among the company, as issuer, certain
subsidiaries of the Company, as subsidiary guarantors, and J.P. Morgan Trust
Company, National Association, as trustee.


 


“Fair Market Value” means the price that would be paid in an
arm’s-length transaction between an informed and willing seller under no
compulsion to sell and an informed and willing buyer under no compulsion to
buy, as determined in good faith by the Board of Directors, whose determination
shall be conclusive if evidenced by a resolution of the Board of Directors.


 


“FF&E Indebtedness” means any Indebtedness of the Company
or any of its Restricted Subsidiaries that is Incurred to finance the
acquisition or lease after the date of this Indenture of furniture, fixtures or
equipment (“FF&E”) used
directly in the operation of any of the Company’s casinos and secured solely by
a Lien on such FF&E, which Indebtedness has a principal amount not to
exceed 100% of the cost of the FF&E so purchased or leased.


 


“GAAP” means generally accepted accounting principles in the
United States of America as in effect from time to time, including, without
limitation, those set forth in the opinions and pronouncements of the
Accounting Principles Board of the American Institute of Certified Public
Accountants and statements and pronouncements of the Financial Accounting
Standards Board or in such other statements by such other entity as approved by
a significant segment of the accounting profession.  All ratios and computations contained or referred to in this
Indenture shall be computed in conformity with GAAP applied on a consistent
basis.


 


“Gaming Authority” means any agency, authority, board,
bureau, commission, department, office or instrumentality of the United States
or foreign government, any state province or any city or other political
subdivision, or any officer of official thereof, including the Illinois Gaming
Board, the Indiana Gaming Commission, the Iowa Racing and Gaming Commission,
the Louisiana Gaming Control Board, the Missouri Gaming Commission and any
other agency with authority to regulate any gaming operation (or proposed
gaming operation) owned, managed or operated by the Company or any of its
Subsidiaries.


 


“Gaming License” means every license, franchise or other
authorization required to own, lease, operate or otherwise conduct the present
and future gaming activities of the Company and its Subsidiaries.


 


“Global Note Legend” means the legend set forth in Section
2.06(g)(2) hereof, which is required to be placed on all Global Notes issued
under this Indenture.


 


“Global Notes” means, individually and collectively, each of
the Restricted Global Notes and the Unrestricted Global Notes deposited with or
on behalf of and registered in the name of the Depository or its nominee,
substantially in the form of Exhibit A hereto and that bears the Global Note
Legend and that has the “Schedule of Exchanges of Interests in the Global Note”
attached thereto, issued in accordance with Section 2.01, 2.06(b)(3),
2.06(b)(4), 2.06(d)(2) or 2.06(f) hereof.


 


9

















 


“Government Securities” means direct obligations of, or
obligations guaranteed by, the United States of America, and the payment for
which the United States pledges its full faith and credit.


 


“Guarantee” means any obligation, contingent or otherwise, of
any Person directly or indirectly guaranteeing any Indebtedness of any other
Person and, without limiting the generality of the foregoing, any obligation,
direct or indirect, contingent or otherwise, of such Person:


 


(1)                                  to purchase or pay (or advance or supply
funds for the purchase or payment of) such Indebtedness of such other Person
(whether arising by virtue of partnership arrangements, or by agreements to
keep-well, to purchase assets, goods, securities or services (unless such
purchase arrangements are on arm’s-length terms and are entered into in the
ordinary course of business), to take-or-pay, or to maintain financial
statement conditions or otherwise) or


 


(2)                                  entered into for purposes of assuring in any
other manner the obligee of such Indebtedness of the payment thereof or to
protect such obligee against loss in respect thereof (in whole or in part); provided that the term “Guarantee” shall
not include endorsements for collection or deposit in the ordinary course of
business.


 


The
term “Guarantee” used as a verb
has a corresponding meaning.


 


“Holder” means a Person in whose name a Note is registered.


 


“Incur” means, with respect to any Indebtedness, to incur,
create, issue, assume, Guarantee or otherwise become liable for or with respect
to, or become responsible for, the payment of, contingently or otherwise, such
Indebtedness, including an “Incurrence” of Acquired Indebtedness; provided that neither the accrual of
interest nor the accretion of original issue discount shall be considered an
Incurrence of Indebtedness.


 


“Indebtedness” means, with respect to any Person at any date
of determination (without duplication):


 


(1)                                  all indebtedness of such Person for borrowed
money;


 


(2)                                  all obligations of such Person evidenced by
bonds, debentures, notes or other similar instruments;


 


(3)                                  all obligations of such Person in respect of
letters of credit or other similar instruments (including reimbursement
obligations with respect thereto, but excluding obligations with respect to
letters of credit (including trade letters of credit) securing obligations (other
than obligations described in this definition) entered into in the ordinary
course of business of such Person to the extent such letters of credit are not
drawn upon or, if drawn upon, to the extent 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);


 


(4)                                  all obligations of such Person to pay the
deferred and unpaid purchase price of property or services, which purchase
price is due more than six months after the date of placing such property in
service or taking delivery and title thereto or the completion of such
services, except Trade Payables;


 


(5)                                  all Capitalized Lease Obligations and
Attributable Debt;


 


10

















 


(6)                                  all Indebtedness of other Persons secured by
a Lien on any asset of such Person, whether or not such Indebtedness is assumed
by such Person; provided that the
amount of such Indebtedness shall be the lesser of (1) the Fair Market Value of
such asset at such date of determination and (2) the amount of such
Indebtedness;


 


(7)                                  all Indebtedness of other Persons Guaranteed
by such Person to the extent such Indebtedness is Guaranteed by such Person;
and


 


(8)                                  to the extent not otherwise included in this
definition, obligations under Currency Agreements and Interest Rate Agreements.


 


The
amount of Indebtedness of any Person at any date shall be the outstanding
balance at such date of all unconditional obligations as described above and, with
respect to contingent obligations, the maximum liability upon the occurrence of
the contingency giving rise to the obligation, provided
that:


 


(A)                              the amount outstanding at any time of any
Indebtedness issued with original issue discount is the face amount of such
Indebtedness less the remaining unamortized portion of the original issue
discount of such Indebtedness at such time as determined in conformity with
GAAP,


 


(B)                                money borrowed and set aside at the time of
the Incurrence of any Indebtedness in order to prefund the payment of the
interest on such Indebtedness shall not be deemed to be “Indebtedness” so long
as such money is held to secure the payment of such interest and


 


(C)                                Indebtedness shall not include any liability
for federal, state, local or other taxes.


 


“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.


 


“Initial Notes” means the first $350,000,000 aggregate
principal amount of Notes issued under this Indenture on the date hereof.


 


“Initial Purchasers” means Morgan Stanley & Co.
Incorporated, Banc of America Securities LLC, Bear, Stearns & Co. Inc.,
Credit Lyonnais Securities (USA) Inc., Deutsche Bank Securities Inc. and Wells
Fargo Securities, LLC.


 


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


 


“Interest Coverage Ratio” means, on any Transaction Date, the
ratio of (1) the aggregate amount of Consolidated EBITDA of the Company and its
Restricted Subsidiaries for the then most recent four fiscal quarters prior to
such Transaction Date for which reports have been filed with the SEC or
provided to the Trustee (the “Four Quarter
Period”) to (2) the aggregate Consolidated Interest Expense of the
Company and its Restricted Subsidiaries during such Four Quarter Period.  In making the foregoing calculation:


 


(A)                              pro forma effect shall be given to any
Indebtedness Incurred or repaid during the period (the “Reference Period”) commencing on the first
day of the Four Quarter Period and ending on the Transaction Date (other than
Indebtedness Incurred or repaid under a


 


11

















 


revolving credit or similar
arrangement to the extent of the commitment thereunder (or under any
predecessor revolving credit or similar arrangement) in effect on the last day
of such Four Quarter Period unless any portion of such Indebtedness is
projected, in the reasonable judgment of the senior management of the Company,
to remain outstanding for a period in excess of 12 months from the date of the
Incurrence thereof), in each case as if such Indebtedness had been Incurred or
repaid on the first day of such Reference Period (and pro forma effect shall be
given to eliminate interest attributable to any Indebtedness which has been
defeased either pursuant to a “covenant defeasance” or “legal defeasance” in
accordance with the instrument under which it was incurred);


 


(B)                                Consolidated Interest Expense attributable to
interest on any Indebtedness (whether existing or being Incurred) computed on a
pro forma basis and bearing a floating interest rate shall be computed as if
the rate in effect on the Transaction Date (taking into account any Interest
Rate Agreement applicable to such Indebtedness if such Interest Rate Agreement
has a remaining term in excess of 12 months or, if shorter, at least equal to
the remaining term of such Indebtedness) had been the applicable rate for the
entire period;


 


(C)                                pro forma effect shall be given to Asset
Dispositions and Asset Acquisitions (including giving pro forma effect to the
application of proceeds of any Asset Disposition) that occur during such
Reference Period as if they had occurred and such proceeds had been applied on
the first day of such Reference Period; and


 


(D)                               pro forma effect shall be given to asset
dispositions and asset acquisitions (including giving pro forma effect to the
application of proceeds of any asset disposition) that have been made by any
Person that has become a Restricted Subsidiary or has been merged with or into
the Company or any Restricted Subsidiary during such Reference Period and that
would have constituted Asset Dispositions or Asset Acquisitions had such
transactions occurred when such Person was a Restricted Subsidiary as if such
asset dispositions or asset acquisitions were Asset Dispositions or Asset
Acquisitions that occurred on the first day of such Reference Period;


 


provided that to the extent that clause (3) or (4) of this sentence requires
that pro forma effect be given to an Asset Acquisition or Asset Disposition,
such pro forma calculation shall be based upon the four full fiscal quarters immediately
preceding the Transaction Date of the Person, or division or line of business
of the Person, that is acquired or disposed for which financial information is
available.


 


“Interest Rate Agreement” means any interest rate protection
agreement, interest rate future agreement, interest rate option agreement,
interest rate swap agreement, interest rate cap agreement, interest rate collar
agreement, interest rate hedge agreement, option or future contract or other
similar agreement or arrangement.


 


“Investment” in any Person means any direct or indirect
advance, loan or other extension of credit (including, without limitation, by
way of Guarantee or similar arrangement; but excluding advances to customers,
suppliers or contractors in the ordinary course of business that are, in
conformity with GAAP, recorded as accounts receivable or prepaid items on the
balance sheet of the Company or its Restricted Subsidiaries) or capital
contribution to (by means of any transfer of cash or other property to others or
any payment for property or services for the account or use of others), or any
purchase or acquisition of Capital Stock, bonds, notes, debentures or other
similar instruments issued by, such Person and shall include:


 


(1)                                  the designation of a Restricted Subsidiary as
an Unrestricted Subsidiary and


 


12

















 


(2)                                  the retention of the Capital Stock (or any
other Investment) by the Company or any of its Restricted Subsidiaries, of (or
in) any Person that has ceased to be a Restricted Subsidiary; provided, however
that “Investment” shall not include the occurrence of a Trigger Event.


 


For purposes of the
definition of “Unrestricted Subsidiaries,” clause (6) of the definition of
“Permitted Investment” and Section 4.07, the amount of or a reduction in an
Investment shall be equal to the fair market value thereof at the time such
Investment is made or reduced.


 


“July 2001 Indenture” means that certain Indenture, dated as
of July 31, 2001 (as such Indenture may be amended or supplemented) among the
Company, as issuer, certain subsidiaries of the Company, as subsidiary
guarantors, and J.P. Morgan Trust Company, National Association, as trustee.


 


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


 


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


 


“Lien” means any mortgage, pledge, security interest,
encumbrance, lien or charge of any kind (inducing, without limitation, any
conditional sale or other title retention agreement or lease in the nature
thereof or any agreement to give any security interest).


 


“Management Agreement” means the Management Agreement to be
entered into between Argosy Illinois Corporation and Empress Casino Joliet
Corporation upon a Trigger Event pursuant to the terms of the Trust Agreements.


 


“Material Casino” means any casino of the Company or its
Restricted Subsidiaries that represents in excess of 10% of Consolidated EBITDA
of the Company and its Restricted Subsidiaries.


 


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


 


“Net Cash Proceeds” means:


 


(1)                                  with respect to any Asset Sale, the proceeds
of such Asset Sale in the form of cash or cash equivalents, including payments
in respect of deferred payment obligations (to the extent corresponding to the
principal, but not interest, component thereof) when received in the form of
cash or cash equivalents and proceeds from the conversion of other property
received when converted to cash or cash equivalents, net of


 


(A)                              brokerage commissions and other fees and expenses (including fees and
expenses of counsel and investment bankers) related to such Asset Sale,


 


(B)                                provisions for all taxes (whether or not such taxes will actually be
paid or are payable) as a result of such Asset Sale without regard to the
consolidated results of operations of the Company and its Restricted
Subsidiaries, taken as a whole,


 


13

















 


(C)                                payments made to repay Indebtedness or any other obligation outstanding
at the time of such Asset Sale that either (1) is secured by a Lien on the property
or assets sold or (2) is required to be paid as a result of such sale and


 


(D)                               appropriate amounts to be provided by the Company or any Restricted
Subsidiary as a reserve against any liabilities associated with such Asset
Sale, including, without limitation, pension and other post-employment benefit
liabilities, liabilities related to environmental matters and liabilities under
any indemnification obligations associated with such Asset Sale, all as
determined in conformity with GAAP and


 


(2)                                  with respect to any issuance or sale of
Capital Stock, the proceeds of such issuance or sale in the form of cash or
cash equivalents, including payments in respect of deferred payment obligations
(to the extent corresponding to the principal, but not interest, component
thereof) when received in the form of cash or cash equivalents and proceeds
from the conversion of other property received when converted to cash or cash
equivalents, net of attorney’s fees, accountants’ fees, underwriters’ or
initial purchasers’ fees, discounts or commissions and brokerage, consultant
and other fees incurred in connection with such issuance or sale and net of
taxes paid or payable as a result thereof.


 


“Non-Recourse Debt” means Indebtedness:


 


(1)                                  as to which neither the Company nor any of
its Restricted Subsidiaries (1) provides credit support of any kind (including
any undertaking, agreement or instrument that would constitute Indebtedness) or
(2) is directly or indirectly liable as a guarantor or otherwise;


 


(2)                                  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


 


(3)                                  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;


 


provided that:


 


(1)                                  the guarantee by the Company or a Restricted
Subsidiary of the completion of the development, construction and opening of a
new or expanded gaming facility by an Unrestricted Subsidiary of the Company
and


 


(2)                                  the agreement by the Company or a Restricted
Subsidiary to advance funds, property or services on behalf of an Unrestricted
Subsidiary in order to maintain the financial condition of such Unrestricted
Subsidiary in connection with the development, construction and opening of a
new or expanded gaming facility by such Unrestricted Subsidiary,


 


in
each case with respect to an Unrestricted Subsidiary whose sole purpose is to
develop, construct and operate a new or expanded gaming facility, will not
cause Indebtedness to constitute Indebtedness other than Non-Recourse Debt and
will not prevent a Subsidiary from becoming or remaining an Unrestricted
Subsidiary.


 


14

















 


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


 


“Notes” has the meaning assigned to it in the preamble to
this Indenture.  The Initial Notes and
the Additional Notes shall be treated as a single class for all purposes under
this Indenture, and unless the context otherwise requires, all references to
the Notes shall include the Initial Notes and any Additional Notes.


 


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


 


“Offer to Purchase” means an offer to purchase Notes by the
Company from the Holders commenced by mailing a notice to the Trustee and each
Holder stating:


 


(1)                                  the section hereof pursuant to which the offer
is being made and that all Notes validly tendered will be accepted for payment
on a pro rata basis;


 


(2)                                  the purchase price and the date of purchase
(which shall be a Business Day no earlier than 30 days nor later than 60 days
from the date such notice is mailed) (the “Payment
Date”);


 


(3)                                  that any Note not tendered will continue to
accrue interest pursuant to its terms;


 


(4)                                  that, unless the Company defaults in the
payment of the purchase price, any Note accepted for payment pursuant to the
Offer to Purchase shall cease to accrue interest on and after the Payment Date;


 


(5)                                  that Holders electing to have a Note
purchased pursuant to the Offer to Purchase will be required to surrender the
Note, together with the form entitled “Option of the Holder to Elect Purchase”
on the reverse side of the Note completed, to the Paying Agent at the address
specified in the notice prior to the close of business on the Business Day
immediately preceding the Payment Date;


 


(6)                                  that Holders will be entitled to withdraw their
election if the Paying Agent receives, not later than the close of business on
the third Business Day immediately preceding the Payment Date, a telegram,
facsimile transmission or letter setting forth the name of such Holder, the
principal amount of Notes delivered for purchase and a statement that such
Holder is withdrawing his election to have such Notes purchased; and


 


(7)                                  that Holders whose Notes are being purchased
only in part will be issued new Notes equal in principal amount to the
unpurchased portion of the Notes surrendered; provided
that each Note purchased and each new Note issued shall be in a principal
amount of $1,000 or integral multiples thereof.


 


On
the Payment Date, the Company shall


 


(1)                                  accept for payment on a pro rata basis Notes or portions thereof
tendered pursuant to an Offer to Purchase;


 


(2)                                  deposit with the Paying Agent money
sufficient to pay the purchase price of all Notes or portions thereof so
accepted; and


 


15

















 


(3)                                  deliver, or cause to be delivered, to the
Trustee all Notes or portions thereof so accepted together with an Officers’
Certificate specifying the Notes or portions thereof accepted for payment by
the Company.


 


The Paying Agent shall
promptly mail to the Holders so accepted payment in an amount equal to the
purchase price, and the Trustee shall promptly authenticate and mail to such
Holders a new Note equal in principal amount to any unpurchased portion of the
Note surrendered, provided that
each Note purchased and each new Note issued shall be in a principal amount of
$1,000 or integral multiples thereof. 
The Company will publicly announce the results of an Offer to Purchase
as soon as practicable after the Payment Date. 
The Trustee shall act as the Paying Agent for an Offer to Purchase.  The Company will comply with Rule 14e-l
under the Exchange Act and any other securities laws and regulations thereunder
to the extent such laws and regulations are applicable, in the event that the
Company is required to repurchase Notes pursuant to an Offer to Purchase.  To the extent that the provisions of any
securities laws or regulations conflict with the provisions of this Indenture
relating to an Offer to Purchase, the Company will comply with the applicable
securities laws and regulations and will not be deemed to have breached its
obligations under such provisions of this Indenture by virtue of such
compliance.


 


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


 


“Officers’ Certificate” means a certificate signed on behalf
of the Company by two Officers of the Company, one of whom must be the
principal executive officer, the principal financial officer, the treasurer or
the principal accounting officer of the Company, that meets the requirements of
Section 11.05 hereof.


 


“Opinion of Counsel” means an opinion from legal counsel who
is reasonably acceptable to the Trustee, that meets the requirements of Section
11.05 hereof.  The counsel may be an
employee of or counsel to the Company, any Subsidiary of the Company or the
Trustee.


 


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


 


“Permitted Asset Swap” means an exchange of assets by the
Company or one of its Restricted Subsidiaries for:


 


(1)                                  one or more Permitted Businesses;


 


(2)                                  a controlling equity interest in any Person
whose assets consist primarily of one or more Permitted Businesses; and/or


 


(3)                                  long-term assets that are used in a Permitted
Business in a like-kind exchange pursuant to Section 1031 of the Internal
Revenue Code or any similar or successor provision of the Internal Revenue Code
or a reverse like-kind exchange as described in Revenue Procedure 2000-37.


 


“Permitted Business” means a casino or gaming business,
businesses ancillary, complementary or reasonably related thereto and
reasonable extensions thereof.


 


16

















 


“Permitted Investment” means:


 


(1)                                  an Investment in the Company or a Restricted
Subsidiary or a Person which will, upon the making of such investment, become a
Restricted Subsidiary or be merged or consolidated with or into or transfer or
convey all or substantially all its assets to, the Company or a Restricted
Subsidiary; provided that such
person’s primary business is related, ancillary or complementary to the
businesses of the Company and its Restricted Subsidiaries on the date of such
Investment;


 


(2)                                  Temporary Cash Investments;


 


(3)                                  payroll, travel and similar advances to cover
matters that are expected at the time of such advances ultimately to be treated
as expenses in accordance with GAAP;


 


(4)                                  stock, obligations or securities received in
satisfaction of judgments;


 


(5)                                  Interest Rate Agreements and Currency
Agreements designed solely to protect the Company or its Restricted
Subsidiaries against fluctuations in interest rates or foreign currency
exchange rates;


 


(6)                                  Investments in a Person the primary business
of which is related, ancillary or complementary to the businesses of the
Company and its Restricted Subsidiaries if:


 


(A)                              the Company would, at the time such Investment is made and after giving
pro forma effect thereto as if such Investment had been made at the beginning
of the applicable four-quarter period, have been permitted to incur at least
$1.00 of additional Indebtedness pursuant to the Interest Coverage Ratio test
set forth in Section 4.09(a) and


 


(B)                                (i) immediately after giving effect to such Investment, the Company or
a Restricted Subsidiary will own at least 50% of the total voting power of the
Voting Stock of such Person, and will control the day-to-day operations of such
Person pursuant to a management contract or otherwise; or (ii) with respect to
any Person that is a Native American tribe or an agency or instrumentality
thereof, there is in effect a written agreement which has been approved by all
required gaming authorities, pursuant to which the Company or one of its
Restricted Subsidiaries will manage such tribe’s gaming activities at the
facility or facilities for which the Investment is being made in exchange for
customary fees and reimbursements;


 


provided that, if an Investment in any Person made pursuant to this clause (6)
would, at any time after the date such Investment is made, cease to qualify as
a Permitted Investment under this clause (6) due to a failure to satisfy the
requirements of the preceding clause (B), then the Company will be deemed to
have made an Investment equal to the value of the Company’s Investment in such
Person less the net reduction in such Investment resulting from payments of
interest on Indebtedness, dividends, repayments of loans or advances, or other
transfers of assets, in each case to the Company or any Restricted Subsidiary
or from the Net Cash Proceeds from the sale of any such Investment (valued in
each case as provided in the definition of “Investment”) and such Investment
will be subject to compliance with and included in calculating whether the
conditions of Section 4.07(a)(C) have been met with respect to any subsequent
Restricted Payments;


 


17

















 


(7)                                  Investments in any Person the primary
business of which is related, ancillary or complementary to the businesses of
the Company and its Restricted Subsidiaries; provided
that at the time of such Investment the aggregate amount of such Investments
pursuant to this clause (7) does not exceed $80.0 million; provided  further
that if an Investment is made pursuant to this clause (7) in a
Person that after the date of such Investment meets the requirements of clause
(6) above, such Investment shall thereafter be deemed to have been made under
clause (6) above and shall cease to have been made pursuant to this clause (7);


 


(8)                                  early retirement of Indebtedness outstanding
as of July 31, 2001 owed to former shareholders of Jazz Enterprises Inc.; and


 


(9)                                  other Investments in any Person having an
aggregate Fair Market Value (measured on the date each such Investment was made
and without giving effect to subsequent changes in value), when taken together
with all other Investments made pursuant to this clause (9) that are at the
time outstanding not to exceed $25.0 million; provided
that if an Investment is made pursuant to this clause (9) in a Person that after
the date of such Investment meets the requirements of clause (6) above, such
Investment shall thereafter be deemed to have been made under clause (6) above
and shall cease to have been made pursuant to this clause (9).


 


“Permitted Junior Securities” means:


 


(1)                                  Equity Interests in the Company or any
Subsidiary; or


 


(2)                                  debt securities that are subordinated to all
Senior Indebtedness and any debt securities issued in exchange for Senior
Indebtedness to substantially the same extent as, or to a greater extent than,
the Notes are subordinated to Senior Indebtedness under this Indenture.


