Exhibit 4.1





Exhibit 4.1

EXECUTION VERSION




PINNACLE ENTERTAINMENT, INC.




Company




ACE GAMING, LLC

AREH MLK LLC

AREP BOARDWALK PROPERTIES LLC

BELTERRA RESORT INDIANA, LLC

BILOXI CASINO CORP.

BOOMTOWN, LLC

CASINO MAGIC CORP.

CASINO ONE CORPORATION

LOUISIANA — I GAMING, A LOUISIANA PARTNERSHIP IN COMMENDAM

MITRE ASSOCIATES LLC

OGLE HAUS, LLC

PNK (BATON ROUGE) PARTNERSHIP

PNK (BOSSIER CITY), INC.

PNK (CHILE 1), LLC

PNK (CHILE 2), LLC

PNK DEVELOPMENT 7, LLC

PNK DEVELOPMENT 8, LLC

PNK DEVELOPMENT 9, LLC

PNK DEVELOPMENT 13, LLC

PNK (ES), LLC

PNK (LAKE CHARLES), L.L.C.

PNK (RENO), LLC

PNK (SCB), L.L.C.

PNK (ST. LOUIS RE), LLC

PNK (STLH), LLC

PRESIDENT RIVERBOAT CASINO — MISSOURI, INC.

PSW PROPERTIES LLC

ST. LOUIS CASINO CORP.

YANKTON INVESTMENTS, LLC




initial Guarantors




8.625% SENIOR NOTES DUE 2017





 







INDENTURE




Dated as of August 10, 2009





 







THE BANK OF NEW YORK MELLON TRUST COMPANY, N.A.




Trustee



 


 









 







CROSS-REFERENCE TABLE*




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






N.A. means not applicable.

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



 


 









 







TABLE OF CONTENTS




	 	 	 	 	 
	 	 	Page	 
	 
	 	 	 	 






ARTICLE 1

DEFINITIONS AND INCORPORATION

BY REFERENCE




	 	 	 	 	 	 	 
	Section 1.01

	 	Definitions
	 	 	1	 
	Section 1.02

	 	Other Definitions
	 	 	32	 
	Section 1.03

	 	Incorporation by Reference of Trust Indenture Act
	 	 	33	 
	Section 1.04

	 	Rules of Construction
	 	 	33	 






ARTICLE 2

THE NOTES




	 	 	 	 	 	 	 
	Section 2.01

	 	Form and Dating
	 	 	34	 
	Section 2.02

	 	Execution and Authentication
	 	 	34	 
	Section 2.03

	 	Registrar and Paying Agent
	 	 	35	 
	Section 2.04

	 	Paying Agent to Hold Money in Trust
	 	 	35	 
	Section 2.05

	 	Holder Lists
	 	 	35	 
	Section 2.06

	 	Transfer and Exchange
	 	 	35	 
	Section 2.07

	 	Replacement Notes
	 	 	48	 
	Section 2.08

	 	Outstanding Notes
	 	 	48	 
	Section 2.09

	 	Treasury Notes
	 	 	48	 
	Section 2.10

	 	Temporary Notes
	 	 	48	 
	Section 2.11

	 	Cancellation
	 	 	49	 
	Section 2.12

	 	Defaulted Interest
	 	 	49	 
	Section 2.13

	 	CUSIP Numbers
	 	 	49	 






ARTICLE 3

REDEMPTION AND PREPAYMENT




	 	 	 	 	 	 	 
	Section 3.01

	 	Notices to Trustee
	 	 	49	 
	Section 3.02

	 	Selection of Notes to Be Redeemed or Purchased
	 	 	50	 
	Section 3.03

	 	Notice of Redemption
	 	 	50	 
	Section 3.04

	 	Effect of Notice of Redemption
	 	 	51	 
	Section 3.05

	 	Deposit of Redemption or Purchase Price
	 	 	51	 
	Section 3.06

	 	Notes Redeemed or Purchased in Part
	 	 	52	 
	Section 3.07

	 	Optional Redemption
	 	 	52	 
	Section 3.08

	 	Mandatory Redemption
	 	 	54	 
	Section 3.09

	 	Offer to Purchase by Application of Excess Proceeds
	 	 	54	 






ARTICLE 4

COVENANTS




	 	 	 	 	 	 	 
	Section 4.01

	 	Payment of Notes
	 	 	56	 
	Section 4.02

	 	Maintenance of Office or Agency
	 	 	56	 
	Section 4.03

	 	Reports
	 	 	57	 
	Section 4.04

	 	Compliance Certificate
	 	 	57	 
	Section 4.05

	 	Taxes
	 	 	58	 
	Section 4.06

	 	Stay, Extension and Usury Laws
	 	 	58	 
	Section 4.07

	 	Restricted Payments
	 	 	58	 
	Section 4.08

	 	Dividend and Other Payment Restrictions Affecting Subsidiaries
	 	 	64	 






 


i









 







	 	 	 	 	 	 	 
	Section 4.09

	 	Incurrence of Indebtedness and Issuance of Preferred Stock
	 	 	65	 
	Section 4.10

	 	Asset Sales
	 	 	66	 
	Section 4.11

	 	Transactions with Affiliates
	 	 	68	 
	Section 4.12

	 	Liens
	 	 	69	 
	Section 4.13

	 	Business Activities
	 	 	70	 
	Section 4.14

	 	Legal Existence
	 	 	70	 
	Section 4.15

	 	Offer to Repurchase Upon Change of Control
	 	 	70	 
	Section 4.16

	 	No Debt Senior to The Notes or Guaranties
	 	 	71	 
	Section 4.17

	 	No Amendment to Other Indebtedness
	 	 	71	 
	Section 4.18

	 	Additional Guaranties
	 	 	72	 
	Section 4.19

	 	Designation of Restricted and Unrestricted Subsidiaries
	 	 	72	 






ARTICLE 5

SUCCESSORS




	 	 	 	 	 	 	 
	Section 5.01

	 	Merger, Consolidation, or Sale of Assets
	 	 	73	 
	Section 5.02

	 	Successor Person Substituted
	 	 	74	 






ARTICLE 6

DEFAULTS AND REMEDIES




	 	 	 	 	 	 	 
	Section 6.01

	 	Events of Default
	 	 	75	 
	Section 6.02

	 	Acceleration
	 	 	76	 
	Section 6.03

	 	Other Remedies
	 	 	77	 
	Section 6.04

	 	Waiver of Past Defaults
	 	 	77	 
	Section 6.05

	 	Control by Majority
	 	 	78	 
	Section 6.06

	 	Limitation on Suits
	 	 	78	 
	Section 6.07

	 	Rights of Holders of Notes to Receive Payment
	 	 	78	 
	Section 6.08

	 	Collection Suit by Trustee
	 	 	78	 
	Section 6.09

	 	Trustee May File Proofs of Claim
	 	 	79	 
	Section 6.10

	 	Priorities
	 	 	79	 
	Section 6.11

	 	Undertaking for Costs
	 	 	79	 
	Section 6.12

	 	Remedies Subject to Applicable Law
	 	 	80	 






ARTICLE 7

TRUSTEE




	 	 	 	 	 	 	 
	Section 7.01

	 	Duties of Trustee
	 	 	80	 
	Section 7.02

	 	Rights of Trustee
	 	 	81	 
	Section 7.03

	 	Individual Rights of Trustee
	 	 	82	 
	Section 7.04

	 	Trustee’s Disclaimer
	 	 	82	 
	Section 7.05

	 	Notice of Defaults
	 	 	82	 
	Section 7.06

	 	Reports by Trustee to Holders of the Notes
	 	 	82	 
	Section 7.07

	 	Compensation and Indemnity
	 	 	83	 
	Section 7.08

	 	Replacement of Trustee
	 	 	83	 
	Section 7.09

	 	Successor Trustee by Merger, etc.
	 	 	84	 
	Section 7.10

	 	Eligibility; Disqualification
	 	 	84	 
	Section 7.11

	 	Preferential Collection of Claims Against Company
	 	 	85	 






ARTICLE 8

LEGAL DEFEASANCE AND COVENANT DEFEASANCE




	 	 	 	 	 	 	 
	Section 8.01

	 	Option to Effect Legal Defeasance or Covenant Defeasance
	 	 	85	 
	Section 8.02

	 	Legal Defeasance and Discharge
	 	 	85	 
	Section 8.03

	 	Covenant Defeasance
	 	 	85	 





 


ii









 





	 	 	 	 	 	 	 
	Section 8.04

	 	Conditions to Legal or Covenant Defeasance
	 	 	86	 
	Section 8.05

	 	Deposited Money and Government Securities to be
Held in Trust; Other Miscellaneous
Provisions
	 	 	87	 
	Section 8.06

	 	Repayment to Company
	 	 	88	 
	Section 8.07

	 	Reinstatement
	 	 	88	 






ARTICLE 9

AMENDMENT, SUPPLEMENT AND WAIVER




	 	 	 	 	 	 	 
	Section 9.01

	 	Without Consent of Holders of Notes
	 	 	88	 
	Section 9.02

	 	With Consent of Holders of Notes
	 	 	89	 
	Section 9.03

	 	Compliance with Trust Indenture Act
	 	 	90	 
	Section 9.04

	 	Revocation and Effect of Consents
	 	 	91	 
	Section 9.05

	 	Notation on or Exchange of Notes
	 	 	91	 
	Section 9.06

	 	Trustee to Sign Amendments, etc.
	 	 	91	 






ARTICLE 10

NOTE GUARANTIES




	 	 	 	 	 	 	 
	Section 10.01

	 	Guaranty
	 	 	91	 
	Section 10.02

	 	Limitation on Guarantor Liability
	 	 	92	 
	Section 10.03

	 	Execution and Delivery of Guaranty
	 	 	93	 
	Section 10.04

	 	Releases
	 	 	93	 






ARTICLE 11

SATISFACTION AND DISCHARGE




	 	 	 	 	 	 	 
	Section 11.01

	 	Satisfaction and Discharge
	 	 	94	 
	Section 11.02

	 	Application of Trust Money
	 	 	95	 






ARTICLE 12

MISCELLANEOUS




	 	 	 	 	 	 	 
	Section 12.01

	 	Trust Indenture Act Controls
	 	 	95	 
	Section 12.02

	 	Notices
	 	 	95	 
	Section 12.03

	 	Communication by Holders of Notes with Other Holders of Notes
	 	 	97	 
	Section 12.04

	 	Certificate and Opinion as to Conditions Precedent
	 	 	97	 
	Section 12.05

	 	Statements Required in Certificate or Opinion
	 	 	97	 
	Section 12.06

	 	Rules by Trustee and Agents
	 	 	97	 
	Section 12.07

	 	No Personal Liability of Directors, Officers, Employees and Stockholders
	 	 	97	 
	Section 12.08

	 	Governing Law
	 	 	98	 
	Section 12.09

	 	No Adverse Interpretation of Other Agreements
	 	 	98	 
	Section 12.10

	 	Successors
	 	 	98	 
	Section 12.11

	 	Severability
	 	 	98	 
	Section 12.12

	 	Counterpart Originals
	 	 	98	 
	Section 12.13

	 	Table of Contents, Headings, etc.
	 	 	98	 
	Section 12.14

	 	Waiver of Jury Trial
	 	 	98	 
	Section 12.15

	 	Force Majeure
	 	 	99	 






EXHIBITS




	 	 	 
	Exhibit A

	 	FORM OF NOTE
	Exhibit B

	 	FORM OF CERTIFICATE OF TRANSFER
	Exhibit C

	 	FORM OF CERTIFICATE OF EXCHANGE
	Exhibit D

	 	FORM OF NOTATION OF GUARANTY
	Exhibit E

	 	FORM OF SUPPLEMENTAL INDENTURE





 


iii









 





INDENTURE dated as of August 10, 2009 among Pinnacle Entertainment, Inc., a Delaware
corporation, the Guarantors (as defined) and The Bank of New York Mellon Trust Company, N.A., a
national banking association, as trustee.



The Company, the Guarantors 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 8.625% Senior Notes due 2017
(the “Notes”):



ARTICLE 1

DEFINITIONS AND INCORPORATION

BY REFERENCE




Section 1.01 Definitions.




“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.



“7.5% Notes” means the 7.5% Senior Subordinated Notes due 2015 issued pursuant to an
indenture, dated as of June 8, 2007, between the Company, the guarantors named therein and The Bank
of New York Trust Company, N.A., as trustee, as amended and supplemented from time to time.



“8.75% Notes” means the 8.75% Senior Subordinated Notes due 2013 issued pursuant to the First
Supplemental Indenture, dated as of September 25, 2003, between the Company, the guarantors named
therein and The Bank of New York, as trustee, to that certain indenture, dated as of September 25,
2003, by and between the Company, the guarantors named therein and The Bank of New York, as amended
and supplemented from time to time.



“8.25% Notes” means the 8.25% Senior Subordinated Notes due 2012 issued pursuant to an
indenture, dated as of March 15, 2004, between the Company, the guarantors named therein and The
Bank of New York, as trustee, as amended and supplemented from time to time.



“Acquired Debt” means, with respect to any specified Person, Indebtedness of another Person
and any of such other Person’s Subsidiaries existing at the time such other Person becomes a
Subsidiary of such Person or at the time it merges or consolidates with such Person or any of such
Person’s Subsidiaries or is assumed by such Person or any Subsidiary of such Person in connection
with the acquisition of assets from such other Person and in each case not Incurred by such Person
or any Subsidiary of such Person or such other Person in connection with, or in anticipation or
contemplation of, such other Person becoming a Subsidiary of such Person or such acquisition,
merger or consolidation.



“Additional Interest” means all amounts, if any, payable (i) pursuant to the provisions
relating to additional interest described under Section 6.02 as the sole remedy for an Event of
Default relating to the failure to comply with the reporting obligations described under Section
4.03, and for any failure to comply with the requirements of Section 314(a) of the TIA and/or (ii)
pursuant to the provisions relating to additional interest described in the Registration Rights
Agreement in the event of a Registration Default (as defined in the Registration Rights Agreement).



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


 


1









 





“Affiliate” means, when used with reference to any Person:




(1) any other Person directly or indirectly controlling, controlled by, or under direct
or indirect common control with, the referent Person or such other Person, as the case may
be, or




(2) any director, officer or partner of such Person or any Person specified in clause
(1) above.



For the purposes of this definition, the term “control” when used with respect to any specified
Person means the power to direct or cause the direction of management or policies of such Person,
directly or indirectly, whether through the ownership of voting securities, by contract or
otherwise; and the terms “affiliated,” “controlling,” and “controlled” have meanings correlative of
the foregoing. None of the Initial Purchasers nor any of their respective Affiliates shall be
deemed to be an Affiliate of any Obligor or of any of their respective Affiliates.



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



“Applicable Premium” means with respect to any Note on any redemption date, as determined by
the Company, the greater of:




(1) 1.0% of the principal amount of the Note; or




(2) the excess of:




(a) the present value at such redemption date of (i) the redemption price of the Note
at August 1, 2013 (such redemption price being set forth in the table appearing under
Section 3.07) plus (ii) all required interest payments due on the Note through August 1,
2013 (excluding accrued but unpaid interest to the redemption date), computed using a
discount rate equal to the Treasury Rate as of such redemption date plus 50 basis points;
over




(b) the principal amount of the Note.



“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.



“Argentina Contribution Amount” means all amounts received after the Issue Date by the Company
or any Restricted Subsidiary as Argentina Receipts less (i) all Reclassified Argentina Receipts and
(ii) all amounts previously distributed after the Issue Date under Section 4.07(b)(14) hereof.



“Argentina Receipts” means any dividend, distribution, payment, reimbursement or other amounts
received after the Issue Date from an Argentina Subsidiary by the Company or any Restricted
Subsidiary, in each case during any time such Argentina Subsidiary is an Unrestricted Subsidiary.



“Argentina Subsidiaries” means Casino Magic Neuquén S.A. and any successors thereto and any
other Subsidiary which conducts operations in Argentina.



“Asset Acquisition” means:


 


2









 






(1) an Investment by any Obligor in any other Person pursuant to which such Person
shall become an Obligor or a Restricted Subsidiary of an Obligor or shall be merged into, or
with any Obligor or Restricted Subsidiary of an Obligor, or




(2) the acquisition by any Obligor of assets of any Person comprising a division or
line of business of such Person or all or substantially all of the assets of such Person.



“Asset Sale” means any direct or indirect sale, issuance, conveyance, transfer, lease (other
than operating leases entered into in the ordinary course of business), assignment or other
disposition (for purposes of this definition, each a “disposition”) by any Obligor (including,
without limitation, pursuant to any sale and leaseback transaction or any merger or consolidation
of any Restricted Subsidiary of the Company with or into another Person (other than another
Obligor) whereby such Restricted Subsidiary shall cease to be a Restricted Subsidiary of the
Company) to any Person of:




(1) any property or assets of any Obligor (other than Capital Stock of any Unrestricted
Subsidiary) to the extent that any such disposition is not in the ordinary course of
business of such Obligor, or




(2) any Capital Stock of any Restricted Subsidiary (other than directors’ qualifying
 shares or shares required by law to be held by a Person other than the Company or a
Restricted Subsidiary),




other than, in both cases:




(A) any disposition to the Company,




(B) any disposition to any Obligor or Restricted Subsidiary,




(C) any disposition that constitutes a Restricted Payment or a Permitted
Investment that is made in accordance with Section 4.07 hereof,




(D) any transaction or series of related transactions resulting in Net Cash
Proceeds to such Obligor (or involving assets or property having a fair market
value, as determined in good faith by the Company) of less than $20 million,




(E) any transaction that is consummated in accordance with Section 5.01 hereof,




(F) the sale or discount, in each case without recourse (direct or indirect),
of accounts receivable arising in the ordinary course of business of the Company or
such Restricted Subsidiary, as the case may be, but only in connection with the
compromise or collection thereof,




(G) any Permitted Lien or any other pledge, assignment by way of collateral
security, grant of security interest, hypothecation or mortgage, permitted by this
Indenture or any foreclosure, judicial or other sale, public or private, by the
pledgee, assignee, mortgagee or other secured party of the subject assets,




(H) a disposition of assets constituting a Permitted Investment,




(I) any disposition of undeveloped or substantially undeveloped real estate,
provided that in such disposition:


 


3









 






(i) the Obligor making such disposition receives consideration at the
time of such disposition at least equal to the fair market value of the real
estate assets disposed of (as determined reasonably and in good faith by the
Board of such Obligor), and




(ii) at least 60% of the consideration received from such disposition
by the Obligor making such disposition is cash or Cash Equivalents and is
received at the time of the consummation of such disposition. (For purposes
of this provision, each of the following shall be deemed to be cash: (A) any
liabilities as shown on such Obligor’s most recent balance sheet (or in the
notes thereto) (other than (i) Indebtedness subordinate in right of payment
to the Notes, (ii) contingent liabilities, (iii) liabilities or Indebtedness
to Affiliates of the Company and (iv) Non-Recourse Indebtedness) that are
assumed by the transferee of any such assets, and (B) to the extent of the
cash received, any notes or other obligations received by the Obligor making
the disposition from such transferee that are converted by such Obligor into
cash within 60 days of receipt), or




(J) any disposition, relinquishment or transfer of assets or licenses in
connection with a sale, disposition or a partial or complete shutdown of the
President Riverboat Casino (also known as the Admiral).



“Atlantic City Entities” means PNK Development 13, LLC, ACE Gaming, LLC, Mitre Associates, LLC
and Brighton Park Maintenance Corp.



“Atlantic City Group Investment” means the amount of cash used to make the Restricted
Investments of the Company and its Restricted Subsidiaries in the Atlantic City Entities as of the
dates originally made prior to the issuance of the 7.5% Notes, irrespective of the fair market
value or net book value of such Restricted Investments in the Atlantic City Entities as of the
dates they were originally made or at the time of designation or redesignation of such entities as
Restricted Subsidiaries.



“Bank Credit Agreement” means the credit facility provided to the Company pursuant to the
Second Amended and Restated Credit Agreement, dated as of December 14, 2005, by and among the
Company, the financial institutions from time to time party thereto, and Barclays Bank PLC, as
Administrative Agent thereunder, as successor to Lehman Commercial Paper Inc., as amended,
restated, modified, renewed, refunded, replaced (whether upon or after termination or otherwise) or
refinanced (including by means of sales of debt securities to institutional investors or other
purchasers) in whole or in part from time to time.



“Bankruptcy Law” means United States Bankruptcy Code and any other bankruptcy, insolvency,
receivership, reorganization, moratorium or similar law providing relief to debtors, in each case,
as from time to time amended and applicable to the relevant case.



“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.


 


4









 





“Board” 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 (or any committee thereof duly authorized to act on behalf of
such board) or other similar governing body of the controlling general partner of the partnership;
(3) with respect to a limited liability company, the Person or Persons who are the managing member,
members or managers or any controlling committee or managing member, members or managers thereof;
and (4) with respect to any other Person, the board or committee or other body of such Person
serving a similar function.



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



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



“Capital Stock” means:




(1) with respect to any Person that is a corporation, any and all shares, rights,
interests, participations or other equivalents (however designated and whether or not
voting) of corporate stock, including each class of common stock and preferred stock of such
Person, and




(2) with respect to any Person that is not a corporation, any and all partnership,
membership or other equity interests of such Person.



“Capitalized Lease Obligation” means, as to any Person, the discounted rental stream payable
by such Person that is required to be classified and accounted for as a capital lease obligation
under GAAP and, for purposes of this definition, the amount of such obligation at any date shall be
the capitalized amount of such obligation at such date, determined in accordance with GAAP. The
final maturity of any such obligation shall be the date of the last payment of rent or any other
amount due under such lease prior to the first date upon which such lease may be terminated by the
lessee without penalty.



“Cash Equivalents” means:




(1) Government Securities;




(2) certificates of deposit, eurodollar time deposits and bankers acceptances maturing
within 12 months from the date of acquisition thereof by any Obligor or Domestic Restricted
Subsidiary and issued by any commercial bank organized under the laws of the United States
of America or any state thereof or the District of Columbia or any U.S. branch of a foreign
bank having, at the date of acquisition of the applicable Cash Equivalent, (A) combined
capital and surplus of not less than $500 million and (B) a commercial paper rating of at
least A-1 from S&P or at least P-1 from Moody’s;




(3) repurchase obligations with a term of not more than seven days after the date of
acquisition thereof by any Obligor or Domestic Restricted Subsidiary for underlying
securities of the types described in clauses (1), (2) and (4) hereof, entered into with any
financial institution meeting the qualifications specified in clause (2) above;




(4) commercial paper having a rating of at least P-1 from Moody’s or a rating of at
least A-1 from S&P on the date of acquisition thereof by any Obligor or Domestic Restricted
Subsidiary;


 


5









 






(5) debt obligations of any corporation maturing within 12 months after the date of
acquisition thereof by any Obligor or Domestic Restricted Subsidiary, having a rating of at
least P-1 or aaa from Moody’s or A-1 or AAA from S&P on the date of such acquisition; and




(6) mutual funds and money market accounts investing at least 90% of the funds under
management in instruments of the types described in clauses (1) through (5) above and, in
each case, maturing within the period specified above for such instrument after the date of
acquisition thereof by any Obligor or Domestic Restricted Subsidiary.



“Casino” means any gaming establishment and other property or assets directly ancillary
thereto or used in connection therewith, including any building, restaurant, hotel, theater,
parking facilities, retail shops, land, golf courses and other recreation and entertainment
facilities, marina, vessel, barge, ship and equipment.



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




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




(2) the adoption, or, if applicable, the approval of any requisite percentage of the
Company’s stockholders of a plan relating to the liquidation or dissolution of the Company,




(3) the consummation of any transaction (including, without limitation, any merger or
consolidation) the result of which is that any “person” (as defined above) becomes the
“beneficial owner” (as such term is defined in Rule 13d-3 and Rule 13d-5 under the Exchange
Act, except that a person shall be deemed to have “beneficial ownership” of all securities
that such person has the right to acquire, whether such right is currently exercisable or is
exercisable only upon the occurrence of a subsequent condition), directly or indirectly, of
more than 50% of the Voting Stock of the Company (measured by voting power rather than
number of shares), or




(4) during any consecutive two-year period, individuals who at the beginning of such
period constituted the Board of the Company (together with any new directors whose election
to such Board or whose nomination for election by the stockholders of the Company was
approved by a vote of a majority of the directors of the Company then still in office who
were either directors at the beginning of such period or whose election or nomination for
election was previously so approved) cease for any reason to constitute a majority of the
Board of the Company then in office.



“Clearstream” means Clearstream Banking, S.A.



“Company” means Pinnacle Entertainment, Inc., a Delaware corporation, and any and all
successors thereto.



“Completion Guarantee and Keep-Well Agreement” means (i) the guarantee by the Company or a
Guarantor of the completion of the development, construction and opening of a new gaming facility
or related or ancillary amenities or businesses in Atlantic City, New Jersey and/or Las Vegas,
Nevada by one or more Unrestricted Subsidiaries of the Company, (ii) any Indebtedness of an
Unrestricted Subsidiary guaranteed by the Company or any Guarantor pursuant to a Completion
Guarantee and Keep-Well Agreement, prior to the time the Company or such Guarantor makes any
principal, interest or comparable


 


6









 






debt service payment with respect to such guaranteed Indebtedness, and/or (iii) the agreement
by the Company or a Guarantor to advance funds, property or services on behalf of one or more
Unrestricted Subsidiaries of the Company in order to maintain the financial condition of such
Unrestricted Subsidiaries in connection with the development, construction, opening and operation
of a new gaming facility or related or ancillary amenities or businesses in Atlantic City, New
Jersey and/or Las Vegas, Nevada by such Unrestricted Subsidiaries; provided that, in the case of
clauses (i), (ii) and (iii) above, such guarantee or agreement is entered into in connection with
obtaining financing for such gaming facility or related or ancillary amenities or businesses or is
required by a Gaming Authority.



“Completion Guarantee/Keep-Well Indebtedness” of the Company or any Guarantor means (i) any
Indebtedness Incurred for money borrowed by the Company or any Guarantor in connection with the
performance of any Completion Guarantee and Keep-Well Agreement or (ii) any Indebtedness of one or
more Unrestricted Subsidiaries of the Company that is guaranteed by the Company or a Guarantor
pursuant to a Completion Guarantee and Keep-Well Agreement, in the case of guaranteed Indebtedness
under this clause (ii), on and after the time the Company or such Guarantor makes any principal,
interest or comparable debt service payment with respect to such guaranteed Indebtedness.



“Consolidated Coverage Ratio” means, with respect to any Person on any date of determination,
the ratio of:




(1) Consolidated EBITDA for the period of four fiscal quarters most recently ended
prior to such date for which internal financial reports are available, ended not more than
135 days prior to such date, to




(2) (A) Consolidated Interest Expense during such period plus (B) dividends on or in
respect of any Capital Stock of any such Person paid in cash during such period;



provided, that the Consolidated Coverage Ratio shall be calculated giving pro forma effect, as of
the beginning of the applicable period, to any acquisition, Incurrence or redemption of
Indebtedness (including the Notes), issuance or redemption of Disqualified Capital Stock,
acquisition, Asset Sale, purchases of assets that were previously leased or re-designation of a
Restricted Subsidiary as an Unrestricted Subsidiary, at any time during or subsequent to such
period, but on or prior to the applicable Determination Date.



In making such computation, Consolidated Interest Expense:




(1) attributable to any Indebtedness bearing a floating interest rate shall be computed
on a pro forma basis as if the rate in effect on the date of computation had been the
applicable rate for the entire period, or




(2) attributable to interest on any Indebtedness under a revolving Credit Facility
shall be computed on a pro forma basis based upon the average daily balance of such
Indebtedness outstanding during the applicable period.



It is understood that the Company may rely on internal or publicly reported financial reports
even though there may be subsequent adjustments (including review and audit adjustments) to such
financial statements. For avoidance of doubt, any action taken or not taken in compliance with a
covenant in this Indenture which is based upon or made in reliance on a computation of the
Consolidated Coverage Ratio by the Company based on such internal or publicly reported financial
statements, shall be deemed to continue to comply with the applicable covenant, notwithstanding any
subsequent adjustments that may result in changes to such internal or publicly reported financial
statements.


 


7









 





For purposes of calculating Consolidated EBITDA of the Company for the most recently completed
period of four full fiscal quarters ending on the last day of the last quarter for which internal
financial statements are available (such period of four fiscal quarters, the “Measurement Period”),
not more than 135 days prior to the transaction or event giving rise to the need to calculate the
Consolidated EBITDA,




(1) any Person that is a Restricted Subsidiary on such Determination Date (or would
become a Restricted Subsidiary on such Determination Date in connection with the transaction
that requires the determination of the Consolidated Coverage Ratio) shall be deemed to have
been a Restricted Subsidiary at all times during such Measurement Period,




(2) any Person that is not a Restricted Subsidiary on such Determination Date (or would
cease to be a Restricted Subsidiary on such Determination Date in connection with the
transaction that requires the determination of the Consolidated Coverage Ratio) will be
deemed not to have been a Restricted Subsidiary at any time during such Measurement Period,




(3) if the Company or any Restricted Subsidiary shall have in any manner




(A) acquired (including through an Asset Acquisition or the commencement of
activities constituting such operating business) any operating business or commenced
operation of any Project during such Measurement Period or after the end of such
Measurement Period and on or prior to the Determination Date, or




(B) disposed of (including by way of an Asset Sale or the termination or
discontinuance of activities constituting such operating business) any operating
business during such Measurement Period or after the end of such Measurement Period
and on or prior to the Determination Date,




such calculation shall be made on a pro forma basis in accordance with GAAP as if,
in the case of an Asset Acquisition or the commencement of activities constituting
such operating business or operation of such Project, all such transactions had been
consummated or effected on the first day of such Measurement Period and, in the case
of an Asset Sale or termination or discontinuance of activities constituting such
operating business, all such transactions had been consummated prior to the first
day of such Measurement Period (except to the extent of any Estimated Business
Interruption Insurance taken into account in computing Consolidated EBITDA for such
Measurement Period); provided, however, that such pro forma adjustment shall not
give effect to the Consolidated EBITDA of any acquired Person to the extent that
such Person’s net income would be excluded pursuant to clause (6) of the definition
of Consolidated Net Income; and




(4) any Indebtedness Incurred and proceeds thereof received and applied as a result of
the transaction giving rise to the need to calculate the Consolidated Coverage Ratio will be
deemed to have been so Incurred, received and applied on the first day of such Measurement
Period.



“Consolidated EBITDA” means, with respect to any Person for any period, the sum (without
duplication) of:




(1) the Consolidated Net Income of such Person for such period, plus


 


8









 






(2) to the extent that any of the following shall have been taken into account in
determining such Consolidated Net Income, and without duplication:




(A) all income taxes of such Person and its Restricted Subsidiaries paid or
accrued in accordance with GAAP for such period (other than income taxes
attributable to extraordinary, unusual or nonrecurring gains or losses or taxes
attributable to sales or dispositions of assets outside the ordinary course of
business),




(B) the Consolidated Interest Expense of such Person for such period,




(C) the amortization expense (including the amortization of deferred financing
charges) and depreciation expense for such Person and its Restricted Subsidiaries
for such period,




(D) other non-cash items (other than non-cash interest) of such Person or any
of its Restricted Subsidiaries (including any non-cash compensation expense
attributable to stock option or other equity compensation arrangements), other than
any non-cash item for such period that requires the accrual of or a reserve for cash
charges for any future period (except as otherwise provided in clause (E) below) and
other than any non-cash charge for such period constituting an extraordinary item of
loss,




(E) any non-recurring costs or expenses of an acquired company or business
incurred in connection with the purchase or acquisition of such acquired company or
business by such Person and any non-recurring adjustments necessary to conform the
accounting policies of the acquired company or business to those of such Person, and




(F) any losses, charges, costs or expenses incurred in connection with the
partial or complete shutdown of the President Riverboat Casino (also known as the
Admiral), less




(3) (A) all non-cash items of such Person or any of its Restricted Subsidiaries
increasing such Consolidated Net Income for such period other than the accrual of revenue in
the ordinary course of business and (B) all cash payments during such period relating to
non-cash items that were added back in determining Consolidated EBITDA in any prior period,
plus




(4) pre-opening expenses related to the Projects, plus




(5) the Estimated Business Interruption Insurance for such period (notwithstanding any
classification of the affected operations as discontinued operations or any disposal of such
operations), less




(6) any business interruption insurance received or expected to be received and
included in the calculation of Consolidated Net Income in accordance with GAAP for such
period;



provided, that, with respect to each Project, for each of the first full three fiscal quarters
following the date of any Project Opening, that portion of Consolidated EBITDA which is
attributable to the applicable Project owned and operated by the Company or any of its Restricted
Subsidiaries for such full fiscal quarters shall be annualized (ignoring any stub period). In
computing such annualization, such full fiscal quarters shall be treated together as one accounting
period and annualized.


 


9









 





“Consolidated Interest Expense” means, with respect to any Person for any period, the sum of:




(1) the consolidated interest expense of such Person and its Restricted Subsidiaries
for such period, whether paid or accrued (including, without limitation, amortization of
original issue discount, non-cash interest payments, the interest component of any deferred
payment obligations, the interest component of all payments associated with Capitalized
Lease Obligations, commissions, discounts and other fees and charges incurred in respect of
letter of credit or bankers’ acceptance financings, and net payments (if any) pursuant to
Hedging Obligations), and




(2) the consolidated interest of such Person and its Restricted Subsidiaries that was
capitalized during such period, and




(3) any interest accruing on Indebtedness of another Person that is guaranteed by such
Person or one of its Restricted Subsidiaries (excluding any Investment Guarantee and any
Completion Guarantee and Keep-Well Agreement, but including any interest expense or interest
component of any comparable debt service payments with respect to any Investment Guarantee
Indebtedness or any Completion Guarantee/Keep-Well Indebtedness to the extent such
Investment Guarantee Indebtedness or such Completion Guarantee/Keep-Well Indebtedness is
actually being serviced by such Person or any Restricted Subsidiary of such Person) or
secured by a Lien on assets of such Person or one of its Restricted Subsidiaries (whether or
not such Lien is called upon), and




(4) the product of:




(A) all dividend payments on any series of preferred stock of such Person or
any of its Restricted Subsidiaries, times




(B) a fraction, the numerator of which is one and the denominator of which is
one minus the then current combined federal, state and local statutory tax rate of
such Person, expressed as a decimal,



in each case, on a consolidated basis and in accordance with GAAP.



“Consolidated Net Income” means, with respect to any Person for any period, the aggregate net
income (or loss) of such Person and its Restricted Subsidiaries for such period on a consolidated
basis, determined in accordance with GAAP; provided, however, that there shall be excluded
therefrom:




(1) net after-tax gains and losses from all sales or dispositions of assets outside of
the ordinary course of business,




(2) net after-tax extraordinary or non-recurring gains or losses and losses on early
extinguishment of debt,




(3) the effect of marking to market Interest Swap Obligations and Hedging Obligations
permitted to be Incurred by clause (9) of Permitted Indebtedness,




(4) the cumulative effect of a change in accounting principles,




(5) any net income of any other Person if such other Person is not a Restricted
Subsidiary and is accounted for by the equity method of accounting, except that such
Person’s equity in the



 


10









 








net income of any such other Person for such period shall be included in such
Consolidated Net Income up to the aggregate amount of cash actually distributed by such
other Person during such period to such Person or a Restricted Subsidiary as a dividend or
other distribution (subject, in case of a dividend or other distribution to a Restricted
Subsidiary, to the limitation that such amount so paid to a Restricted Subsidiary shall be
excluded to the extent that such amount could not at that time be paid to the Company due to
the restrictions set forth in clause (6) below (regardless of any waiver of such
conditions)),




(6) any net income of any Restricted Subsidiary if such Restricted Subsidiary is
subject to restrictions, directly or indirectly, by contract, operation of law, pursuant to
its charter or otherwise on the payment of dividends or the making of distributions by such
Restricted Subsidiary to such Person except that:




(A) such Person’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 such Person as a dividend or other distribution (provided that such ability is
not due to a waiver of such restriction), and




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




(7) any restoration to income of any contingency reserve, except to the extent that
provision for such reserve was made out of Consolidated Net Income accrued at any time
following September 25, 2003,




(8) income or loss attributable to discontinued operations (including, without
limitation, operations disposed of during such period whether or not such operations were
classified as discontinued),




(9) in the case of a successor to such Person by consolidation or merger or as a
transferee of such Person’s assets, any net income or loss of the successor corporation
prior to such consolidation, merger or transfer of assets, and




(10) the net income but not loss of any Unrestricted Subsidiary, except that the
Company’s or any Restricted Subsidiary’s equity in the net income of any Unrestricted
Subsidiary (other than the Argentina Subsidiaries during periods in which they are
Unrestricted Subsidiaries) or other Person for such period shall be included in such
Consolidated Net Income up to the aggregate amount of cash actually distributed by such
Unrestricted Subsidiary or Person during such period to the Company or a Restricted
Subsidiary as a dividend or other distribution; provided, however, that all Reclassified
Argentina Receipts may be included in determining Consolidated Net Income in the period in
which the reclassification is made.



“Consolidated Total Assets” means, with respect to any Determination Date, the total amount of
assets that would appear on a consolidated balance sheet of the Company and its Restricted
Subsidiaries as of the most recent date on or prior to such Determination Date for which internal
financial statements are available, determined on a consolidated basis in accordance with GAAP.



“Contribution Indebtedness” means Indebtedness of the Company, any Guarantor or any Domestic
Restricted Subsidiary that is not an Obligor in an aggregate principal amount on any date of


 


11









 






Incurrence not greater than twice the aggregate amount of any net cash proceeds received by
the Company from any Equity Offerings of the Company after the Issue Date; provided that:




(1) such net cash proceeds can be the basis of Contribution Indebtedness on such date
of Incurrence only to the extent that such net cash proceeds have not then been used to make
a Restricted Payment under the second clause (3) of Section 4.07(a) hereof, where such net
cash proceeds shall not be considered to have been used to make a Restricted Payment unless
the amount available to make such Restricted Payment under such clause (3) at such time
excluding such net cash proceeds would not be sufficient to permit such Restricted Payment
and then only to the extent such net cash proceeds are necessary to permit such Restricted
Payment at such time (and any restoration of the amount available for Restricted Payments
under such clause (3) pursuant to subclauses (D) and (E) of such clause (3) of an amount of
net cash proceeds considered to have been used to make a Restricted Payment, to the extent
the Restricted Investment involved in such restoration was considered made using such net
cash proceeds, shall also result in such net cash proceeds not being considered used to make
a Restricted Payment), and




	(2)	 	if, on the date of Incurrence of any Contribution Indebtedness, after giving pro forma effect
to the incurrence thereof, the aggregate outstanding principal amount of Contribution
Indebtedness would exceed the aggregate amount of such net cash proceeds, the amount of such
excess then being Incurred shall be Indebtedness (i) that is not secured Indebtedness, (ii)
that does not rank senior in right of payment to the Notes, and (iii) with a final maturity
date no earlier than the final maturity date of the Notes, and







	(3)	 	such Contribution Indebtedness is so designated as Contribution Indebtedness pursuant to an
officers’ certificate on the Incurrence date thereof;






provided that a Domestic Restricted Subsidiary that is not an Obligor may not Incur Contribution
Indebtedness described in clause (2) above.



“Core Businesses” means (a) the gaming, card club, racing, sports, entertainment, lodging,
restaurant, riverboat operations, real estate development and all other businesses and activities
necessary for or reasonably related or incident thereto, including, without limitation, related
acquisition, construction, development or operation of related truck stop, transportation, retail
and other facilities designed to enhance any of the foregoing and (b) any of the types of
pre-existing businesses being operated on land acquired (whether by purchase, lease or otherwise)
by an Obligor, or similar types of businesses conducted by such Obligor after such acquisition of
land, and all other businesses and activities necessary for or reasonably related or incident
thereto, provided that such land was acquired by such Obligor for the purpose, determined in good
faith by the Company, of ultimately conducting a business or activity described in clause (a) above
at some time in the future.



“Corporate Trust Office of the Trustee” means the principal office of the Trustee at which at
any time its corporate trust business shall be administered, which office at the date hereof is at
the address of the Trustee specified in Section 12.02 hereof or such other address as to which the
Trustee may give notice to the Company and the Holders.



“Credit Facilities” means, with respect to any Obligor, one or more debt facilities
(including, without limitation, the Bank Credit Agreement) or commercial paper facilities with any
combination of banks, other institutional lenders and other Persons extending financial
accommodations or holding corporate debt obligations in the ordinary course of their business,
providing for revolving credit loans, term loans, receivables financing (including through the sale
of receivables to such lenders or to special


 


12









 






purpose entities formed to borrow from such lenders against such receivables) or letters of
credit, in each case, as amended, restated, modified, renewed, refunded, replaced or refinanced in
whole or in part from time to time by the same or different institutional investors or other
purchasers.