 


“Permitted Liens” means


 


(1)                                  Liens securing obligations under Senior
Indebtedness that is permitted to be incurred pursuant to this Indenture
including, without limitation, the Credit Facility;


 


(2)                                  Liens existing on the Closing Date;


 


(3)                                  Liens granted after the Closing Date on any
assets or Capital Stock of the Company or its Restricted Subsidiaries created
in favor of the Holders;


 


(4)                                  Liens for taxes, assessments, governmental
charges or claims that are being contested in good faith by appropriate legal
proceedings promptly instituted and diligently conducted and for which a
reserve or other appropriate provision, if any, as shall be required in
conformity with GAAP shall have been made;


 


(5)                                  statutory and common law Liens of landlords
and carriers, warehousemen, mechanics, suppliers, materialmen, repairmen or
other similar Liens arising in the ordinary course of business and with respect
to amounts not yet delinquent or being contested in good faith by appropriate
legal proceedings promptly instituted and diligently conducted and for which a
reserve or other appropriate provision, if any, as shall be required in
conformity with GAAP shall have been made;


 


(6)                                  Liens incurred or deposits made in the
ordinary course of business in connection with workers’ compensation,
unemployment insurance and other types of social security;


 


18

















 


(7)                                  Liens incurred or deposits made to secure the
performance of tenders, bids, leases, statutory or regulatory obligations,
bankers’ acceptances, surety and appeal bonds, government contracts,
performance and return-of-money bonds and other obligations of a similar nature
incurred in the ordinary course of business (exclusive of obligations for the
payment of borrowed money);


 


(8)                                  easements, rights-of-way, municipal and
zoning ordinances and similar charges, encumbrances, title defects or other
irregularities that do not materially interfere with the ordinary course of
business of the Company or any of its Restricted Subsidiaries;


 


(9)                                  Liens (including extensions and renewals
thereof) upon real or personal property acquired after the Closing Date; provided that


 


(A)                              such Lien is created solely for the purpose of securing Indebtedness
Incurred, in accordance with Section 4.09, to finance the cost (including the
cost of improvement or construction) of the item of property or assets subject
thereto and such Lien is created prior to, at the time of or within six months
after the later of the acquisition, the completion of construction or the
commencement of full operation of such property,


 


(B)                                the principal amount of the Indebtedness secured by such Lien does not
exceed 100% of such cost and


 


(C)                                any such Lien shall not extend to or cover any property or assets other
than such item of property or assets and any improvements on such item;


 


(10)                            leases or subleases granted to others that do
not materially interfere with the ordinary course of business of the Company
and its Restricted Subsidiaries, taken as a whole;


 


(11)                            Liens encumbering property or assets under
construction arising from progress or partial payments by a customer of the
Company or its Restricted Subsidiaries relating to such property or assets;


 


(12)                            any interest or title of a lessor in the
property subject to any Capitalized Lease or operating lease;


 


(13)                            Liens arising from filing Uniform Commercial
Code financing statements regarding leases;


 


(14)                            Liens on property of, or on shares of Capital
Stock or Indebtedness of, any Person existing at the time such Person becomes
or becomes a part of, any Restricted Subsidiary, provided that such Liens do not extend to or cover any
property or assets of the Company or any Restricted Subsidiary other than the
property or assets acquired;


 


(15)                            Liens in favor of the Company or any
Restricted Subsidiary, other than Liens securing intercompany Indebtedness
incurred under Section 4.09(b)(2);


 


(16)                            Liens arising from the rendering of a final
judgment or order against the Company or any Restricted Subsidiary that does
not give rise to an Event of Default;


 


19

















 


(17)                            Liens securing reimbursement obligations with
respect to letters of credit that encumber documents and other property
relating to such letters of credit and the products and proceeds thereof;


 


(18)                            Liens in favor of customs and revenue
authorities arising as a matter of law to secure payment of customs duties in
connection with the importation of goods;


 


(19)                            Liens encumbering customary initial deposits
and margin deposits, and other Liens that are within the general parameters
customary in the industry and incurred in the ordinary course of business, in
each case, securing Indebtedness under Interest Rate Agreements and Currency
Agreements and forward contracts, options, future contracts, futures options or
similar agreements or arrangements designed solely to protect the Company or
any of its Restricted Subsidiaries from fluctuations in interest rates,
currencies or the price of commodities;


 


(20)                            Liens arising out of conditional sale, title
retention, consignment or similar arrangements for the sale of goods entered
into by the Company or any of its Restricted Subsidiaries in the ordinary
course of business in accordance with the past practices of the Company and its
Restricted Subsidiaries prior to the Closing Date;


 


(21)                            Liens on or sales of receivables;


 


(22)                            Liens securing obligations under Currency
Agreements and Interest Rate Agreements entered into in the ordinary course of
business; and


 


(23)                            Liens in addition to the foregoing incurred
in the ordinary course of business provided
that the amount of the obligations secured by such Liens does not exceed in the
aggregate $10.0 million at any one time outstanding and that


 


(A)                              such Liens are not incurred in connection with the borrowing of money
or the obtaining of advances or credit (other than trade credit in the ordinary
course of business) and


 


(B)                                such Liens do not in the aggregate materially detract from the value of
the property or materially impair the use thereof in the operation of the
business by the Company or any of its Subsidiaries.


 


“Person” means any individual, corporation, partnership,
joint venture, association, joint-stock company, trust, unincorporated
organization or government or agency or political subdivision thereof
(including any subdivision or ongoing business of any such entity or
substantially all of the assets of any such entity, subdivision or business).


 


“Private Placement Legend” means the legend set forth in
Section 2.06(g)(1) hereof 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.


 


“Registration Rights Agreement” means the Registration Rights
Agreement, dated as of February 12, 2004, by and among the Company and the
other parties named on the signature pages thereof, as such agreement may be
amended, modified or supplemented from time to time, and, with respect to any


20

















 


Additional Notes, one or more registration
rights agreements among the Company and the other parties thereto, as such
agreement(s) may be amended, modified or supplemented from time to time,
relating to rights given by the Company to the purchasers of Additional Notes
to register such Additional Notes under the Securities Act.


 


“Regulation S” means Regulation S promulgated under the
Securities Act.


 


“Regulation S Global Note” means a Global Note substantially
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 Depositary or its nominee, issued in a denomination equal to the
outstanding principal amount of the Notes sold in reliance on Rule 903 of
Regulation S.


 


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


 


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


 


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


 


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


 


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


 


“Restricted Subsidiary” means any Subsidiary of the Company
other than an Unrestricted Subsidiary.


 


“Reverse Trigger Event” means after the occurrence of a
Trigger Event, the transfer of the shares of the capital stock of Empress
Casino Corporation to the Company or a Restricted Subsidiary of the Company
pursuant to the terms of the Trust Agreements.


 


“Rule 144” means Rule 144 promulgated under the Securities
Act.


 


“Rule 144A” means Rule 144A promulgated under the Securities
Act.


 


“Rule 903” means Rule 903 promulgated under the Securities
Act.


 


“Rule 904” means Rule 904 promulgated under the Securities
Act.


 


“S&P” means Standard & Poor’s Ratings Group, a
division of The McGraw-Hill Companies, and its successors.


 


“SEC” means the Securities and Exchange Commission.


 


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


 


“Senior Indebtedness” means the following obligations of the
Company, whether outstanding on the Closing Date or thereafter Incurred:


 


21

















 


(1)                                  all Indebtedness and all other monetary
obligations (including, without limitation, expenses, fees, principal,
interest, reimbursement obligations under letters of credit and indemnities
payable in connection therewith) of the Company (or in respect of) the Credit Facility
or any Interest Rate Agreement or Currency Agreement relating to the
Indebtedness under the Credit Facility; provided,
however, notwithstanding anything
to the contrary in this clause (1), Senior Indebtedness shall not include any
Indebtedness of the Company, to the extent not permitted by Sections 4.09 or
4.15; and


 


(2)                                  all other Indebtedness and all other monetary
obligations of the Company (other than the Notes), including principal and
interest on such Indebtedness, unless such Indebtedness, by its terms or by the
terms of any agreement or instrument pursuant to which such Indebtedness is
issued, is on a parity with, or subordinated in right of payment to, the Notes;
provided, however, notwithstanding anything to the
contrary in this clause (2), Senior Indebtedness shall not include:


 


(A)                              any Indebtedness of the Company that, when Incurred, was without
recourse to the Company,


 


(B)                                any Indebtedness of the Company to a Subsidiary of the Company, or to a
joint venture in which the Company has an interest,


 


(C)                                any Indebtedness of the Company, to the extent not permitted by Section
4.09 or 4.15,


 


(D)                               any repurchase, redemption or other obligation in respect of
Disqualified Stock,


 


(E)                                 any Indebtedness to any employee of the
Company or any of its Subsidiaries,


 


(F)                                 any liability for taxes owed or owing by the
Company or any of its Subsidiaries or


 


(G)                                any Trade Payables.


 


“Senior Subordinated Obligations” means any principal of,
premium, if any, or interest on the Notes payable pursuant to the terms of the
Notes or upon acceleration, including any amounts received upon the exercise of
rights of rescission or other rights of action (including claims for damages)
or otherwise, to the extent relating to the purchase price of the Notes or
amounts corresponding to such principal, premium, if any, or interest on the
Notes.


 


“Significant Subsidiary” means, at any date of determination,
any Subsidiary that, together with its Subsidiaries:


 


(1)                                  for the most recent fiscal year of the
Company, accounted for more than 10% of the consolidated revenues of the
Company and its Subsidiaries or


 


(2)                                  as of the end of such fiscal year, was the
owner of more than 10% of the consolidated assets of the Company and its
Subsidiaries, all as set forth on the most recently available consolidated
financial statements of the Company for such fiscal year.


 


“Stated Maturity” means, (1) with respect to any debt
security, the date specified in such debt security as the fixed date on which
the final installment of principal of such debt security is due and


 


22

















 


payable and (2) with respect to any scheduled
installment of principal of or interest on any debt security, the date
specified in such debt security as the fixed date on which such installment is
due and payable.


 


“Subsidiary” means, with respect to any Person, any
corporation, association or other business entity of which more than 50% of the
voting power of the outstanding Voting Stock is owned, directly or indirectly,
by such Person and one or more other Subsidiaries of such Person and,
notwithstanding the occurrence of a Trigger Event, shall continue to include
Empress Joliet Corporation during the term of the Trust Agreements.


 


“Temporary Cash Investment” means any of the following:


 


(1)                                  direct obligations of the United States of
America or any agency thereof or obligations fully and unconditionally
guaranteed by the United States of America or any agency thereof;


 


(2)                                  demand deposit accounts, time deposit
accounts, certificates of deposit and money market deposits maturing within 180
days of the date of acquisition thereof issued by a bank or trust company which
is organized under the laws of the United States of America, any state thereof
or any foreign country recognized by the United States of America, and which
bank or trust company has capital, surplus and undivided profits aggregating in
excess of $100 million (or the foreign currency equivalent thereof and has
outstanding debt which is rated “A” (or such similar equivalent rating) or
higher by at least one nationally recognized statistical rating organization
(as defined in Rule 436 under the Securities Act) or any money-market fund
sponsored by a registered broker dealer or mutual fund distributor;


 


(3)                                  repurchase obligations with a term of not
more than 30 days for underlying securities of the types described in clause
(1) above entered into with a bank or trust company meeting the qualifications
described in clause (2) above;


 


(4)                                  commercial paper, maturing not more than one
year after the date of acquisition, issued by a corporation (other than an
Affiliate of the Company) organized and in existence under the laws of the
United States of America, any state thereof or any foreign country recognized
by the United States of America with a rating at the time as of which any
investment therein is made of “P-2” (or higher) according to Moody’s or “A-2”
(or higher) according to S&P;


 


(5)                                  securities with maturities of one year or
less from the date of acquisition issued or fully and conditionally guaranteed
by any state, commonwealth or territory of the United States of America, or by
any political subdivision or taxing authority thereof, and rated at least “A”
by S&P or Moody’s; and


 


(6)                                  other dollar denominated securities issued by
any Person incorporated in the United States rated at least “A” or the
equivalent by S&P or at least “A2” or the equivalent by Moody’s and in each
case either (A) maturing not more than one year after the date of acquisition
or (B) which are subject to a repricing arrangement (such as a Dutch auction)
not more than one year after the date of acquisition (and reprices at least
yearly thereafter) which the Person making the investment believes in good
faith will permit such Person to sell such security at par in connection with
such repricing mechanism.


 


“TIA” means the Trust Indenture Act of 1939, as amended (15
U.S.C. §§ 77aaa-77bbbb).


 


23

















 


“Trade Payables” means, with respect to any Person, any
accounts payable or any other indebtedness or monetary obligation to trade
creditors created, assumed or Guaranteed by such Person or any of its
Subsidiaries arising in the ordinary course of business in connection with the
acquisition of goods or services.


 


“Transaction Date” means, with respect to the Incurrence of
any Indebtedness by the Company or any of its Restricted Subsidiaries, the date
such Indebtedness is to be Incurred and, with respect to any Restricted
Payment, the date such Restricted Payment is to be made.


 


“Trigger Event” means the transfer of shares of capital stock
of Empress Casino Corporation into trust pursuant to the terms of the Trust
Agreements.


 


“Trust Agreements” means the Transfer of Ownership Agreement
by and among the Company, Empress Casino Corporation and the Illinois Gaming
Board and the Trust Agreement by and between the Company and LaSalle Bank
National Association, each dated as of July 24, 2001, together with any
agreements, instruments and documents executed or delivered pursuant to or in
connection with such agreements, in each case as such agreements, instruments
or documents may be amended, supplemented, extended, renewed or otherwise
modified from time to time.


 


“Trustee” means J.P. Morgan Trust Company, National
Association, until a successor replaces it in accordance with the applicable
provisions of this Indenture and thereafter means the successor serving
hereunder.


 


“Unrestricted Definitive Note” means a Definitive Note that
does not bear and is not required to bear the Private Placement Legend.


 


“Unrestricted Global Note” means a Global Note that does not
bear and is not required to bear the Private Placement Legend.


 


“Unrestricted Subsidiary” means:


 


(1)                                  any Subsidiary of the Company that at the
time of determination shall be designated an Unrestricted Subsidiary by the
Board of Directors in the manner provided below, and


 


(2)                                  any Subsidiary of an Unrestricted Subsidiary;


 


provided that such Subsidiary:


 


(1)                                  has no Indebtedness other than Non-Recourse
Debt;


 


(2)                                  is not party to any agreement, contract,
arrangement or understanding with the Company or any Restricted Subsidiary of
the Company unless the terms of any such agreement, contract, arrangement or
understanding are no less favorable to the Company or such Restricted Subsidiary
than those that might be obtained at the time from Persons who are not
Affiliates of the Company;


 


(3)                                  is a Person with respect to which neither the
Company nor any of its Restricted Subsidiaries has any direct or indirect
obligation (1) to subscribe for additional Equity Interests or (2) to maintain
or preserve such Person’s financial condition or to cause such Person to
achieve any specified levels of operating results; and


 


24

















 


(4)                                  has not guaranteed or otherwise directly or
indirectly provided credit support for any Indebtedness of the Company or any
of its Restricted Subsidiaries.


 


If, at any time, any
Unrestricted Subsidiary would fail to meet the preceding requirements as an
Unrestricted Subsidiary, it shall thereafter cease to be an Unrestricted
Subsidiary for purposes of this Indenture and any Indebtedness of such
Subsidiary shall be deemed to be incurred by a Restricted Subsidiary of the
Company as of such date and, if such Indebtedness is not permitted to be
incurred as of such date under Section 4.09, the Company shall be in default of
such section.


 


“U.S. Government Obligations” means securities that are


 


(1)                                  direct obligations of the United States of
America for the payment of which its full faith and credit is pledged or


 


(2)                                  obligations of a Person controlled or
supervised by and acting as an agency or instrumentality of the United States
of America the payment of which is unconditionally guaranteed as a full faith
and credit obligation by the United States of America,


 


which,
in either case, are not callable or redeemable at the option of the issuer
thereof at any time prior to the Stated Maturity of the Notes, and shall also
include a depository receipt issued by a bank or trust company as custodian
with respect to any such U.S. Government Obligation or a specific payment of
interest on or principal of any such U.S. Government Obligation held by such
custodian for the account of the holder of a depository receipt; provided that (except as required by law)
such custodian is not authorized to make any deduction from the amount payable
to the holder of such depository receipt from any amount received by the
custodian in respect of the U.S. Government Obligation or the specific payment
of interest on or principal of the U.S. Governmental Obligation evidenced by
such depository receipt.


 


“U.S. Person” means a U.S. Person as defined in Rule 902(k)
promulgated under the Securities Act.


 


“Voting Stock” means with respect to any Person, Capital
Stock of any class or kind ordinarily having the power to vote for the election
of directors, managers or other voting members of the governing body of such
Person.


 


“Wholly Owned” means, with respect to any Subsidiary of any
Person, the ownership of all of the outstanding Capital Stock of such
Subsidiary (other than any director’s qualifying shares or Investments by
foreign nationals mandated by applicable law) by such Person or one or more
Wholly Owned Subsidiaries of such Person.


 


Section
1.02                                Other Definitions.


 


	
  Term

  	
   

  	
  Defined

  in

  Section

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  “Affiliate Transaction”

  	
   

  	
  4.11

  	
   

  
	
  “Authentication Order”

  	
   

  	
  2.02

  	
   

  
	
  “Covenant Defeasance”

  	
   

  	
  8.03

  	
   

  
	
  “DTC”

  	
   

  	
  2.03

  	
   

  
	
  “Event of Default”

  	
   

  	
  6.01

  	
   

  
	
  “Excess Proceeds”

  	
   

  	
  4.10

  	
   

  



 


25

















 


	
  Term

  	
   

  	
  Defined

  in

  Section

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  “Legal Defeasance”

  	
   

  	
  8.02

  	
   

  
	
  “Paying Agent”

  	
   

  	
  2.03

  	
   

  
	
  “Permitted Debt”

  	
   

  	
  4.09

  	
   

  
	
  “Payment Blockage Notice”

  	
   

  	
  10.03

  	
   

  
	
  “Purchase Date”

  	
   

  	
  1.01

  	
   

  
	
  “Registrar”

  	
   

  	
  2.03

  	
   

  
	
  “Restricted Payments”

  	
   

  	
  4.07

  	
   

  
	
  “Suspended Covenants”

  	
   

  	
  4.19

  	
   

  



 


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;


 


“indenture to be qualified” means this Indenture;


 


“indenture trustee” or “institutional
trustee” means the Trustee; and


 


“obligor” on the Notes means the Company and any successor
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 have the meanings so assigned to
them.


 


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;


 


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


 


(5)                                  “will” shall be interpreted to express a
command;


 


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


 


26

















 


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


 


ARTICLE 2

THE NOTES


 


Section
2.01                                Form and Dating.


 


(a) General. 
The Notes and the Trustee’s certificate of authentication will be
substantially in the form of Exhibit A hereto. 
The Notes may have notations, legends or endorsements required by law,
stock exchange rule or usage.  Each Note
will 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 will 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.


 


(b)
Global Notes.  Notes issued in global form will be
substantially in the form of Exhibit A hereto (including the Global Note Legend
thereon and the “Schedule of Exchanges of Interests in the Global Note”
attached thereto).  Notes issued in
definitive form will be substantially in the form of Exhibit A hereto (but
without the Global Note Legend thereon and without the “Schedule of Exchanges
of Interests in the Global Note” attached thereto).  Each Global Note will represent such of the outstanding Notes as
will be specified therein and each shall provide that it represents 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 will be made by the Trustee or the Custodian, at the
direction of the Trustee, in accordance with instructions given by the Holder
thereof as required by Section 2.06 hereof.


 


(c)
Euroclear and Clearstream Procedures
Applicable.  The provisions
of the “Operating Procedures of the Euroclear System” and “Terms and Conditions
Governing Use of Euroclear” and the “General Terms and Conditions of
Clearstream Banking” and “Customer Handbook” of Clearstream will be applicable
to transfers of beneficial interests in the Regulation S Global Note that are
held by Participants through Euroclear or Clearstream.


 


Section
2.02                                Execution and
Authentication.


 


An Officer must sign the
Notes for the Company by manual or facsimile signature.


 


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


 


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


 


The Trustee will, upon
receipt of a written order of the Company signed by an Officer (an “Authentication Order”), authenticate and
deliver:  (i) on the date hereof, an
aggregate principal amount


 


27

















 


of $350.0 million 7% Senior Subordinated
Notes due 2014, (ii) Additional Notes issued in compliance with Section 2.14
hereof for an original issue in an aggregate principal amount specified in the
written order of the Company pursuant to this Section 2.02 and (iii) Exchange
Notes for issue only in an Exchange Offer pursuant to a registration rights
agreement, for a like principal amount of Initial Notes or Additional
Notes.  Such Authentication Order shall
specify the amount of the Notes to be authenticated and the date on which the
original issue of the Notes is to be authenticated.


 


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


 


Section
2.03                                Registrar and Paying Agent.


 


The Company will maintain an
office or agency where Notes may be presented for registration of transfer or
for exchange (“Registrar”) and an
office or agency where Notes may be presented for payment (“Paying Agent”).  The Registrar will 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 will 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 or any
of its Restricted Subsidiaries may act as Paying Agent or Registrar.


 


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


 


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


 


Section
2.04                                Paying Agent to Hold Money
in Trust.


 


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


 


Section
2.05                                Holder Lists.


 


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


 


28

















 


Holders and the Company shall otherwise
comply with TIA § 312(a).  The Trustee,
the Registrar and the Company shall provide a current list of all Holders to
any Gaming Authority upon demand.


 


Section
2.06                                Transfer and Exchange.


 


(a)  Transfer
and Exchange of Global Notes. 
A Global Note may not be transferred except as a whole by the Depositary
to a nominee of the Depositary, by a nominee of the Depositary to the
Depositary or to another nominee of the Depositary, or by the Depositary or any
such nominee to a successor Depositary or a nominee of such successor
Depositary.  All Global Notes will be
exchanged by the Company for Definitive Notes if:


 


(1)                                  the Company delivers to the Trustee notice
from the Depositary that it is unwilling or unable to continue to act as
Depositary or that it is no longer a clearing agency registered under the
Exchange Act and, in either case, a successor Depositary is not appointed by
the Company within 120 days after the date of such notice from the Depositary;


 


(2)                                  the Company in its sole discretion determines
that the Global Notes (in whole but not in part) should be exchanged for
Definitive Notes and delivers a written notice to such effect to the Trustee;
or


 


(3)                                  there has occurred and is continuing a
Default or Event of Default with respect to the Notes.


 


Upon the occurrence of
either of the preceding events in (1) or (2) above, Definitive Notes shall be
issued in such names as the Depositary shall instruct the Trustee.  Global Notes also may be exchanged or
replaced, in whole or in part, as provided in Sections 2.07 and 2.10
hereof.  Every Note authenticated and
delivered in exchange for, or in lieu of, a Global Note or any portion thereof,
pursuant to this Section 2.06 or Section 2.07 or 2.10 hereof, shall be
authenticated and delivered in the form of, and shall be, a Global Note.  A Global Note may not be exchanged for
another Note other than as provided in this Section 2.06(a), however,
beneficial interests in a Global Note may be transferred and exchanged as
provided in Section 2.06(b), (c) or (f) hereof.


 


(b)  Transfer
and Exchange of Beneficial Interests in the Global Notes.  The transfer and exchange of beneficial
interests in the Global Notes will be effected through the Depositary, in
accordance with the provisions of this Indenture and the Applicable
Procedures.  Beneficial interests in the
Restricted Global Notes will 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 will require compliance with either subparagraph (1) or (2)
below, as applicable, as well as one or more of the other following
subparagraphs, as applicable:


 


(1)                                  Transfer of Beneficial
Interests in the Same Global Note.  Beneficial interests in any
Restricted Global Note may be transferred to Persons who take delivery thereof
in the form of a beneficial interest in the same Restricted Global Note in
accordance with the transfer restrictions set forth in the Private Placement
Legend; provided, however, that
prior to the expiration of the Restricted Period, transfers of beneficial
interests in the Regulation S Global Note may not be made to a U.S. Person or
for the account or benefit of a U.S. Person (other than an Initial Purchaser).  Beneficial
interests in any Unrestricted Global Note may be transferred to Persons who
take delivery thereof in the form of a beneficial interest in an Unrestricted
Global Note.  No written orders or
instructions shall be required to be delivered to the Registrar to effect the
transfers described in this Section 2.06(b)(1).


 


29

















 


(2)                                  All Other Transfers and
Exchanges of Beneficial Interests in Global Notes.  In
connection with all transfers and exchanges of beneficial interests that are
not subject to Section 2.06(b)(1) above, the transferor of such beneficial
interest must deliver to the Registrar either:


 


(A)                              both:


 


(i)                                     a written order from a Participant or an
Indirect Participant given to the Depositary in accordance with the Applicable
Procedures directing the Depositary to credit or cause to be credited a
beneficial interest in another Global Note in an amount equal to the beneficial
interest to be transferred or exchanged; and


 


(ii)                                  instructions given in accordance with the
Applicable Procedures containing information regarding the Participant account
to be credited with such increase; or


 


(B)                                both:


 


(iii)                               a written order from a Participant or an Indirect Participant given to
the Depositary in accordance with the Applicable Procedures directing the
Depositary to cause to be issued a Definitive Note in an amount equal to the
beneficial interest to be transferred or exchanged; and


 


(iv)                              instructions given by the Depositary to the Registrar containing
information regarding the Person in whose name such Definitive Note shall be
registered to effect the transfer or exchange referred to in (1) above.


 


Upon
consummation of an Exchange Offer by the Company in accordance with Section
2.06(f) hereof, the requirements of this Section 2.06(b)(2) shall be deemed to
have been satisfied upon receipt by the Registrar of the instructions contained
in the Letter of Transmittal delivered by the Holder of such beneficial
interests in the Restricted Global Notes. 
Upon satisfaction of all of the requirements for transfer or exchange of
beneficial interests in Global Notes contained in this Indenture and the Notes
or otherwise applicable under the Securities Act, the Trustee shall adjust the
principal amount of the relevant Global Note(s) pursuant to Section 2.06(h)
hereof.


 


(3)                                  Transfer of Beneficial
Interests to Another Restricted Global Note.  A beneficial interest in any
Restricted Global Note may be transferred to a Person who takes delivery
thereof in the form of a beneficial interest in another Restricted Global Note
if the transfer complies with the requirements of Section 2.06(b)(2) above and
the Registrar receives the following:


 


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


 


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


 


(4)                                  Transfer and Exchange of
Beneficial Interests in a Restricted Global Note for Beneficial Interests in an
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


 


30



















Global Note or transferred to a Person who takes delivery
thereof in the form of a beneficial interest in an Unrestricted Global Note if
the exchange or transfer complies with the requirements of Section 2.06(b)(2)
above and:


 


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


 


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


 


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


 


(D)                               the Registrar receives the
following:


 


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


 


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


 


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


 


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


 


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


 


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


 


(1)                                  Beneficial Interests in Restricted Global Notes to
Restricted Definitive Notes.  If any holder
of a beneficial interest in a Restricted Global Note proposes to exchange such
beneficial interest for a Restricted Definitive Note or to transfer such
beneficial interest to a


 


31

















 


Person who takes delivery thereof in the form of a Restricted
Definitive Note, then, upon receipt by the Registrar of the following
documentation:


 


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


 


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


 


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


 


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


 


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


 


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


 


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


 


the Trustee shall
cause the aggregate principal amount of the applicable Global Note to be
reduced accordingly pursuant to Section 2.06(h) hereof, and the Company shall
execute and the Trustee shall authenticate and deliver to the Person designated
in the instructions a Definitive Note in the appropriate principal amount.  Any Definitive Note issued in exchange for a
beneficial interest in a Restricted Global Note pursuant to this Section
2.06(c) shall be registered in such name or names and in such authorized
denomination or denominations as the holder of such beneficial interest shall
instruct the Registrar through instructions from the Depositary and the
Participant or Indirect Participant. 
The Trustee shall deliver such Definitive Notes to the Persons in whose
names such Notes are so registered.  Any
Definitive Note issued in exchange for a beneficial interest in a Restricted
Global Note pursuant to this Section 2.06(c)(1) shall bear the Private
Placement Legend and shall be subject to all restrictions on transfer contained
therein.


 


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


 


32

















 


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


 


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


 


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


 


(D)                               the Registrar receives the
following:


 


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


 


(ii)                                  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 an
Unrestricted Definitive Note, a certificate from such holder in the form of
Exhibit B hereto, including the certifications in item (4) thereof;


 


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


 


(3)                                  Beneficial Interests in Unrestricted Global Notes to
Unrestricted Definitive Notes.  If any holder
of a beneficial interest in an Unrestricted Global Note proposes to exchange
such beneficial interest for a Definitive Note or to transfer such beneficial
interest to a Person who takes delivery thereof in the form of a Definitive
Note, then, upon satisfaction of the conditions set forth in Section 2.06(b)(2)
hereof, the Trustee will cause the aggregate principal amount of the applicable
Global Note to be reduced accordingly pursuant to Section 2.06(h) hereof, and
the Company will execute and the Trustee will authenticate and deliver to the
Person designated in the instructions a Definitive Note in the appropriate
principal amount.  Any Definitive Note
issued in exchange for a beneficial interest pursuant to this Section
2.06(c)(3) will be registered in such name or names and in such authorized
denomination or denominations as the holder of such beneficial interest
requests through instructions to the Registrar from or through the Depositary
and the Participant or Indirect Participant. 
The Trustee will deliver such Definitive Notes to the Persons in whose
names such Notes are so registered.  Any
Definitive Note issued in exchange for a beneficial interest pursuant to this
Section 2.06(c)(3) will not bear the Private Placement Legend.


 


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


 


33

















 


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


 


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


 


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


 


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


 


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


 


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


 


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


 


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


 


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


 


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


 


(A)                              such exchange or transfer is
effected pursuant to the Exchange Offer in accordance with the Registration
Rights Agreement and the Holder, in the case of an exchange, or the transferee,
in the case of a transfer, certifies in the applicable Letter of


 


34

















 


Transmittal that it is not (i) a Broker-Dealer, (ii) a Person
participating in the distribution of the Exchange Notes or (iii) a Person who
is an affiliate (as defined in Rule 144) of the Company;


 


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


 


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


 


(D)                               the Registrar receives the
following:


 


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


 


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


 


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


 


Upon satisfaction of the conditions of any of the
subparagraphs in this Section 2.06(d)(2), the Trustee will cancel the
Definitive Notes and increase or cause to be increased the aggregate principal
amount of the Unrestricted Global Note.


 


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


 


If any such exchange or
transfer from a Definitive Note to a beneficial interest is effected pursuant to
subparagraphs (2)(B), (2)(D) or (3) above at a time when an Unrestricted Global
Note has not yet been issued, the Company will issue and, upon receipt of an
Authentication Order in accordance with Section 2.02 hereof, the Trustee will
authenticate one or more Unrestricted Global Notes in an aggregate principal
amount equal to the principal amount of Definitive Notes so transferred.


 


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


 


35

















 


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


 


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


 


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


 


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


 


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


 


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


 


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


 


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


 


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


 


(D)                               the Registrar receives the
following:


 


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


 


(ii)                                  if the Holder of such Restricted
Definitive Notes proposes to transfer such Notes to a Person who shall take
delivery thereof in the form of an


 


36

















 


Unrestricted
Definitive Note, a certificate from such Holder in the form of Exhibit B
hereto, including the certifications in item (4) thereof;


 


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


 


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


 


(f)            Exchange Offer.  Upon the
occurrence of the Exchange Offer in accordance with the Registration Rights
Agreement, the Company will issue and, upon receipt of an Authentication Order
in accordance with Section 2.02 hereof, the Trustee will authenticate:


 


(1)                                  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 accepted for exchange in
the Exchange Offer by Persons that certify in the applicable Letters of
Transmittal that (A) they are not Broker-Dealers, (B) they are not
participating in a distribution of the Exchange Notes and (C) they are not
affiliates (as defined in Rule 144) of the Company; and


 


(2)                                  Unrestricted Definitive Notes in an
aggregate principal amount equal to the principal amount of the Restricted
Definitive Notes accepted for exchange in the Exchange Offer by Persons that
certify in the applicable Letters of Transmittal that (A) they are not
Broker-Dealers, (B) they are not participating in a distribution of the
Exchange Notes and (C) they are not affiliates (as defined in Rule 144) of the
Company.


 


Concurrently with the issuance of such Notes, the
Trustee will cause the aggregate principal amount of the applicable Restricted
Global Notes to be reduced accordingly, and the Company will execute and the
Trustee will authenticate and deliver to the Persons designated by the Holders
of Definitive Notes so accepted Unrestricted Definitive Notes in the
appropriate principal amount.


 


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


 


(1)                                  Private Placement
Legend.


 


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


 


“THIS NOTE HAS NOT
BEEN REGISTERED UNDER THE U.S. SECURITIES ACT OF 1933, AS AMENDED (THE “SECURITIES ACT”) AND, ACCORDINGLY, MAY NOT
BE OFFERED OR SOLD WITHIN THE UNITED STATES OR TO, OR FOR THE ACCOUNT OR
BENEFIT OF, U.S. PERSONS EXCEPT AS SET FORTH IN THE FOLLOWING SENTENCE.  BY ITS ACQUISITION HEREOF, THE HOLDER (1)
REPRESENTS THAT (A) IT IS A “QUALIFIED INSTITUTIONAL


 


37

















 


BUYER” (AS DEFINED
IN RULE 144A UNDER THE SECURITIES ACT) OR (B) IT IS NOT A U.S. PERSON AND IS
ACQUIRING THIS NOTE IN AN OFFSHORE TRANSACTION IN COMPLIANCE WITH REGULATION S
UNDER THE SECURITIES ACT; (2) AGREES THAT IT WILL NOT, PRIOR TO EXPIRATION
OF THE HOLDING PERIOD APPLICABLE TO SALES OF THIS NOTE UNDER RULE 144(K) UNDER
THE SECURITIES ACT (OR ANY SUCCESSOR PROVISION), RESELL OR OTHERWISE TRANSFER
THIS NOTE EXCEPT (A) TO ARGOSY GAMING COMPANY OR ANY SUBSIDIARY THEREOF, (B)
INSIDE THE UNITED STATES TO A QUALIFIED INSTITUTIONAL BUYER IN COMPLIANCE WITH
RULE 144A UNDER THE SECURITIES ACT, (C) OUTSIDE THE UNITED STATES IN AN
OFFSHORE TRANSACTION IN COMPLIANCE WITH RULE 904 UNDER THE SECURITIES ACT, (D)
PURSUANT TO THE EXEMPTION FROM REGISTRATION PROVIDED BY RULE 144 UNDER THE
SECURITIES ACT (IF AVAILABLE), (E) INSIDE THE UNITED STATES TO AN
INSTITUTIONAL ACCREDITED INVESTOR THAT, PRIOR TO SUCH TRANSFER, FURNISHES TO
THE TRUSTEE A SIGNED LETTER CONTAINING CERTAIN REPRESENTATIONS AND AGREEMENTS
RELATING TO THE RESTRICTIONS ON TRANSFER OF THIS NOTE (THE FORM OF WHICH LETTER
CAN BE OBTAINED FROM THE TRUSTEE) AND, IF SUCH TRANSFER IS IN RESPECT OF AN
AGGREGATE PRINCIPAL AMOUNT OF NOTES OF LESS THAN $100,000, AN OPINION OF
COUNSEL ACCEPTABLE TO THE COMPANY THAT SUCH TRANSFER IS IN COMPLIANCE WITH THE
SECURITIES ACT, OR (F) PURSUANT TO A REGISTRATION STATEMENT WHICH HAS BEEN
DECLARED EFFECTIVE UNDER THE SECURITIES ACT (AND WHICH CONTINUES TO BE
EFFECTIVE AT THE TIME OF SUCH TRANSFER); AND (3) AGREES THAT IT WILL DELIVER TO
EACH PERSON TO WHOM THIS NOTE IS TRANSFERRED A NOTICE SUBSTANTIALLY TO THE
EFFECT OF THIS LEGEND.  IN CONNECTION
WITH ANY TRANSFER OF THIS NOTE, PRIOR TO THE EXPIRATION OF THE HOLDING PERIOD
APPLICABLE TO SALES OF THIS NOTE UNDER RULE 144(K) UNDER THE SECURITIES ACT (OR
ANY SUCCESSOR PROVISION), THE HOLDER MUST CHECK THE APPROPRIATE BOX SET FORTH
ON THE REVERSE HEREOF RELATING TO THE MANNER OF SUCH TRANSFER AND SUBMIT THIS
CERTIFICATE TO J.P. MORGAN TRUST COMPANY, NATIONAL ASSOCIATION, AS TRUSTEE (OR
A SUCCESSOR TRUSTEE, AS APPLICABLE).  IF
THE PROPOSED TRANSFEREE IS AN INSTITUTIONAL ACCREDITED INVESTOR OR A PURCHASER
WHO IS NOT A U.S. PERSON, THE HOLDER MUST, PRIOR TO SUCH TRANSFER, FURNISH TO
THE TRUSTEE AND THE COMPANY SUCH CERTIFICATIONS, LEGAL OPINIONS, OR OTHER
INFORMATION AS EITHER OF THEM MAY REASONABLY REQUIRE TO CONFIRM THAT SUCH
TRANSFER IS BEING MADE PURSUANT TO AN EXEMPTION FROM, OR IN A TRANSACTION NOT
SUBJECT TO, THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT.  THIS LEGEND WILL BE REMOVED UPON THE EARLIER
OF THE TRANSFER OF THIS NOTE PURSUANT TO CLAUSE 2(F) ABOVE OR UPON ANY TRANSFER
OF THIS NOTE UNDER RULE 144(K) UNDER THE SECURITIES ACT (OR ANY SUCCESSOR
PROVISION).  AS USED HEREIN, THE TERMS
“OFFSHORE TRANSACTION,” “UNITED STATES” AND “U.S. PERSON” HAVE THE MEANINGS
GIVEN TO THEM BY REGULATION S UNDER THE SECURITIES ACT.”


 


(B)                                Notwithstanding the foregoing, any
Global Note or Definitive Note issued pursuant to subparagraphs (b)(4), (c)(2),
(c)(3), (d)(2), (d)(3), (e)(2), (e)(3) or (f) of this Section 2.06 (and all
Notes issued in exchange therefor or substitution thereof) will not bear the
Private Placement Legend.


 


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


 


38

















 


“THIS GLOBAL NOTE
IS HELD BY THE DEPOSITARY (AS DEFINED IN THE INDENTURE GOVERNING THIS NOTE) OR
ITS NOMINEE IN CUSTODY FOR THE BENEFIT OF THE BENEFICIAL OWNERS HEREOF, AND IS
NOT TRANSFERABLE TO ANY PERSON UNDER ANY CIRCUMSTANCES EXCEPT THAT (1) THE
TRUSTEE MAY MAKE SUCH NOTATIONS HEREON AS MAY BE REQUIRED PURSUANT TO SECTION
2.06 OF THE INDENTURE, (2) THIS GLOBAL NOTE MAY BE EXCHANGED IN WHOLE BUT NOT
IN PART PURSUANT TO SECTION 2.06(a) OF THE INDENTURE, (3) THIS GLOBAL NOTE MAY
BE DELIVERED TO THE TRUSTEE FOR CANCELLATION PURSUANT TO SECTION 2.11 OF THE
INDENTURE AND (4) THIS GLOBAL NOTE MAY BE TRANSFERRED TO A SUCCESSOR DEPOSITARY
WITH THE PRIOR WRITTEN CONSENT OF THE COMPANY.


 


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


 


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


 


(i)             General Provisions
Relating to Transfers and Exchanges.


 


(1)                                  To permit registrations of transfers
and exchanges, the Company will execute and the Trustee will authenticate
Global Notes and Definitive Notes upon receipt of an Authentication Order in
accordance with Section 2.02 hereof or at the Registrar’s request.


 


(2)                                  No service charge will be made to a
Holder of a beneficial interest in a Global Note or to a Holder of a Definitive
Note for any registration of transfer or exchange, 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


 


39

















 


similar governmental charge payable
upon exchange or transfer pursuant to Sections 2.10, 3.06,  4.10, 4.14 and 9.05 hereof).


 


(3)                                  The Registrar will not be required
to register the transfer of or exchange of any Note selected for redemption in
whole or in part, except the unredeemed portion of any Note being redeemed in
part or upon the order of any Gaming Authority.


 


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


 


(5)                                  Neither the Registrar nor the
Company will be required:


 


(A)                              to issue, to register the transfer
of or to exchange any Notes during a period beginning at the opening of
business 15 days before the day of any selection of Notes for redemption under
Section 3.02 hereof and ending at the close of business on the day of
selection;


 


(B)                                to register the transfer of or to
exchange any Note 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.


 


(6)                                  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 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.


 


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


 


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


 


Section 2.07                                Replacement
Notes.


 


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


 


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


 


40

















 


Section 2.08                                Outstanding
Notes.


 


The Notes outstanding at any time are all the Notes
authenticated by the Trustee except for those canceled by it, those delivered
to it for cancellation, those reductions in the interest in a Global Note
effected by the Trustee in accordance with the provisions hereof, and those
described in this Section 2.08 as not outstanding.  Except as set forth in Section 2.09 hereof, a Note does not cease
to be outstanding because the Company or an Affiliate of the Company holds the
Note; however, Notes held by the Company or a Subsidiary of the Company shall
not be deemed to be outstanding for purposes of Section 3.07(a) hereof.


 


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


 


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


 


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


 


Section 2.09                                Treasury Notes.


 


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


 


Section 2.10                                Temporary Notes.


 


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


 


Holders of temporary Notes will 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 will forward to the Trustee any Notes surrendered to them for
registration of transfer, exchange or payment. 
The Trustee and no one else will cancel all Notes surrendered for
registration of transfer, exchange, payment, replacement or cancellation and
will destroy canceled Notes (subject to the record retention requirement of the
Exchange Act).  Certification of the
destruction of all canceled Notes will be delivered to the Company.  Subject to Section 2.07, the Company may not
issue new Notes to replace Notes that it has paid or that have been delivered
to the Trustee for cancellation.


 


41

















 


Section 2.12                                Defaulted Interest.


 


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


 


Section 2.13                                CusiP Numbers.


 


The Company in issuing the Notes may use CUSIP, ISIN
or other such numbers (if then generally in use), and, if so, the Trustee shall
use CUSIP, ISIN or other such 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 of such numbers either as
printed on the Notes or as contained in any notice of a redemption or exchange
and that reliance may be placed only on the other identification numbers
printed on the Notes, and any such redemption or exchange shall not be affected
by any defect in or omission of such numbers. 
The Company shall promptly notify the Trustee of any change in the
CUSIP, ISIN or other numbers.


 


Section 2.14                                Issuance of Additional
Notes.


 


The Company shall be entitled, from time to time,
subject to its compliance with Article 4, without consent of the Holders, to
issue Additional Notes under this Indenture with identical terms as the Initial
Notes issued on the Closing Date other than with respect to (i) the date of
issuance, (ii) the issue price, (iii) the amount of interest payable on the
first interest payment date and (iv) any adjustments in order to conform to and
ensure compliance with the Securities Act (or other applicable securities
laws).  The Initial Notes issued on the
Closing Date, any Additional Notes and all Exchange Notes issued in exchange
therefor shall be treated as a single class for all purposes under this
Indenture.


 


With respect to
any Additional Notes, the Company shall set forth in an Officers’ Certificate
pursuant to a resolution of the Board of Directors of the Company, copies of
which shall be delivered to the Trustee, the following information:


 


(1)                                  the aggregate principal amount of
such Additional Notes to be authenticated and delivered pursuant to this
Indenture;


 


(2)                                  the issue price, the issue date and
the CUSIP number of such Additional Notes; provided,
however, that no Additional Notes
may be issued at a price that would cause such Additional Notes to have
“original issue discount” within the meaning of Section 1273 of the
Internal Revenue Code of 1986, as amended; and


 


(3)                                  whether such Additional Notes shall
be Restricted Notes or shall be issued in the form of Exchange Notes.


 


42

















 


ARTICLE 3

REDEMPTION AND PREPAYMENT


 


Section 3.01                                Notices to Trustee.


 


If the Company elects to redeem Notes pursuant to the
optional redemption provisions of Section 3.07 hereof, it must furnish to the
Trustee, a reasonable time prior to the redemption notice period set forth in
Section 3.03 or such other time as shall be required by order of any applicable
Gaming Authority, an Officers’ Certificate setting forth:


 


(1)                                  the clause of this Indenture
pursuant to which the redemption shall occur;


 


(2)                                  the redemption date;


 


(3)                                  the principal amount of Notes to be
redeemed; and


 


(4)                                  the redemption price.


 


Section 3.02                                Selection of Notes
to Be Redeemed or Purchased.


 


If less than all of the Notes are to be redeemed or
purchased in an Offer to Purchase at any time, the Trustee will select Notes
for redemption or purchase on a pro rata
basis except:


 


(1)                                  if the Notes are listed on any
national securities exchange, in compliance with the requirements of the
principal national securities exchange on which the Notes are listed; or


 


(2)                                  if otherwise required by law.


 


In the event of partial redemption or purchase by lot,
the particular Notes to be redeemed or purchased will be selected, unless
otherwise provided herein, not less than 30 nor more than 60 days prior to the
redemption or purchase date by the Trustee from the outstanding Notes not
previously called for redemption or purchase.


 


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


 


Section 3.03                                Notice of Redemption.


 


Subject to the provisions of Section 4.10, at least 30
days but not more than 60 days before a redemption date or such other time as
shall be required by order of any applicable Gaming Authority, the Company will
mail or cause to be mailed, by first class mail, a notice of redemption to each
Holder whose Notes are to be redeemed at its registered address, except that
redemption notices may be mailed more than 60 days prior to a redemption date
if the notice is issued in connection with a defeasance of the Notes or a
satisfaction and discharge of this Indenture pursuant to Article 8 hereof.


 


43

















 


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


 


(1)                                  the redemption date;


 


(2)                                  the redemption price;


 


(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 upon
cancellation of the original Note;


 


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


 


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


 


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


 


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


 


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


 


At the Company’s request, the Trustee will give the
notice of redemption in the Company’s name and at its expense; provided,
however, that the Company has delivered to the Trustee, pursuant to
Section 3.01, an Officers’ Certificate requesting that the Trustee give such
notice and setting forth the information to be stated in such notice as
provided in the preceding paragraph.


 


Section 3.04                                                                     Effect of Notice of
Redemption.


 


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


 


Section 3.05                                Deposit of
Redemption or Purchase Price.


 


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


 


If the Company complies with the provisions of the
preceding paragraph, on and after the redemption or purchase date, interest
will cease to accrue on the Notes or the portions of Notes called for
redemption or purchase.  If a Note is
redeemed or purchased 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


 


44

















 


for redemption or
purchase is not so paid upon surrender for redemption or purchase because of
the failure of the Company to comply with the preceding paragraph, interest
shall be paid on the unpaid principal, from the redemption or purchase date
until such principal is paid, and to the extent lawful on any interest not paid
on such unpaid principal, in each case at the rate provided in the Notes and in
Section 4.01 hereof.


 


Section 3.06                                Notes Redeemed or
Purchased in Part.


 


Upon surrender of a Note that is redeemed or purchased
in part, the Company will issue and, upon receipt of an Authentication Order, the
Trustee will authenticate for the Holder at the expense of the Company a new
Note equal in principal amount to the unredeemed or unpurchased portion of the
Note surrendered.


 


Section 3.07                                Optional Redemption.


 


(a)          At any time prior to
January 15, 2007, the Company may on any one or more occasions redeem up
to 35% of the aggregate principal amount of Notes issued under this Indenture
at a redemption price of 107.0% of the principal amount thereof, plus accrued
and unpaid interest and Additional Interest, if any, to the redemption date (subject to the right of Holders of record on the
relevant record date that is on or prior to the redemption date to receive
interest due on an interest payment date), with the Net Cash Proceeds of
one or more Equity Offerings; provided that:


 


(1)                                  at least 65% of the aggregate
principal amount of Notes issued under this Indenture remains outstanding
immediately after the occurrence of such redemption (excluding Notes held by
the Company and its Subsidiaries); and


 


(2)                                  the redemption occurs within 60 days
of the date of the closing of such Equity Offering.


 


(b)         Except pursuant to Section 3.07(a),
the Notes will not be redeemable at the Company’s option prior to
January 15, 2009.