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



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



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



“Determination Date” means, with respect to any calculation, the date on which such
calculation is made in accordance with the terms hereof.



“Disqualified Capital Stock” means any Capital Stock which by its terms (or by the terms of
any security into which it is, by its terms, convertible or for which it is, by its terms,
exchangeable at the option of the holder thereof), or upon the happening of any specified event, is
required to be redeemed or is redeemable (at the option of the holder thereof) at any time prior to
the earlier of the repayment of all Notes or the stated maturity of the Notes or is exchangeable at
the option of the holder thereof for Indebtedness at any time prior to the earlier of the repayment
of all Notes or the stated maturity of the Notes.



“Domestic Restricted Subsidiary” means any Restricted Subsidiary that is a Person organized
under the laws of the United States or any state thereof.



“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 any public or private sale of Qualified Capital Stock.



“Estimated Business Interruption Insurance” means an estimate of the amount (determined in
good faith by senior management of the Company, notwithstanding the failure of any designation by
applicable insurance carriers as to how much of any expected recovery is attributable to business
interruption coverage as opposed to other types of coverage) of business interruption insurance the
Company expects to collect with respect to any applicable period; provided that such
amount, which shall not be taken in account for any period after two years following the date of
the event giving rise to the claim under the relevant business interruption insurance, shall not
exceed the sum of (A) the excess of (x) such property’s historical quarterly Consolidated EBITDA
for the previous four fiscal quarters most recently ended prior to such date for which internal
financial reports are available for that property ending prior to the date the damage occurred (or
annualized if such property has less than four full quarters of operations) over (y) the actual
Consolidated EBITDA generated by such property for such four fiscal quarter period, and (B) the
amount of business interruption insurance proceeds not reflected in clause (A)


 


13









 






that the Company expects to collect as a reimbursement in respect of other expenses incurred
at that property with respect to such period (provided that the amount included pursuant to this
clause (B) shall not exceed the amount of the other expenses incurred at that property that are
actually included in calculating Consolidated Net Income for such fiscal quarter).



“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.



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



“Foreign Restricted Subsidiary” means any Restricted Subsidiary that is not a Domestic
Restricted Subsidiary.



“GAAP” means generally accepted accounting principles set forth in the opinions and
pronouncements of the Accounting Principles Board of the American Institute of Certified Public
Accountants and statements and pronouncements of the Financial Accounting Standards Board or in
such other statements by such other entity as may be approved by a significant segment of the
accounting profession of the United States, which are in effect as of the Issue Date.



“Gaming Approval” means any governmental approval, license, registration, qualification or
finding of suitability relating to any gaming business, operation or enterprise.



“Gaming Authority” means any governmental authority with regulatory oversight of, authority to
regulate or jurisdiction over any gaming businesses, operations or enterprises, including the
Nevada State Gaming Control Board and City of Reno, Nevada gaming authorities, Nevada Gaming
Commission, Indiana Gaming Commission, Louisiana Gaming Control Board, New Jersey Casino Control
Commission, Missouri Gaming Commission and Colorado Division of Gaming, with regulatory oversight
of, authority to regulate or jurisdiction over any existing or proposed gaming business, operation
or enterprise owned, managed or operated by any Obligor.



“Gaming Laws” means all applicable provisions of all:




(1) constitutions, treaties, statutes or laws governing gaming operations (including
without limitation card club casinos and pari mutuel race tracks) and rules, regulations and
ordinances of any Gaming Authority,




(2) Gaming Approvals, and




(3) orders, decisions, judgments, awards and decrees of any Gaming Authority.



“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.


 


14









 





“Global Notes” means a permanent global note in registered form deposited with the Trustee, as
a custodian for The Depositary Trust Company or any other designated depositary, 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)(1), 2.06(d)(2), 2.06(d)(3) or 2.06(f) hereof.



“Government Securities” means marketable direct obligations issued by, or unconditionally
guaranteed by, the United States government or issued by any agency or instrumentality thereof and
backed by the full faith and credit of the United States, in each case maturing within 12 months
from the date of acquisition thereof by any Obligor or any Domestic Restricted Subsidiary.



“Guarantor” means any existing or future Material Restricted Subsidiary of the Company, which
has guaranteed the obligations of the Company arising under or in connection with the Notes, as
required by this Indenture.



“Guaranty” means a guaranty by a Guarantor of the Obligations of the Company arising under or
in connection with the Notes (including, without limitation, the Exchange Notes).



“Hedging Obligations” means all obligations of the Obligors or any Domestic Restricted
Subsidiary that is not an Obligor arising under or in connection with any rate or basis swap,
forward contract, commodity swap or option, equity or equity index swap or option, bond, note or
bill option, interest rate option, foreign currency exchange transaction, cross currency rate swap,
currency option, cap, collar or floor transaction, swap option, synthetic trust product, synthetic
lease or any similar transaction or agreement.



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



“Incur” means, with respect to any Indebtedness of any Person or any Lien, to create, issue,
incur (by conversion, exchange or otherwise), assume, guarantee or otherwise become liable in
respect of such Indebtedness or Lien or the recording, as required pursuant to GAAP or otherwise,
of any such Indebtedness on the balance sheet of such Person (and “Incurrence,” “Incurred,”
“Incurrable” and “Incurring” shall have meanings correlative to the foregoing).



“Indebtedness” means with respect to any Person, without duplication, whether contingent or
otherwise,




(1) any obligations for money borrowed,




(2) any obligation evidenced by bonds, debentures, notes, or other similar instruments,




(3) Letter of Credit Obligations and obligations in respect of other similar
instruments,




(4) any obligations to pay the deferred purchase price of property or services,
including Capitalized Lease Obligations,




(5) the maximum fixed redemption or repurchase price of Disqualified Capital Stock,




(6) Indebtedness of other Persons of the types described in clauses (1) through (5)
above, secured by a Lien on the assets of such Person or its Restricted Subsidiaries,
valued, in such cases where the recourse thereof is limited to such assets, at the lesser of
the principal amount of such Indebtedness or the fair market value of the subject assets,


 


15









 






(7) Indebtedness of other Persons of the types described in clauses (1) through (5)
above, guaranteed by such Person or any of its Restricted Subsidiaries, and




(8) the net obligations of such Person under Hedging Obligations,



provided that the amount of any Indebtedness at any date shall be calculated as the outstanding
balance of all unconditional obligations and the maximum liability supported by any contingent
obligations at such date.



Notwithstanding the foregoing, (i) an Investment Guarantee and a Completion Guarantee and
Keep-Well Agreement shall not constitute Indebtedness, (ii) Investment Guarantee Indebtedness and
Completion Guarantee/Keep-Well Agreement Indebtedness shall constitute Indebtedness, and (iii)
“Indebtedness” shall not be construed to include trade payables, credit on open account, accrued
liabilities, provisional credit, daylight overdrafts or similar items. For purposes of this
definition, the “maximum fixed redemption or repurchase price” of any Disqualified Capital Stock
that does not have a fixed repurchase price shall be calculated in accordance with the terms of
such Disqualified Capital Stock as if such Disqualified Capital Stock were repurchased on the date
on which Indebtedness shall be required to be determined pursuant to this Indenture, and if such
price is based upon, or measured by, the fair market value of such Disqualified Capital Stock, such
fair market value shall be determined reasonably and in good faith by the Board of the issuing
Person. Unless otherwise specified in this Indenture, the amount outstanding at any time of any
Indebtedness issued with original issue discount is the full 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.



“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 $450,000,000 aggregate principal amount of Notes issued under
this Indenture on the date hereof.



“Initial Purchasers” means J.P. Morgan Securities Inc., Banc of America Securities LLC,
Deutsche Bank Securities Inc., Barclays Capital Inc., Goldman, Sachs & Co., UBS Investment Bank,
CALYON, Capital One Southcoast and Moelis & Company.



“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 Payment Date” means the Stated Maturity of an installment of interest on the Notes.



“Interest Swap Obligations” means the net obligations of any Person under any interest rate
protection agreement, interest rate future, interest rate option, interest rate swap, interest rate
cap, collar or floor transaction or other interest rate Hedging Obligation.



“Investment” by any Person means, without duplication, any direct or indirect:




(1) loan, advance or other extension of credit or capital contribution (valued at the
fair market value thereof as of the date of contribution or transfer) (by means of transfers
of cash or other property or services for the account or use of other Persons, or otherwise,
other than a Permitted Lien under clause (15) of the definition of Permitted Lien);


 


16









 






(2) purchase or acquisition of Capital Stock, bonds, notes, debentures or other
securities or evidences of Indebtedness issued by any other Person (whether by merger,
consolidation, amalgamation or otherwise and whether or not purchased directly from the
issuer of such securities or evidences of Indebtedness);




(3) guarantee or assumption of any Indebtedness or any other obligation of any other
Person (except for any assumption of Indebtedness for which the assuming Person receives
consideration at the time of such assumption in the form of property or assets with a fair
market value at least equal to the principal amount of the Indebtedness assumed);




(4) the making by such Person or any Subsidiary of such Person of any Investment
Guarantee Payment or of any payment pursuant to any Completion Guarantee and Keep-Well
Agreement or in respect of any Completion Guarantee/Keep-Well Indebtedness (without
duplication of amounts taken into account under clause (3) above), and




(5) all other items that would be classified as investments (including, without
limitation, purchases of assets outside the ordinary course of business) on a balance sheet
of such Person prepared in accordance with GAAP.



Notwithstanding the foregoing, the purchase or acquisition of any securities, Indebtedness or
Productive Assets of any other Person solely with Qualified Capital Stock shall not be deemed to be
an Investment. The term “Investments” shall also exclude extensions of trade credit and advances to
customers and suppliers to the extent made in the ordinary course of business on ordinary business
terms. The amount of any non-cash Investment shall be the fair market value of such Investment, as
determined conclusively in good faith by management of the Company or the affected Restricted
Subsidiary, as applicable, unless the fair market value of such Investment exceeds $5 million, in
which case the fair market value shall be determined conclusively in good faith by the Board of
such Person as of the time such Investment is made or such other time as specified in this
Indenture. Unless otherwise required by this Indenture, the amount of any Investment shall not be
adjusted for increases or decreases in value, or write-ups, write-downs or write-offs subsequent to
the date such Investment is made with respect to such Investment.



“Investment Guarantee” means any guarantee, directly or indirectly, by the Company or any
Guarantor of Indebtedness of a Permitted Joint Venture, provided that at the time such guarantee is
incurred, the Company is permitted to incur at least $1.00 of additional Indebtedness pursuant to
the Consolidated Coverage Ratio under Section 4.09 hereof.



“Investment Guarantee Indebtedness” of the Company or any Guarantor means any Indebtedness of
another Person guaranteed by the Company or such Guarantor pursuant to an Investment Guarantee, on
and after the time the Company or such Guarantor makes any principal, interest or comparable debt
service payment with respect to such guaranteed Indebtedness.



“Investment Guarantee Payments” means, without duplication, (1) any payments made pursuant to
any Investment Guarantee, including any payment in respect of any Investment Guarantee
Indebtedness, or (2) the full amount of any Investment Guarantee if, at any time, the Person whose
Indebtedness is guaranteed by such Investment Guarantee ceases to constitute a Permitted Joint
Venture as a result of a decline in the Company’s or Guarantor’s ownership interest to less than
35% as a result of a sale, transfer or other disposition of Capital Stock of such Person by the
Company or such Guarantor.



“Issue Date” means August 10, 2009.


 


17









 





“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 Credit Obligations” means Obligations of an Obligor arising under or in connection
with letters of credit.



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



“Lien” means, with respect to any assets, any mortgage, lien, pledge, charge, security
interest or other similar encumbrance (including, without limitation, any conditional sale or other
title retention agreement or lease in the nature thereof, any option or other agreement to sell,
and any filing of or agreement to give, any security interest).



“Limited Real Estate Development” means the development or improvement of (1) any undeveloped
or substantially undeveloped real estate held by the Company or a Subsidiary on the date of this
Indenture or (2) any undeveloped or substantially undeveloped real estate that is acquired by the
Company or a Subsidiary in an acquisition of a company that is primarily in the Casino business.



“Material Restricted Subsidiary” means any Subsidiary which is both a Material Subsidiary and
a Restricted Subsidiary.



“Material Subsidiary” means any Subsidiary of the Company organized under the laws of the
United States or any state thereof, other than a Non-Material Subsidiary.



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



“Net Cash Proceeds” means with respect to any Asset Sale, the proceeds in the form of cash or
Cash Equivalents including payments in respect of deferred payment obligations when received in the
form of cash or Cash Equivalents received by any Obligor from such Asset Sale, net of:




(1) reasonable out-of- pocket expenses, fees and other direct costs relating to such
Asset Sale (including, without limitation, brokerage, legal, accounting and investment
banking fees and sales commissions),




(2) taxes paid or payable after taking into account any reduction in tax liability due
to available tax credits or deductions and any tax sharing arrangements,




(3) repayment of Indebtedness (other than any intercompany Indebtedness) that is
required by the terms thereof to be repaid or pledged as cash collateral, or the holders of
which otherwise have a contractual claim that is legally superior to any claim of the
holders (including a restriction on transfer) to the proceeds of the subject assets, in
connection with such Asset Sale, and




(4) appropriate amounts to be provided by any applicable Obligor, as a reserve, in
accordance with GAAP, against any liabilities associated with such Asset Sale and retained
by any applicable Obligor including, without limitation, pension and other post- employment
benefit liabilities, liabilities related to environmental matters and liabilities under any
indemnification


 


18









 








obligations associated with such Asset Sale and any reserve for adjustment to the sale
price received in such Asset Sale for so long as such reserve is held.



“Non-Material Foreign Restricted Subsidiaries” means all Foreign Restricted Subsidiaries
designated as Non-Material Foreign Restricted Subsidiaries by the Company; provided, that all such
Foreign Restricted Subsidiaries may not, in the aggregate at any time have assets (attributable to
the Company’s and its Restricted Subsidiaries’ equity interest in such entity) constituting more
than 1.5% of the Company’s total assets on a consolidated basis based on the Company’s most recent
internal financial statements. As of the Issue Date, the Non-Material Foreign Restricted
Subsidiaries shall be all of the Company’s Foreign Restricted Subsidiaries existing as of the Issue
Date other than Casino Magic Neuquén, S.A.



“Non-Material Subsidiaries” means all Domestic Restricted Subsidiaries designated as
Non-Material Subsidiaries by the Company; provided, that all such Domestic Restricted Subsidiaries
may not, in the aggregate at any time have assets (attributable to the Company’s and its Domestic
Restricted Subsidiaries’ equity interest in such entity) constituting more than 6% of the Company’s
total assets on a consolidated basis based on the Company’s most recent internal financial
statements. As of the Issue Date, the Non-Material Subsidiaries shall be all of the Company’s
Domestic Restricted Subsidiaries existing as of the Issue Date other than the Guarantors as of the
Issue Date.



“Non-Recourse Indebtedness” means Indebtedness of an Unrestricted Subsidiary




(1) as to which none of the Obligors:




(A) provides credit support of any kind (including any undertaking, agreement
or instrument that would constitute Indebtedness),




(B) is directly or indirectly liable (as a guarantor or otherwise), or




(C) constitutes the lender;




(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 (other than the Notes)
of any Obligor 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 any Obligor.



The foregoing notwithstanding, if an Obligor or a Restricted Subsidiary (x) makes a loan to an
Unrestricted Subsidiary that is permitted under Section 4.07 hereof or is a Permitted Investment
and is otherwise permitted to be incurred under this Indenture or (y) executes an Investment
Guarantee or a Completion Guarantee and Keep-Well Agreement for the benefit of an Unrestricted
Subsidiary for the purpose of developing, constructing, opening and operating a new gaming facility
or related or ancillary amenities or businesses or Incurs Investment Guarantee Indebtedness or
Completion Guarantee/Keep-Well Indebtedness, such actions referred to in the foregoing clauses (x)
and (y) shall not prevent the Indebtedness of an Unrestricted Subsidiary to which such actions
relate from being considered Non-Recourse Indebtedness.



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


 


19









 





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



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



“Obligor” means the Company or any Guarantor and any Foreign Restricted Subsidiary that is not
a Non-Material Foreign Restricted Subsidiary.



“Officer” means, (i) with respect to any Person that is a corporation, 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, the Assistant
Secretary or any Vice-President of such Person and (ii) with respect to any other Person, the
individuals selected by the Board or corresponding governing or managing body of such Person to
perform functions similar to those of the officers listed in clause (i).



“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 12.05 hereof.



“Opinion of Counsel” means a written opinion from legal counsel that meets the requirements of
Section 12.05 hereof. The counsel may be an employee of or counsel to the Company or any
Subsidiary of the Company.



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



“Permitted Indebtedness” means, without duplication, each of the following:




(1) Indebtedness of the Company or any Restricted Subsidiary outstanding on the Issue
Date (other than Indebtedness under the Bank Credit Agreement) as reduced by the amount of
any scheduled amortization payments or mandatory prepayments when actually paid or permanent
reductions thereof;




(2) Indebtedness Incurred by the Company under the Notes and by the Guarantors under
the Guaranties;




(3) Indebtedness Incurred by the Company or any Restricted Subsidiary, including
pursuant to the Bank Credit Agreement; provided that the aggregate principal amount of all
such Indebtedness outstanding under this clause (3) as of any date of Incurrence (after
giving pro forma effect to the application of the proceeds of such Incurrence), including
all Permitted Refinancing Indebtedness Incurred to repay, redeem, extend, refinance, renew,
replace, defease or refund any Indebtedness Incurred pursuant to this clause (3), shall not
exceed the greater of (x) $750 million and (y) 3.5 times the Company’s Consolidated EBITDA
for the period of four fiscal


  


20









 








quarters most recently ended prior to such date for which internal financial reports
are available, ended not more than 135 days prior to such date (using the pro forma and
calculation conventions for Consolidated EBITDA referenced in the definition of Consolidated
Coverage Ratio), in each case, to be reduced dollar-for-dollar by the amount of the
aggregate amount of all Net Cash Proceeds of Asset Sales applied by an Obligor to
permanently prepay or repay Indebtedness under the Bank Credit Agreement pursuant to Section
4.10 hereof;




(4) Indebtedness of the Company to any Obligor or of any Guarantor to any other Obligor
for so long as such Indebtedness is held by the Company or by another Obligor; provided
that:




(A) any Indebtedness of the Company to any other Obligor that is not a
Guarantor is unsecured and evidenced by an intercompany promissory note that is
subordinated, pursuant to a written agreement, to the Company’s obligations under
this Indenture and the Notes, and




(B) if as of any date any Person other than the Company or a Guarantor owns or
holds any such Indebtedness or holds a Lien in respect of such Indebtedness (other
than such a Lien in favor of the lenders under the Bank Credit Agreement or holders
of other Indebtedness not subordinate in right of payment to the Notes or the
Guaranties permitted under this Indenture), such date shall be deemed to be an
Incurrence of Indebtedness not constituting Permitted Indebtedness under this clause
(4) by the issuer of such Indebtedness;




(5) Indebtedness of a Restricted Subsidiary to the Company for so long as such
Indebtedness is held by an Obligor; provided that if as of any date any Person other than an
Obligor acquires any such Indebtedness or holds a Lien in respect of such Indebtedness
(other than such a Lien in favor of the lenders under the Bank Credit Agreement or holders
of other Indebtedness not subordinate in right of payment to the Notes or the Guaranties),
such acquisition shall be deemed to be an Incurrence of Indebtedness not constituting
Permitted Indebtedness under this clause (5) by the issuer of such Indebtedness;




(6) Permitted Refinancing Indebtedness;




(7) the Incurrence by Unrestricted Subsidiaries of Non-Recourse Indebtedness; provided
that, if any such Indebtedness ceases to be Non-Recourse Indebtedness of an Unrestricted
Subsidiary, such event shall be deemed to constitute an Incurrence of Indebtedness that is
not permitted by this clause (7);




(8) (a) Indebtedness Incurred by the Company or any Restricted Subsidiary solely to
finance the construction or acquisition or improvement of, or consisting of Capitalized
Leased Obligations Incurred to acquire rights of use in, capital assets useful in the
Company’s or such Subsidiary’s business, as applicable, and, in any such case, Incurred
prior to or within 180 days after the construction, acquisition, improvement or leasing of
the subject assets, not to exceed $175 million in aggregate principal amount outstanding at
any time (including all Permitted Refinancing Indebtedness Incurred to repay, redeem,
extend, refinance, renew, replace, defease or refund any Indebtedness Incurred pursuant to
this clause (8)) for all of the Company and its Restricted Subsidiaries, and (b) additional
Indebtedness of the kind described in this clause (8) with respect to which neither the
Company nor any Restricted Subsidiary is directly or indirectly liable, and which is
expressly made non-recourse to all of such Person’s assets, except the asset so financed;