 


(c)          On or after January 15, 2009,
the Company may redeem all or a part of the Notes upon not less than 30 nor
more than 60 days’ notice, at the redemption prices (expressed as percentages
of principal amount) set forth below plus accrued and unpaid interest and
Additional Interest, if any, on the Notes redeemed to the applicable redemption
date (subject to the right of Holders on the
relevant record date that is on or prior to the redemption date to receive
interest due on an interest payment date), if redeemed during the
twelve-month period beginning on January 15 of the years indicated below:


 


	
  Year

  	
   

  	
  Percentage

  	
   

  
	
  2009

  	
   

  	
  103.500

  	
  %

  
	
  2010

  	
   

  	
  102.333

  	
  %

  
	
  2011

  	
   

  	
  101.167

  	
  %

  
	
  2012 and thereafter

  	
   

  	
  100.000

  	
  %

  



 


Unless the Company defaults in the payment of the
redemption price, interest will cease to accrue on the Notes or portions
thereof called for redemption on the applicable redemption date.


 


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


 


 


45

















 


Section 3.08                                Gaming Redemption.


 


Notwithstanding any other provision of this Indenture,
if any Gaming Authority:


 


(1)                                  requests
or requires a Holder or Beneficial Owner of Notes to appear before, submit to
the jurisdiction of or provide information to, such Gaming Authority and such
Holder or Beneficial Owner either refuses to do so or otherwise fails to comply
with such request or requirement within a reasonable period of time; or


 


(2)                                  determines
that any Holder or Beneficial Owner of Notes is not suitable or qualified with
respect to beneficial ownership of the Notes,


 


then the Company may:


 


(1)                                  require
that such Holder or Beneficial Owner dispose of its Notes within 30 days
(or such earlier date as required by the Gaming Authority) of (1) the
termination of the 30-day period described in this Section 3.08 for the Holder
or Beneficial Owner to apply for a license, qualification or finding of
suitability or (2) the receipt of the notice from the Gaming Authority
that the Holder or Beneficial Owner will not be licensed, qualified or found
suitable; or


 


(2)                                  redeem
the Notes of such Holder or Beneficial Owner at a price equal to the lesser of
(1) the price at which such Holder or Beneficial Owner acquired such Notes
or (2) the Fair Market Value of such Notes or, if the Notes are listed on
a national securities exchange, the last reported sale price on the date the
Company notifies such Holder or Beneficial Owner of the redemption.


 


Immediately upon a determination that a Holder or
Beneficial Owner will not be licensed, qualified or found suitable, the Holder
or Beneficial Owner will have no further rights (1) to exercise any right
conferred by the Notes, directly or indirectly, through any trustee, nominee or
any other Person or entity, or (2) to receive any interest or other
distribution or payment with respect to the Notes or any remuneration in any
form from the Company for services rendered or otherwise, except the redemption
price of the Notes.  The Holder or Beneficial
Owner applying for a license, qualification or finding of suitability must pay
all costs of the licensure or investigation for such qualification or finding
of suitability.


 


Section 3.09                                Mandatory Redemption.


 


The Company is not required to make mandatory
redemption or sinking fund payments with respect to the Notes.


 


ARTICLE 4

COVENANTS


 


Section 4.01                                Payment of Notes.


 


The Company will pay or cause to be paid the principal
of, premium, if any, and interest and Additional Interest, if any, on, the
Notes on the dates and in the manner provided in the Notes.  Principal, premium, if any, and interest and
Additional Interest, if any will be considered paid on the date due if the
Paying Agent, if other than the Company or a Subsidiary thereof, holds as of 10:00
a.m. Eastern Time on the due date money deposited by the Company in immediately
available funds and designated for and


 


46

















 


sufficient to pay
all principal, premium, if any, and interest then due.  The Company will pay all Additional
Interest, if any, in the same manner on the dates and in the amounts set forth
in the Registration Rights Agreement.


 


The Company will pay interest (including post-petition
interest in any proceeding under any Bankruptcy Law) on overdue principal at
the rate equal to the then applicable interest rate on the Notes to the extent
lawful; it will pay interest (including post-petition interest in any
proceeding under any Bankruptcy Law) on overdue installments of interest and
Additional Interest (without regard to any applicable grace period) at the same
rate to the extent lawful.


 


Section 4.02                                Maintenance of
Office or Agency.


 


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


 


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


 


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


 


Section 4.03                                Reports.


 


(a)          Whether or not required by the rules
and regulations of the SEC, so long as any Notes are outstanding, the Company
will furnish to the Holders or cause the Trustee to furnish to the Holders,
within the time periods specified in the SEC’s rules and regulations:


 


(1)                                  all quarterly and annual reports
that would be required to be filed with the SEC on Forms 10-Q and 10-K if the
Company were required to file reports; and


 


(2)                                  all current reports that would be
required to be filed with the SEC on Form 8-K if the Company were required to
file such reports.


 


The availability of the foregoing materials on the
SEC’s EDGAR service shall be deemed to satisfy the Company’s delivery
obligations.


 


All such reports will be prepared in all material
respects in accordance with all of the rules and regulations applicable to such
reports.  Each annual report on Form
10-K will include a report on the Company’s consolidated financial statements
by the Company’s certified independent accountants.  The Company will file a copy of each of the reports referred to
in Section 4.03(a)(1) and (2) with the SEC for public availability within the
time periods specified in the rules and regulations applicable to such reports


 


47

















 


(unless the SEC
will not accept such a filing) and will post the reports on its website within
those time periods.


 


If, at any time the Company is no longer subject to
the periodic reporting requirements of the Exchange Act for any reason, the
Company will nevertheless continue filing the reports specified in the
preceding paragraph with the SEC within the time periods specified above unless
the SEC will not accept such a filing. 
The Company will not take any action for the purpose of causing the SEC
not to accept any such filings.  If,
notwithstanding the foregoing, the SEC will not accept the Company’s filings
for any reason, the Company will post the reports referred to in the preceding
paragraph on its website within the time periods that would apply if the
Company were required to file those reports with the SEC.


 


(b)         For so long as any Notes remain
outstanding, if at any time it is not required to file with the SEC the reports
required by the preceding paragraphs of this Section 4.03, the Company will
furnish to the Holders and to securities analysts and prospective investors,
upon their request, the information required to be delivered pursuant to Rule
144A(d)(4) under the Securities Act.


 


Section 4.04                                Compliance
Certificate.


 


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


 


(b)         So long as any of the Notes are
outstanding, the Company will deliver to the Trustee, forthwith upon any
Officer becoming aware of any Default or Event of Default, an Officers’
Certificate specifying such Default or Event of Default and what action the
Company is taking or proposes to take with respect thereto.


 


Section 4.05                                Taxes.


 


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


 


Section 4.06                                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,
that may affect the covenants or the performance of this Indenture; and the
Company (to the extent that 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


 


48

















 


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 4.07                                              Restricted Payments.


 


(a)          The Company will not, and will not
permit any Restricted Subsidiary to, directly or indirectly:


 


(1)                                  declare or pay any dividend or make
any distribution on or with respect to the Company’s or any Restricted
Subsidiary’s Capital Stock (other than dividends or distributions payable
solely in shares of its Capital Stock (other than Disqualified Stock) or in
options, warrants or other rights to acquire shares of such Capital Stock) held
by Persons other than the Company or any of its Restricted Subsidiaries,


 


(2)                                  purchase, redeem, retire or
otherwise acquire for value any shares of Capital Stock of the Company or any
Subsidiary of the Company (including options, warrants or other rights to
acquire such shares of Capital Stock) held by any Person;


 


(3)                                  make any voluntary or optional
principal payment, or voluntary or optional redemption, repurchase, defeasance,
or other acquisition or retirement for value, of Indebtedness of the Company
that is subordinated in right of payment to the Notes, as the case may be; or


 


(4)                                  make any Investment, other than a
Permitted Investment in any Person (such payments or any other actions set
forth in clauses (1) through (4) of this Section 4.07(a) being collectively “Restricted Payments”);


 


if, at the time of and after giving effect to the
proposed Restricted Payment:


 


(A)                              a
Default or Event of Default shall have occurred and be continuing,


 


(B)                                the
Company could not Incur at least $1.00 of Indebtedness pursuant to the Interest
Coverage Ratio test set forth in Section 4.09(a) or


 


(C)                                the
aggregate amount of all Restricted Payments, including Investments deemed to be
made pursuant to the proviso set forth in clause (6) of the definition of
“Permitted Investments,” (the amount of any Restricted Payment with a Fair
Market Value in excess of $5.0 million, if other than in cash, to be determined
in good faith by the Board of Directors whose determination shall be conclusive
and evidenced by a resolution of the Board of Directors), made from and after
July 1, 1999 shall exceed the sum, without duplication, of


 


(I)                                    50%
of the aggregate amount of the Adjusted Consolidated Net Income (or, if the
Adjusted Consolidated Net Income is a loss, minus 100% of the amount of such
loss) (determined by excluding income resulting from transfers of assets by the
Company or a Restricted Subsidiary to an Unrestricted Subsidiary) accrued on a
cumulative basis during the period (taken as one accounting period) beginning
on July 1, 1999 and ending on the last day of the last fiscal quarter preceding
the Transaction Date for which reports have been filed with the SEC or provided
to the Trustee; plus


 


(II)                                the
aggregate Cash Proceeds received by the Company after July 1, 1999 from the
issuance and sale permitted by this Indenture (or in the case of an issuance or
sale occurring prior to the date of this Indenture, permitted by the Existing
Indentures) of


 


49

















 


its Capital Stock (other than Disqualified Stock) to a
Person who is not a Subsidiary of the Company, including an issuance or sale
permitted by this Indenture (or in the case of an issuance or sale occurring
prior to the date of this Indenture, permitted by the Existing Indentures) of
convertible or exchangeable Indebtedness of the Company for cash after July 1,
1999 upon the conversion of such Indebtedness into Capital Stock (other than
Disqualified Stock) of the Company, or from the issuance after July 1, 1999 to
a Person who is not a Subsidiary of the Company of any options, warrants or
other rights to acquire Capital Stock of the Company (in each case, exclusive
of any Disqualified Stock or any options, warrants or other rights that are
redeemable at the option of the Holder, or are required to be redeemed, prior
to the Stated Maturity of the Notes); plus


 


(III)                            an amount equal to the net
reduction in Investments made after July 1, 1999 and treated as Restricted
Payments under this Indenture or the Existing Indentures in any Person
resulting from payments of interest on Indebtedness, dividends, repayments of
loans or advances, or other transfers of assets, in each case to the Company or
any Restricted Subsidiary or from the Net Cash Proceeds from the sale of any
such Investment (except, in each case, to the extent any such payment or
proceeds are included in the calculation of Adjusted Consolidated Net Income),
or to the extent that any Unrestricted Subsidiary of the Company designated as
such after July 1, 1999 is redesignated as a Restricted Subsidiary, an amount
equal to the value of the Company’s Investment in such Unrestricted Subsidiary
(valued in each case as provided in the definition of “Investment”), not to
exceed, in each case, the amount of Investments previously made by the Company
or any Restricted Subsidiary in such Person or Unrestricted Subsidiary that
were treated as Restricted Payments under this Indenture or the Existing
Indentures.


 


(b)         The foregoing provision shall not be
violated by reason of:


 


(1)                                  the payment of any dividend within
60 days after the date of declaration thereof if, at said date of declaration,
such payment would comply with the foregoing provision of this Indenture;


 


(2)                                  the redemption, repurchase,
defeasance or other acquisition or retirement for value of Indebtedness that is
subordinated in right of payment to the Notes including premium, if any, and
accrued and unpaid interest, with the proceeds of, or in exchange for,
Indebtedness Incurred under Section 4.09(b)(3);


 


(3)                                  the repurchase, redemption or other
acquisition of Capital Stock of the Company or an Unrestricted Subsidiary (or
options, warrants or other rights to acquire such Capital Stock) in exchange
for, or out of the proceeds of a substantially concurrent offering of, shares
of Capital Stock (other than Disqualified Stock) of the Company (or options,
warrants or other rights to acquire such Capital Stock);


 


(4)                                  the making of any principal payment
or the repurchase, redemption, retirement, defeasance or other acquisition for
value of Indebtedness of the Company which is subordinated in right of payment
to the Notes in exchange for, or out of the proceeds of, a substantially
concurrent offering of, shares of the Capital Stock (other than Disqualified
Stock) of the Company (or options, warrants or other rights to acquire such
Capital Stock);


 


(5)                                  payments or distributions, to
dissenting stockholders pursuant to applicable law, pursuant to or in
connection with a consolidation, merger or transfer of assets that complies
with


 


50

















 


 


the provisions of this Indenture
applicable to mergers, consolidations and transfers of all of the property and
assets of the Company;


 


(6)                                  pro rata dividends or distributions on Common Stock of
Restricted Subsidiaries held by minority stockholders;


 


(7)                                  the redemption or repurchase of any
debt or equity securities of the Company or any Restricted Subsidiary required
by, and in accordance with any order of any Gaming Authority, provided, that the Company has used its
reasonable best efforts to effect a disposition of such securities to a
third-party and has been unable to do so; or


 


(8)                                  other Restricted Payments in an
aggregate amount not to exceed $80.0 million;


 


provided
that, except in the case of clauses (1) and (3), no Default
or Event of Default shall have occurred and be continuing or occur as a
consequence of the actions or payments set forth therein.


 


Each Restricted Payment made subsequent to July 1,
1999 and permitted pursuant to Section 4.07(b) (other than Restricted Payments
referred to in clause (2) thereof, an exchange of Capital Stock for Capital
Stock or Indebtedness referred to in clause (3) or (4) thereof), the Net Cash
Proceeds from any issuance of Capital Stock referred to in clauses (3) and (4)
and, Investments deemed to be made pursuant to the proviso set forth in clause
(6) of the definition of “Permitted Investments,” shall be included in
calculating whether the conditions of Section 4.07(a)(C) have been met with
respect to any subsequent Restricted Payments. 
In the event the proceeds of an issuance of Capital Stock of the Company
are used for the redemption, repurchase or other acquisition of the Notes, or
Indebtedness that is pari passu
with the Notes, then the Net Cash Proceeds of such issuance shall be included
in Section 4.07(a)(C) only to the extent such proceeds are not used for such
redemption, repurchase or other acquisition of Indebtedness.


 


Section 4.08                                Dividend and Other
Payment Restrictions Affecting
Subsidiaries.


 


(a)          The Company will not, and will not
permit any Restricted Subsidiary to, create or otherwise cause or suffer to
exist or become effective any consensual encumbrance or restriction of any kind
on the ability of any Restricted Subsidiary to:


 


(1)                                  pay dividends or make any other
distributions permitted by applicable law on any Capital Stock of such
Restricted Subsidiary owned by the Company or any other Restricted Subsidiary;


 


(2)                                  pay any Indebtedness owed to the
Company or any other Restricted Subsidiary;


 


(3)                                  make loans or advances to the
Company or any other Restricted Subsidiary; or


 


(4)                                  transfer any of its property or
assets to the Company or any other Restricted Subsidiary.


 


(b)         The restrictions in Section 4.08(a)
will not restrict any encumbrances or restrictions:


 


(1)                                  existing on the Closing Date in the
Credit Facility, this Indenture or any other agreements in effect on the
Closing Date, and any extensions, refinancings, renewals or replacements of
such agreements; provided that
the encumbrances and restrictions in any such extensions, refinancings,
renewals or replacements are no less favorable in any material respect


 


51

















 


the Holders than those encumbrances or restrictions that are
then in effect and that are being extended, refinanced, renewed or replaced;


 


(2)                                  existing under or by reason of
applicable law or by order of any Gaming Authority;


 


(3)                                  imposed pursuant to the Trust
Agreements upon the occurrence of a Trigger Event;


 


(4)                                  existing with respect to any Person
or the property or assets of such Person acquired by the Company or any
Restricted Subsidiary, existing at the time of such acquisition and not
incurred in contemplation thereof, which encumbrances or restrictions are not
applicable to any Person or the property or assets of any Person other than
such Person or the property or assets of such Person so acquired;


 


(5)                                  in the case of Section 4.08(a)(4);


 


(A)                              that restrict in a customary manner
the subletting, assignment or transfer of any property or asset that is a
lease, license, conveyance or contract or similar property or asset;


 


(B)                                existing by virtue of any transfer
of, agreement to transfer, option or right with respect to, or Lien on, any
property or assets of the Company or any Restricted Subsidiary not otherwise
prohibited by this Indenture; or


 


(C)                                arising or agreed to in the ordinary
course of business, not relating to any Indebtedness, and that do not,
individually or in the aggregate, detract from the value of property or assets
of the Company or any Restricted Subsidiary in any manner material to the
Company or any Restricted Subsidiary;


 


(6)                                  with respect to a Restricted
Subsidiary and imposed pursuant to an agreement that has been entered into for
the sale or disposition of all or substantially all of the Capital Stock of, or
property and assets of, such Restricted Subsidiary; or


 


(7)                                  contained in the terms of any
Indebtedness or any agreement pursuant to which such Indebtedness was issued
if:


 


(A)                              the encumbrance or restriction
applies only in the event of a payment default or a default with respect to a
financial covenant contained in such Indebtedness or agreement;


 


(B)                                the encumbrance or restriction is
not materially more disadvantageous to the Holders than is customary in
comparable financings (as determined by the Company); and


 


(C)                                the Company determines that any such
encumbrance or restriction will not affect the Company’s ability to make
principal or interest payments on the Notes.


 


(c)          Nothing contained in this Section
4.08 shall prevent the Company or any Restricted Subsidiary from:


 


 


52

















 


(1)                                  creating, incurring, assuming or
suffering to exist any Liens otherwise permitted pursuant to Section 4.12 of
this Indenture; or


 


(2)                                  restricting the sale or other
disposition of property or assets of the Company or any of its Restricted
Subsidiaries that secure Indebtedness of the Company or any of its Restricted
Subsidiaries.


 


Section 4.09                                Incurrence of
Indebtedness and Issuance of
Preferred Stock.


 


(a)          The Company will not, and will not
permit any of its Restricted Subsidiaries to, Incur any Indebtedness (other
than the Notes and any guarantees thereof issued on the Closing Date and other
Indebtedness existing on the Closing Date) and the Company will not issue any
Disqualified Stock and will not permit any of its Restricted Subsidiaries to
issue any Disqualified Stock; provided
that the Company may Incur Indebtedness or issue Disqualified Stock and the
Company’s Restricted Subsidiaries may Incur Indebtedness or issue Disqualified
Stock if, after giving effect to the Incurrence of such Indebtedness or the
issuance of such Disqualified Stock and the receipt and application of the
proceeds therefrom, the Interest Coverage Ratio would be greater than 2.0:1.


 


(b)         Notwithstanding the provisions of
Section 4.09(a), the Company and any Restricted Subsidiary (except as specified
below) may Incur the following Indebtedness (collectively, “Permitted
Debt”):


 


(1)                                  Indebtedness and letters of credit
under the Credit Facility in an aggregate principal amount at any one time
outstanding under this Section 4.09(b)(1) (with letters of credit being deemed
to have a principal amount equal to the maximum potential liability of the
Company and its Subsidiaries thereunder) not to exceed $675.0 million less
any amount of such Indebtedness permanently repaid pursuant to Section 4.10;


 


(2)                                  Indebtedness owed to the Company
evidenced by a promissory note or to any Restricted Subsidiary; provided that:


 


(a)          if the Company is the obligor on
such Indebtedness and the payee is not the Company, such Indebtedness must be
expressly subordinated to the prior payment in full in cash of all Senior
Subordinated Obligations with respect to the Notes; and


 


(b)         any event which results in any such
Restricted Subsidiary ceasing to be a Restricted Subsidiary or any subsequent
transfer of such Indebtedness (other than to the Company or another Restricted
Subsidiary) shall be deemed, in each case, to constitute an Incurrence of such
Indebtedness not permitted by this Section 4.09(b)(2);


 


(3)                                  Indebtedness issued in exchange for,
or the net proceeds of which are used to refinance or refund, then outstanding
Indebtedness Incurred under Section 4.09(a) or clauses (5), (6), (8),
(9) and (10) of this Section 4.09(b), and any refinancings thereof in
an amount not to exceed the amount so refinanced or refunded (plus premiums,
accrued interest, fees and expenses); provided
that Indebtedness the proceeds of which are used to refinance or refund the
Notes or Indebtedness that is pari passu
with, or subordinated in right of payment to, the Notes shall only be permitted
under this Section 4.09(b)(3) if:


 


(a)                                  in case the Notes are refinanced in
part or the Indebtedness to be refinanced is pari
passu with the Notes, such new Indebtedness, by its terms or by the
terms of any agreement or instrument pursuant to which such new Indebtedness is


 


53

















 


outstanding, is expressly made pari passu with, or subordinate in right
of payment to, the remaining Notes;


 


(b)                                 in case the Indebtedness to be
refinanced is subordinated in right of payment to the Notes, such new
Indebtedness, by its terms or by the terms of any agreement or instrument
pursuant to which such new Indebtedness is issued or remains outstanding, is
expressly made subordinate in right of payment to the Notes at least to the
extent that the Indebtedness to be refinanced is subordinated to the Notes; and


 


(c)                                  such new Indebtedness, determined as
of the date of Incurrence of such new Indebtedness, does not mature prior to
the Stated Maturity of the Indebtedness to be refinanced or refunded, and the
Average Life of such new Indebtedness is at least equal to the remaining
Average Life of the Indebtedness to be refinanced or refunded;


 


and provided
further that in no event may Indebtedness of the Company that is pari passu or subordinated in right of
payment to the Notes be refinanced by means of any Indebtedness of any
Restricted Subsidiary pursuant to this Section 4.09(b)(3);


 


(4)                                  Indebtedness (A) in respect of
performance, surety or appeal bonds provided in the ordinary course of
business, (B) under Currency Agreements and Interest Rate Agreements; provided that such agreements (I) are
designed solely to protect the Company or its Restricted Subsidiaries against
fluctuations in foreign currency exchange rates or interest rates and
(II) do not increase the Indebtedness of the obligor outstanding at any
time other than as a result of fluctuations in foreign currency exchange rates
or interest rates or by reason of fees, indemnities and compensation payable
thereunder; and (C) arising from agreements providing for indemnification,
adjustment of purchase price or similar obligations, or from Guarantees or letters
of credit, surety bonds or performance bonds securing any obligations of the
Company or any of its Restricted Subsidiaries pursuant to such agreements, in
any case Incurred in connection with the disposition of any business, assets or
Restricted Subsidiary (other than Guarantees of Indebtedness Incurred by any
Person acquiring all or any portion of such business, assets or Restricted
Subsidiary for the purpose of financing such acquisition), in a principal
amount not to exceed the gross proceeds actually received by the Company or any
Restricted Subsidiary in connection with such disposition;


 


(5)                                  the incurrence by the Company of
Indebtedness represented by the Notes to be issued on the date of this
Indenture;


 


(6)                                  Indebtedness of the Company, to the
extent the net proceeds thereof are promptly (A) used to purchase Notes
tendered in an Offer to Purchase made as a result of a Change in Control or
(B) deposited to defease the Notes pursuant to Article 8;


 


(7)                                  Guarantees of Indebtedness of the
Company or a Restricted Subsidiary by the Company that was permitted to be
incurred by another provision of this Section 4.09;


 


(8)                                  Indebtedness of the Company or a
Restricted Subsidiary that is (A) Incurred in connection with the
construction of any new facility or facilities related to the gaming business
or any related business of the Company or any Restricted Subsidiary or in
connection with the expansion by the Company or any Restricted Subsidiary of
any of its existing facilities or (B) FF&E Indebtedness; provided that the amount of such
Indebtedness in the aggregate outstanding at any time, including all
refinancings, replacements and refundings thereof, will not exceed
$75.0 million;


 


 


54

















 


(9)                                  Indebtedness evidenced by the 9%
Notes; and


 


(10)                            Indebtedness of the Company (in
addition to Indebtedness permitted under clauses (1) through (9) of this
Section 4.09(b)) in an aggregate principal amount outstanding at any time
(together with refinancings thereof) not to exceed $35.0 million.


 


(c)                                  Notwithstanding
any other provision of this Section 4.09, the maximum amount of Indebtedness
that the Company or a Restricted Subsidiary may Incur pursuant to this Section
4.09 shall not be deemed to be exceeded, with respect to any outstanding
Indebtedness due solely to the result of fluctuations in the exchange rates of
currencies.  For purposes of determining
any particular amount of Indebtedness under this Section 4.09,


 


(1)                                  Indebtedness
incurred under the Credit Facility on or prior to the Closing Date shall be
treated as Incurred pursuant to this Section 4.09(b)(1); and


 


(2)                                  Guarantees,
Liens or obligations with respect to letters of credit supporting Indebtedness
which is included in the determination of such particular amount shall not be
included.


 


(d)                                 For
purposes of determining compliance with this Section 4.09, in the event that an
item of Indebtedness meets the criteria of more than one of the types of
Indebtedness described in the above clauses (other than Indebtedness referred
to in clause (1) of the preceding sentence), the Company, in its sole
discretion, shall classify, and from time to time may reclassify, such item of
Indebtedness and only be required to include the amount and type of such
Indebtedness in one of such clauses.


 


Section 4.10                                                Asset Sales.


 


(a)          The Company will not, and will not
permit any Restricted Subsidiary to, consummate any Asset Sale, unless:


 


(1)                                  the consideration received by the
Company or such Restricted Subsidiary is at least equal to the fair market
value of the assets sold or disposed of and


 


(2)                                  at least 75% of the consideration
received consists of cash or Temporary Cash Investments or the assumption of
the Indebtedness of the Company or any Restricted Subsidiary (other than
Indebtedness to the Company or any Restricted Subsidiary), provided that the Company or such
Restricted Subsidiary is irrevocably and unconditionally released from all
liability under such Indebtedness.


 


Notwithstanding the immediately preceding paragraph of
this Section 4.10, the Company and its Restricted Subsidiaries will be
permitted to consummate a Permitted Asset Swap without complying with such
paragraph if (i) immediately after giving effect to such Permitted Asset Swap,
the Company could Incur at least $1.00 of additional Indebtedness pursuant to
the Interest Coverage Ratio test set forth in Section 4.09(a) and (ii) the
Company or the applicable Restricted Subsidiary, as the case may be, receives
assets at the time of such Permitted Asset Swap of a value at least equal to
the fair market value of the assets or other property sold or otherwise
disposed of (as evidenced by a resolution of the Company’s Board of Directors
set forth in an Officers’ Certificate delivered to the Trustee, or, in the
event that the fair market value of such Permitted Asset Swap exceeds $100.0
million, such fair market value has been determined by a written opinion of an
investment banking firm of national standing or other recognized independent
expert with experience appraising the terms and conditions of the type of
transaction contemplated thereby).


 


55

















 


(b)         Within twelve months after the
receipt of any Net Cash Proceeds from one or more Asset Sales occurring on or
after the Closing Date, the Company shall or shall cause the relevant
Restricted Subsidiary to:


 


(1)                                  (A)  apply
an amount equal to such Net Cash Proceeds to permanently repay Senior
Indebtedness of the Company or Indebtedness of any Restricted Subsidiary, in
each case owing to a Person other than the Company or any of its Restricted
Subsidiaries; or (B) invest an equal amount, or the amount not so applied
pursuant to clause (A) (or enter into a definitive agreement committing to so
invest within 12 months after the date of such agreement), in property or
assets (other than current assets) of a nature or type or that are used in a
business (or in a company having property and assets of a nature or type, or
engaged in a business) similar or related to the nature or type of the property
and assets of, or the business of, the Company and its Restricted Subsidiaries
existing on the date of such investment; and


 


(2)                                  apply
(no later than the end of the 12-month period referred to in this
Section 4.10(b)) such excess Net Cash Proceeds (to the extent not applied
pursuant to Section 4.10(b)(1)) as provided in the following paragraph of
this Section 4.10.


 


The amount of such
excess Net Cash Proceeds required to be applied (or to be committed to be
applied) during such 12-month period as set forth in this Section 4.10(b) and
not applied as so required by the end of such period shall constitute “Excess
Proceeds.”


 


If, as of the first day of any calendar month, the
aggregate amount of Excess Proceeds not theretofore subject to an Offer to
Purchase pursuant to this Section 4.10 totals at least $25.0 million, the
Company must commence, not later than the fifteenth Business Day of such month,
and consummate an Offer to Purchase from the Holders (and if required by the
terms of any Indebtedness that is pari passu
with the Notes (“Pari Passu
Indebtedness”), from the holders of such Pari Passu Indebtedness) on
a pro
rata basis an aggregate principal amount of Notes (and Pari Passu
Indebtedness) equal to the Excess Proceeds on such date, at a purchase price
equal to 100% of the principal amount thereof, plus, in each case, accrued
interest and Additional Interest, if any, to the Payment Date.  If the aggregate principal amount of Notes
and any such Pari Passu Indebtedness tendered by holders thereof exceeds the
amount of Excess Proceeds, the Notes and Pari Passu Indebtedness shall be
purchased on a pro rata basis.  Upon
the completion of any such Offers to Purchase, regardless of the amount of
Notes validly tendered, the amount of Excess Proceeds shall be reset to zero.


 


The Company will comply with the requirements of Rule
14e-1 under the Exchange Act and any other securities laws and regulations
thereunder to the extent such laws and regulations are applicable in connection
with each repurchase of Notes pursuant to this Section 4.10.  To the extent that the provisions of any
securities laws or regulations conflict with the provisions of this Section
4.10, the Company will comply with the applicable securities laws and regulations
and will not be deemed to have breached its obligations under this Section 4.10
by virtue of such compliance.


 


Section 4.11                                Transactions with
Affiliates.


 


(a)          The Company will not, and will not
permit any Restricted Subsidiary to, directly or indirectly, enter into, renew
or extend any transaction (including, without limitation, purchase, sale, lease
or exchange of property or assets, or the rendering of any service) with any
holder (or any Affiliate of such holder) of 10% or more of any class of Capital
Stock of the Company or with any Affiliate of the Company or any Restricted
Subsidiary (each an “Affiliate Transaction”),
unless:


 


56

















 


(1)                                  such Affiliate Transaction is on
fair and reasonable terms that are no less favorable to the Company or the
relevant Restricted Subsidiary than those that would have been obtained, at the
time of such transaction or, if such transaction is pursuant to a written
agreement, at the time of execution of the agreement providing therefor, in a
comparable transaction by the Company or such Subsidiary with a Person that is
not such a holder or an Affiliate; and


 


(2)                                  the Company delivers to the Trustee:


 


(a)          with respect to any transaction or
series of related transactions the aggregate amount of which exceeds $5.0 million
in value, a resolution of the Board of Directors set forth in an Officers’
Certificate certifying that such Affiliate Transaction complies with this
Section 4.11 and that such Affiliate Transaction has been approved by a
majority of the disinterested members of the Board of Directors; and


 


(b)         with respect to any Affiliate
Transaction or series of related Affiliate Transactions involving aggregate
consideration in excess of $15.0 million, an opinion as to the fairness to the
Holders of such Affiliate Transaction or series of related Affiliate
Transactions from a financial point of view issued by an accounting, appraisal
or investment banking firm of national standing.


 


(b)         The provisions of Section 4.11(a) do
not limit, and shall not apply to:


 


(1)                                  any transaction solely between the
Company and any of its Wholly Owned Restricted Subsidiaries or solely between
Wholly Owned Restricted Subsidiaries;


 


(2)                                  the payment of reasonable and
customary regular fees and indemnities to directors of the Company who are not
employees of the Company;


 


(3)                                  any payments or other transactions
pursuant to any tax-sharing agreement between the Company and any other Person
with which the Company files a consolidated tax return or with which the
Company is part of a consolidated group for tax purposes;


 


(4)                                  any sale of shares of Capital Stock
(other than Disqualified Stock) of the Company; or


 


(5)                                  any Restricted Payments not
prohibited by Section 4.07.


 


Section 4.12                                             Liens.


 


The Company will not, and will not permit any of its
Restricted Subsidiaries to, directly or indirectly create, incur, assume or
suffer to exist any Lien of any kind securing Indebtedness or trade payables on
any asset now owned or hereafter acquired, except Permitted Liens.


 


Section 4.13                                             Corporate Existence.


 


Subject to Article 5 hereof, the Company shall do or
cause to be done all things necessary to preserve and keep in full force and
effect:


 


(1)                                  its corporate existence, and the
corporate, partnership or other existence of each of its Subsidiaries, in
accordance with the respective organizational documents (as the same may be
amended from time to time) of the Company or any such Subsidiary; and


 


57

















 


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


 


Section 4.14                                Offer to Repurchase
Upon Change of Control.


 


Within 30 days of the occurrence of a Change of
Control, the Company shall commence and consummate an Offer to Purchase all
Notes then outstanding, at a purchase price equal to 101% of the principal
amount thereof, plus accrued interest and Additional Interest, if any, to the
Payment Date.


 


Section 4.15                                Limitation on
Senior Subordinated Indebtedness.


 


The Company shall not Incur any Indebtedness that is
subordinate in right of payment to any Senior Indebtedness unless such Indebtedness
is pari passu with, or
subordinated in right of payment to, the Notes; provided that the foregoing limitation shall not apply to
distinctions between categories of Senior Indebtedness of the Company that
exist by reason of any Liens or Guarantees arising or created in respect of
some but not all such Senior Indebtedness.


 


Section 4.16                                Payments for Consent.


 


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


 


Section 4.17                              Designation of
Restricted and Unrestricted Subsidiaries.


 


(a)          The Board of Directors may designate
any Restricted Subsidiary (including any newly acquired or newly formed
Subsidiary of the Company) to be an Unrestricted Subsidiary unless such
Subsidiary owns any Capital Stock of, or owns or holds any Lien on any property
of, the Company or any Restricted Subsidiary; provided
that:


 


(1)                                  the value of all outstanding
Investments owned by the Company and its Restricted Subsidiaries in the
Restricted Subsidiary being so designated will be deemed to be an Investment
made by the Company or such Restricted Subsidiary as of the time of such
designation,


 


(2)                                  the Investment referred to in
Section 4.17(a)(1) would be permitted under Section 4.07 (other than pursuant
to clauses (6), (7) or (9) of the definition of Permitted Investments); and


 


(3)                                  such Restricted Subsidiary otherwise
meets the definition of an Unrestricted Subsidiary.


 


(b)         The Board of Directors may designate
any Unrestricted Subsidiary to be a Restricted Subsidiary; provided that:


 


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(1)                                  no
Default or Event of Default shall have occurred and be continuing at the time
of or after giving effect to such designation and


 


(2)                                  all
Liens and Indebtedness of such Unrestricted Subsidiary outstanding immediately
after such designation would, if incurred at such time, have been permitted to
be Incurred (and shall be deemed to have been Incurred) for all purposes of
this Indenture.


 


Any such designation by the Board of Directors shall
be evidenced to the Trustee by promptly filing with the Trustee a copy of the
resolution of the Board of Directors giving effect to such designation and an
Officers’ Certificate certifying that such designation complied with the
foregoing provisions.


 


Section 4.18                                Limitation on Status
as Investment Company.


 


The Company will not take any action that may require
the Company to register as an “investment company” (as that term is defined in
the Investment Company Act of 1940, as amended) or otherwise become subject to
regulation under the Investment Company Act.


 


Section 4.19                                Certain Suspended
Covenants


 


During any period of time
that:  (i) the Notes are rated Baa3 or better by Moody’s and
BBB- or better by S&P (or, if either such entity ceases to rate the Notes
for reasons outside of the control of the Company, the equivalent investment
grade credit rating from any other “nationally recognized statistical rating
organization” within the meaning of Rule 15c3-1(c)(2)(vi)(F) under the
Exchange Act selected by the Company as a replacement agency), and (ii) no Default or Event of Default
shall have occurred and be continuing, then, beginning on that day and subject
to this Section 4.19, the Company and its Restricted Subsidiaries will not be
subject to Sections 4.07, 4.08, 4.09, 4.10 and 4.11 hereof (collectively, the “Suspended
Covenants”).  During any period that the Suspended Covenants have been suspended, the Company’s Board of
Directors may not designate any of its Subsidiaries as Unrestricted
Subsidiaries pursuant to Section 4.17.


 


Notwithstanding the foregoing, if
the rating assigned by either such rating agency should subsequently decline to
below Baa3 or BBB-, respectively, the
Suspended Covenants will be
reinstated as of and from the date of such rating decline. Calculations under
the reinstated Section 4.07 will be made as if Section 4.07 had been in effect
since the date of this Indenture except that no default will be deemed to have
occurred solely by reason of a Restricted Payment made while Section 4.07 was
suspended.


 


ARTICLE 5

SUCCESSORS


 


Section 5.01                                Merger, Consolidation, or Sale of Assets.


 


The Company will not consolidate
with, merge with or into, or sell, convey, transfer, lease or otherwise dispose
of all or substantially all of its property and assets (as an entirety or
substantially an entirety in one transaction or a series of related transactions)
to any Person or permit any Person to merge with or into the Company unless:


 


(1)                                        the Company shall be the continuing Person, or the
Person (if other than the Company) formed by such consolidation or into which
the Company is merged or that acquired or leased such property and assets of
the Company shall be a corporation organized and validly existing under the
laws of the United States of America or any jurisdiction thereof and shall


 


59

















 


expressly
assume, by a supplemental indenture, executed and delivered to the Trustee, all
of the obligations of the Company on all of the Notes and under the Indenture;


 


(2)                                  immediately after giving effect to such
transaction, no Default or Event of Default shall have occurred and be
continuing;


 


(3)                                  immediately after giving effect to such
transaction on a pro forma basis the Company, or any Person becoming the
successor obligor of the Notes, as the case may be, could Incur at least $1.00
of Indebtedness pursuant to the Interest Coverage Ratio test set forth in
Section 4.09(a); provided that
this clause (3) shall not apply to a consolidation, merger or sale of all
(but not less than all) of the assets of the Company if all Liens and
Indebtedness of the Company or any Person becoming the successor obligor on the
Notes, as the case may be, and its Restricted Subsidiaries outstanding
immediately after such transaction would have been permitted (and all such
Liens and Indebtedness, other than Liens and Indebtedness of the Company and
its Restricted Subsidiaries outstanding immediately prior to the transaction,
shall be deemed to have been Incurred) for all purposes of the Indenture; and


 


(4)                                  the Company delivers to the Trustee an Officers’
Certificate (attaching the arithmetic computations to demonstrate compliance
with clause (3)) and an opinion of counsel, in each case stating that such
consolidation, merger or transfer and such supplemental indenture complies with
this provision and that all conditions precedent provided for herein relating
to such transaction have been complied with;


 


provided, however,
that clause (3) above will not apply if, in the good faith determination
of the Board of Directors of the Company, whose determination shall be
evidenced by a resolution of the Board of Directors, the principal purpose of
such transaction is to change the state of incorporation of the Company and any
such transaction shall not have as one of its purposes the evasion of the
foregoing limitations.


 


In addition, the Company may not,
directly or indirectly, lease all or substantially all of its properties or
assets, in one or more related transactions, to any other Person. This Section
5.01 will not apply to a sale, assignment, transfer, conveyance or other
disposition of assets between or among the Company and any Restricted
Subsidiaries.


 


Section 5.02                                Successor
Corporation Substituted.


 


Upon any consolidation or merger, or any sale,
assignment, transfer, lease, conveyance or other disposition of all or
substantially all of the properties or assets of the Company in a transaction
that is subject to, and that complies with the provisions of, Section 5.01
hereof, the successor Person formed by such consolidation or into or with which
the Company is merged or to which such sale, assignment, transfer, lease,
conveyance or other disposition is made shall succeed to, and be substituted
for (so that from and after the date of such consolidation, merger, sale,
assignment, transfer, lease, conveyance or other disposition, the provisions of
this Indenture referring to the “Company” shall refer instead to the successor
Person and not to the Company), 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; provided, however, that the predecessor
Company shall not be relieved from the obligation to pay the principal of and
interest on the Notes except in the case of a sale of all of the Company’s
assets in a transaction that is subject to, and that complies with the
provisions of, Section 5.01 hereof.


 


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ARTICLE
6


DEFAULTS AND
REMEDIES


 


Section 6.01                                Events of Default.


 


Each of the following is an “Event of Default”:


 


(1)                                        default in the payment of principal
of (or premium, if any, on) any Note when the same becomes due and payable at
maturity, upon acceleration, redemption or otherwise whether or not such
payment is prohibited by the subordination provisions of this Indenture;


 


(2)                                  default 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 whether or not such payment is prohibited by the
subordination provisions of this Indenture;


 


(3)                                  default in the performance or breach
of the provisions of this Indenture applicable to mergers, consolidations and
transfers of all or substantially all of the assets of the Company or the
failure to make or consummate an Offer to Purchase in accordance with Section
4.10 or 4.14 of this Indenture;


 


(4)                                  the Company defaults in the
performance of or breaches any other covenant or agreement of the Company in
this Indenture or under the Notes (other than a default specified in clause
(1), (2) or (3) of this Section 6.01) and such default or breach continues for
a period of 30 consecutive days after written notice by the Trustee or the
Holders of 25% or more in aggregate principal amount of the Notes;


 


(5)                                  there occurs with respect to any
issue or issues of Indebtedness of the Company or any Restricted Subsidiary
having an outstanding principal amount of $20.0 million or more in the
aggregate for all such issues of all such Persons, whether such Indebtedness
now exists or shall hereafter be created, (A) an event of default that has
caused the holder thereof to declare such Indebtedness to be due and payable
prior to its Stated Maturity and such Indebtedness has not been discharged in
full or such acceleration has not been rescinded or annulled within 30 days of
such acceleration and/or (B) the failure to make a principal payment at the
final (but not any interim) fixed maturity and such defaulted payment shall not
have been made, waived or extended within 30 days of such payment default;


 


(6)                                  any final judgment or order (not
covered by insurance) for the payment of money in excess of $20.0 million in
the aggregate for all such final judgments or orders against all such Persons
(treating any deductibles, self-insurance or retention as not so covered) shall
be rendered against the Company or any Restricted Subsidiary and shall not be
paid or discharged, and there shall be any period of 60 consecutive days
following entry of the final judgment or order that causes the aggregate amount
for all such final judgments or orders outstanding and not paid or discharged
against all such Persons to exceed $20.0 million during which a stay of
enforcement of such final judgment or order, by reason of a pending appeal or
otherwise, shall not be in effect;


 


(7)                                  a court having jurisdiction in the
premises enters a decree or order for (A) relief in respect of the Company
or any of its Restricted Subsidiaries that is a Significant Subsidiary or any
group of Restricted Subsidiaries that, taken together, would constitute a
Significant Subsidiary in an involuntary case under any applicable bankruptcy,
insolvency or other similar law now or hereafter in effect,
(B) appointment of a receiver, liquidator, assignee, custodian, trustee,
sequestrator or similar official of such Person or group of such Persons or for
all or


 


61

















 


substantially all of the property and
assets of such Person or group of such Persons or (C) the winding up or
liquidation of the affairs of such Person or group of such Persons and, in each
case, such decree or order shall remain unstayed and in effect for a period of
30 consecutive days;


 


(8)                                  the Company or any of its Restricted
Subsidiaries that is a Significant Subsidiary or any group of Restricted
Subsidiaries that, taken together, would constitute a Significant Subsidiary
(A) commences a voluntary case under any applicable bankruptcy, insolvency
or other similar law now or hereafter in effect, or consents to the entry of an
order for relief in an involuntary case under any such law, (B) consents
to the appointment of or taking possession by a receiver, liquidator, assignee,
custodian, trustee, sequestrator or similar official of such Person or group of
such Persons or for all or substantially all of the property and assets of such
Person or group of such Persons or (C) effects any general assignment for
the benefit of creditors;


 


(9)                                  the revocation, termination,
suspension or other cessation of effectiveness for a period or more than 90
consecutive days of any Gaming License that results in the cessation or
suspension of gaming operations at any Material Casino; provided that any voluntary relinquishment
of or failure to renew after revocation a Gaming License of a Material Casino
if such relinquishment or failure to renew 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 Subsidiaries, taken as a whole, and not disadvantageous in any material
respect to the Holders shall not constitute an Event of Default;


 


(10)                            there occurs with respect to any
issue or issues of Indebtedness of the Company or any Restricted Subsidiary
having an outstanding principal amount of $20.0 million or more in the
aggregate for all such issues of all such Persons, whether such Indebtedness
now exists or shall hereafter be created, an event of default that arises out
of or is related to the occurrence of a Trigger Event; or


 


(11)                            after the occurrence of a Trigger
Event, the revocation, termination, suspension or other cessation of
effectiveness of the gaming license with respect to the Empress Casino Joliet
pursuant to the terms of the Trust Agreements.


 


Section 6.02                                Acceleration.


 


If an event of Default (other than an Event of Default
specified in clause (7) or (8) of Section 6.01 that occurs with respect to the
Company) occurs and is continuing under this Indenture, the Trustee or the
Holders of at least 25% in aggregate principal amount of the Notes, then
outstanding, by written notice to the Company (and to the Trustee if such
notice is given by Holders), may, and the Trustee at the request of such
Holders shall, declare the principal of, premium, if any, and accrued interest
and Additional Interest, if any, on the Notes to be immediately, due and payable.


 


Upon a declaration of acceleration, such principal of,
premium, if any, and accrued interest and Additional Interest, if any, shall be
immediately due and payable.  In the
event of a declaration of acceleration because of an Event of Default set forth
in clause (5) of Section 6.01 has occurred and is continuing, such declaration
of acceleration shall be automatically rescinded and annulled if the event of
default triggering such Event of Default pursuant to clause (5) of Section 6.01
shall be remedied or cured by the Company or the relevant Restricted Subsidiary
or waived by the holders of the relevant Indebtedness within 60 days after the
declaration of acceleration with respect thereto.  If an Event of Default specified in clause (7) or (8) of Section
6.01 occurs with respect to the Company, the principal of, premium, if any, and
accrued interest or Additional Interest, if any, on the Notes then outstanding
shall


 


62

















 


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 at least a majority in principal amount
of the outstanding Notes by written notice to the Company and to the Trustee,
may waive all past defaults and rescind and annul a declaration of acceleration
and its consequences if (i) all existing Events of Default, other than the
nonpayment of the principal of, premium, if any, and accrued interest and
Additional Interest, if any, on the Notes that have become due solely by such
declaration of acceleration, have been cured or waived and (ii) the rescission
would not conflict with any judgment or decree of a court of competent
jurisdiction.


 


Section 6.03                                Other Remedies.


 


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


 


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


 


Section 6.04                                Waiver of Past Defaults.


 


Holders of not less than a majority in aggregate
principal amount of the then outstanding Notes by notice to the Trustee may on
behalf of the Holders of all of the Notes waive an existing Default or Event of
Default and its consequences hereunder, except a continuing Default or Event of
Default in the payment of the principal of, premium, if any, or interest on,
the Notes (including in connection with an Offer to Purchase); provided,
however, that the Holders of a majority in aggregate principal
amount of the then outstanding Notes may rescind an acceleration and its
consequences, including any related payment default that resulted from such
acceleration.  Upon any such waiver,
such Default shall cease to exist, and any Event of Default arising therefrom
shall be deemed to have been cured for every purpose of this Indenture; but no
such waiver shall extend to any subsequent or other Default or impair any right
consequent thereon.


 


Section 6.05                                Control by Majority.


 


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


 


Section 6.06                                Limitation
on Suits.


 


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


 


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


 


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


 


63

















 


(3)                                  such Holder or Holders offer the
Trustee indemnity satisfactory to the Trustee against any costs, liability or
expense;


 


(4)                                  the Trustee does not comply with the
request within 60 days after receipt of the request and the offer of indemnity;
and


 


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


 


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


 


Section 6.07                                Rights of Holders
to Receive Payment.


 


Notwithstanding any other provision of this Indenture,
the right of any Holder to receive payment of principal, premium and Additional
Interest, if any, and interest on the Note, on or after the respective due
dates expressed in the Note (including in connection with an Offer to
Purchase), or to bring suit for the enforcement of any such payment on or after
such respective dates, shall not be impaired or affected without the consent of
such Holder.


 


Section 6.08                                Collection Suit by
Trustee.


 


If an Event of Default specified in Section 6.01(1) or
(2) hereof occurs and is continuing, the Trustee is authorized to recover
judgment in its own name and as trustee of an express trust against the Company
for the whole amount of principal of, premium and Additional Interest, if any,
and interest remaining unpaid on, the Notes and interest on overdue principal
and, to the extent lawful, interest and such further amount as shall be
sufficient to cover the costs and expenses of collection, including the
reasonable compensation, expenses, disbursements and advances of the Trustee,
its agents and counsel.