 


21









 






(9) Hedging Obligations and Interest Swap Obligations entered into not as speculative
Investments but as hedging transactions designed to protect the Company and its Restricted
Subsidiaries against fluctuations in interest rates in connection with Indebtedness
otherwise permitted hereunder or against exchange rate risk or commodity pricing risk;




(10) Indebtedness of the Company or any Restricted Subsidiary arising in respect of
performance bonds and completion guaranties (to the extent that the Incurrence thereof does
not result in the Incurrence of any obligation for the payment of borrowed money of others),
in the ordinary course of business, in amounts and for the purposes customary in such
Person’s industry; provided, that such Indebtedness shall be Incurred solely in connection
with the development, construction, improvement or enhancement of assets useful in such
Person’s business;




(11) Completion Guarantee/Keep-Well Indebtedness or Investment Guarantee Indebtedness
up to a maximum of $200 million in aggregate principal amount (or accreted value, as
applicable) outstanding at any time (including all Permitted Refinancing Indebtedness
Incurred to repay, redeem, extend, refinance, renew, replace, defease or refund any
Indebtedness Incurred pursuant to this clause (11)) ;




(12) the guarantee by a Guarantor of Indebtedness of the Company, or the guarantee by a
Restricted Subsidiary of Indebtedness not subordinate in right of payment to the Notes or
the Guaranties of the Company, provided such Indebtedness was outstanding on the Issue Date
or was, at the time it was incurred, permitted to be incurred by the Company under this
Indenture; provided that if the Indebtedness being guaranteed is subordinated to or pari
passu with the Notes, then the guarantee may only be incurred by a Guarantor and shall be
subordinated to, or pari passu with, as applicable, the Notes to the same extent as the
Indebtedness guaranteed;




(13) the issuance by any of the Company’s Restricted Subsidiaries to the Company or to
any of its Restricted Subsidiaries of shares of preferred stock; provided, however, that:




(A) any subsequent issuance or transfer of Equity Interests that results in any
such preferred stock being held by a Person other than the Company or a Restricted
Subsidiary; and




(B) any sale or other transfer of any such preferred stock to a Person that is
not either the Company or a Restricted Subsidiary of the Company;




will be deemed, in each case, to constitute an issuance of such preferred stock by
such Restricted Subsidiary that was not permitted by this clause (13);




(14) Indebtedness in an amount not to exceed $25 million under a junior pay-in-kind
note incurred in order to redeem or repurchase Capital Stock of the Company upon a final
determination by any Gaming Authority of the unsuitability of a holder or beneficial owner
of Capital Stock of the Company or upon any other requirement or order by any Gaming
Authority having jurisdiction over the Company prohibiting a holder from owning,
beneficially or otherwise, the Company’s Capital Stock, provided that the Company has used
its reasonable best efforts to effect a disposition of such capital stock to a third party
and has been unable to do so; provided, further, that such junior pay-in-kind note:




(A) is expressly subordinated to the Notes,


 


22









 






(B) provides that no installment of principal matures (whether by its terms, by
optional or mandatory redemption or otherwise) earlier than three months after the
maturity of the Notes,




(C) provides for no cash payments of interest, premium or other distributions
earlier than six months after the maturity of the Notes and provides that all
interest, premium or other distributions may only be made by distributions of
additional junior pay-in-kind notes, which such in-kind distributions shall be
deemed Permitted Indebtedness, and




(D) contains provisions whereby the holder thereof agrees that prior to the
maturity or payment in full in cash of the Notes, regardless of whether any
insolvency or liquidation has occurred against any Obligor, such holder will not
exercise any rights or remedies or institute any action or proceeding with respect
to such rights or remedies under such junior pay-in-kind note;




(15) Contribution Indebtedness;




(16) Indebtedness of the Company or Indebtedness or preferred stock of a Guarantor
incurred or issued to finance an acquisition or the incurrence of Acquired Debt of Persons
that are acquired by the Company or any Restricted Subsidiary (whether by merger or
otherwise) in accordance with the terms of this Indenture; provided that after giving effect
to such acquisition, either (a) the Company would be permitted to Incur at least $1.00 of
Indebtedness (other than Permitted Indebtedness) pursuant to the Consolidated Coverage Ratio
test set forth in Section 4.09(b) or (b) the Company’s Consolidated Coverage Ratio
immediately following such acquisition and incurrence or issuance would be no less than the
Company’s Consolidated Coverage Ratio immediately prior to such acquisition and incurrence
or issuance;




(17) the Incurrence by the Company or any Guarantor of Indebtedness in an aggregate
principal amount outstanding at any time under this clause (17), including all Permitted
Refinancing Indebtedness Incurred to repay, redeem, extend, refinance, renew, replace,
defease or refund any Indebtedness Incurred pursuant to this clause (17) (or accreted value,
as applicable), not to exceed $500 million at any time outstanding for the purpose of
developing, constructing, improving or acquiring a Casino or Casinos in Atlantic City, New
Jersey or, if applicable, any Related Business in connection with such Casino or Casinos;
provided, however, that Indebtedness may not be Incurred pursuant to this clause (17) unless
and until the Consolidated EBITDA of the Company (using the proforma and calculation
conventions for Consolidated EBITDA referenced in the definition of Consolidated Coverage
Ratio) for any period of four consecutive full fiscal quarters at any time prior to such
Incurrence (which need not be the most recently completed four fiscal quarters), for which
internal financial statements are available, exceeds $210 million (the “EBITDA Threshold”)
(provided that (x) in the event of a sale or other disposition of an operating facility
owned by the Company or a Restricted Subsidiary (whether or not owned by the Company and its
Subsidiaries on the Issue Date, and whether by sale of assets or the equity of such
Restricted Subsidiary or otherwise) after the Issue Date and prior to the date of any such
Incurrence under this clause (17), and (y) the consideration received by the Company or any
of its Restricted Subsidiaries from such sale or other disposition is at least equal to the
fair market value of the assets sold or of which other disposition is made (as determined
reasonably and in good faith by the Board), then the EBITDA Threshold shall be reduced by
the positive Consolidated EBITDA, if any, of the Restricted Subsidiary or of the operating
facility sold or disposed of for the last complete four quarter period prior to its sale or
disposition); provided, further, that for purposes of computing the EBITDA Threshold in this
clause (17) only, the


  


23









 








Consolidated EBITDA of the Company shall not include any net income of an Unrestricted
Subsidiary for such four fiscal quarter period notwithstanding any actual distribution of
cash to the Company or any Restricted Subsidiary by such Unrestricted Subsidiary; and




(18) the Incurrence by the Company or any Restricted Subsidiary of additional
Indebtedness in an aggregate principal amount (or accreted value, as applicable) outstanding
under this clause (18) as of any date of Incurrence, including all Permitted Refinancing
Indebtedness Incurred to repay, redeem, extend, refinance, renew, replace, defease or refund
any Indebtedness Incurred pursuant to this clause (18), not to exceed the greater of (i) 5%
of Consolidated Total Assets and (ii) $250 million.



For purposes of this definition, it is understood that the Company may rely on internal or
publicly reported financial reports even though there may be subsequent adjustments (including
review and audit adjustments) to such financial statements. For avoidance of doubt, any incurrence
of Permitted Indebtedness which is based upon or made in reliance on a computation based on such
internal or publicly reported financial statements, shall be deemed to continue to comply with the
applicable covenant, notwithstanding any subsequent adjustments that may result in changes to such
internal or publicly reported financial statements.



“Permitted Investments” means, without duplication, each of the following:




(1) Investments in cash (including deposit accounts with major commercial banks) and
Cash Equivalents;




(2) Investments by the Company or a Restricted Subsidiary in the Company or any
Restricted Subsidiary or any Person that is or will immediately become upon giving effect to
such Investment, or as a result of which, such Person is merged, consolidated or liquidated
into, or conveys substantially all of its assets to, an Obligor or a Restricted Subsidiary;
provided that Investments in any such Person (other than the Company or any Restricted
Subsidiary) made prior to such Investment shall not be “Permitted Investments” under this
clause (2); and provided, further, that for purposes of calculating at any date the
aggregate amount of Investments made since September 25, 2003 pursuant to Section 4.07, such
Investment shall be a Permitted Investment only so long as any Subsidiary in which any such
Investment has been made continues to be an Obligor or a Restricted Subsidiary;




(3) Investments existing on the Issue Date;




(4) accounts receivable created or acquired in the ordinary course of business of the
Company or any Restricted Subsidiary on ordinary business terms;




(5) Investments arising from transactions by the Company or a Restricted Subsidiary
with trade creditors or customers in the ordinary course of business (including any such
Investment received pursuant to any plan of reorganization or similar arrangement pursuant
to the bankruptcy or insolvency of such trade creditors or customers or otherwise in
settlement of a claim);




(6) Investments made as the result of non-cash consideration received from an Asset
Sale that was made pursuant to and in compliance with Section 4.10;




(7) Investments consisting of advances to officers, directors and employees of the
Company or a Restricted Subsidiary for travel, entertainment, relocation, purchases of
Capital


  


24









 








Stock of the Company or a Restricted Subsidiary permitted by this Indenture and
analogous ordinary business purposes;




(8) Hedging Obligations and Interest Swap Obligations consisting of Permitted
Indebtedness under clause (9) thereof;




(9) Transfers by the Company or a Restricted Subsidiary to an Unrestricted Subsidiary
of operational agreements (including, without limitation, slot machine leases, technical
assistance services agreements, trademark and tradename licenses, management services
agreements and royalty agreements) or other agreements entered into in the ordinary course
of business between the Company or a Restricted Subsidiary, on the one hand, and the
Argentina Subsidiaries, on the other hand; provided that any such transfer is made in
connection with the payment of any dividend or other distribution by the Company or its
Restricted Subsidiaries or Equity Interests in the Argentina Subsidiaries that are
Unrestricted Subsidiaries;




(10) 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 (10)
that are at the time outstanding, not to exceed $50 million; and




(11) the provision of management and related services (including intellectual property
rights and the use of corporate aircraft in providing such management services) to any
Unrestricted Subsidiary in the ordinary course of business, and, provided however, that the
Company or any Restricted Subsidiary shall not be required to allocate employee compensation
for management services provided by employees of the Company or any Restricted Subsidiary to
Unrestricted Subsidiaries in connection with such employees’ services to the Company or any
Restricted Subsidiary.



“Permitted Joint Venture” means a Person primarily engaged or preparing to engage in a Related
Business or related or ancillary business thereto as to which the Company or a Guarantor owns at
least 35% of the shares of Capital Stock (including at least 35% of the total voting power thereof)
of such Person.



“Permitted Liens” means:




(1) Liens securing Indebtedness under the Bank Credit Agreement or other Indebtedness
not subordinate in right of payment to the Notes or the Guaranties, in either case, that was
permitted by the terms of the Indenture to be incurred pursuant to clause (3) of the
definition of Permitted Indebtedness (“Basket Debt”), including Basket Debt reclassified by
the Company as Indebtedness Incurred under the Consolidated Coverage Ratio test in Section
4.09(b)(2) (such reclassified Indebtedness being referred to as “Reclassified Secured
Indebtedness”); provided, that for purposes of determining the maximum aggregate principal
amount of Indebtedness that may be secured by Liens under this clause (1), the Reclassified
Secured Indebtedness will continue to be treated as if it were Indebtedness outstanding
under the Basket Debt for that purpose only; provided, further, the reclassification of
Basket Debt to Reclassified Secured Indebtedness shall not be considered the creation,
incurrence, or assumption of a Lien for purposes of the obligations described in Section
4.12 hereof.




(2) Liens in favor of the Company or Liens on the assets of any Guarantor so long as
such Liens are held by another Obligor;


 


25









 






(3) Liens on property of a Person existing at the time such Person is merged into or
consolidated with the Company or a Restricted Subsidiary; provided that such Liens were not
Incurred in anticipation of such merger or consolidation and do not extend to any assets
other than those of the Person merged into or consolidated with the Company or such
Restricted Subsidiary, as applicable;




(4) Liens on property existing at the time of acquisition thereof by any Obligor or
Restricted Subsidiary; provided that such Liens were not Incurred in anticipation of such
acquisition;




(5) Liens Incurred to secure Indebtedness permitted by clause (8) of the definition of
Permitted Indebtedness, attaching to or encumbering only the subject assets and directly
related property such as proceeds (including insurance proceeds) and products thereof and
accessions, replacements and substitutions thereof;




(6) Liens to secure the performance of statutory obligations, surety or appeal bonds,
performance bonds or other obligations of a like nature incurred in the ordinary course of
business;




(7) Liens created by “notice” or “precautionary” filings in connection with operating
leases or other transactions pursuant to which no Indebtedness is Incurred by the Company or
any Restricted Subsidiary;




(8) Liens existing on the Issue Date;




(9) Liens for taxes, assessments or governmental charges or claims (including, without
limitation, Liens securing the performance of workers compensation, social security, or
unemployment insurance obligations) that are not yet delinquent or that are being contested
in good faith by appropriate proceedings promptly instituted and diligently concluded;
provided that any reserve or other appropriate provision as shall be required in conformity
with GAAP shall have been made therefor;




(10) Liens on shares of any equity security or any warrant or option to purchase an
equity security or any security which is convertible into an equity security issued by any
Obligor that holds, directly or indirectly through a holding company or otherwise, a license
under any applicable Gaming Laws; provided that this clause (10) shall apply only so long as
such Gaming Laws provide that the creation of any restriction on the disposition of any of
such securities shall not be effective and, if such Gaming Laws at any time cease to so
provide, then this clause (10) shall be of no further effect;




(11) Liens on securities constituting “margin stock” within the meaning of Regulation
T, U or X promulgated by the Board of Governors of the Federal Reserve System, to the extent
that (i) prohibiting such Liens would result in the classification of the obligations of the
Company under the Notes as a “purpose credit” and (ii) the Investment by any Obligor in such
margin stock is permitted by this Indenture;




(12) Liens securing Permitted Refinancing Indebtedness; provided that any such Lien
attaches only to the assets encumbered by the predecessor Indebtedness, unless the
Incurrence of such Liens is otherwise permitted under this Indenture;


 


26









 






(13) Liens securing stay and appeal bonds or judgment Liens in connection with any
judgment not giving rise to an Event of Default under Section 6.01(5);




(14) statutory Liens of landlords and Liens of carriers, warehousemen, mechanics,
suppliers, materialmen, repairmen and other Liens imposed by law incurred in the ordinary
course of business, in respect of obligations not constituting Indebtedness and not past
due; provided that adequate reserves shall have been established therefor in accordance with
GAAP;




(15) easements, rights-of-way, zoning restrictions, reservations, encroachments and
other similar charges or encumbrances in respect of real property which do not, individually
or in the aggregate, materially interfere with the conduct of business by any Obligor;




(16) any interest or title of a lessor under any Capitalized Lease Obligation permitted
to be incurred hereunder;




(17) Liens upon specific items of inventory or equipment and proceeds thereof, Incurred
to secure obligations in respect of bankers’ acceptances issued or created for the account
of any Obligor or Restricted Subsidiary in the ordinary course of business to facilitate the
purchase, shipment, or storage of such inventory or equipment;




(18) Liens securing Letter of Credit Obligations permitted to be Incurred hereunder
Incurred in connection with the purchase of inventory or equipment by an Obligor or
Restricted Subsidiary in the ordinary course of the business and secured only by such
inventory or equipment, the documents issued in connection therewith and the proceeds
thereof;




(19) Liens securing the Notes or the Guaranties or in favor of the Trustee arising
under this Indenture; and




(20) Liens incurred in the ordinary course of business of any Obligor with respect to
obligations that do not exceed, in the aggregate for all Obligors, $10.0 million at any one
time outstanding.



“Permitted Refinancing Indebtedness” means any Indebtedness of the Company or any Restricted
Subsidiary issued in exchange for, or the net proceeds of which are used to repay, redeem, extend,
refinance, renew, replace, defease or refund other Permitted Indebtedness of such Person arising
under clauses (1), (2), (3), (6), (8), (10), (11), (15), (16), (17) or (18) of the definition of
“Permitted Indebtedness” or Indebtedness Incurred under the Consolidated Coverage Ratio test in
Section 4.09(b)(2) (any such Indebtedness, “Existing Indebtedness”); provided that:




(1) the principal amount of such Permitted Refinancing Indebtedness does not exceed the
principal amount and accrued interest of such Existing Indebtedness (plus the amount of
prepayment penalties, fees, premiums and expenses incurred or paid in connection therewith),
except to the extent that the Incurrence of such excess is otherwise permitted by this
Indenture;




(2) if such Existing Indebtedness is subordinated to, or pari passu in right of payment
with, the Notes, such Permitted Refinancing Indebtedness has a final maturity date on or
later than the final maturity date of, and has a Weighted Average Life to Maturity equal to
or greater than the Weighted Average Life to Maturity of, such Existing Indebtedness;
provided this clause (2) shall not apply to Permitted Refinancing Indebtedness to repay,
redeem, refinance, retire for value, replace, defease or refund the 7.5% Notes, 8.25% Notes
or 8.75% Notes outstanding on the Issue Date;


 


27









 






(3) if such Existing Indebtedness is subordinated in right of payment to the Notes,
such Permitted Refinancing Indebtedness has a final maturity date on or later than the final
maturity date of, and is subordinated in right of payment to, the Notes on terms at least as
favorable to the Holders of Notes as those contained in the documentation governing the
Indebtedness being repaid, redeemed, extended, refinanced, renewed, replaced, defeased or
refunded; provided this clause (3) shall not apply to Permitted Refinancing Indebtedness to
repay, redeem, refinance, retire for value, replace, defease or refund the 8.25% Notes
outstanding on the Issue Date; and




(4) such Permitted Refinancing Indebtedness shall be Indebtedness solely of an Obligor
or a Restricted Subsidiary obligated under such Existing Indebtedness, unless otherwise
permitted by this Indenture.



“Person” means any individual, corporation, partnership, joint venture, association, limited
liability company, joint-stock company, trust, unincorporated organization, or government 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).



“Plan of Liquidation” means, with respect to any Person, a plan (including by operation of
law) that provides for, contemplates or the effectuation of which is preceded or accomplished by
(whether or not substantially contemporaneously):




(1) the sale, lease or conveyance of all or substantially all of the assets of such
Person otherwise than as an entirety or substantially as an entirety, and




(2) the distribution of all or substantially all of the proceeds of such sale, lease,
conveyance, or other disposition and all or substantially all of the remaining assets of
such Person to holders of Capital Stock of such Person.



“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.



“Productive Assets” means assets (including assets owned directly or indirectly through
Capital Stock of a Restricted Subsidiary) of a kind used or usable in the businesses of the
Obligors as they are conducted on the date of the Asset Sale or on any other determination date.



“Project” means any new facility developed or being developed by the Company or one of its
Restricted Subsidiaries and any expansion, renovation or refurbishment of a facility owned by the
Company or one of its Restricted Subsidiaries which expansion, renovation or refurbishment costs
$40 million or more.



“Project Opening” means, with respect to (a) any Project which is a new facility, when all of
the following have occurred: (i) a certificate of occupancy (which may be a temporary certificate
of occupancy) has been issued in respect of such Project and, if such Project includes gaming
facilities, then such certificate of occupancy need only relate to such gaming facilities and not
the remainder of such Project; (ii) such Project (or the gaming facility portion thereof in the
case of a Project that includes gaming facilities and not the remainder of such Project) is in a
condition (including installation of furnishings, fixtures and equipment) to receive customers in
the ordinary course of business; (iii) if such Project includes gaming facilities, such Project’s
gaming facilities (but not necessarily the hotel facilities if a hotel is contemplated to accompany
such Project’s gaming facilities) are legally open for business and to the general public and
operating in accordance with applicable law; and (iv) all Gaming Approvals, if


 


28









 






applicable, with respect to such Project have been granted and not revoked or suspended, and
(b) any Project which is an expansion, renovation or refurbishment, when clauses (ii), (iii) and
(iv) have occurred, to the extent applicable.



“Property” means any right or interest in or to property of any kind whatsoever, whether real,
personal or mixed and whether tangible or intangible, including, without limitation, Capital Stock.



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



“Qualified Capital Stock” means any Capital Stock that is not Disqualified Capital Stock.



“Reclassified Argentina Receipts” means all Argentina Receipts which, as determined in good
faith by the Company, will no longer be deemed available for distributions to any Argentina
Subsidiary that is an Unrestricted Subsidiary under Section 4.07(b)(14), provided that such amount
does not exceed the balance of the Argentina Contribution Amount immediately prior to such
reclassification.



“Registration Rights Agreement” means the Registration Rights Agreement, dated as of August
10, 2009, among the Company, the Guarantors and the other parties named on the signature pages
thereof, as such agreement may be amended, modified or supplemented from time to time and, with
respect to any Additional Notes, one or more registration rights agreements among the Company, the
Guarantors 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.



“Related Business” means the gaming (including pari-mutuel betting) business and/or any and
all reasonably related businesses necessary for, in support or anticipation of and ancillary to or
in preparation for (or required by a Gaming Authority to be developed, constructed, improved or
acquired in connection with the licensing approval of such Casino or Casinos), the gaming business
including, without limitation, the development, expansion or operation of any Casino (including any
land-based, dockside, riverboat or other type of Casino), owned, or to be owned, by the Company or
one of its Subsidiaries.



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



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



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



“Restricted Investment” means an Investment other than a Permitted Investment.


 


29









 





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



“Restricted Subsidiary” of a Person means any Subsidiary of the referent Person that is not an
Unrestricted Subsidiary. If no referent Person is specified, “Restricted Subsidiary” means a
Subsidiary of the Company.



“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 Rating Group, a division of The McGraw-Hill Industries, Inc.,
and its successors.



“SEC” means the Securities and Exchange Commission.



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



“Shelf Registration Statement” means the Shelf Registration Statement as defined in the
Registration Rights Agreement.



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



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



“Subsidiary,” with respect to any Person, means:




(1) any corporation or comparably organized entity, a majority of whose voting stock
(defined as any class of capital stock having voting power under ordinary circumstances to
elect a majority of the Board of such Person) is owned, directly or indirectly, by any one
or more of the Obligors, and




(2) any other Person (other than a corporation) in which any one or more of the
Obligors, directly or indirectly, has at least a majority ownership interest entitled to
vote in the election of directors, managers or trustees thereof or of which such Obligor is
the managing general partner.



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



“Treasury Rate” means, as of any redemption date, the yield to maturity as of such redemption
date of United States Treasury securities with a constant maturity (as compiled and published in
the most recent Federal Reserve Statistical Release H.15 (519) that has become publicly available
at least two business days prior to the redemption date (or, if such Statistical Release is no
longer published, any publicly available source of similar market data)) most nearly equal to the
period from the redemption


 


30









 






date to August 1, 2013; provided, however, that if the period from the redemption date to
August 1, 2013 is less than one year, the weekly average yield on actually traded United States
Treasury securities adjusted to a constant maturity of one year will be used.



“Trustee” means The Bank of New York Mellon Trust Company, N.A. 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 any Subsidiary of the Company that is designated by the Board
of the Company as its Unrestricted Subsidiary pursuant to a Board resolution; but only to the
extent that such Subsidiary:




(A) has, or will have after giving effect to such designation, no Indebtedness
other than Non-Recourse Indebtedness,




(B) is not party to any agreement, contract, arrangement or understanding with
any Obligor unless the terms of any such agreement, contract, arrangement or
understanding are no less favorable to such Obligor than those that might be
obtained at the time from Persons who are not Affiliates of such Obligor, or such
agreement, contract, arrangement or understanding constitutes a Restricted Payment
that is made in accordance with Section 4.07, the definition of a Permitted
Investment, or an Asset Sale that is made in accordance with Section 4.10,




(C) is a Person with respect to which none of the Obligors has any direct or
indirect obligation (i) to subscribe for additional Equity Interests or (ii) to
maintain or preserve such Person’s financial condition or to cause such Person to
achieve any specified levels of operating results,




(D) has not guaranteed or otherwise directly or indirectly provided credit
support for any Indebtedness of any Obligor, and




(E) has at least one member on its Board who is not a member of the Board or
executive officer of any Obligor and has at least one executive officer who is not a
member of the Board or executive officer of any Obligor;



provided, however, that the Company or any of its Guarantors may execute an Investment Guarantee or
Completion Guarantee and Keep-Well Agreement for the benefit of an Unrestricted Subsidiary, or may
Incur Investment Guarantee Indebtedness or Completion Guarantee/Keep-Well Indebtedness, for the
purpose of such Unrestricted Subsidiary developing, constructing, opening and operating a new
gaming facility or related or ancillary amenities or businesses, and the execution and performance
(if such performance is permitted under Section 4.07 hereof) of such Investment Guarantee,
Completion Guarantee and Keep-Well Agreement, Investment Guarantee Indebtedness, or Completion
Guarantee/Keep-Well Indebtedness shall not prevent a Subsidiary from becoming or remaining an
Unrestricted Subsidiary.


 


31









 





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



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



“Weighted Average Life to Maturity” means, when applied to any Indebtedness at any date, the
Company’s calculations of the number of years obtained by dividing:




(1) the then outstanding aggregate principal amount of such Indebtedness into,




(2) the total of the products obtained by multiplying:




(A) the amount of each then remaining installment, sinking fund, serial
maturity or other required payment of principal, including payment at final
maturity, in respect thereof, by




(B) the number of years (calculated to the nearest one-twelfth) which will
elapse between such date and the making of such payment.



Section 1.02 Other Definitions.




	 	 	 	 	 
	 	 	Defined in	 
	Term	 	Section	 
	“Affiliate Transaction”
	 	 	4.11	 
	“Amount Limitation”
	 	 	4.07	 
	“Amount Limitation Restoration”
	 	 	4.07	 
	“Authentication Order”
	 	 	2.02	 
	“Basket Debt”
	 	 	1.01	 
	“Change of Control Offer”
	 	 	4.15	 
	“Change of Control Payment”
	 	 	4.15	 
	“Change of Control Payment Date”
	 	 	4.15	 
	“Covenant Defeasance”
	 	 	8.03	 
	“DTC”
	 	 	2.03	 
	“EBITDA Threshold”
	 	 	1.01	 
	“Event of Default”
	 	 	6.01	 
	“Excess Proceeds”
	 	 	4.10	 
	“Existing Indebtedness”
	 	 	1.01	 
	“Legal Defeasance”
	 	 	8.02	 
	“Measurement Period”
	 	 	1.01	 
	“Net Proceeds Offer”
	 	 	4.10	 
	“Net Proceeds Offer Amount”
	 	 	4.10	 
	“Net Proceeds Offer Payment Date”
	 	 	4.10	 
	“Net Proceeds Offer Trigger Date”
	 	 	4.10	 
	“Offer Period”
	 	 	3.09	 
	“Paying Agent”
	 	 	2.03	 
	“Payment Default”
	 	 	6.01	 
	“Payment Restriction”
	 	 	4.08	 
	“Reclassified Secured Indebtedness”
	 	 	1.01	 





 


32









 





	 	 	 	 	 
	 	 	Defined in	 
	Term	 	Section	 
	“Redemption Date”
	 	 	3.07	 
	“Registrar”
	 	 	2.03	 
	“Restricted Payments”
	 	 	4.07	 






Section 1.03 Incorporation by Reference of Trust Indenture Act.




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



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



“indenture securities” means the Notes;



“indenture security Holder” means a Holder of a Note;



“indenture to be qualified” means this Indenture;



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



“obligor” on the Notes and the Guaranties means the Company and the Guarantors, respectively,
and any successor obligor upon the Notes and the Guaranties, respectively.



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



Section 1.04 Rules of Construction.




Unless the context otherwise requires:




(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;




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




(8) references to any contract, instrument or agreement shall be deemed to include any
amendments, modifications or supplements thereto or restatements thereof not prohibited
hereby, through the date of reference thereto.


 


33









 





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 $2,000 and integral multiples of $1,000 in excess of $2,000.



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



(b) Global Notes. Notes issued in global form 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.




At least one 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.



All Notes shall be dated the date of their authentication.



The Trustee will, upon receipt of a written order of the Company signed by two Officers (an
"Authentication Order”), authenticate Notes for original issue up to the aggregate principal amount
that may be validly issued under this Indenture, including any Additional Notes.


 


34









 





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 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 Holders of Notes and the Company shall otherwise comply with TIA
§ 312(a).



Section 2.06 Transfer and Exchange.




(a) Transfer and Exchange of Global Notes. A Global Note may not be transferred 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


 


35









 






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 or by the provisions of this
Indenture. 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).




(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:


 


36









 






(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:




(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 cause to be issued a Definitive Note in an amount equal to the
beneficial interest to be transferred or exchanged; and




(ii) 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 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:


 


37









 






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


 


38









 






(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 (4)(a) thereof;




(E) if such beneficial interest is being transferred to an Institutional
Accredited Investor or other Person 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)(a) 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 (4)(d) 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:




(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;


 


39









 






(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.




(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:


 


40









 






(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 (4)(a) thereof;




(E) if such Restricted Definitive Note is being transferred to an Institutional
Accredited Investor or other Person 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)(a) 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 (4)(d)
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, and, in the case of clause (C) above, the Regulation S 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 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;


 


41









 






(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 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).


 


42









 






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


 


43









 






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:



“THE NOTES EVIDENCED HEREBY HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS
AMENDED (THE “SECURITIES ACT”). NEITHER THIS NOTE NOR ANY INTEREST OR PARTICIPATION HEREIN MAY BE
REOFFERED, SOLD, ASSIGNED, TRANSFERRED, PLEDGED, ENCUMBERED OR OTHERWISE DISPOSED OF IN THE ABSENCE
OF SUCH REGISTRATION OR UNLESS THE TRANSACTION IS EXEMPT FROM, OR NOT SUBJECT TO, THE REGISTRATION
REQUIREMENTS OF THE SECURITIES ACT. EACH PURCHASER OF THE SECURITY EVIDENCED HEREBY IS NOTIFIED
THAT THE SELLER MAY BE RELYING ON THE EXEMPTION FROM SECTION 5 OF THE SECURITIES ACT PROVIDED BY
RULE 144A THEREUNDER. THE HOLDER OF THIS SECURITY BY ITS ACCEPTANCE HEREOF (1) REPRESENTS THAT (A)
IT IS A “QUALIFIED INSTITUTIONAL BUYER” (AS DEFINED IN RULE 144A UNDER THE SECURITIES ACT) OR (B)
IT IS NOT A U.S.


 


44









 





PERSON AND IS ACQUIRING ITS NOTE IN AN “OFFSHORE TRANSACTION” PURSUANT TO RULE 904 OF
REGULATION S UNDER THE SECURITIES ACT, (2) AGREES THAT IT WILL NOT PRIOR TO (X) THE DATE WHICH IS
ONE YEAR (OR SUCH SHORTER PERIOD OF TIME AS PERMITTED BY RULE 144 UNDER THE SECURITIES ACT OR ANY
SUCCESSOR PROVISION THEREUNDER) AFTER THE LATER OF THE ORIGINAL ISSUE DATE HEREOF (OR OF ANY
PREDECESSOR OF THIS NOTE) OR THE LAST DAY ON WHICH THE COMPANY OR ANY AFFILIATE OF THE COMPANY WAS
THE OWNER OF THIS NOTE (OR ANY PREDECESSOR OF THIS NOTE) AND (Y) SUCH LATER DATE, IF ANY, AS MAY BE
REQUIRED BY APPLICABLE LAW (THE “RESALE RESTRICTION TERMINATION DATE”), OFFER, SELL OR OTHERWISE
TRANSFER THIS NOTE EXCEPT (A) TO THE COMPANY, (B) PURSUANT TO A REGISTRATION STATEMENT WHICH HAS
BEEN DECLARED EFFECTIVE UNDER THE SECURITIES ACT, (C) FOR SO LONG AS THE NOTES ARE ELIGIBLE FOR
RESALE PURSUANT TO RULE 144A, TO A PERSON IT REASONABLY BELIEVES IS A “QUALIFIED INSTITUTIONAL
BUYER” AS DEFINED IN RULE 144A UNDER THE SECURITIES ACT THAT PURCHASES FOR ITS OWN ACCOUNT OR FOR
THE ACCOUNT OF A QUALIFIED INSTITUTIONAL BUYER TO WHOM NOTICE IS GIVEN THAT THE TRANSFER IS BEING
MADE IN RELIANCE ON RULE 144A, (D) PURSUANT TO OFFERS AND SALES TO NON-U.S. PERSONS THAT OCCUR
OUTSIDE THE UNITED STATES WITHIN THE MEANING OF REGULATION S UNDER THE SECURITIES ACT OR (E)
PURSUANT TO ANY OTHER AVAILABLE EXEMPTION FROM THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT
AND (3) AGREES THAT IT WILL GIVE TO EACH PERSON TO WHOM THIS NOTE IS TRANSFERRED A NOTICE
SUBSTANTIALLY TO THE EFFECT OF THIS LEGEND; PROVIDED THAT THE COMPANY, THE TRUSTEE AND THE
REGISTRAR SHALL HAVE THE RIGHT PRIOR TO ANY SUCH OFFER, SALE OR TRANSFER PURSUANT TO CLAUSE (D) OR
(E) TO REQUIRE THE DELIVERY OF AN OPINION OF COUNSEL, CERTIFICATION AND/ OR OTHER INFORMATION, ALL
IN FORM AND SUBSTANCE SATISFACTORY TO EACH OF THEM. THIS LEGEND WILL BE REMOVED UPON THE REQUEST OF
THE HOLDER AFTER THE RESALE RESTRICTION TERMINATION DATE. 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:



“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.


 


45









 





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.”




(3) Gaming Law Legend. Each Global Note and Definitive Note (and all Notes issued in
exchange therefor or in substitution thereof) shall bear the legend in substantially the
following form:



“THE NOTES REPRESENTED BY THIS CERTIFICATE ARE SUBJECT TO RESTRICTIONS ON OWNERSHIP AND
TRANSFER IMPOSED BY APPLICABLE GAMING LAWS, THE PROVISIONS OF ARTICLE XIII OF THE COMPANY’S
RESTATED CERTIFICATE OF INCORPORATION, INCLUDING ANY AMENDMENTS THERETO OR ANY SUCCESSOR PROVISIONS
THERETO, AND SECTION 3.07(e) OF THE INDENTURE (WHICH IS SUMMARIZED ON THIS CERTIFICATE). A COPY OF
ARTICLE XIII OF THE COMPANY’S RESTATED CERTIFICATE OF INCORPORATION IS ON FILE AT THE OFFICE OF THE
COMPANY, AND MADE A PART HEREOF AS FULLY AS THOUGH THE PROVISIONS OF SAID PROVISIONS OF THE
COMPANY’S RESTATED CERTIFICATE OF INCORPORATION WERE PRINTED IN FULL ON THIS CERTIFICATE, TO ALL OF
WHICH THE HOLDER OF THIS CERTIFICATE, BY ACCEPTANCE HEREOF, ASSENTS AND AGREES TO BE BOUND. ANY
HOLDER OF A NOTE MAY OBTAIN, UPON REQUEST AND WITHOUT CHARGE, A COPY OF SUCH PROVISIONS OF THE
COMPANY’S RESTATED CERTIFICATE OF INCORPORATION. ANY SUCH REQUEST SHALL BE ADDRESSED TO THE
SECRETARY OF THE COMPANY.”



(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.


 


46









 





(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
similar governmental charge payable upon exchange or transfer pursuant to Sections 2.10,
3.06, 3.09, 4.10, 4.15 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.




(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.


 


47









 





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.



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)(1) 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 any Guarantor, or by any Person
directly or indirectly controlling or controlled by or under direct or indirect common control with
the Company or any Guarantor, 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 a Responsible Officer of the Trustee actually 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.


 


48









 





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 dispose of such
canceled Notes (subject to the record retention requirement of the Exchange Act) in its customary
manner. The Company may not issue new Notes to replace Notes that it has paid or that have been
delivered to the Trustee for cancellation.



Section 2.12 Defaulted Interest.




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



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, at least 15 days but not more than 60 days
before a redemption date, 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;




(4) the redemption price; and


 


49









 






(5) the applicable CUSIP numbers.



Section 3.02 Selection of Notes to Be Redeemed or Purchased.




If less than all of the Notes are to be redeemed or purchased pursuant to this Indenture
(except as provided in Section 3.07(e)) at any time, the Trustee will select the Notes to be
redeemed or purchased among the holders of Notes as follows:




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




(2) if the Notes are not so listed, on a pro rata basis, by lot or in accordance with
any other method the Trustee considers fair and appropriate.



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 10 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 $2,000 or whole multiples of $1,000 in excess of $2,000; 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 $2,000 or a multiple of $1,000 in excess of $2,000, 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 3.09 hereof, at least 15 days but not more than 60 days
before a redemption date, 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 Articles 8 or 11 hereof.



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;




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


 


50









 






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




(6) that, unless the Company defaults in making such redemption payment, interest and
Additional Interest, if any, on Notes called for redemption ceases to accrue on and after
the redemption date, subject to the satisfaction of any condition to such redemption;




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




(8) 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, at least 45
days prior to the redemption date (unless a shorter period is acceptable to the Trustee), 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,
subject to the satisfaction of any conditions to such redemption. A notice of redemption may be
conditional in that the Company may, notwithstanding the giving of the notice of redemption,
condition the redemption of the Notes specified in the notice of redemption upon the completion of
other transactions, such as refinancings or acquisitions (whether of the Company or by the
Company).



Section 3.05 Deposit of Redemption or Purchase Price.




On or before 10:00 a.m. New York City time on 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, subject to the satisfaction of any conditions to such redemption,
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 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.


 


51









 





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 August 1, 2012, the Company may redeem up to 35% of the initially
outstanding aggregate principal amount of Notes issued under this Indenture at a redemption price
in cash of 108.625% of the principal amount thereof, plus accrued and unpaid interest and
Additional Interest, if any, to the redemption date, with the net cash proceeds of one or more
Equity Offerings of the Company; provided that:




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




(2) notice of any such redemption shall be given by the Company to the Holders and the
Trustee within 15 days after the consummation of any such Equity Offering; and




(3) such redemption shall occur within 60 days of the date of such notice.



(b) Except pursuant to the preceding paragraph or paragraphs (d) or (e) below, the Notes will
not be redeemable at the Company’s option prior to August 1, 2013.



(c) On or after August 1, 2013, the Company may redeem the Notes, in whole or in part, upon
not less than 15 nor more than 60 days’ notice, at the redemption prices (expressed as percentages
of principal amount thereof) set forth below plus accrued and unpaid interest and Additional
Interest, if any, on the Notes redeemed, to the applicable redemption date, if redeemed during the
twelve-month period beginning on August 1 of the years indicated below:



	 	 	 	 	 
	Year	 	Percentage	 
	2013
	 	 	104.313	%
	2014
	 	 	102.156	%
	2015 and thereafter
	 	 	100.000	%






Unless the Company defaults in the payment of the redemption price, interest and Additional
Interest, if any, will cease to accrue on the Notes or portions thereof called for redemption on
the applicable redemption date, subject to the satisfaction of any condition to such redemption.



(d) At any time prior to August 1, 2013, the Company may also redeem all or a part of the
Notes upon not less than 15 nor more than 60 days’ prior notice mailed by first-class mail to each
Holder’s registered address, at a redemption price equal to 100% of the principal amount of notes
redeemed plus the Applicable Premium as of, and accrued and unpaid interest and Additional
Interest, if any, to the date of redemption (the “Redemption Date”), subject to the rights of
holders of Notes on the relevant record dates occurring prior to the Redemption Date to receive
interest due on the relevant interest payment date.



(e) In addition to the foregoing, if:


 


52









 






(1) any Gaming Authority makes a determination of unsuitability of a Holder or
beneficial owner of Notes (or of an Affiliate of such Holder or beneficial owner), or




(2) any Gaming Authority requires that a Holder or beneficial owner of Notes (or an
Affiliate thereof) must either (i) be licensed, qualified or found suitable under any
applicable Gaming Laws or (ii) reduce its position in the Notes to below a level that would
require licensure, qualification or a finding of suitability, and such Holder or beneficial
owner (or Affiliate thereof):




(A) fails to apply for a license, qualification or a finding of suitability
within 30 days (or such shorter period as may be required by the applicable Gaming
Authority) after being requested to do so by the Gaming Authority,




(B) fails to reduce its position in the Notes appropriately; or




(C) is denied such license or qualification or not found suitable,



the Company shall have the right, at any time from or after the Issue Date, at its option:




(1) to require any such Holder or beneficial owner to dispose of all or a portion of
its Notes within 30 days (or such earlier date as may be required by the applicable Gaming
Authority) of receipt of such notice or finding by such Gaming Authority, or




(2) to call for the redemption of all or a portion of the Notes of such Holder or
beneficial owner at a redemption price equal to the least of:




(A) the principal amount thereof,




(B) the price at which such Holder or beneficial owner acquired the Notes, in
the case of either clause (A) above or this clause (B), together with accrued and
unpaid interest and Additional Interest, if any, to the earlier of the date of
redemption or the date of the denial of license or qualification or of the finding
of unsuitability by such Gaming Authority (subject to the rights of Holders of Notes
on the relevant record dates occurring prior to such redemption date to receive
interest on the relevant interest payment date), or




(C) such other lesser amount as may be required by any Gaming Authority.