 


Section 6.09                                Trustee May File Proofs
of Claim.


 


The Trustee is authorized to file such proofs of claim
and other papers or documents as may be necessary or advisable in order to have
the claims of the Trustee (including any claim for the reasonable compensation,
expenses, disbursements and advances of the Trustee, its agents and counsel)
and the Holders allowed in any judicial proceedings relative to the Company (or
any other obligor upon the Notes), its creditors or its property and shall be
entitled and empowered to collect, receive and distribute any money or other
property payable or deliverable on any such claims and any custodian in any
such judicial proceeding is hereby authorized by each Holder to make such
payments to the Trustee, and in the event that the Trustee shall consent to the
making of such payments directly to the Holders, to pay to the Trustee any
amount due to it for the reasonable compensation, expenses, disbursements and
advances of the Trustee, its agents and counsel, and any other amounts due the
Trustee under Section 7.07 hereof.  To
the extent that the payment of any such compensation, expenses, disbursements
and advances of the Trustee, its agents and counsel, and any other amounts due
the Trustee under Section 7.07 hereof out of the estate in any such proceeding,
shall be denied for any reason, payment of the same shall be secured by a Lien
on, and shall be paid out of, any and all distributions, dividends, money,
securities and other properties that the Holders may be entitled to receive in
such proceeding whether in liquidation or under any plan of reorganization or
arrangement or otherwise.  Nothing
herein contained shall be deemed to authorize the Trustee to authorize or
consent to or accept or adopt on behalf of any Holder any plan of reorganization,
arrangement, adjustment or composition affecting the Notes or the rights of any
Holder, or to authorize the Trustee to vote in respect of the claim of any
Holder in any such proceeding.


 


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Section 6.10                                Priorities.


 


If the Trustee collects any money pursuant to this
Article 6, it shall pay out the money in the following order:


 


First:                                           to
the Trustee, its agents and attorneys for amounts due under Sections 6.08 and
7.07 hereof, including payment of all compensation, expenses and liabilities
incurred, and all advances made, by the Trustee and the costs and expenses of
collection;


 


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


 


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


 


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


 


Section 6.11                                Undertaking for Costs.


 


In any suit for the enforcement of any right or remedy
under this Indenture or in any suit against the Trustee for any action taken or
omitted by it as a Trustee, a court in its discretion may require the filing by
any party litigant in the suit of an undertaking to pay the costs of the suit,
and the court in its discretion may assess reasonable costs, including
reasonable attorneys’ fees, 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
hereof, or a suit by Holders of more than 10% in aggregate 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 will exercise such of the rights and powers
vested in it by this Indenture, and use the same degree of care and skill in
its exercise, as a prudent person would exercise or use under the circumstances
in the conduct of such person’s own affairs.


 


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


 


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


 


(2)                                  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.


 


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However, the Trustee will examine the certificates and
opinions to determine whether or not they appear on their face to conform to
the requirements of this Indenture.


 


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


 


(1)                                  this paragraph does not limit the
effect of paragraph (b) of this Section 7.01;


 


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


 


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


 


(d)          Whether or not therein expressly so
provided, every provision of this Indenture that in any way relates to the
Trustee is subject to paragraphs (a), (b), and (c) of this Section 7.01.


 


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


 


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


 


Section 7.02                                Rights of
Trustee.


 


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


 


(b)          Before the Trustee acts or refrains
from acting, it may require an Officers’ Certificate or an Opinion of Counsel
or both.  The Trustee will 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 and the written advice of such
counsel or any Opinion of Counsel will be full and complete authorization and
protection from liability in respect of any action taken, suffered or omitted
by it hereunder in good faith and in reliance thereon.


 


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


 


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


 


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


 


(f)             The Trustee will 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 have
offered to the


 


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Trustee
reasonable security or indemnity against the costs, expenses and liabilities
that might be incurred by it in compliance with such request or direction.


 


Section 7.03                                Individual
Rights of Trustee.


 


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


 


Section 7.04                                Trustee’s
Disclaimer.


 


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


 


In connection with
the transfer or exchange of Notes by the Trustee pursuant to Section 2.06
hereof, the Trustee shall obtain a certificate in the form of Exhibit B or
Exhibit C to this Indenture, as the case may be, and, if Item 3(d) on Exhibit B
is checked, shall obtain a certificate in the form of Exhibit D to the
Indenture and an Opinion of Counsel referenced therein.  The Trustee shall have no responsibility to
inquire further or to investigate whether the matters included in any such
certification or opinion are true or correct. 
The Trustee shall have no responsibility to determine whether the conditions
of this Indenture or the Notes governing transfer or exchange of Notes have
been followed and shall have no responsibility to seek or obtain any Opinions
of Counsel in connection with any transfer or exchange of Notes other than as
set forth in this Section 7.04.  The
Trustee shall have no responsibility to inquire whether the Company has
complied with any covenant of Article 4, other than deliver of the certificate
stated in Section 4.04(a).


 


Section 7.05                                Notice of
Defaults.


 


If a Default or
Event of Default occurs and is continuing and if it is known to the Trustee,
the Trustee will mail to Holders and the agent bank under the Credit Facility
(the “Agent Bank”), a notice of the Default or Event of Default within 90 days
after it occurs.  Except in the case of
a Default or Event of Default in payment of principal of, premium, if any, or
interest on any Note, the Trustee may withhold the notice if and so long as a
committee of its Responsible Officers in good faith determines that withholding
the notice is in the interests of the Holders. 
The name and address of the Agent Bank for purposes of this Section 7.05
is Wells Fargo Bank, National Association, 5340 Kietzke, Suite 201, Reno,
Nevada 89511, Attention:  Casey Potter,
Vice President.  Any change in the
identity or address of the Agent Bank shall be effective only if the Trustee
receives written notice of the change, specifically providing that the change
is effective for any notices to the Agent Bank under the Indenture.  If payment of the Notes is accelerated
because of an Event of Default, the Trustee shall promptly notify the Agent
Bank in accordance with this Section 7.05 of such acceleration.


 


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Section 7.06                                Reports by
Trustee to Holders.


 


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


 


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


 


Section 7.07                                Compensation
and Indemnity.


 


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


 


(b)          The Company will indemnify the
Trustee against any and all losses, liabilities or 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, any Holder or any
other Person) or liability in connection with the exercise or performance of
any of its powers or duties hereunder, except to the extent any such loss,
liability or expense may be attributable to its negligence or bad faith.  The Trustee will notify the Company promptly
of any claim for which it may seek indemnity. 
Failure by the Trustee to so notify the Company will not relieve the
Company of its obligations hereunder. 
The Company will defend the claim and the Trustee will cooperate in the
defense.  The Trustee may have separate
counsel and the Company will pay the reasonable fees and expenses of such
counsel.  The Company need not pay for
any settlement made without its consent; provided
that the Company will not be required to pay such fees and expenses if it
assumes the Trustee’s defense and there is no conflict of interest between the
Company and the Trustee in connection with such defense.  The Company need not reimburse any expense
or indemnify any loss or liability to the extent incurred by the Trustee
through its gross negligence, bad faith or willful misconduct.


 


(c)           The obligations of the Company under
this Section 7.07 will survive the satisfaction and discharge of this
Indenture.


 


(d)          To secure the Company’s payment
obligations in this Section 7.07, the Trustee will 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 will survive the satisfaction and
discharge of this Indenture.


 


(e)           When the Trustee incurs expenses or
renders services after an Event of Default specified in Section 6.01(7) or (8)
hereof occurs, the expenses and the compensation for the services (including
the


 


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fees and
expenses of its agents and counsel) are intended to constitute expenses of
administration under any Bankruptcy Law.


 


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


 


Section 7.08                                Replacement
of Trustee.


 


(a)           A resignation or removal of the
Trustee and appointment of a successor Trustee will become effective only upon
the successor Trustee’s acceptance of appointment as provided in this Section
7.08.


 


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


 


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


 


(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 incapable of
acting.


 


(c)           If the Trustee resigns or is removed
or if a vacancy exists in the office of Trustee for any reason, the Company
will promptly appoint a successor Trustee. 
Within one year after the successor Trustee takes office, the Holders of
a majority in aggregate principal amount of the then outstanding Notes may
appoint a successor Trustee to replace the successor Trustee appointed by the
Company.


 


(d)          If a successor Trustee does not take
office within 60 days after the retiring Trustee resigns or is removed, the retiring
Trustee, the Company, or the Holders of at least 10% in aggregate principal
amount of the then outstanding Notes may petition any court of competent
jurisdiction for the appointment of a successor Trustee.


 


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


 


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


 


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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 will be the successor Trustee.


 


Section 7.10                                Eligibility;
Disqualification.


 


There will at all
times be a Trustee hereunder that is a corporation organized and doing business
under the laws of the United States of America or of any state thereof that is
authorized under such laws to exercise corporate trustee power, that is subject
to supervision or examination by federal or state authorities and that has a
combined capital and surplus of at least $100.0 million as set forth in its
most recent published annual report of condition.


 


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


 


Section 7.11                                Preferential
Collection of Claims Against Company.


 


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


 


ARTICLE 8


LEGAL DEFEASANCE
AND COVENANT DEFEASANCE


 


Section 8.01                                Option to
Effect Legal Defeasance or Covenant Defeasance.


 


The Company may at
any time, at the option of its Board of Directors evidenced by a resolution set
forth in an Officers’ Certificate, elect to have either Section 8.02 or 8.03
hereof be applied to all outstanding Notes upon compliance with the conditions
set forth below in this Article 8.


 


Section 8.02                                Legal
Defeasance and Discharge.


 


Upon the Company’s
exercise under Section 8.01 hereof of the option applicable to this Section
8.02, the Company will, subject to the satisfaction of the conditions set forth
in Section 8.04 hereof, be deemed to have been discharged from its obligations
with respect to all outstanding Notes on the date the conditions set forth
below are satisfied (hereinafter, “Legal Defeasance”).  For this purpose, Legal Defeasance means
that the Company will be deemed to have paid and discharged the entire
Indebtedness represented by the outstanding Notes, which will thereafter be
deemed to be “outstanding” only for the purposes of Section 8.05 hereof and the
other Sections of this Indenture referred to in clauses (1) and (2) below, and
to have satisfied all its other obligations under such Notes and this Indenture
(and the Trustee, on demand of and at the expense of the Company, shall execute
proper instruments acknowledging the same), except for the following provisions
which will survive until otherwise terminated or discharged hereunder:


 


(1)                                  the rights of Holders of outstanding
Notes to receive payments in respect of the principal of, or interest or
premium and Additional Interest, if any, on, such Notes when such payments are
due from the trust referred to in Section 8.04 hereof;


 


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(2)                                  the Company’s obligations with
respect to such Notes under Article 2 and Section 4.02 hereof;


 


(3)                                  the rights, powers, trusts, duties
and immunities of the Trustee hereunder and the Company’s obligations in
connection therewith; and


 


(4)                                  this Article 8.


 


Subject to
compliance with this Article 8, the Company may exercise its option under this
Section 8.02 notwithstanding the prior exercise of its option under Section
8.03 hereof.


 


Section 8.03                                Covenant
Defeasance.


 


Upon the Company’s
exercise under Section 8.01 hereof of the option applicable to this Section
8.03, the Company will, subject to the satisfaction of the conditions set forth
in Section 8.04 hereof, be released from its obligations under the covenants
contained in Sections 4.03(a), 4.04, 4.07, 4.08, 4.09, 4.10, 4.11, 4.12, 4.14,
4.15, 4.16,
4.17 and 4.18 hereof and clause (4) of Section 5.01 hereof with respect
to the outstanding Notes on and after the date the conditions set forth in
Section 8.04 hereof are satisfied (hereinafter, “Covenant Defeasance”), and
the Notes will thereafter be deemed not “outstanding” for the purposes of any
direction, waiver, consent or declaration or act of Holders (and the
consequences of any thereof) in connection with such covenants, but will
continue to be deemed “outstanding” for all other purposes hereunder (it being
understood that such Notes will not be deemed outstanding for accounting
purposes).  For this purpose, Covenant
Defeasance means that, with respect to the outstanding Notes, the Company may
omit to comply with and will have no liability in respect of any term,
condition or limitation set forth in any such covenant, whether directly or
indirectly, by reason of any reference elsewhere herein to any such covenant or
by reason of any reference in any such covenant to any other provision herein
or in any other document and such omission to comply will not constitute a
Default or an Event of Default under Section 6.01 hereof, but, except as
specified above, the remainder of this Indenture and such Notes will be
unaffected thereby.  In addition, upon
the Company’s exercise under Section 8.01 hereof of the option applicable to
this Section 8.03, subject to the satisfaction of the conditions set forth in
Section 8.04 hereof, Sections 6.01(3) through 6.01(6)  hereof will not
constitute Events of Default.


 


Section 8.04                                Conditions
to Legal or Covenant Defeasance.


 


In order to
exercise either Legal Defeasance or Covenant Defeasance under either Section
8.02 or 8.03 hereof:


 


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


 


(2)                                  in the case of an election under
Section 8.02 hereof, the Company must deliver to the Trustee an Opinion of
Counsel confirming that:


 


(A)                              the Company has received from, or
there has been published by, the Internal Revenue Service a ruling; or


 


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(B)                                since the date of this Indenture,
there has been a change in the applicable federal income tax law,


 


in either case to the effect that, and based thereon
such Opinion of Counsel shall confirm that, the Holders of the outstanding
Notes will not recognize income, gain or loss for federal income tax purposes
as a result of such Legal Defeasance and will be subject to federal income tax
on the same amounts, in the same manner and at the same times as would have
been the case if such Legal Defeasance had not occurred;


 


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


 


(4)                                  no
Default or Event of Default shall have occurred and be continuing on the date
of such deposit (other than a Default or Event of Default resulting from the
borrowing of funds to be applied to such deposit);


 


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


 


(6)                                  the
Company must deliver to the Trustee an Officers’ Certificate stating that the
deposit was not made by the Company with the intent of preferring the Holders
over the other creditors of the Company with the intent of defeating,
hindering, delaying or defrauding any creditors of the Company or others; and


 


(7)                                  the
Company must deliver to the Trustee an Officers’ Certificate and an Opinion of
Counsel, each stating that all conditions precedent relating to the Legal
Defeasance or the Covenant Defeasance have been complied with.


 


Section 8.05                                Deposited
Money and Government Securities to be Held in Trust; Other Miscellaneous
Provisions.


 


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


 


The Company will
pay and indemnify the Trustee against any tax, fee or other charge imposed on
or assessed against the cash or non-callable Government Securities deposited
pursuant to Section 8.04 hereof or the principal and interest received in
respect thereof other than any such tax, fee or other charge which by law is
for the account of the Holders of the outstanding Notes.


 


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Notwithstanding
anything in this Article 8 to the contrary, the Trustee will deliver or pay to
the Company from time to time upon the request of the Company any money or
non-callable Government Securities held by it as provided in Section 8.04
hereof which, in the opinion of a nationally recognized firm of independent
public accountants expressed in a written certification thereof delivered to
the Trustee (which may be the opinion delivered under Section 8.04(1) hereof),
are in excess of the amount thereof that would then be required to be deposited
to effect an equivalent Legal Defeasance or Covenant Defeasance.


 


Section 8.06                                Repayment to
Company.


 


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


 


Section 8.07                                Reinstatement.


 


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


 


ARTICLE 9


AMENDMENT,
SUPPLEMENT AND WAIVER


 


Section 9.01                                Without
Consent of Holders.


 


Notwithstanding
Section 9.02 of this Indenture, the Company and the Trustee may amend or
supplement this Indenture or the Notes without the consent of any Holder:


 


(1)                             cure any ambiguity, defect or
inconsistency in this Indenture; provided that
such amendments do not adversely affect the interests of the Holders in any
material respect;


 


(2)                             comply with the provisions under
Article 5;


 


(3)                             comply with any requirements of the
SEC in connection with the qualification of this Indenture under the Trust
Indenture Act;


 


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(4)                             evidence and provide for the
acceptance of appointment by a successor Trustee; 


 


(5)                             to conform the text of this
Indenture or the Notes to any provision of the “Description of Notes” section
of the Company’s Offering Memorandum dated February 5, 2004, relating to the
initial offering of the Notes, to the extent that such provision was intended
to be a verbatim recitation of a provision of this Indenture or the Notes;


 


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


 


(7)                             make any change that, in the good
faith opinion of the Board of Directors, does not materially and adversely
affect the rights of any Holder.


 


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


 


Section 9.02                                With Consent
of Holders.


 


Except as provided
below in this Section 9.02, the Company and the Trustee may amend or supplement
this Indenture (including, without limitation, Sections 4.10 and 4.14) and the
Notes with the consent of the Holders of at least a majority in aggregate
principal amount of the then outstanding Notes (including, without limitation,
Additional Notes, if any) voting as a single class (including, without
limitation, consents obtained in connection with a tender offer or exchange
offer for, or purchase of, the Notes), and, subject to Sections 6.04 and 6.07
hereof, any existing Default or Event of Default (other than a Default or Event
of Default in the payment of the principal of, premium or Additional Interest,
if any, or interest on, the Notes, except a payment default resulting from an
acceleration that has been rescinded) or compliance with any provision of this
Indenture or the Notes may be waived with the consent of the Holders of a
majority in aggregate principal amount of the then outstanding Notes
(including, without limitation, Additional Notes, if any) voting as a single
class (including, without limitation, consents obtained in connection with a
tender offer or exchange offer for, or purchase of, the Notes). 



 


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


 


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


 


After an
amendment, supplement or waiver under this Section 9.02 becomes effective, the
Company will mail to the Holders affected thereby a notice briefly describing
the amendment,


 


74

















 


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


 


(1)                                  change the Stated Maturity of the
principal of, or any installment of interest on, any Note;


 


(2)                                  reduce the principal amount of, or
premium, if any, or interest on, any Note;


 


(3)                                  waive a redemption payment with
respect to any Note (other than a payment required by Sections 4.10 or 4.14);


 


(4)                                  change the place or currency of
payment of principal of, or premium, if any, or interest on, any Note;


 


(5)                                  impair the right to institute suit
for the enforcement of any payment on or after the Stated Maturity (or, in the
case of a redemption, on or after the Redemption Date) of any Note;


 


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


 


(7)                                  modify the subordination provisions
in a manner adverse to the Holders; or 


 


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


 


Section 9.03                                Compliance
with Trust Indenture Act.


 


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


 


Section 9.04                                Revocation
and Effect of Consents.


 


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


 


75

















 


Section 9.05                                Notation on
or Exchange of Notes.


 


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


 


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


 


Section 9.06                                Trustee to
Sign Amendments, etc.


 


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


 


ARTICLE 10


SUBORDINATION


 


Section 10.01                          Agreement to
Subordinate.


 


The Company
agrees, and each Holder by accepting a Note agrees, that the payment of the
Senior Subordinated Obligations will, to the extent set forth herein, be
subordinated in right of payment to the prior payment in full, in cash or cash
equivalents, of all Obligations due in respect of existing and future Senior
Indebtedness (whether outstanding on the date hereof or hereafter created,
incurred, assumed or guaranteed), and that the subordination is for the benefit
of the holders of Senior Indebtedness.


 


Section 10.02                          Liquidation;
Dissolution; Bankruptcy.


 


Upon any distribution
to creditors of the Company in a liquidation or dissolution of the Company or
in a bankruptcy, reorganization, insolvency, receivership or similar proceeding
relating to the Company or its property, in an assignment for the benefit of
creditors or any marshaling of the Company’s assets and liabilities:  


 


(1)                                  holders
of Senior Indebtedness will be entitled to receive payment in full in cash or
cash equivalents of all Obligations due in respect of Senior Indebtedness
(including, with respect to Designated Senior Indebtedness, any interest
accruing after the commencement of any proceeding described below at the rate
specified in the applicable Designated Senior Indebtedness whether or not
interest is an allowed claim enforceable against the Company in such
proceeding) before the Holders will be entitled to receive any payment on
account of Senior Subordinated Obligations or any payment to acquire any of the
Notes for cash, property or securities, or any distribution with respect to the
Notes of any cash, property or securities (except that Holders may receive and
retain (A) Permitted Junior Securities and (B) payments made from the trust
described in Article 8 hereof), in the event of any distribution to creditors
of the Company:  (1) in a
liquidation or dissolution of the Company; (2) in a bankruptcy,
reorganization, insolvency, receivership or similar proceeding relating to the
Company or its property; (3) in an


 


76

















 


assignment for the benefit of creditors; or (4) in any
marshaling of the Company’s assets and liabilities.


 


(2)                                  until
all Obligations due with respect to Senior Indebtedness (including, with
respect to Designated Senior Indebtedness, any interest accruing after the
commencement of any proceeding described before at the rate specified in the
applicable Designated Senior Indebtedness whether or not interest is an allowed
claim enforceable against the Company in such proceeding) are paid in full in
cash or cash equivalents, any such distribution to which Holders would be
entitled shall be made to the holders of Senior Indebtedness (except that
Holders may receive and retain (A) Permitted Junior Securities and (B) payments
made from the trust described in Article 8 hereof).


 


Section 10.03                          Default on
Designated Senior Indebtedness.


 


(a)                                  The
Company and the Subsidiary Guarantors may not make any payment in respect of
any Senior Subordinated Obligations (except in (A) Permitted Junior Securities
or (B) from the trust described in Article 8 hereof) nor may any amounts be set
aside or deposited pursuant to Article 8 if: 


 


(1)                                  a
payment default on Designated Senior Indebtedness occurs and is continuing
beyond any applicable grace period; or 


 


(2)                                  any
other default occurs and is continuing on any series of Designated Senior
Indebtedness that permits holders of that series of Designated Senior
Indebtedness to accelerate its maturity and the Trustee receives a notice of
such default (a “Payment Blockage Notice”)
from the trustee or other representative for the holders of any Designated
Senior Indebtedness, or the holders of at least a majority of the outstanding
principal amount of such Designated Senior Indebtedness.  No new Payment Blockage Notice may be
delivered unless and until: (A) 360 days have elapsed since the
delivery of the immediately prior Payment Blockage Notice; and (B) all
scheduled payments of principal, interest and premium and Additional or Special
Interest, if any, on the Notes that have come due have been paid in full in
cash. No nonpayment default that existed or was continuing on the date of
delivery of any Payment Blockage Notice to the Trustee shall be, or be made,
the basis for a subsequent Payment Blockage Notice. 


 


(b)                                 Payments
on the Notes and the Subsidiary Guarantees may and shall be resumed: 


 


(1)                                  in
the case of a payment default, upon the date on which such default is cured or
waived; and 


 


(2)                                  in
case of a nonpayment default, the earlier of the date on which such nonpayment
default is cured or waived or 179 days after the date on which the
applicable Payment Blockage Notice is received.


 


(c)                                  Notwithstanding
the foregoing, the Company will be permitted to redeem any Notes to the extent
required to do so by any Gaming Authority as described in Section 3.08 hereof.


 


Section 10.04                          Acceleration
of Notes.


 


If payment of the
Notes is accelerated because of an Event of Default, the Company shall promptly
notify holders of Senior Indebtedness of the acceleration.


 


77

















 


Section 10.05                          When
Distribution Must Be Paid Over.


 


In the event that
the Trustee or any Holder receives any payment of any Senior Subordinated
Obligations with respect to the Notes at a time when the Trustee or such
Holder, as applicable, has actual knowledge that such payment is prohibited by
Section 10.03 hereof, such payment shall be held by the Trustee or such Holder,
in trust for the benefit of, and shall be paid forthwith over and delivered,
upon written request, to, the holders of Senior Indebtedness as their interests
may appear or their Representative under this Indenture or other agreement (if
any) pursuant to which Senior Indebtedness may have been issued, as their
respective interests may appear, for application to the payment of all
Obligations with respect to Senior Indebtedness remaining unpaid to the extent
necessary to pay such Obligations in full in accordance with their terms, after
giving effect to any concurrent payment or distribution to or for the holders
of Senior Indebtedness.


 


With respect to
the holders of Senior Indebtedness, the Trustee undertakes to perform only such
obligations on the part of the Trustee 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
shall not be liable to any such holders if the Trustee shall pay over or
distribute to or on behalf of Holders or the Company or any other Person money
or assets to which any holders of Senior Indebtedness shall be entitled by
virtue of this Article 10, except if such payment is made as a result of the
willful misconduct or gross negligence of the Trustee.


 


Section 10.06                          Notice by
Company.


 


The Company shall
promptly notify the Trustee, holders of Senior Indebtedness and the Paying
Agent of any facts known to the Company that would cause a payment of any
Senior Subordinated Obligations with respect to 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 as provided in this Article 10.


 


Section 10.07                          Subrogation.


 


Subject to the
payment in full, in cash or cash equivalents, of all Senior Indebtedness, the
Holders shall be subrogated to the rights of the holders of Senior Indebtedness
to receive payments or distributions of assets of the Company applicable to the
Senior Indebtedness until all amounts owing on the Notes shall be paid in full,
in cash or cash equivalents, and for the purpose of such subrogation no
payments or distributions to the holders of Senior Indebtedness by or on behalf
of the Holders by virtue of this Article 10, which otherwise would have been
made to the Holders, shall, as between the Company and the Holders, be deemed
to be payment by the Company to holders or on account of the Senior
Indebtedness, it being understood that the provisions of this Article 10 are
and are intended solely for the purpose of defining the relative rights of the
Holders, on the one hand, and the holders of Senior Indebtedness, on the other
hand.


 


If any payment or
distribution to which the Holders would otherwise have been entitled but for
the provisions of this Article 10 shall have been applied, pursuant to the
provisions of this Article 10, to the payment of all amounts payable under the
Senior Indebtedness, then the Holders shall be entitled to receive from the
holders of such Senior Indebtedness any payments or distributions received by
such holders of Senior Indebtedness in excess of the amount sufficient to pay
all amounts payable under or in respect of the Senior Indebtedness in full, in
cash or cash equivalents.


 


78

















 


Section 10.08                          Relative
Rights.


 


This Article 10
defines the relative rights of Holders and holders of Senior Indebtedness.
Nothing in this Indenture shall:


 


(1)                                  impair,
as between the Company and 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 their
rights in relation to holders of Senior Indebtedness; or


 


(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 and owners of Senior
Indebtedness to receive distributions and payments otherwise payable to
Holders.


 


If the Company
fails because of this Article 10 to pay principal of or interest on a Note on
the due date, the failure is still a Default or Event of Default.


 


Section 10.09                          Subordination
May Not Be Impaired by Company.


 


No right of any
holder of Senior Indebtedness to enforce the subordination of the Indebtedness
evidenced by the Notes shall be impaired by any act or failure to act by the
Company or any Holder or by the failure of the Company or any Holder to comply
with this Indenture.


 


Section 10.10                          Distribution
or Notice to Representative.


 


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 Representative.


 


Upon any payment
or distribution of assets of the Company referred to in this Article 10, the
Trustee and the Holders shall be entitled to rely upon any order or decree made
by any court of competent jurisdiction or upon any certificate of such
Representative or of the liquidating trustee or agent or other 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 the Senior Indebtedness and other Indebtedness of the Company, the
amount thereof or payable thereon, the amount or amounts paid or distributed
thereon and all other facts pertinent thereto or to this Article 10.


 


Section 10.11                          Rights of
Trustee and Paying Agent.


 


Notwithstanding
the provisions of this Article 10 or any other provision of this Indenture, the
Trustee shall not be charged with knowledge of the existence of any facts that
would prohibit the making of any payment or distribution by the Trustee, and
the Trustee and the Paying Agent may continue to make payments on the Notes,
unless the Trustee shall have received at its Corporate Trust Office at least
two Business Days prior to the date of such payment written notice of facts
that would cause the payment of any Senior Subordinated Obligations with
respect to the Notes to violate this Article 10.   Only the Company or a Representative may give the notice.  Nothing in this Article 10 shall impair the
claims of, or payments to, the Trustee under or pursuant to Section 7.07
hereof.


 


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.


 


79

















 


Section 10.12                          Authorization
to Effect Subordination.


 


Each Holder, by
the Holder’s acceptance thereof, authorizes and directs the Trustee on such
Holder’s behalf to take such action as may be necessary or appropriate to
effectuate the subordination as provided in this Article 10, and appoints the
Trustee to act as such Holder’s attorney-in-fact for any and all
such purposes.  If the Trustee does not
file a proper proof of claim or proof of debt in the form required in any
proceeding referred to in Section 6.09 hereof at least 30 days before the
expiration of the time to file such claim, the Representatives are hereby
authorized to file an appropriate claim for and on behalf of the Holders.


 


Section 10.13                          Amendments.


 


The provisions of
this Article 10 shall not be amended or modified without the written consent of
the holders of all Senior Indebtedness.


 


ARTICLE 11


MISCELLANEOUS


 


Section 11.01                          Trust
Indenture Act Controls.


 


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


 


Section 11.02                          Notices.


 


Any notice or
communication by the Company or the Trustee to the others is duly given if in
writing and delivered in Person or by first class mail (registered or
certified, return receipt requested), facsimile transmission or overnight air
courier guaranteeing next day delivery, to the others’ address:


 


If to the Company:


 


Argosy Gaming Company


219 Piasa Street


Alton, IL 
62002-6232


Facsimile No.: 
(618) 474-6232


Attention: 
General Counsel


 


With a copy to:


Winston & Strawn LLP


35 West Wacker Drive 


Chicago, IL 
60601


Facsimile No.: 
(312) 558-5700


Attention:  R.
Cabell Morris, Jr.


 


If to the Trustee:


J.P. Morgan Trust Company, National Association


55 West Monroe Street, 15th
Floor, Suite IL1-0823


Chicago, Illinois  60670-0823


Facsimile No.: 
(312) 336-8841


Attention: 
Joseph J. Morand


 


80

















 


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


 


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


 


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


 


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


 


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


 


Section 11.03                          Communication
by Holders with Other Holders.


 


Holders may
communicate pursuant to TIA § 312(b) with other Holders with respect to
their rights under this Indenture or the Notes.  The Company, the 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 to the Trustee to take any action under this
Indenture, the Company shall furnish to the Trustee:


 


(1)                                  an Officers’ Certificate in form and
substance reasonably satisfactory to the Trustee (which must include the
statements set forth in Section 11.05 hereof) stating that, in the opinion of
the signers, all conditions precedent and covenants, if any, provided for in
this Indenture relating to the proposed action have been satisfied; and


 


(2)                                  an Opinion of Counsel in form and
substance reasonably satisfactory to the Trustee (which must include the
statements set forth in Section 11.05 hereof) stating that, in the opinion of
such counsel, all such conditions precedent and covenants have been satisfied.


 


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 (other than a certificate provided pursuant to TIA
§ 314(a)(4)) must comply with the provisions of TIA § 314(e) and must
include:


 


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


 


81

















 


(2)                                  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;


 


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


 


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


 


Section 11.06                          Rules by
Trustee and Agents.


 


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


 


Section 11.07                          No Personal
Liability of Directors, Officers, Employees and Stockholders.


 


No past, present
or future director, officer, employee, incorporator or stockholder of the
Company, as such, will have any liability for any obligations of the Company
under the Notes, this Indenture or for any claim based on, in respect of, or by
reason of, such obligations or their creation. 
Each Holder by accepting a Note waives and releases all such
liability.  The waiver and release are part
of the consideration for issuance of the Notes.  The waiver may not be effective to waive liabilities under the
federal securities laws.


 


Section 11.08                          Governing
Law.


 


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


 


Section 11.09                          No Adverse
Interpretation of Other Agreements.


 


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


 


Section 11.10                          Successors.


 


All agreements of
the Company in this Indenture and the Notes will bind its successors.  All agreements of the Trustee in this
Indenture will bind its successors.


 


Section 11.11                          Severability.


 


In case any
provision in this Indenture or in the Notes is invalid, illegal or
unenforceable, the validity, legality and enforceability of the remaining
provisions will not in any way be affected or impaired thereby.


 


82

















 


Section 11.12                          Counterpart
Originals.


 


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


 


Section 11.13                          Table of
Contents, Headings, etc.


 


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


 


(Signature Page
Follows)


 


83

















 


SIGNATURES


 


	
  Dated as of
  February 12, 2004

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  ARGOSY GAMING
  COMPANY

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
  /s/ DALE R.
  BLACK

  	
   

  
	
   

  	
   

  	
   

  	
  Dale R. Black

  
	
   

  	
   

  	
   

  	
  Senior Vice
  President and Chief Financial Officer

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  J.P. MORGAN
  TRUST COMPANY, NATIONAL

  ASSOCIATION

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
  /s/ JOSEPH J.
  MORAND

  	
   

  
	
   

  	
   

  	
   

  	
  Joseph J. Morand

  
	
   

  	
   

  	
   

  	
  Vice President

  



 

















[Face of Note]


 


CUSIP/CINS
            


 


7% Senior
Subordinated Notes due 2014


 


	
  No.     

  	
   

  	
  $            

  



 


Argosy Gaming
Company


 


promises to pay to
[                       ]
or registered assigns, 


 


the principal sum
of
                                                          
DOLLARS on
             ,
20   .


 


Interest Payment
Dates:  January 15 and July 15


 


Record Dates:  January 1 and July 1


 


Dated: 
               ,
200 


 


	
   

  	
  ARGOSY GAMING
  COMPANY

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
  Title:

  
	
   

  	
   

  	
   

  
	
  This is one of
  the Notes referred to

  in the within-mentioned Indenture:

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  J.P. MORGAN
  TRUST COMPANY, NATIONAL

  ASSOCIATION

  	
   

  	
   

  
	
    as Trustee

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  By:

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Authorized
  Signatory

  
							



 


A-1

















 


[Back of Note]


7% Senior
Subordinated Notes due 2014


 


[Insert the Global Note Legend, if
applicable pursuant to the provisions of the Indenture]


 


[Insert the Private Placement
Legend, if applicable pursuant to the provisions of the Indenture]


 


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


 


(1)                                  Interest. 
Argosy Gaming Company, a Delaware corporation (the “Company”), promises to pay interest on the
principal amount of this Note at 7% per annum from
                     ,
20   until maturity and shall pay the Additional Interest, if any,
payable pursuant to the Registration Rights Agreement referred to below.  The Company will pay interest and Additional
Interest, if any, semi-annually in arrears on January 15 and July 15 of each
year, or if any such day is not a Business Day, on the next succeeding Business
Day (each, an “Interest Payment Date”).  Interest on the Notes will accrue from the
most recent date to which interest has been paid or, if no interest has been
paid, from the date of issuance; provided that if there is no existing
Default in the payment of interest, and if this Note is authenticated between a
record date referred to on the face hereof and the next succeeding Interest
Payment Date, interest shall accrue from such next succeeding Interest Payment
Date; provided
further that the first Interest Payment Date shall be
             ,
20  .  The Company will pay
interest (including post-petition interest in any proceeding under any
Bankruptcy Law) on overdue principal and premium, if any, from time to time on
demand at a rate then in effect to the extent lawful; it will pay interest
(including post-petition interest in any proceeding under any Bankruptcy Law)
on overdue installments of interest and Additional Interest, if any, (without
regard to any applicable grace periods) from time to time on demand at the same
rate to the extent lawful.  Interest
will be computed on the basis of a 360-day year of twelve 30-day months.


 


(2)                                  Method of Payment. 
The Company will pay interest on the Notes (except defaulted interest)
and Additional Interest, if any, to the Persons who are registered Holders at
the close of business on the January 1 or July 1 next preceding the Interest
Payment Date, even if such Notes are canceled after such record date and on or
before such Interest Payment Date, except as provided in Section 2.12 of the
Indenture with respect to defaulted interest. 
The Notes will be payable as to principal, premium and Additional
Interest, if any, and interest at the office or agency of the Company
maintained for such purpose within or without the City and State of New York,
or, at the option of the Company, payment of interest and Additional Interest,
if any, may be made by check mailed to the Holders at their addresses set forth
in the register of Holders; provided that payment by wire transfer of
immediately available funds will be required with respect to principal of and
interest, premium and Additional Interest, if any, on, all Global Notes and all
other Notes the Holders of which will have provided wire transfer instructions
to the Company or the Paying Agent. 
Such payment will be in such coin or currency of the United States of
America as at the time of payment is legal tender for payment of public and
private debts.


 


(3)                                  Paying Agent and Registrar. 
Initially, J.P. Morgan Trust Company National Association, the Trustee
under the Indenture, will act as Paying Agent and Registrar.  The Company may change any Paying Agent or
Registrar without notice to any Holder. 
The Company or any of its Subsidiaries may act in any such capacity.


 


(4)                                  Indenture. 
The Company issued the Notes under an Indenture dated as of February 12,
2004 (the “Indenture”) between
the Company and the Trustee.  The terms
of the Notes


 


A-2

















 


include those stated in the Indenture
and those made part of the Indenture by reference to the TIA.  The Notes are subject to all such terms, and
Holders are referred to the Indenture and such Act for a statement of such
terms.  To the extent any provision of
this Note conflicts with the express provisions of the Indenture, the
provisions of the Indenture shall govern and be controlling.  The Notes are unsecured obligations of the
Company.  The Indenture does not limit
the aggregate principal amount of Notes that may be issued thereunder.


 


(5)                                  Optional Redemption.


 


(a)                Except as set forth in subparagraph (b) of this
Paragraph (5), the Company will not have the option to redeem the Notes prior
to January 15, 2009.  On or after
January 15, 2009, the Company will have the option to redeem all or a part of
the Notes upon not less than 30 nor more than 60 days’ notice, at the
redemption prices (subject to the right of
Holders on the relevant record date that is on or prior to the redemption date
to receive interest due on an interest payment date), if redeemed during
the twelve-month period beginning on January 15 of the years indicated
below:


 


	
  Year

  	
   

  	
  Percentage

  	
   

  
	
  2009

  	
   

  	
  103.500

  	
  %

  
	
  2010

  	
   

  	
  102.333

  	
  %

  
	
  2011

  	
   

  	
  101.167

  	
  %

  
	
  2012 and thereafter

  	
   

  	
  100.000

  	
  %

  



 


Unless the Company
defaults in the payment of the redemption price, interest will cease to accrue
on the Notes or portions thereof called for redemption on the applicable redemption
date.


 


(b)               Notwithstanding the provisions of subparagraph (a) of
this Paragraph (5), at any time prior to January 15, 2007, the Company may on
any one or more occasions redeem up to 35% of the aggregate principal amount of
Notes issued under the Indenture at a redemption price of 107.0% of the
principal amount thereof, plus accrued and unpaid interest and Additional
Interest, if any, to the redemption date (subject
to the right of Holders of record on the relevant record date that is on or
prior to the redemption date to receive interest due on an interest payment
date), with the Net Cash Proceeds (as defined in the Indenture) of one
or more Equity Offerings (as defined in the Indenture); provided that (i) at least
65% of the aggregate principal amount of Notes issued under the Indenture
remains outstanding immediately after the occurrence of such redemption
(excluding Notes held by the Company and its Subsidiaries); and (ii) the
redemption occurs within 60 days of the date of the closing of such Equity
Offering.


 


(6)                                  Gaming
Redemption.  If any Gaming Authority (i) requests
or requires a Holder or Beneficial Owner of Notes to appear before, submit to
the jurisdiction of or provide information to, such Gaming Authority and such
Holder or Beneficial Owner either refuses to do so or otherwise fails to comply
with such request or requirement within a reasonable period of time; or (ii)
determines that any Holder or Beneficial Owner of Notes is not suitable or
qualified with respect to beneficial ownership of the Notes, then the Company
may: (1) require that such Holder or Beneficial Owner dispose of its Notes
within 30 days (or such earlier date as required by the Gaming Authority)
of (a) the termination of the 30-day period described above for the Holder
or Beneficial Owner to apply for a license, qualification or finding of
suitability or (b) the receipt of the notice from the Gaming Authority
that the Holder or Beneficial Owner will not be licensed, qualified or found
suitable; or (2) redeem the Notes of such Holder or Beneficial Owner at a price
equal to the lesser of (a) the price at which such Holder or Beneficial
Owner acquired such Notes or (b) the Fair Market Value of such Notes or,
if the Notes are listed on a national securities exchange, the last reported
sale price on the date the Company notifies such Holder or Beneficial Owner of
the redemption. Immediately upon a determination that a Holder or Beneficial
Owner will not be licensed, qualified or found suitable, the Holder or
Beneficial


 


A-3

















 


Owner will have no further rights
(i) to exercise any right conferred by the Notes, directly or indirectly,
through any trustee, nominee or any other Person or entity, or (ii) to
receive any interest or other distribution or payment with respect to the Notes
or any remuneration in any form from the Company for services rendered or
otherwise, except the redemption price of the Notes.  The Holder or Beneficial Owner applying for a license,
qualification or finding of suitability must pay all costs of the licensure or
investigation for such qualification or finding of suitability.


 


(7)                                  Mandatory Redemption.


 


The Company is not
required to make mandatory redemption or sinking fund payments with respect to
the Notes.


 


(8)                                  Offers to Purchase.


 


(a)                                         Change of Control.  Within
30 days of the occurrence of a Change of Control, the Company shall
commence and consummate an Offer to Purchase for all Notes then outstanding, at
a purchase price equal to 101% of the principal amount thereof, plus accrued
interest and Additional Interest, if any, to the Payment Date.


 


(b)                                        Asset Sale. The Company will not, and will not permit any
Restricted Subsidiary to, consummate any Asset Sale, unless (i) the
consideration received by the Company or such Restricted Subsidiary is at least
equal to the fair market value of the assets sold or disposed of and (ii) at
least 75% of the consideration received consists of cash or Temporary Cash
Investments or the assumption of the Indebtedness of the Company or any
Restricted Subsidiary (other than Indebtedness to the Company or any Restricted
Subsidiary), provided that the
Company or such Restricted Subsidiary is irrevocably and unconditionally
released from all liability under such Indebtedness. Notwithstanding clauses
(i) and (ii), the Company and its Restricted Subsidiaries will be permitted to
consummate a Permitted Asset Swap without complying with such paragraph if (i)
immediately after giving effect to such Permitted Asset Swap, the Company could
Incur at least $1.00 of additional Indebtedness pursuant to the Interest
Coverage Ratio test set forth in Section 4.09(a) of the Indenture and (ii) the
Company or the applicable Restricted Subsidiary, as the case may be, receives
assets at the time of such Permitted Asset Swap of a value at least equal to
the fair market value of the assets or other property sold or otherwise
disposed of (as evidenced by a resolution of the Company’s Board of Directors
set forth in an Officers’ Certificate delivered to the Trustee, or, in the
event that the fair market value of such Permitted Asset Swap exceeds $100.0
million, such fair market value has been determined by a written opinion of an
investment banking firm of national standing or other recognized independent
expert with experience appraising the terms and conditions of the type of
transaction contemplated thereby).


 


Within twelve months after the receipt of any Net Cash
Proceeds from one or more Asset Sales occurring on or after the Closing Date,
the Company shall or shall cause the relevant Restricted Subsidiary to
(i)(A)  apply an amount equal to such Net Cash Proceeds to
permanently repay Senior Indebtedness of the Company or Indebtedness of any
Restricted Subsidiary, in each case owing to a Person other than the Company or
any of its Restricted Subsidiaries; or (B) invest an equal amount, or the
amount not so applied pursuant to clause (A) (or enter into a definitive
agreement committing to so invest within 12 months after the date of such
agreement), in property or assets (other than current assets) of a nature or
type or that are used in a business (or in a company having property and assets
of a nature or type, or engaged in a business) similar or related to the nature
or type of the property and assets of, or the business of, the Company and its
Restricted Subsidiaries existing on the date of such investment; and (ii) apply
(no later than the end of the 12-month period referred to in (i)(B)) such
excess Net Cash Proceeds (to the extent not applied pursuant to clause (i)) as
provided in the following paragraph of this paragraph (8)(b).  The amount of such excess Net Cash Proceeds
required to be applied (or to be committed to be


 


A-4

















 


applied) during
such 12-month period as set forth in clause (i) of the preceding sentence and
not applied as so required by the end of such period shall constitute “Excess
Proceeds.”


 


If, as of the first day of any calendar month, the
aggregate amount of Excess Proceeds not theretofore subject to an Offer to
Purchase pursuant to this paragraph (8) totals at least $25.0 million, the
Company must commence, not later than the fifteenth Business Day of such month,
and consummate an Offer to Purchase from the Holders (and if required by the terms
of any Indebtedness that is pari passu with
the Notes (“Pari Passu Indebtedness”),
from the holders of such Pari Passu Indebtedness) on a pro rata basis an aggregate
principal amount of Notes (and Pari Passu Indebtedness) equal to the Excess
Proceeds on such date, at a purchase price equal to 100% of the principal
amount thereof, plus, in each case, accrued interest and Additional Interest,
if any, to the Payment Date.  If the
aggregate principal amount of Notes and any such Pari Passu Indebtedness tendered
by holders thereof exceeds the amount of Excess Proceeds, the Notes and Pari
Passu Indebtedness shall be purchased on a pro rata basis.  Upon the completion of any such Offers to Purchase, regardless of
the amount of Notes validly tendered, the amount of Excess Proceeds shall be
reset to zero.


 


(c)                                  Suspended Covenants.  During
any period of time that:  (i) the Notes are rated Baa3 or better by Moody’s and
BBB- or better by S&P (or, if either such entity ceases to rate the Notes
for reasons outside of the control of the Company, the equivalent investment
grade credit rating from any other “nationally recognized statistical rating
organization” within the meaning of Rule 15c3-1(c)(2)(vi)(F) under the
Exchange Act selected by the Company as a replacement agency), and (ii) no Default or Event of Default
shall have occurred and be continuing, then, beginning on that day and subject
to this paragraph (8)(c), the Company and its Restricted Subsidiaries will not
be subject to the covenants set forth in paragraph (8)(a) and (8)(b) hereof and
certain other covenants contained in the Indenture (collectively, the “Suspended
Covenants”).  During any period that the Suspended Covenants have been suspended, the Company’s Board of
Directors may not designate any of its Subsidiaries as Unrestricted
Subsidiaries pursuant to Section 4.17 of the Indenture.


 


Notwithstanding the foregoing, if the rating assigned by either such
rating agency should subsequently decline to below Baa3 or BBB-, respectively, the Suspended Covenants will be reinstated as of and from the date of such
rating decline. Calculations under the reinstated Section 4.07 of the Indenture
will be made as if such section had been in effect since the date of the
Indenture except that no default will be deemed to have occurred solely by
reason of a Restricted Payment (as defined in the Indenture) made while Section
4.07 was suspended.


 


(9)                                  Notice of Redemption. 
Notice of redemption will be mailed at least 30 days but not more than
60 days before the redemption date to each Holder whose Notes are to be
redeemed at its registered address, except that redemption notices may be
mailed more than 60 days prior to a redemption date if the notice is issued in
connection with a defeasance of the Notes or a satisfaction or discharge of the
Indenture.  Notes in denominations
larger than $1,000 may be redeemed in part but only in whole multiples of
$1,000, unless all of the Notes held by a Holder are to be redeemed.


 


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


 


A-5

















 


selection of Notes to be redeemed or
during the period between a record date and the corresponding Interest Payment
Date.


 


(11)                            Persons Deemed Owners. 
The registered Holder may be treated as its owner for all purposes.


 


(12)                            Amendment, Supplement and Waiver. 
Subject to certain exceptions, the Indenture or the Notes may be amended
or supplemented with the consent of the Holders of at least a majority in
aggregate principal amount of the then outstanding Notes including Additional
Notes, if any, voting as a single class, and any existing Default or Event or
Default or compliance with any provision of the Indenture or the Notes may be
waived with the consent of the Holders of a majority in aggregate principal
amount of the then outstanding Notes including Additional Notes, if any, voting
as a single class.  Without the consent
of any Holder, the Indenture or the Notes may be amended or supplemented to
cure any ambiguity, defect or inconsistency; to provide for the assumption of
the Company’s obligations to Holders in case of a merger or consolidation;
evidence and provide for the acceptance of appointment by a successor trustee;
to comply with the requirements of the SEC in order to effect or maintain the
qualification of the Indenture under the TIA; to conform the text of the
Indenture or the Notes to any provision of the “Description of Notes” section
of the Company’s Offering Memorandum dated February 5, 2004, relating to the
initial offering of the Notes, to the extent that such provision was intended
to be a verbatim recitation of a provision of the Indenture or the Notes; to
provide for the issuance of Additional Notes in accordance with the limitations
set forth in the Indenture; or to make any change that, in the good faith
opinion of the Company’s Board of Directors will not materially and adversely
affect the rights of any Holder.