Immediately upon a determination by a Gaming Authority that a Holder or beneficial owner of
the Notes (or an Affiliate thereof) will not be licensed, qualified or found suitable or is denied
a license, qualification or finding of suitability, the Holder or beneficial owner will not have
any further rights with respect to the Notes to:




(1) exercise, directly or indirectly, through any Person, any right conferred by the
Notes;




(2) receive any interest or Additional Interest, if any, or any other distribution or
payment with respect to the Notes; or




(3) receive any remuneration in any form from the Company or its Affiliates for
services rendered or otherwise, except the redemption price of the Notes.



The Company shall notify the Trustee in writing of any such redemption as soon as practicable.
The Holder or beneficial owner (or an Affiliate thereof) applying for a license, qualification or a
finding


 


53









 






of suitability must pay all costs of the licensure or investigation for such qualification or
finding of suitability.



In addition, by accepting a Note, each Holder or beneficial owner of a Note will be agreeing
to comply with all requirements of the Gaming Laws and Gaming Authorities in each jurisdiction
where the Company and its Affiliates are licensed or registered under applicable Gaming Laws or
conduct gaming activities. Each Holder or beneficial owner will also be agreeing that the Notes
held by such Holder or beneficial owner shall be subject to the provisions of Article XIII of the
Company’s Restated Certificate of Incorporation (dealing with Gaming Laws and gaming-related
restrictions on ownership and transfer), including any amendments thereto or any successor
provisions thereto.



(f) Any redemption pursuant to this Section 3.07 (other than any redemption pursuant to
Section 3.07(e)) shall be made pursuant to the provisions of Sections 3.01 through 3.06 hereof.



Section 3.08 Mandatory Redemption.




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



Section 3.09 Offer to Purchase by Application of Excess Proceeds.




In the event that, pursuant to Section 4.10 hereof, the Company is required to commence a Net
Proceeds Offer, it will follow the procedures specified below.



The Net Proceeds Offer will remain open for a period of at least 20 Business Days following
its commencement and not more than 30 Business Days, except to the extent that a longer period is
required by applicable law (the “Offer Period”). The Net Proceeds Offer Payment Date shall be no
later than five Business Days after the termination of the Offer Period. On the Net Proceeds Offer
Payment Date, the Company shall purchase the principal amount of Notes, and any other Indebtedness
Incurred by the Company or an Obligor which is pari passu with the Notes, if applicable, required
to be purchased pursuant to Section 4.10 hereof or the terms of such other Indebtedness or, if less
than the Net Proceeds Offer Amount has been tendered, all Notes and such other Indebtedness
tendered in response to the Net Proceeds Offer. Payment for any Notes so purchased shall be made
in the same manner as interest payments are made.



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



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




(1) that the Net Proceeds Offer is being made pursuant to this Section 3.09 and Section
4.10 hereof and the length of time the Net Proceeds Offer will remain open;




(2) the Net Proceeds Offer Amount, the purchase price and the Net Proceeds Offer
Payment Date;


 


54









 






(3) that any Note not tendered or accepted for payment will continue to accrue
interest;




(4) that, unless the Company defaults in making such payment, any Note accepted for
payment pursuant to the Net Proceeds Offer will cease to accrue interest and Additional
Interest, if any, after the Net Proceeds Purchase Date;




(5) that Holders electing to have a Note purchased pursuant to an Net Proceeds Offer
may elect to have Notes purchased in $2,000 or integral multiples of $1,000 in excess of
$2,000 only;




(6) that Holders electing to have Notes purchased pursuant to any Net Proceeds Offer
will be required to surrender the Note, with the form entitled “Option of Holder to Elect
Purchase” attached to the Notes completed, or transfer by book-entry transfer, to the
Company, a Depositary, if appointed by the Company, or a Paying Agent at the address
specified in the notice at least three Business Days before the Net Proceeds Purchase Date;




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




(8) that, if the aggregate principal amount of Notes and other pari passu Indebtedness
surrendered by Holders thereof exceeds the Net Proceeds Offer Amount, the Company will
select the Notes and other pari passu Indebtedness to be purchased on a pro rata basis based
on the principal amount of Notes and such other pari passu Indebtedness surrendered (with
such adjustments as may be deemed appropriate by the Company so that only Notes in the
amount of $2,000 or denominations of $1,000 in excess of $2,000, or integral multiples
thereof, will be purchased); and




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



On or before the Net Proceeds Offer Payment Date, the Company will, to the extent lawful,
accept for payment, on a pro rata basis to the extent necessary, the Net Proceeds Offer Amount of
Notes or portions thereof and other pari passu Indebtedness tendered pursuant to the Net Proceeds
Offer, or if less than the Net Proceeds Offer Amount has been tendered, all Notes and such other
Indebtedness tendered, and will deliver or cause to be delivered to the Trustee the Notes properly
accepted together with an Officers’ Certificate stating that such Notes and such other Indebtedness
or portions thereof were accepted for payment by the Company in accordance with the terms of this
Section 3.09. The Company, the Depositary or the Paying Agent, as the case may be, will promptly
(but in any case not later than three Business Days after the Net Proceeds Offer Payment Date) mail
or deliver to each tendering Holder an amount equal to the purchase price of the Notes tendered by
such Holder and accepted by the Company for purchase, and the Company will promptly issue a new
Note, and the Trustee, upon written request from the Company, will authenticate and mail or deliver
(or cause to be transferred by book entry) such new Note to such Holder, in a principal amount
equal to any unpurchased portion of the Note surrendered. Any Note not so accepted shall be
promptly mailed or delivered by the Company to the Holder thereof. The Company will publicly
announce the results of the Net Proceeds Offer on the Net Proceeds Offer Payment Date.


 


55









 





Other than as specifically provided in this Section 3.09, any purchase pursuant to this
Section 3.09 shall be made pursuant to the provisions of Sections 3.01 through 3.06 hereof.



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 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 1% per annum in excess of 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 office of the Trustee’s
affiliate, The Bank of New York Mellon, as designated below.



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 office of the Trustee’s affiliate, The Bank of New York
Mellon, located at 101 Barclay Street, Floor 8 West, New York, New York 10286, Attention: Corporate
Trust Administration as one such office or agency of the Company in accordance with Section 2.03
hereof; provided that any notices or demands sent to the above New York address shall also be sent
to the Trustee at its address listed in Section 12.02.


 


56









 





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 Trustee for mailing to the Holders of Notes:




(1) all quarterly and annual financial information that would be required to be
contained in a filing or filings by the Company with the SEC on Forms 10-Q and 10-K if the
Company were required to file such forms, including a “Management’s Discussion and Analysis
of Financial Condition and Results of Operations” and, with respect to the annual
information only, a report thereon by the Company’s certified independent accountants, and




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



in each case within 15 days of the time periods specified in the SEC’s rules and regulations.



In addition, whether or not required by the rules and regulations of the SEC, the Company will
file a copy of all such information and reports with the SEC for public availability (unless the
SEC will not accept such a filing) and make such information available to securities analysts and
prospective investors upon request. The Company may deliver the consolidated reports or financial
information of the Company to comply with the foregoing requirements. The Company will at all
times comply with TIA § 314(a).



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.



Delivery of such reports, information and documents to the Trustee is for informational
purposes only and the Trustee’s receipt of such shall not constitute constructive notice of any
information contained therein or determinable from information contained therein, including the
Company’s compliance with any of its covenants hereunder (as to which the Trustee is entitled to
rely exclusively on Officers’ Certificates).



(b) For so long as any Notes remain outstanding, if at any time they are not required to file
with the SEC the reports required by paragraphs (a) and (b) of this Section 4.03, the Company and
the Guarantors 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 and each Guarantor (to the extent that such Guarantor is so required under the
TIA) shall deliver to the Trustee, within 120 days after the end of each fiscal year, beginning
April 30, 2010, 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


 


57









 






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



(c) 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 of the Notes.



Section 4.06 Stay, Extension and Usury Laws.




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



Section 4.07 Restricted Payments.




(a) Neither the Company nor any Restricted Subsidiary will, directly or indirectly:




(1) declare or pay any dividend or make any other payment or distribution (other than
dividends or distributions payable solely in Qualified Capital Stock of the Company or
dividends or distributions payable to the Company or a Restricted Subsidiary) in respect of
the Company’s or any Restricted Subsidiary’s Equity Interests (including, without
limitation, any payment in connection with any merger or consolidation involving the Company
or such Restricted


  


58









 








Subsidiary, as applicable) or to the direct or indirect holders of the Company’s or
such Restricted Subsidiary’s Equity Interests in their capacity as such,




(2) purchase, redeem or otherwise acquire or retire for value (including, without
limitation, any payment in connection with any merger or consolidation involving the Company
or any Restricted Subsidiary) Equity Interests of the Company or any Restricted Subsidiary
or of any direct or indirect parent or Affiliate of the Company or any Restricted Subsidiary
(other than any such Equity Interests owned by the Company or any Restricted Subsidiary),




(3) make any payment on or with respect to, or purchase, defease, redeem, prepay,
decrease or otherwise acquire or retire for value any Indebtedness that is subordinate in
right of payment to the Notes (other than any such payment in respect of senior subordinated
Indebtedness of the Company or any Restricted Subsidiary made prior to the Issue Date),
except a payment of principal, interest or other amounts required to be paid at Stated
Maturity, or




(4) make any Investment (other than Permitted Investments) (each of the foregoing
prohibited actions set forth in clauses (1), (2), (3) and (4) being referred to as a
“Restricted Payment”),



if at the time of such proposed Restricted Payment or immediately after giving effect thereto,





(1) a Default or an Event of Default has occurred and is continuing or would result
therefrom,




(2) the Company is not, or would not be, able to Incur at least $1.00 of additional
Indebtedness under the Consolidated Coverage Ratio test described in Section 4.09(b)(2), or




(3) the aggregate amount of Restricted Payments (including such proposed Restricted
Payment) made subsequent to September 25, 2003 (the amount expended for such purposes, if
other than in cash, being the fair market value of such property as determined reasonably
and in good faith by the Company) exceeds or would exceed the sum, without duplication, of:




(A) 50% of the cumulative Consolidated Net Income (or if cumulative
Consolidated Net Income shall be a loss, minus 100% of such loss) of the Company and
the Restricted Subsidiaries during the period (treating such period as a single
accounting period) beginning on September 25, 2003 and ending on the last day of the
most recent fiscal quarter of the Company ending immediately prior to the date of
the making of such Restricted Payment for which internal financial statements are
available ending not more than 135 days prior to the date of determination, plus




(B) 100% of the fair market value of the aggregate net proceeds received by the
Company from any Person (other than from a Subsidiary of the Company) from the
issuance and sale of Qualified Capital Stock of the Company or the conversion of
debt securities or Disqualified Capital Stock into Qualified Capital Stock (to the
extent that proceeds of the issuance of such Qualified Capital Stock would have been
includable in this clause if such Qualified Capital Stock had been initially issued
for cash) subsequent to September 25, 2003 and on or prior to the date of the making
of such Restricted Payment (excluding any Qualified Capital Stock of the Company the
purchase price of which has been financed directly or indirectly using funds (i)
borrowed from the Company or any Restricted Subsidiary, unless and until and to the
extent such borrowing is repaid, or (ii) contributed, extended, guaranteed or
advanced by the Company or any




 


59









 








Restricted Subsidiary (including, without limitation, in respect of any
employee stock ownership or benefit plan)); provided that such aggregate net
proceeds are limited to cash, Cash Equivalents and other assets used or useful in a
Related Business or the Capital Stock of a Person engaged in a Related Business,
plus




(C) 100% of the aggregate cash received by the Company subsequent to September
25, 2003 and on or prior to the date of the making of such Restricted Payment upon
the exercise of options or warrants (whether issued prior to or after September 25,
2003) to purchase Qualified Capital Stock of the Company, plus




(D) to the extent that any Restricted Investment that was made after September
25, 2003 is sold for cash or Cash Equivalents or otherwise liquidated or repaid for
cash or Cash Equivalents, or any dividends, distributions, principal repayments, or
returns of capital are received by the Company or any Restricted Subsidiary in
respect of any Restricted Investment, the proceeds of such sale, liquidation,
repayment, dividend, distribution, principal repayment or return of capital or
subrogation recovery, in each such case (i) reduced by the amount of any Amount
Limitation Restoration (as defined below) for such Restricted Investment and (ii)
valued at the cash or marked-to-market value of Cash Equivalents received with
respect to such Restricted Investment (less the cost of disposition, if any), and to
the extent that any Restricted Investment consisting of a guarantee or other
contingent obligation that was made after September 25, 2003 is terminated or
cancelled, the excess, if any of (x) the amount by which such Restricted Investment
reduced the sum otherwise available for making Restricted Payments under this first
paragraph of the Restricted Payment covenant, over (y) the aggregate amount of
payments made (including costs incurred) in respect of such guarantee or other
contingent obligation, plus




(E) to the extent that any Person becomes a Restricted Subsidiary or an
Unrestricted Subsidiary is redesignated as a Restricted Subsidiary after September
25, 2003, the lesser of (i) the fair market value of the Restricted Investment of
the Company and its Restricted Subsidiaries in such Person as of the date it becomes
a Restricted Subsidiary or in such Unrestricted Subsidiary on the date of
redesignation as a Restricted Subsidiary or (ii) the fair market value of such
Restricted Investment as of the date such Restricted Investment was originally made
in such Person or, in the case of the redesignation of an Unrestricted Subsidiary
into a Restricted Subsidiary which Subsidiary was designated as an Unrestricted
Subsidiary after September 25, 2003, the amount of the Company and its Restricted
Subsidiaries’ Restricted Investment therein as determined under the first paragraph
of Section 4.19(a), plus the aggregate fair market value of any additional
Restricted Investments (each valued as of the date made) by the Company and its
Restricted Subsidiaries in such Unrestricted Subsidiary after September 25, 2003;
provided that any amount so determined in (i) or (ii) shall be reduced to the extent
that such Restricted Investment shall have been recouped as an Amount Limitation
Restoration to the Amount Limitations of clauses (4), (6), (16) or (18) below.
Notwithstanding the other provisions of this subparagraph (E), for purposes of this
subparagraph (E) the amount of such Restricted Investments of the Company and its
Restricted Subsidiaries in the Atlantic City Entities made prior to the issuance of
the 7.5% Notes shall be deemed to be equal to the Atlantic City Group Investment.


 


60









 





(b) Notwithstanding the foregoing, the provisions set forth in Section 4.07(a) will not
prohibit:




(1) the payment of any dividend or the making of any distribution within 60 days after
the date of declaration of such dividend or distribution if the making thereof would have
been permitted on the date of declaration; provided such dividend will be deemed to have
been made as of its date of declaration or the giving of such notice for purposes of this
clause (1);




(2) the redemption, repurchase, retirement or other acquisition of Capital Stock of the
Company or warrants, rights or options to acquire Capital Stock of the Company either (A)
solely in exchange for shares of Qualified Capital Stock of the Company or warrants, rights
or options to acquire Qualified Capital Stock of the Company, or (B) through the application
of net proceeds of a substantially concurrent sale for cash (other than to a Subsidiary of
the Company) of shares of Qualified Capital Stock of the Company or warrants, rights or
options to acquire Qualified Capital Stock of the Company; provided that no Default or Event
of Default shall have occurred and be continuing at the time of such Restricted Payment or
would result therefrom;




(3) the redemption, repurchase, retirement, defeasance or other acquisition of
Indebtedness of any Obligor that is subordinate or junior in right of payment to the Notes
or the Guaranties either (A) solely in exchange for shares of Qualified Capital Stock of the
Company or for Permitted Refinancing Indebtedness, or (B) through the application of the net
proceeds of (i) a substantially concurrent sale for cash (other than to an Obligor) of
 shares of Qualified Capital Stock of the Company or warrants, rights or options to acquire
Qualified Capital Stock of the Company or (ii) Permitted Refinancing Indebtedness; provided
that no Default or Event of Default shall have occurred and be continuing at the time of
such Restricted Payment pursuant to this clause (3) or would not result therefrom; provided
further, that the Company’s tender offers for, and repurchases of, all of the 8.75% Notes
and $75 million in aggregate principal amount of the 8.25% Notes and any redemptions of such
8.75% Notes and such 8.25% Notes (to the extent such amounts are not repurchased in such
tender offers) all as described under “Use of proceeds” in the Company’s Offering Memorandum
dated as of July 27, 2009 for the Notes shall be deemed to be permitted hereunder;




(4) Restricted Payments in an amount not in excess of $100 million in the aggregate for
all such Restricted Payments made in reliance upon this clause (4), for the purpose of (A)
Limited Real Estate Development or (B) developing, constructing, improving or acquiring (i)
a Casino or Casinos or, if applicable, any Related Business in connection with a Casino or
Casinos or (ii) a Related Business to be used primarily in connection with an existing
Casino or Casinos;




(5) redemptions, repurchases or repayments to the extent required by any Gaming
Authority having jurisdiction over the Company or any Restricted Subsidiary or deemed
necessary by the Board of the Company in order to avoid the suspension, revocation or denial
of a gaming license by any Gaming Authority;




(6) other Restricted Payments not to exceed $125 million in the aggregate; provided no
Default or Event of Default then exists or would result therefrom;




(7) repurchases by the Company of its common stock, options, warrants or other
securities exercisable or convertible into such common stock from employees and directors of
the Company or any of its respective Subsidiaries upon death, disability or termination of
employment or directorship of such employees or directors;


 


61









 






(8) the payment of any amounts in respect of Equity Interests by any Restricted
Subsidiary organized as a partnership or a limited liability company or other pass-through
entity:




(A) to the extent of capital contributions made to such Restricted Subsidiary
(other than capital contributions made to such Restricted Subsidiary by the Company
or any Restricted Subsidiary),




(B) to the extent required by applicable law, or




(C) to the extent necessary for holders thereof to pay taxes with respect to
the net income of such Restricted Subsidiary, the payment of which amounts under
this clause (C) is required by the terms of the relevant partnership agreement,
limited liability company operating agreement or other governing document;




provided, that except in the case of clause (B) and (C), no Default or Event of
Default has occurred and is continuing at the time of such Restricted Payment or
would result therefrom, and provided further that, except in the case of clause (B)
or (C), such distributions are made pro rata in accordance with the respective
Equity Interests contemporaneously with the distributions paid to the Company or a
Restricted Subsidiary or their Affiliates holding an interest in such Equity
Interests;




(9) Investments in Unrestricted Subsidiaries, joint ventures, partnerships or limited
liability companies consisting of conveyances of substantially undeveloped real estate in a
number of acres which, after giving effect to any such conveyance, would not exceed in the
aggregate for all such conveyances after September 25, 2003, 50% of the sum of (A) the acres
of substantially undeveloped real estate held by the Company and its Restricted Subsidiaries
on the date of such conveyance plus (B) the acres of substantially undeveloped real estate
previously so conveyed by the Company and its Restricted Subsidiaries after September 25,
2003; provided, that no Default or Event of Default has occurred and is continuing at the
time of such Restricted Payment or would result therefrom;




(10) Investments, not to exceed $35 million in the aggregate, in any combination of (A)
readily marketable equity securities and (B) assets of the kinds described in the definition
of “Cash Equivalents”; provided, that for the purposes of this clause (10), such Investments
may be made without regard to the rating requirements or the maturity limitations set forth
in such definition;




(11) the payment of any dividend or distributions by a Restricted Subsidiary of the
Company to the holders of its Equity Interests on a pro rata basis;




(12) the repurchase of Equity Interests deemed to occur upon the exercise of stock
options to the extent such Equity Interests represent a portion of the exercise price of
those stock options;




(13) the declaration and payment of regularly scheduled or accrued dividends to holders
of any class or series of Disqualified Capital Stock of the Company or any Restricted
Subsidiary of the Company issued on or after September 25, 2003 in accordance with the
Consolidated Coverage Ratio test described in Section 4.09(b)(2);


 


62









 






(14) contributions, payments, loans or remittances from the Company or a Restricted
Subsidiary of the Argentina Contribution Amount to an Argentina Subsidiary at a time when
such Argentina Subsidiary is an Unrestricted Subsidiary;




(15) the payment of any dividend or other distribution by the Company or its Restricted
Subsidiaries of Equity Interests in the Argentina Subsidiaries that are Unrestricted
Subsidiaries and the termination of any agreements or arrangements with such entities in
connection therewith; provided that no Default or Event of Default shall have occurred and
be continuing at the time of such Restricted Payment or would result therefrom;




(16) Investment Guarantees and Completion Guarantee and Keep-Well Agreements in a
principal or other similar amount not to exceed $200 million in the aggregate; provided that
no Default or Event of Default shall have occurred and be continuing at the time of entering
into such Investment Guarantee or Completion Guarantee and Keep-Well Agreement or would
result therefrom;




(17) any Investment Guarantee Payments in respect of Investment Guarantees permitted
under clause (16) or the making of any payments pursuant to any Completion Guarantee and
Keep-Well Agreements permitted under clause (16) or in respect of any Completion
Guarantee/Keep-Well Indebtedness Incurred pursuant to any Completion Guarantee and Keep-Well
Agreements permitted under clause (16); or




(18) the provision of goods to any Unrestricted Subsidiary in the ordinary course of
business with a fair market value as determined reasonably and in good faith by the Company
not to exceed $2.0 million in the aggregate.



In determining the aggregate amount of Restricted Payments made subsequent to September 25,
2003, Restricted Payments made pursuant to clauses (2), (3), (4), (6), (8), (9), (11), (12), (14),
(15), (16) and (18) of this Section 4.07(b) (and Restricted Payments made prior to the Issue Date
permitted under clauses (2), (3), (4), (6), (8), (9), (11), (12), (14), (15), (16) and (18) of
Section 4.07(b) (Restricted Payments covenant) of the indenture governing the 7.5% Notes as in
effect on the Issue Date), shall, in each case, be excluded from such calculation; provided, that
any amounts expended or liabilities incurred in respect of fees, premiums or similar payments in
connection therewith shall be included in such calculation. Restricted Payments under clauses (4),
(6), (10), (16) and (18) of this Section 4.07(b) shall be limited to the respective amounts of
$100.0 million, $125.0 million, $35.0 million, $200.0 million and $2.0 million set forth in such
clauses (each, an “Amount Limitation”). The Amount Limitation for each clause shall be permanently
reduced at the time of any Restricted Payment made under such clause; provided, however, that to
the extent that a Restricted Investment made under such clause is sold for cash or Cash Equivalents
or otherwise liquidated or repaid for cash or Cash Equivalents, or principal repayments, returns of
capital or subrogation recoveries are received by the Company or any Restricted Subsidiary in
respect of such Restricted Investment, valued, in each such case at the cash or marked-to-market
value of Cash Equivalents received with respect to such Restricted Investment (less the cost of
disposition, if any), or to the extent that any Restricted Investment consisting of a guarantee or
other contingent obligation that was made after the date of this Indenture is terminated or
cancelled, the excess, if any of (x) the amount by which such Restricted Investment counted toward
the Amount Limitation, over (y) the aggregate amount of payments made (including costs incurred) in
respect of such guarantee or other contingent obligation, then the Amount Limitation for such
clause shall be increased by the amount so received by the Company or a Restricted Subsidiary or
the amount of such excess of (x) over (y) (an “Amount Limitation Restoration”). In no event shall
the aggregate Amount Limitation Restorations for a Restricted Investment exceed the original amount
of such Restricted Investment.


 


63









 





With respect to clauses (4), (6), (16) and (18) of this Section 4.07(b), the respective Amount
Limitation under each such clause, as applicable, shall also be increased when any Person becomes a
Restricted Subsidiary or an Unrestricted Subsidiary is redesignated as a Restricted Subsidiary
(each such increase also referred to as an “Amount Limitation Restoration”) by the lesser of (i)
the fair market value of the Restricted Investment made under clause (4), (6), (16) or (18) of this
Section 4.07(b), as the case may be, in such Person as of the date it becomes a Restricted
Subsidiary or in such Unrestricted Subsidiary as of the date of redesignation, as the case may be,
or (ii) the fair market value of such Restricted Investment as of the date such Restricted
Investment was originally made in such Person or, in the case of the redesignation of an
Unrestricted Subsidiary into a Restricted Subsidiary which Subsidiary was designated as an
Unrestricted Subsidiary after the date of this Indenture, the amount of the Company’s Restricted
Investment therein as determined under the first paragraph of Section 4.19(a), plus the aggregate
fair market value of any additional Investments (each valued as of the date made) made under clause
(4), (6), (16) or (18) of this Section 4.07(b), as the case may be, in such Unrestricted Subsidiary
after the date of this Indenture.



(c) Not less than once each fiscal quarter in which the Company has made a Restricted Payment,
the Company shall deliver to the Trustee an Officers’ Certificate stating that each Restricted
Payment (and any Amount Limitation Restoration relied upon in making such Restricted Payment) made
during the prior fiscal quarter complies with this Indenture and setting forth in reasonable detail
the basis upon which the required calculations were computed, including any applicable calculations
of the Argentina Receipts, Argentina Contribution Amount and the Reclassified Argentina Receipts
(upon which the Trustee may conclusively rely without any investigation whatsoever), which
calculations may be based upon the Company’s latest available internal quarterly financial
statements. In the event that the Company makes one or more Restricted Payments in an amount
exceeding $5 million that have not been covered by an Officers’ Certificate issued pursuant to the
immediately preceding sentence, the Company shall deliver to the Trustee an Officers’ Certificate
stating that such Restricted Payments (and any Amount Limitation Restoration relied upon in making
such Restricted Payment) comply with this Indenture and setting forth in reasonable detail the
basis upon which the required calculations were computed (upon which the Trustee may conclusively
rely without any investigation whatsoever), which calculations may be based upon the Company’s
latest available internal quarterly financial statements. In the event the Company fails to
deliver any such report described in this paragraph to the Trustee, such failure shall not
constitute a Default until and unless the Company has failed to deliver such report after written
notice to the Company of such failure by the Trustee or by a Holder.



For purposes of this Section 4.07, it is understood that the Company may rely on internal or
publicly reported financial statements even though there may be subsequent adjustments (including
review and audit adjustments) to such financial statements. For avoidance of doubt, any Restricted
Payment that complied with the conditions of this Section 4.07 made in reliance on such calculation
by the Company based on such internal or publicly reported financial statements, shall be deemed to
continue to comply with the conditions of this Section 4.07, notwithstanding any subsequent
adjustments that may result in changes to such internal financial or publicly reported statements.



Section 4.08 Dividend and Other Payment Restrictions Affecting Subsidiaries.




(a) No Obligor will, directly or indirectly, create or otherwise cause or permit or suffer to
exist or become effective any encumbrance or restriction on the ability of any Restricted
Subsidiary to:




(1) pay dividends or make any other distributions on its Capital Stock,




(2) make loans or advances to or pay any Indebtedness or other obligations owed to any
Obligor or to any Restricted Subsidiary, or


 


64









 






(3) transfer any of its property or assets to any Obligor or to any Restricted
Subsidiary (each such encumbrance or restriction in clause (1), (2) or (3), a “Payment
Restriction”).



However, the preceding restrictions will not apply to encumbrances or restrictions existing
under or by reason of:




(A) applicable law or required by any Gaming Authority;




(B) this Indenture;




(C) customary non-assignment provisions of any purchase money financing
contract or lease of any Restricted Subsidiary entered into in the ordinary course
of business of such Restricted Subsidiary;




(D) any instrument governing Acquired Debt Incurred in connection with an
acquisition by any Obligor or Restricted Subsidiary in accordance with this
Indenture as the same was in effect on the date of such Incurrence; provided that
such encumbrance or restriction is not, and will not be, applicable to any Person,
or the properties or assets of any Person, other than the Person and its
Subsidiaries or the property or assets, including directly-related assets, such as
accessions and proceeds so acquired or leased;




(E) any restriction or encumbrance contained in contracts for the sale of
assets to be consummated in accordance with this Indenture solely in respect of the
assets to be sold pursuant to such contract;




(F) any restrictions of the nature described in clause (3) above with respect
to the transfer of assets secured by a Lien that was permitted by this Indenture to
be Incurred;




(G) any encumbrance or restriction contained in Permitted Refinancing
Indebtedness; provided that the provisions relating to such encumbrance or
restriction contained in any such Permitted Refinancing Indebtedness are no less
favorable to the Holders of the Notes in any material respect in the good faith
judgment of the Board of the Company than the provisions relating to such
encumbrance or restriction contained in the Indebtedness being refinanced;




(H) agreements governing Indebtedness of the Company or its Restricted
Subsidiaries existing on the Issue Date, including the Bank Credit Agreement, and
any amendments, modifications, restatements, renewals, increases, supplements,
refundings, replacements or refinancings of those agreements; provided that the
amendments, modifications, restatements, renewals, increases, supplements,
refundings, replacement or refinancings are no more restrictive, taken as a whole,
with respect to such dividend and other payment restrictions than those contained in
those agreements on the date of this Indenture, taken as a whole; or




(I) any agreement for the sale or other disposition of a Restricted Subsidiary
that restricts distributions by that Restricted Subsidiary pending the sale or other
disposition.



Section 4.09 Incurrence of Indebtedness and Issuance of Preferred Stock.




(a) The Company will not, directly or indirectly:


 


65









 






(1) Incur any Indebtedness or issue any Disqualified Capital Stock, other than
Permitted Indebtedness, or




(2) cause or permit any of its Restricted Subsidiaries to Incur any Indebtedness or
issue any Disqualified Capital Stock or preferred stock, in each case, other than Permitted
Indebtedness.



(b) Notwithstanding the foregoing limitations, the Company may issue Disqualified Capital
Stock and may Incur Indebtedness (including, without limitation, Acquired Debt), and any Guarantor
may issue preferred stock or Incur Indebtedness (including without limitation, Acquired Debt), if:




(1) no Default or Event of Default shall have occurred and be continuing on the date of
the proposed Incurrence or issuance or would result as a consequence of such proposed
Incurrence or issuance, and




(2) immediately after giving pro forma effect to such proposed Incurrence or issuance
and the receipt and application of the net proceeds therefrom, the Company’s Consolidated
Coverage Ratio would not be less than 2.00:1.00.



Any Indebtedness of any Person existing at the time it becomes a Restricted Subsidiary
(whether by merger, consolidation, acquisition of capital stock or otherwise) shall be deemed to be
Incurred as of the date such Person becomes a Restricted Subsidiary.



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 categories of Permitted Indebtedness
described in clauses (1) through (18) of such definition or is entitled to be Incurred pursuant to
Section 4.09(b), the Company will, in its sole discretion, classify such item of Indebtedness in
any manner that complies with this Section and such item of Indebtedness will be treated as having
been Incurred pursuant to only one of such clauses or pursuant to Section 4.09(b). The Company may
reclassify such Indebtedness from time to time in its sole discretion and may classify any item of
Indebtedness in part under one or more of the categories of Permitted Indebtedness and/or in part
as Indebtedness entitled to be Incurred pursuant to Section 4.09(b). Accrual of interest, the
accretion of principal amount and the payment of interest on any Indebtedness in the form of
additional Indebtedness with the same terms will not be deemed to be an Incurrence of Indebtedness
for purposes of this Section.



Section 4.10 Asset Sales.




No Obligor will, directly or indirectly,:




(1) consummate an Asset Sale unless such Obligor, receives consideration at the time of
such Asset Sale (or at such earlier time as such Obligor becomes obligated to complete such
Asset Sale) at least equal to the fair market value of the assets sold or of which other
disposition is made (as determined reasonably and in good faith by the Board of such
Obligor), and




(2) consummate or enter into a binding obligation to consummate an Asset Sale unless at
least 75% of the consideration received by such Obligor from such Asset Sale will be cash or
Cash Equivalents and will be received at the time of the consummation of any such Asset
Sale. For purposes of this provision, each of the following shall be deemed to be cash:




(A) any liabilities as shown on the Obligor’s most recent balance sheet (or in
the notes thereto) (other than (i) Indebtedness subordinate in right of payment to the Notes,


 


66









 








(ii) contingent liabilities, (iii) liabilities or Indebtedness to Affiliates of
the Company and (iv) Non-Recourse Indebtedness) that are assumed by the transferee
of any such assets, and




(B) to the extent of the cash received, any notes or other obligations received
by the Company or any such Restricted Subsidiary from such transferee that are
converted by such Obligor into cash within 90 days of receipt.



Notwithstanding the foregoing, an Obligor may consummate an Asset Sale without complying with
the foregoing provisions if:




(1) such Obligor receives consideration at the time of such Asset Sale at least equal
to the fair market value of the assets or other property sold, issued or otherwise disposed
of (as evidenced by a resolution of the Board of such Obligor), and




(2) the consideration for such Asset Sale constitutes Productive Assets; provided that
any non-cash consideration not constituting Productive Assets received by such Obligor in
connection with such Asset Sale that is converted into or sold or otherwise disposed of for
cash or Cash Equivalents at any time within 360 days after such Asset Sale and any
Productive Assets constituting cash or Cash Equivalents received by such Obligor in
connection with such Asset Sale shall constitute Net Cash Proceeds subject to the provisions
set forth above.



Upon the consummation of an Asset Sale, the Company or the affected Obligor will be required
to apply an amount equal to all Net Cash Proceeds that are received from such Asset Sale within 360
days of the receipt thereof either:




(1) to reinvest (or enter into a binding commitment to invest, if such investment is
effected within 360 days after the date of such commitment) in Productive Assets or in Asset
Acquisitions not otherwise prohibited by this Indenture, or




(2) to permanently prepay or repay Indebtedness of any Obligor other than Indebtedness
that is subordinate in right of payment to the Notes or any Guaranty.



Pending the final application of any such Net Cash Proceeds, the Obligors may temporarily
reduce revolving Indebtedness or otherwise invest such Net Cash Proceeds in any manner not
prohibited by this Indenture.



On the 361st day after an Asset Sale or such earlier date, if any, as the Board of the Company
or the affected Obligor determines not to apply the Net Cash Proceeds relating to such Asset Sale
as set forth in clauses (1) or (2) of the third paragraph of this Section 4.10 (each a “Net
Proceeds Offer Trigger Date”), such aggregate amount of Net Cash Proceeds which have not been
applied on or before such Net Proceeds Offer Trigger Date as permitted in clauses (1) or (2) of the
third paragraph of this Section 4.10 (each a “Net Proceeds Offer Amount”), will be applied by the
Company to make an offer to purchase (the “Net Proceeds Offer”), in accordance with the procedures
set forth in Section 3.09 hereof, on a date (the “Net Proceeds Offer Payment Date”) not less than
30 nor more than 60 days following the applicable Net Proceeds Offer Trigger Date, on a pro rata
basis (A) Notes at a purchase price in cash equal to 100% of the aggregate principal amount of
Notes, in each case, plus accrued and unpaid interest thereon and Additional Interest, if any, on
the Net Proceeds Offer Payment Date and (B) other Indebtedness Incurred by the Company or an
Obligor which is pari passu with the Notes, in each case to the extent required by the terms
thereof; provided that if at any time within 360 days after an Asset Sale any non-cash
consideration received by the Company or the affected Obligor in connection with such Asset Sale is


 


67









 






converted into or sold or otherwise disposed of for cash, then such conversion or disposition
will be deemed to constitute an Asset Sale hereunder and the Net Cash Proceeds thereof will be
applied in accordance with this Section. To the extent that the aggregate principal amount of Notes
or other pari passu Indebtedness tendered pursuant to the Net Proceeds Offer is less than the Net
Proceeds Offer Amount, the Obligors may use any remaining proceeds of such Asset Sales for general
corporate purposes (but subject to the other terms of this Indenture). Upon completion of a Net
Proceeds Offer, the Net Proceeds Offer Amount relating to such Net Proceeds Offer will be deemed to
be zero for purposes of any subsequent Asset Sale. In the event that a Restricted Subsidiary
consummates an Asset Sale, only that portion of the Net Cash Proceeds therefrom (including any Net
Cash Proceeds received upon the sale or other disposition of any noncash proceeds received in
connection with an Asset Sale) that are distributed to or received by any Obligor will be required
to be applied by the Obligors in accordance with the provisions of this paragraph.



Notwithstanding the foregoing, if a Net Proceeds Offer Amount is less than $25 million the
application of the Net Cash Proceeds constituting such Net Proceeds Offer Amount to a Net Proceeds
Offer may be deferred until such time as such Net Proceeds Offer Amount plus the aggregate amount
of all Net Proceeds Offer Amounts arising subsequent to the date of this Indenture from all Asset
Sales by the Obligors in respect of which a Net Proceeds Offer has not been made aggregate at least
$25 million, at which time the affected Obligor will apply all Net Cash Proceeds constituting all
Net Proceeds Offer Amounts that have been so deferred to make a Net Proceeds Offer (each date on
which the aggregate of all such deferred Net Proceeds Offer Amounts is equal to $25 million or more
will be deemed to be a Net Proceeds Offer Trigger Date). In connection with any Asset Sale with
respect to assets having a book value in excess of $25 million or as to which it is expected that
the aggregate consideration therefor to be received by the affected Obligor will exceed $25 million
in value, such Asset Sale will be approved, prior to the consummation thereof, by the Board of the
applicable Obligor.



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 a Net Proceeds Offer. To the
extent that the provisions of any securities laws or regulations conflict with the provisions of
Section 3.09 hereof or 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 Section 3.09
hereof or this Section 4.10 by virtue of such compliance.



Section 4.11 Transactions with Affiliates.




(a) No Obligor may make any payment to, or sell, lease, transfer or otherwise dispose of any
of its properties or assets to, or purchase any property or assets from, or enter into or make or
amend any transaction, contract, agreement, understanding, loan, advance or guarantee with, or for
the benefit of, any Affiliate (each of the foregoing, an “Affiliate Transaction”), unless:




(1) such Affiliate Transaction is, considered in light of any series of related
transactions of which it comprises a part, on terms that are fair and reasonable and no less
favorable to such Obligor than those that might reasonably have been obtained at such time
in a comparable transaction or series of related transactions on an arms-length basis from a
Person that is not such an Affiliate;




(2) with respect to any Affiliate Transaction involving aggregate consideration of $20
million or more to the affected Obligor, a majority of the disinterested members of the
Board of the Company (and of any other affected Obligor, where applicable) shall, prior to
the consummation of any portion of such Affiliate Transaction, have reasonably and in good
faith




 


68









 








determined, as evidenced by a resolution of its Board, that such Affiliate Transaction
meets the requirements of the foregoing clause; and




(3) with respect to any Affiliate Transaction involving value of $30 million or more to
the affected Obligor, the Board of the applicable Obligor shall have received prior to the
consummation of any portion of such Affiliate Transaction, a written opinion from an
independent investment banking, accounting or appraisal firm of recognized national standing
that such Affiliate Transaction is on terms that are fair to such Obligor from a financial
point of view.



(b) The foregoing restrictions will not apply to:




(1) reasonable fees and compensation (including any such compensation in the form of
Equity Interests not derived from Disqualified Capital Stock, together with loans and
advances, the proceeds of which are used to acquire such Equity Interests) paid to, and
indemnity provided on behalf of, officers, directors, employees or consultants of the
Obligors as determined in good faith by the Board or senior management,




(2) any transaction solely between or among Obligors and Restricted Subsidiaries to the
extent any such transaction is otherwise in compliance with, or not prohibited by, this
Indenture,




(3) any Restricted Payment permitted by the terms of the covenant described above under
Section 4.07 or any Permitted Investment,




(4) provision of management and related services (including intellectual property
rights and the use of corporate aircraft in providing such management services) (including
any agreements therefor) to an Unrestricted Subsidiary in connection with the development,
construction and operation of gaming facilities or any Related Business, provided the
Obligor is reimbursed for all non-ordinary course costs and expenses it incurs in providing
such services and, provide further, that such Obligor shall not be required to allocate
employee compensation for management services provided by employees of Obligors to
Unrestricted Subsidiaries in connection with such employees’ services to Obligors, or




(5) transactions pursuant to agreements existing on the Issue Date or any amendment
thereto or any transaction contemplated thereby (including pursuant to any amendment
thereto) or by any replacement agreement thereto so long as any such amendment or
replacement agreement is not more disadvantageous to the Holders in any material respect
than the original agreement as in effect on the Issue Date as determined in good faith by
the Company’s Board.



Section 4.12 Liens.