 


(13)                            Defaults and Remedies. 
Events of Default include:  (i)
default in the payment of principal of (or premium, if any, on) any Note when
the same becomes due and payable at maturity, upon acceleration, redemption or
otherwise whether or not such payment is prohibited by the subordination
provisions of the Indenture; (ii) default in the payment of interest on any
Note when the same becomes due an payable, and such default continues for a
period of 30 days whether or not such payment is prohibited by the
subordination provisions of the Indenture; (iii) default in the performance or
breach of the provisions of the Indenture applicable to mergers, consolidations
and transfers of all or substantially all of the assets of the Company or the
failure to make or consummate an Offer to Purchase in accordance with Section
4.10 or 4.14 of the Indenture; (iv) the Company defaults in the performance of
or breaches any other covenant or agreement of the Company in the Indenture or
under the Notes (other than a default specified in clause (i), (ii) or (iii) of
this paragraph (13) and such default or breach continues for a period of 30
consecutive days after written notice by the Trustee or the Holders of 25% or
more in aggregate principal amount of the Notes; (v) there occurs with respect
to any issue or issues of Indebtedness of the Company or any Restricted
Subsidiary having an outstanding principal amount of $20.0 million or more in
the aggregate for all such issues of all such Persons, whether such
Indebtedness now exists or shall hereafter be created, (A) an event of default
that has caused the holder thereof to declare such Indebtedness to be due and
payable prior to its Stated Maturity and such Indebtedness has not been
discharged in full or such acceleration has not been rescinded or annulled
within 30 days of such acceleration and/or (B) the failure to make a principal
payment at the final (but not any interim) fixed maturity and such defaulted
payment shall not have been made, waived or extended within 30 days of such
payment default; (vi) any final judgment or order (not covered by insurance)
for the payment of money in excess of $20.0 million in the aggregate for all
such final judgments or orders against all such Persons (treating any
deductibles, self-insurance or retention as not so covered) shall be
rendered against the Company or any Restricted Subsidiary and shall not be paid
or discharged, and there shall be any period of 60 consecutive days following
entry of the final judgment or order that causes the aggregate amount for all
such final judgments or orders outstanding and not paid or discharged against
all such Persons to exceed $20.0 million during which a stay of enforcement of
such final judgment or order, by


 


A-6

















 


reason of a pending appeal or
otherwise, shall not be in effect; (vii) certain events of bankruptcy or
insolvency; or (viii) the revocation, termination, suspension or other
cessation of effectiveness for a period or more than 90 consecutive days of any
Gaming License that results in the cessation or suspension of gaming operations
at any Material Casino; provided
that any voluntary relinquishment of or failure to renew after revocation a
Gaming License of a Material Casino if such relinquishment or failure to renew
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 Subsidiaries, taken as a whole, and not
disadvantageous in any material respect to the Holders shall not constitute an
Event of Default.  If an event of
Default (other than an Event of Default arising out of certain events of
bankruptcy or insolvency) occurs and is continuing under the Indenture, the
Trustee or the Holders of at least 25% in aggregate principal amount of the
Notes, then outstanding, by written notice to the Company (and to the Trustee
if such notice is given by Holders), may, and the Trustee at the request of
such Holders shall, declare the principal of, premium, if any, and accrued
interest and Additional Interest, if any, on the Notes to be immediately, due
and payable.  Upon a declaration of
acceleration, such principal of, premium, if any, and accrued interest and
Additional Interest, if any, shall be immediately due and payable.  In the event of a declaration of
acceleration because of an Event of Default set forth in clause (v) of this paragraph
has occurred and is continuing, such declaration of acceleration shall be
automatically rescinded and annulled if the event of default triggering such
Event of Default pursuant to clause (v) of this paragraph shall be remedied or
cured by the Company or the relevant Restricted Subsidiary or waived by the
holders of the relevant Indebtedness within 60 days after the declaration of
acceleration with respect thereto.  If
an Event of Default specified in clause (vii) of this paragraph (13) occurs
with respect to the Company, the principal of, premium, if any, and accrued
interest or Additional Interest, if any, on the Notes then outstanding 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 at least a
majority in principal amount of the outstanding Notes by written notice to the
Company and to the Trustee, may waive all past defaults and rescind and annul a
declaration of acceleration and its consequences if (i) all existing Events of
Default, other than the nonpayment of the principal of, premium, if any, and
accrued interest and Additional Interest, if any, on the Notes that have become
due solely by such declaration of acceleration, have been cured or waived and
(ii) the rescission would not conflict with any judgment or decree of a court
of competent jurisdiction.  If an Event
of Default occurs and is continuing, the Trustee may pursue any available
remedy to collect the payment of principal, premium and Additional Interest, if
any, and interest on the Notes or to enforce the performance of any provision
of the Notes or the Indenture.  The
Trustee may maintain a proceeding even if it does not possess any of the Notes
or does not produce any of them in the proceeding.  A delay or omission by the Trustee or any Holder 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.


 


(14)                      Subordination.  Payment
of principal, interest and premium and Additional Interest, if any, on the
Notes is subordinated to the prior payment of Senior Debt on the terms provided
in the Indenture.


 


(15)                            Trustee Dealings with Company. 
The Trustee, in its individual or any other capacity, may make loans to,
accept deposits from, and perform services for the Company or its Affiliates,
and may otherwise deal with the Company or its Affiliates, as if it were not
the Trustee.


 


(16)                            No Recourse Against Others. 
A director, officer, employee, incorporator or stockholder of the
Company, as such, will 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 Holder by accepting a Note waives and
releases all such liability.  The waiver
and release are part of the consideration for the issuance of the Notes.


 


A-7

















 


(17)                            Authentication. 
This Note will not be valid until authenticated by the manual signature
of the Trustee or an authenticating agent.


 


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


 


(19)                            Additional Rights of Holders of
Restricted Global Notes and Restricted Definitive Notes. 
In addition to the rights provided to Holders under the Indenture,
Holders of Restricted Global Notes and Restricted Definitive Notes will have
all the rights set forth in the Registration Rights Agreement dated as of
February 12, 2004, between the Company and the other parties named on the
signature pages thereof or, in the case of Additional Notes, Holders of
Restricted Global Notes and Restricted Definitive Notes will have the rights set
forth in one or more registration rights agreements, if any, between the
Company and the other parties thereto, relating to rights given by the Company
to the purchasers of any Additional Notes (collectively, the “Registration Rights Agreement”).


 


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


 


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


 


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


 


Argosy Gaming
Company


219 Piasa Street


Alton, IL  62002-6232


Attention:  General Counsel


 


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 legal name)

  
	
   

  
	
   

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

  
	
   

  
	
   

  
	
   

  
	
   

  
	
   

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

  
	
   

  
	
  and irrevocably appoint 

  	
   

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

  
			



 


	
  Date:

  	
   

  	
   

  
	
   

  
	
   

  	
  Your Signature:

  	
   

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

  Note)

  
	
   

  
	
  Signature
  Guarantee*:

  	
   

  	
   

  
							



 












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


 


A-9

















 


Option of Holder to Elect Purchase


 


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


 




	
  –Section 4.10

  	
   

  	
  –Section 4.14

  






 


If you want to
elect to have only part of the Note purchased by the Company pursuant to
Section 4.10 or Section 4.14 of the Indenture, state the amount you elect to
have purchased:


 


$                         


 


	
  Date:

  	
   

  	
   

  
	
   

  
	
   

  	
  Your Signature:

  	
   

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

  Note)

  
	
   

  
	
   

  	
  Tax
  Identification No.:

  	
   

  
	
   

  
	
  Signature
  Guarantee*:

  	
   

  	
   

  
								



 












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


 


A-10

















 


Schedule of Exchanges of Interests in the Global Note *


 


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


 


 


	
  Date of Exchange

  	
   

  	
  Amount of

  decrease in

  Principal Amount 

  of this Global Note

  	
   

  	
  Amount of

  increase in

  Principal Amount 

  of this Global Note

  	
   

  	
  Principal
  Amount 

  of this Global Note

  following such

  decrease (or

  increase)

  	
   

  	
  Signature
  of

  authorized officer

  of Trustee or

  Custodian

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  



 












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


 


A-11

















EXHIBIT B


 


FORM OF
CERTIFICATE OF TRANSFER


 


Argosy Gaming
Company


219 Piasa Street


Alton, IL  62002-6232


Fax:
                    


Attention:
                  


 


 


J.P. Morgan Trust
Company, 


  National Association


55
West Monroe Street, 15th Floor, Suite IL1-0823


Chicago, Illinois  60670-0823


Attention: Corporate Trust Administration


 


Re:                               7%
Senior Subordinated Notes due 2014


 


Reference is
hereby made to the Indenture, dated as of February 12, 2004 (the “Indenture”),
between Argosy Gaming Company, as issuer (the “Company”), and J.P. Morgan
Trust Company, National Association, as trustee.  Capitalized terms used but not defined herein shall have the
meanings given to them in the Indenture.


 


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


 


[CHECK ALL THAT
APPLY]


 


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


 


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


 


B-1

















 


efforts have been made in
contravention of the requirements of Rule 903(b) or Rule 904(b) of Regulation S
under the Securities Act, (iii) the transaction is not part of a plan or scheme
to evade the registration requirements of the Securities Act and (iv) if the
proposed transfer is being made prior to the expiration of the Restricted
Period, the transfer is not being made to a U.S. Person or for the account or
benefit of a U.S. Person (other than an Initial Purchaser).  Upon consummation of the proposed transfer
in accordance with the terms of the Indenture, the transferred beneficial
interest or Definitive Note will be subject to the restrictions on Transfer
enumerated in the Private Placement Legend printed on the Regulation S Global
Note and/or the Restricted Definitive Note and in the Indenture and the
Securities Act.


 


3.  o  Check and
complete if Transferee will take delivery of a beneficial interest in a
Restricted Definitive Note pursuant to any provision of the Securities Act
other than Rule 144A or Regulation S.  The Transfer is being effected in compliance with the transfer
restrictions applicable to beneficial interests in Restricted Global Notes and
Restricted Definitive Notes and pursuant to and in accordance with the
Securities Act and any applicable blue sky securities laws of any state of the
United States, and accordingly the Transferor hereby further certifies that
(check one):


 


(a)                                  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 effected pursuant to an effective registration statement
under the Securities Act and in compliance with the prospectus delivery
requirements of the Securities Act;


 


or


 


(d)                                 o  such
Transfer is being effected to an Institutional Accredited Investor and pursuant
to an exemption from the registration requirements of the Securities Act other
than Rule 144A, Rule 144, Rule 903 or Rule 904, and the Transferor hereby
further certifies that it has not engaged in any general solicitation within
the meaning of Regulation D under the Securities Act and the Transfer complies
with the transfer restrictions applicable to beneficial interests in a
Restricted Global Note or Restricted Definitive Notes and the requirements of
the exemption claimed, which certification is supported by (1) a certificate
executed by the Transferee in the form of Exhibit D to the Indenture and (2) if
such Transfer is in respect of a principal amount of Notes at the time of
transfer of less than $100,000, an Opinion of Counsel provided by the
Transferor or the Transferee (a copy of which the Transferor has attached to
this certification), to the effect that such Transfer is in compliance with the
Securities Act.  Upon consummation of
the proposed transfer in accordance with the terms of the Indenture, the
transferred beneficial interest or Definitive Note will be subject to the
restrictions on transfer enumerated in the Private Placement Legend printed on
the Restricted Definitive Notes and in the Indenture and the Securities Act.


 


4.  o  Check if
Transferee will take delivery of a beneficial interest in an Unrestricted
Global Note or of an Unrestricted Definitive Note.


 


B-2

















 


(a)  o  Check if
Transfer is pursuant to Rule 144. 
(i) The Transfer is being effected pursuant to and in accordance with
Rule 144 under the Securities Act and in compliance with the transfer
restrictions contained in the Indenture and any applicable blue sky securities
laws of any state of the United States and (ii) the restrictions on transfer
contained in the Indenture and the Private Placement Legend are not required in
order to maintain compliance with the Securities Act.  Upon consummation of the proposed Transfer in accordance with the
terms of the Indenture, the transferred beneficial interest or Definitive Note
will no longer be subject to the restrictions on transfer enumerated in the
Private Placement Legend printed on the Restricted Global Notes, on Restricted
Definitive Notes and in the Indenture.


 


(b)  o  Check if
Transfer is Pursuant to Regulation S.  (i) The Transfer is being effected pursuant to and in accordance
with Rule 903 or Rule 904 under the Securities Act and in compliance with the
transfer restrictions contained in the Indenture and any applicable blue sky
securities laws of any state of the United States and (ii) the restrictions on
transfer contained in the Indenture and the Private Placement Legend are not
required in order to maintain compliance with the Securities Act.  Upon consummation of the proposed Transfer
in accordance with the terms of the Indenture, the transferred beneficial
interest or Definitive Note will no longer be subject to the restrictions on
transfer enumerated in the Private Placement Legend printed on the Restricted
Global Notes, on Restricted Definitive Notes and in the Indenture.


 


(c)  o  Check if
Transfer is Pursuant to Other Exemption.  (i) The Transfer is being effected pursuant to and in compliance
with an exemption from the registration requirements of the Securities Act
other than Rule 144, Rule 903 or Rule 904 and in compliance with the transfer
restrictions contained in the Indenture and any applicable blue sky securities
laws of any State of the United States and (ii) the restrictions on transfer
contained in the Indenture and the Private Placement Legend are not required in
order to maintain compliance with the Securities Act.  Upon consummation of the proposed Transfer in accordance with the
terms of the Indenture, the transferred beneficial interest or Definitive Note
will not be subject to the restrictions on transfer enumerated in the Private
Placement Legend printed on the Restricted Global Notes or Restricted
Definitive Notes and in the Indenture.


 


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


 


	
   

  	
   

  
	
   

  	
  [Insert Name of
  Transferor]

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
  Title:

  
	
   

  	
   

  	
   

  
	
                Dated:

  	
   

  	
   

  	
   

  	
   

  
					



 


B-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  144A
Global Note (CUSIP          ), or


 


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


 


(b)   o  Restricted
Definitive Note.


 


2.                                       After
the Transfer the Transferee will hold:


 


[CHECK ONE]


 


(a)    o  a
beneficial interest in the:


 


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


 


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


 


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


 


(b)   o  a
Restricted Definitive Note; or


 


(c)    o  an
Unrestricted Definitive Note,


 


in accordance with the terms of the Indenture.


 


B-4

















 


EXHIBIT C


 


FORM OF
CERTIFICATE OF EXCHANGE


 


Argosy Gaming
Company


219 Piasa Street


Alton, IL  62002-6232


Fax:                   


Attention:
                  


 


 


J.P. Morgan Trust
Company, 


  National Association

55 West Monroe Street,
15th Floor, Suite IL1-0823


Chicago, Illinois  60670-0823


Attention: Corporate Trust Administration


 


Re:                               7%
Senior Subordinated Notes due 2014


 


(CUSIP
              )


 


Reference is
hereby made to the Indenture, dated as of February 12, 2004 (the “Indenture”),
between Argosy Gaming Company, as issuer (the “Company”), and J.P. Morgan
Trust Company, National Association, as trustee.  Capitalized terms used but not defined herein shall have the
meanings given to them in the Indenture.


 


                          ,
(the “Owner”)
owns and proposes to exchange the Note[s] or interest in such Note[s] specified
herein, in the principal amount of
$             in
such Note[s] or interests (the “Exchange”).  In connection with the Exchange, the Owner hereby certifies that:


 


1.                                       Exchange
of Restricted Definitive Notes or Beneficial Interests in a Restricted Global
Note for Unrestricted Definitive Notes or Beneficial Interests in an
Unrestricted Global Note


 


(a)  o                Check if
Exchange is from beneficial interest in a Restricted Global Note to beneficial
interest in an Unrestricted Global Note.  In connection with the Exchange of the Owner’s beneficial
interest in a Restricted Global Note for a beneficial interest in an Unrestricted
Global Note in an equal principal amount, the Owner hereby certifies (i) the
beneficial interest is being acquired for the Owner’s own account without
transfer, (ii) such Exchange has been effected in compliance with the transfer
restrictions applicable to the Global Notes and pursuant to and in accordance
with the Securities Act of 1933, as amended (the “Securities Act”), (iii) the
restrictions on transfer contained in the Indenture and the Private Placement
Legend are not required in order to maintain compliance with the Securities Act
and (iv) the beneficial interest in an Unrestricted Global Note is being
acquired in compliance with any applicable blue sky securities laws of any
state of the United States.


 


(b)  o               Check if
Exchange is from beneficial interest in a Restricted Global Note to
Unrestricted Definitive Note. 
In connection with the Exchange of the Owner’s beneficial interest in a
Restricted Global Note for an Unrestricted Definitive Note, the Owner hereby
certifies (i) the Definitive Note is being acquired for the Owner’s own account
without transfer, (ii) such Exchange has been effected in compliance with the
transfer restrictions applicable to the Restricted Global Notes and pursuant to
and in accordance with the Securities Act, (iii) the restrictions on transfer
contained in the


 


C-1

















 


Indenture and the Private
Placement Legend are not required in order to maintain compliance with the
Securities Act and (iv) the Definitive Note is being acquired in compliance
with any applicable blue sky securities laws of any state of the United States.


 


(c)  o                Check if
Exchange is from Restricted Definitive Note to beneficial interest in an
Unrestricted Global Note.  In
connection with the Owner’s Exchange of a Restricted Definitive Note for a
beneficial interest in an Unrestricted Global Note, the Owner hereby certifies
(i) the beneficial interest is being acquired for the Owner’s own account
without transfer, (ii) such Exchange has been effected in compliance with the
transfer restrictions applicable to Restricted Definitive Notes and pursuant to
and in accordance with the Securities Act, (iii) the restrictions on transfer
contained in the Indenture and the Private Placement Legend are not required in
order to maintain compliance with the Securities Act and (iv) the beneficial
interest is being acquired in compliance with any applicable blue sky
securities laws of any state of the United States.


 


(d)  o               Check if
Exchange is from Restricted Definitive Note to Unrestricted Definitive Note.  In connection with the Owner’s Exchange of a
Restricted Definitive Note for an Unrestricted Definitive Note, the Owner
hereby certifies (i) the Unrestricted Definitive Note is being acquired for the
Owner’s own account without transfer, (ii) such Exchange has been effected in
compliance with the transfer restrictions applicable to Restricted Definitive
Notes and pursuant to and in accordance with the Securities Act, (iii) the
restrictions on transfer contained in the Indenture and the Private Placement
Legend are not required in order to maintain compliance with the Securities Act
and (iv) the Unrestricted Definitive Note is being acquired in compliance with
any applicable blue sky securities laws of any state of the United States.


 


2.                                       Exchange
of Restricted Definitive Notes or Beneficial Interests in Restricted Global
Notes for Restricted Definitive Notes or Beneficial Interests in Restricted
Global Notes


 


(a)  o                Check if
Exchange is from beneficial interest in a Restricted Global Note to Restricted
Definitive Note.  In
connection with the Exchange of the Owner’s beneficial interest in a Restricted
Global Note for a Restricted Definitive Note with an equal principal amount,
the Owner hereby certifies that the Restricted Definitive Note is being
acquired for the Owner’s own account without transfer.  Upon consummation of the proposed Exchange
in accordance with the terms of the Indenture, the Restricted Definitive Note
issued will continue to be subject to the restrictions on transfer enumerated
in the Private Placement Legend printed on the Restricted Definitive Note and
in the Indenture and the Securities Act.


 


(b)  o               Check if
Exchange is from Restricted Definitive Note to beneficial interest in a
Restricted Global Note.  In
connection with the Exchange of the Owner’s Restricted Definitive Note for a
beneficial interest in the [CHECK ONE]  ̈144A Global Note,  ̈Regulation S Global
Note, 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.


 


C-2

















 


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


 


	
   

  	
   

  	
   

  
	
   

  	
   

  	
  [Insert Name of
  Transferor]

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
  Title:

  
	
   

  	
   

  	
   

  
	
  Dated:  

  	
   

  	
   

  	
   

  	
   

  
					



 


C-3

















 


EXHIBIT D


 


FORM OF CERTIFICATE FROM


ACQUIRING INSTITUTIONAL ACCREDITED INVESTOR


 


Argosy Gaming Company


219 Piasa Street


Alton, IL  62002-6232


Fax:
                  


Attention:
                  


 


J.P. Morgan Trust
Company, 


  National Association


55
West Monroe Street, 15th Floor, Suite IL1-0823


Chicago, Illinois  60670-0823


Attention: Corporate Trust Administration


 


Re:                               7%
Senior Subordinated Notes due 2014


 


Reference is
hereby made to the Indenture, dated as of February 12, 2004 (the “Indenture”),
between Argosy Gaming Company, as issuer (the “Company”) and J.P. Morgan Trust
Company, National Association, as trustee. 
Capitalized terms used but not defined herein shall have the meanings
given to them in the Indenture.


 


In connection with
our proposed purchase of
$            
aggregate principal amount of:


 


(a)                                  o                                    a
beneficial interest in a Global Note, or


 


(b)                                 o                                    a
Definitive Note,


 


we confirm that:


 


1.                                       We
understand that any subsequent transfer of the Notes or any interest therein is
subject to certain restrictions and conditions set forth in the Indenture and
the undersigned agrees to be bound by, and not to resell, pledge or otherwise
transfer the Notes or any interest therein except in compliance with, such
restrictions and conditions and the United States Securities Act of 1933, as
amended (the “Securities Act”).


 


2.                                       We
understand that the offer and sale of the Notes have not been registered under
the Securities Act, and that the Notes and any interest therein may not be
offered or sold except as permitted in the following sentence.  We agree, on our own behalf and on behalf of
any accounts for which we are acting as hereinafter stated, that if we should
sell the Notes or any interest therein, we will do so only (A) to the
Company or any subsidiary thereof, (B) in accordance with Rule 144A under the
Securities Act to a “qualified institutional buyer” (as defined therein), (C)
to an institutional “accredited investor” (as defined below) that, prior to
such transfer, furnishes (or has furnished on its behalf by a U.S.
broker-dealer) to you and to the Company a signed letter substantially in the
form of this letter and, if such transfer is in respect of a principal amount
of Notes, at the time of transfer of less than $100,000, an Opinion of Counsel
in form reasonably acceptable to the Company to the effect that such transfer
is in compliance with the Securities Act, (D) outside the United States in
accordance with Rule 904 of Regulation S under the Securities Act, (E)
pursuant to the provisions of Rule 144(k) under the Securities


 


D-1

















 


Act or (F) pursuant to an
effective registration statement under the Securities Act, and we further agree
to provide to any person purchasing the Definitive Note or beneficial interest
in a Global Note from us in a transaction meeting the requirements of clauses
(A) through (E) of this paragraph a notice advising such purchaser that resales
thereof are restricted as stated herein.


 


3.                                       We
understand that, on any proposed resale of the Notes or beneficial interest
therein, we will be required to furnish to you and the Company such
certifications, legal opinions and other information as you and the Company may
reasonably require to confirm that the proposed sale complies with the
foregoing restrictions.  We further
understand that the Notes purchased by us will bear a legend to the foregoing
effect.


 


4.                                       We
are an institutional “accredited investor” (as defined in Rule 501(a)(1), (2),
(3) or (7) of Regulation D under the Securities Act) and have such knowledge
and experience in financial and business matters as to be capable of evaluating
the merits and risks of our investment in the Notes, and we and any accounts
for which we are acting are each able to bear the economic risk of our or its
investment.


 


5.                                       We
are acquiring the Notes or beneficial interest therein purchased by us for our
own account or for one or more accounts (each of which is an institutional
“accredited investor”) as to each of which we exercise sole investment
discretion.


 


You and the
Company are entitled to rely upon this letter and are irrevocably authorized to
produce this letter or a copy hereof to any interested party in any
administrative or legal proceedings or official inquiry with respect to the
matters covered hereby.


 


	
   

  	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  [Insert
  Name of Accredited Investor]

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
  Title:

  
	
   

  	
   

  	
   

  
	
  Dated:

  	
   

  	
   

  	
   

  	
   

  
					



 


D-1