No Obligor may, directly or indirectly, create, Incur or assume any Lien, except a Permitted
Lien, securing Indebtedness on or with respect to any of its property or assets including any
shares of stock or Indebtedness of any Restricted Subsidiary, whether owned on the Issue Date or
thereafter acquired, or any income, profits or proceeds therefrom, unless:




(1) in the case of any Lien securing Indebtedness that is subordinate in right of
payment to the Notes or the Guaranties, the Notes or the Guaranties are secured by a Lien on
such property, assets or proceeds that is senior in priority to such Lien, or




(2) in all other cases, the Notes or the Guaranties are equally and ratably secured.


 


69









 





Any Lien created for the benefit of the Holders pursuant to the preceding paragraph shall
provide by its terms that such Lien shall be automatically and unconditionally released and
discharged upon the release and discharge of the Lien that gave rise to the obligation to secure
the Notes or such Guaranty under this Section 4.12.



Section 4.13 Business Activities.




The Obligors will not engage in any lines of business other than the Core Businesses.



Section 4.14 Legal 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 Restricted Subsidiaries, in accordance with the respective organizational documents
(as the same may be amended from time to time) of the Company or any such Restricted
Subsidiary; and




(2) the corporate or entity franchises and rights (charter and statutory) of the
Company and its Restricted Subsidiaries;



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



Section 4.15 Offer to Repurchase Upon Change of Control.




(a) Upon the occurrence of a Change of Control, each Holder of Notes will have the right to
require the Company to repurchase all or any part (equal to $2,000 or an integral multiple of
$1,000 in excess of $2,000) of such Holder’s Notes pursuant to the offer described below (the
"Change of Control Offer”) at an offer price in cash (the “Change of Control Payment”) equal to
101% of the aggregate principal amount of Notes plus accrued and unpaid interest thereon and
Additional Interest, if any, to the date of repurchase. Within 30 days following any Change of
Control, the Company will mail a notice to the Trustee and each Holder describing the transaction
or transactions that constitute the Change of Control and offering to repurchase Notes on the date
specified in such notice, which date shall be no earlier than 30 days nor later than 60 days from
the date such notice is mailed (the “Change of Control Payment Date”), pursuant to the procedures
required by this Indenture and described in such notice. The Company will comply with all
applicable laws, including, without limitation, Section 14(e) of the Exchange Act and the rules
thereunder and all applicable federal and state securities laws, and will include all instructions
and materials necessary to enable Holders to tender their Notes.



To the extent that the provisions of any securities laws or regulations conflict with the
provisions of Sections 3.09 or 4.15 hereof, the Company will comply with the applicable securities
laws and regulations and will not be deemed to have breached its obligations under Section 3.09
hereof or this Section 4.15 by virtue of such compliance.



(b) On the Change of Control Payment Date, the Company will, to the extent lawful:


 


70









 






(1) accept for payment all Notes or portions thereof properly tendered pursuant to the
Change of Control Offer,




(2) deposit with the Paying Agent an amount equal to the Change of Control Payment in
respect of all Notes or portions thereof so tendered, and




(3) deliver or cause to be delivered to the Trustee the Notes so accepted, together
with an Officers’ Certificate stating the aggregate principal amount of Notes or portions
thereof being purchased by the Company.



The Paying Agent will promptly mail to each Holder of Notes so tendered the Change of Control
Payment for such Notes, and the Trustee will promptly authenticate and mail (or cause to be
transferred by book entry) to each Holder a new Note equal in principal amount to any unpurchased
portion of the Notes surrendered by such Holder, if any; provided that each such new Note will be
in a principal amount of $2,000 or an integral multiple of $1,000 in excess of $2,000. The Company
will publicly announce the results of the Change of Control Offer on or as soon as practicable
after the Change of Control Payment Date.



The Change of Control provisions described above will be applicable whether or not any other
provisions of this Indenture are applicable.



(c) Notwithstanding anything to the contrary in this Section 4.15, the Company will not be
required to make a Change of Control Offer upon a Change of Control if (1) a third party makes the
Change of Control Offer in the manner, at the times and otherwise in compliance with the
requirements set forth in this Section 4.15 and Section 3.09 hereof and purchases all Notes
properly tendered and not withdrawn under the Change of Control Offer, or (2) notice of redemption
has been given pursuant to Section 3.07 hereof, unless and until there is a default in payment of
the applicable redemption price.



Section 4.16 No Debt Senior to The Notes or Guaranties.




No Obligor will Incur any Indebtedness (including Permitted Indebtedness) that is
contractually subordinated in right of payment to any other Indebtedness of such Obligor unless
such Indebtedness is also contractually subordinated in right of payment to the Notes and the
applicable Guaranty on substantially identical terms; provided, however, that no Indebtedness will
be deemed to be contractually subordinated in right of payment to any other Indebtedness of an
Obligor solely by virtue of being unsecured or by virtue of being secured on a junior priority
basis.



Section 4.17 No Amendment to Other Indebtedness.




Without the consent of the Holders of 66-2/3% of the principal amount of the outstanding
Notes, the Obligors will not amend, modify or alter the indentures governing the 8.25% Notes or the
7.5% Notes in any way that will:




(1) increase the rate of or change the time for payment of interest on such
subordinated indebtedness (other than an increase of up to 2.0% in the interest rate of the
7.5% Notes otherwise permitted by the terms of this Indenture),




(2) increase the principal of, advance the final maturity date of or shorten the
Weighted Average Life to Maturity of any such subordinated indebtedness,


 


71









 






(3) alter the redemption provisions or the price or terms at which any Obligor is
required to offer to purchase such subordinated indebtedness, or




(4) amend the provisions of Article 10 of such indentures (which relate to
subordination) in a way that is adverse to the holders of the Notes.



Section 4.18 Additional Guaranties.




If the Company or any of its Subsidiaries acquires or creates another Material Restricted
Subsidiary after the date of this Indenture or if any Subsidiary becomes a Material Restricted
Subsidiary after the Issue Date, then, subject to the applicable Gaming Laws, the Company will
cause that newly acquired or created Material Restricted Subsidiary or Subsidiary that becomes a
Material Restricted Subsidiary to become a Guarantor and execute a Notation of Guaranty pursuant to
a supplemental indenture in substantially the form of Exhibit E hereto and deliver an Opinion of
Counsel to the Trustee within 10 Business Days of the date on which it was acquired or created or
became a Material Restricted Subsidiary to the effect that such supplemental indenture has been
duly authorized, executed and delivered by that Material Restricted Subsidiary and constitutes a
valid and binding agreement of that Material Restricted Subsidiary, enforceable in accordance with
its terms (subject to customary exceptions). The form of such Notation of Guaranty is attached as
Exhibit D hereto. The Company shall use its best efforts to obtain all Gaming Approvals necessary
to permit its Material Restricted Subsidiaries to become Guarantors as promptly as practicable.



Section 4.19 Designation of Restricted and Unrestricted Subsidiaries.




(a) The Board of the Company may designate any of its Restricted Subsidiaries to be
Unrestricted Subsidiaries if such designation would not cause a Default. For purposes of making
such determination, all outstanding Investments by the Obligors (except to the extent repaid in
cash or in kind) in the Subsidiary so designated will be deemed to be Restricted Payments at the
time of such designation and will reduce the amount available for Restricted Payments under Section
4.07(a) to the extent that such deemed Restricted Payments would not be excluded from such
calculation under Section 4.07(b) or will reduce the amount available under one or more clauses of
the definition of Permitted Investments, as determined by the Company. All such outstanding
Investments will be deemed to constitute Investments in an amount equal to the greatest of:




(1) the net book value of such Investments at the time of such designation,




(2) the fair market value of such Investments at the time of such designation, and




(3) the original fair market value of such Investments at the time they were made.



Such designation will only be permitted if such Restricted Payment would be permitted at such
time and if such Restricted Subsidiary otherwise meets the definition of an Unrestricted
Subsidiary.



Any such designation by the Board of the Company shall be evidenced to the Trustee by filing
with the Trustee a certified copy of the Board resolution giving effect to such designation and an
Officers’ Certificate certifying that such designation complied with the foregoing conditions and
was permitted by Section 4.07. If at any time any Unrestricted Subsidiary would fail to meet the
foregoing requirements as an Unrestricted Subsidiary, it shall thereafter cease to be an
Unrestricted Subsidiary for purposes of this Indenture and any Indebtedness of such Subsidiary
shall be deemed to be Incurred by a Restricted Subsidiary as of such time (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). The Board of the Company may at any


 


72









 






time designate any Unrestricted Subsidiary to be a Restricted Subsidiary; provided that such
designation shall be deemed to be an Incurrence of Indebtedness by a Restricted Subsidiary of any
outstanding Indebtedness of such Unrestricted Subsidiary and such designation shall only be
permitted if:




(1) such Indebtedness is permitted under Section 4.09, and, if applicable, calculated
on a pro forma basis as if such designation had occurred at the beginning of the reference
period, and




(2) no Default or Event of Default would be in existence following such designation.



As of the Issue Date, the following entities shall be Unrestricted Subsidiaries: Casino Magic
Buenos Aires, S.A., Casino Magic (Europe), B.V., Casino Magic Hellas Management Services, S.A.,
Landing Condominium, LLC, PNK Development 10, LLC, PNK Development 11, LLC, PNK Development 17,
LLC, PNK (Kansas), LLC and Port St. Louis Condominium, LLC.



ARTICLE 5

SUCCESSORS




Section 5.01 Merger, Consolidation, or Sale of Assets.




The Company may not, in a single transaction or a series of related transactions, consolidate
or merge with or into any Person, or sell, assign, transfer, lease, convey or otherwise dispose of
all or substantially all of the properties or assets of the Company and its Subsidiaries, taken as
a whole, to any Person or adopt a Plan of Liquidation unless:




(1) either




(A) in the case of a consolidation or merger, the Company, or any successor
thereto, is the surviving or continuing corporation, or




(B) the Person (if other than the Company) formed by such consolidation or into
which the Company is merged or the Person which acquires by sale, assignment,
transfer, lease, conveyance or other disposition of the properties and assets of the
Company and its Subsidiaries, taken as a whole, or in the case of a Plan of
Liquidation, the Person to which assets of the Company and its Subsidiaries have
been transferred (i) shall be organized and validly existing under the laws of the
United States or any State thereof or the District of Columbia and (ii) shall
expressly assume, by supplemental indenture (in form and substance satisfactory to
the Trustee), executed and delivered to the Trustee, the due and punctual payment of
the principal of, and premium, if any, and interest and Additional Interest, if any,
on all of the Notes and the performance of every covenant of the Notes and this
Indenture and the Registration Rights Agreement on the part of the Company to be
performed or observed;




(2) in the event that such transaction involves (A) the incurrence by the Company or
any Restricted Subsidiary, directly or indirectly, of additional Indebtedness (and treating
any Indebtedness not previously an obligation of the Company or any of its Restricted
Subsidiaries incurred in connection with or as a result of such transaction as having been
incurred at the time of such transaction) and/or (B) the assumption contemplated by clause
(1)(B)(ii) above (including giving effect to any Indebtedness and Acquired Debt Incurred or
anticipated to be Incurred in connection with or in respect of such transaction), then
immediately after giving effect to such incurrence and/or assumption under clauses (A) and
(B), (i) the Company, or any such other Person assuming the obligations of the Company
through the operation of clause (1)(B) above,


 


73









 






could Incur at least $1.00 of Indebtedness (other than Permitted Indebtedness) pursuant
to the Consolidated Coverage Ratio test described above under Section 4.09(b)(2) or (ii) the
Consolidated Coverage Ratio of the Company (or such other Person assuming the obligations of
the Company through the operation of clause (1)(B) above) is no less than the Company’s
Consolidated Coverage Ratio immediately prior to such transaction or series of transactions;




(3) immediately before and immediately after giving effect to such transaction and the
assumption contemplated by clause (1)(B)(ii) above (including, without limitation, giving
effect to any Indebtedness and Acquired Debt Incurred or anticipated to be Incurred and any
Lien granted in connection with or in respect of the transaction) no Default and no Event of
Default shall have occurred or be continuing; and




(4) the Company or such other Person shall have delivered to the Trustee an Officers’
Certificate and an Opinion of Counsel, each stating that such consolidation, merger, sale,
assignment, transfer, lease, conveyance, other disposition or Plan of Liquidation and, if a
supplemental indenture is required in connection with such transaction, such supplemental
indenture, comply with the applicable provisions of this Indenture and that all conditions
precedent in this Indenture relating to such transaction have been satisfied.



Notwithstanding clause (2) above:




(A) any Restricted Subsidiary may consolidate with, or merge with or into, or
sell, assign, transfer, lease, convey or otherwise dispose of all or substantially
all of its assets to the Company or to a Restricted Subsidiary, and




(B) the Company or any Subsidiary may consolidate with or merge with or into,
or sell, assign, transfer, lease, convey or otherwise dispose of all or
substantially all of its assets to any Person that has conducted no business and
Incurred no Indebtedness or other liabilities if such transaction is solely for the
purpose of effecting a change in the state of incorporation or form of organization
of the Company or such Subsidiary.



For purposes of the foregoing, the transfer (by lease, assignment, sale or otherwise, in a
single transaction or series of transactions) of all or substantially all of the properties and
assets of one or more Subsidiaries of the Company, the Capital Stock of which constitutes all or
substantially all of the properties and assets of the Company, shall be deemed to be the transfer
of all or substantially all of the properties and assets of the Company.



Section 5.02 Successor Person 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 or substantially all of the


 


74









 






properties and assets of such predecessor Company and its Subsidiaries, taken as a whole, in a
transaction that is subject to, and that complies with the provisions of, Section 5.01 hereof.



ARTICLE 6

DEFAULTS AND REMEDIES




Section 6.01 Events of Default.




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




(1) default for 30 days in the payment when due of interest (including any Additional
Interest) on the Notes or the Guaranties;




(2) default in payment of the principal of or premium, if any, on the Notes or the
Guaranties when due and payable, at maturity, upon acceleration, redemption or otherwise;




(3) failure by any Obligor to comply with any of its other agreements in this
Indenture, the Notes or the Guaranties for 60 days after written notice to the Company by
the Trustee or by Holders of not less than 25% in aggregate principal amount of the Notes
then outstanding voting as a single class;




(4) default under any mortgage, indenture or instrument under which there may be issued
or by which there may be secured or evidenced any Indebtedness for money borrowed by any
Obligor (or the payment of which is guaranteed by any Obligor) whether such Indebtedness or
guarantee now exists, or is created after the Issue Date, which default:




(A) is caused by a failure to pay principal of or premium, if any, or interest,
if any, on such Indebtedness prior to the expiration of the grace period provided in
such Indebtedness on the date of such default (a “Payment Default”), or




(B) results in the acceleration of such Indebtedness prior to its express
maturity




and, in each case, the principal amount of any such Indebtedness, together with the
principal amount of any other such Indebtedness under which there has been a Payment Default
or the maturity of which has been so accelerated, aggregates $25 million or more;




(5) failure by any Obligor to pay final judgments aggregating in excess of $25 million,
net of any applicable insurance, the carrier or underwriter with respect to which has
acknowledged liability in writing, which judgments are not paid, discharged or stayed for a
period of 60 days after such judgment or judgments become final and non-appealable;




(6) any Obligor pursuant to or within the meaning of Bankruptcy Law:




(A) commences a voluntary case,




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




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




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


 


75









 






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




(A) is for relief against any Obligor in an involuntary case;




(B) appoints a custodian of any Obligor or for all or substantially all of the
property of any Obligor; or




(C) orders the liquidation of any Obligor;




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



Section 6.02 Acceleration.




If an Event of Default (other than an Event of Default with respect to clauses (6) and (7) of
Section 6.01 hereof with respect to the Company or any of its Significant Subsidiaries or any group
of Obligors that, taken together as a whole, would constitute a Significant Subsidiary), including,
without limitation, an Event of Default specified in clauses (6) and (7) of Section 6.01 hereof,
with respect to a single Obligor that does not constitute a Significant Subsidiary or a group of
Obligors that taken together as a whole would not constitute a Significant Subsidiary, occurs and
is continuing, then and in every such case, the Trustee or the Holders of not less than 25% in
aggregate principal amount of the then outstanding Notes may declare the principal amount, together
with any accrued and unpaid interest and premium and Additional Interest, if any, on all the Notes
and Guaranties then outstanding to be due and payable, by a notice in writing to the Company (and
to the Trustee, if given by Holders) specifying the Event of Default and that it is a “notice of
acceleration” and on the fifth Business Day after delivery of such notice the principal amount, in
either case, together with any accrued and unpaid interest and premium and Additional Interest, if
any, on all the Notes or the Guaranties then outstanding will become immediately due and payable,
notwithstanding anything contained in this Indenture, the Notes or the Guaranties to the contrary.
Upon the occurrence of specified Events of Default specified in clause (6) or (7) of Section 6.01
hereof with respect to the Company or any of its Significant Subsidiaries or any group of Obligors
that, taken together as a whole, would constitute a Significant Subsidiary, the principal amount,
together with any accrued and unpaid interest and premium and Additional Interest, if any, will
immediately and automatically become due and payable, without the necessity of notice or any other
action by any Person. Holders of the Notes may not enforce this Indenture, the Notes or the
Guaranties except as provided in this Indenture. Subject to certain limitations, Holders of a
majority in principal amount of the then outstanding Notes may direct the Trustee in its exercise
of any trust or power. The Trustee shall be under no obligation to exercise any of the rights or
powers at the request or direction of any of the Holders unless such Holders shall have offered to
the trustee security or indemnity satisfactory to the Trustee against the costs, expenses and
liabilities which might be incurred by it in compliance with such request or direction. The
Trustee may withhold from Holders of the Notes notice of any continuing Default or Event of Default
(except a Default or Event of Default relating to the payment of principal or interest or
Additional Interest, if any) if it determines that withholding notice is in their interest.



Upon any such declaration of acceleration, the Notes shall become due and payable immediately.



Notwithstanding any other provision of this Indenture, the sole remedy for an Event of Default
relating to the failure to comply with the reporting obligations described under Section 4.03, and
for any failure to comply with the requirements of Section 314(a) of the TIA, will for the 365 days
after the occurrence of such an Event of Default consist exclusively of the right to receive
Additional Interest on the principal amount of the Notes at a rate equal to 0.50% per annum. This
Additional Interest will be payable in the same manner and subject to the same terms as other
interest payable under this Indenture.


 


76









 





The Additional Interest will accrue on all outstanding Notes from and including the date on
which an Event of Default relating to a failure to comply with the reporting obligations described
under Section 4.03 or Section 314(a) of the TIA first occurs to but not excluding the
365th day thereafter (or such earlier date on which the Event of Default relating to the
reporting obligations described under Section 4.03 or Section 314(a) of the TIA shall have been
cured or waived). On such 365th day (or earlier, if the Event of Default relating to
such reporting obligations is cured or waived prior to such 365th day), such Additional
Interest will cease to accrue and the Notes will be subject to the other remedies as provided under
this Section 6.02 if the Event of Default is continuing. For the avoidance of doubt, the
provisions of this paragraph will not affect the rights of Holders of Notes in the event of the
occurrence of any other Event of Default.



The Holders of a majority in aggregate principal amount of the then outstanding Notes by
written notice to the Trustee may, on behalf of all of the Holders, rescind an acceleration and its
consequences, if the rescission would not conflict with any judgment or decree and if all existing
Events of Default (except nonpayment of principal, interest or premium or Additional Interest, if
any, that has become due solely because of the acceleration) have been cured or waived.



In the case of any Event of Default occurring by reason of any willful action (or inaction)
taken (or not taken) by or on behalf of any Obligor with the intention of avoiding payment of the
premium that the Company would have had to pay if the Company then had elected to redeem the Notes
pursuant to Section 3.07 hereof, an equivalent premium shall also become and be immediately due and
payable to the extent permitted by law upon the acceleration of the Notes. If an Event of Default
occurs prior to August 1, 2013 by reason of any willful action (or inaction) taken (or not taken)
by or on behalf of the Company with the intention of avoiding the prohibition on redemption of the
Notes prior to August 1, 2013 (other than a redemption of Notes permitted by Sections 3.07(d) or
(e)), then the Applicable Premium shall also become immediately due and payable to the extent
permitted by law upon the acceleration of the Notes and Guaranties.



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 of a Note
in exercising any right or remedy accruing upon an Event of Default shall not impair the right or
remedy or constitute a waiver of or acquiescence in the Event of Default. All remedies are
cumulative to the extent permitted by law.



Section 6.04 Waiver of Past Defaults.




The Holders of a majority in aggregate principal amount of the Notes then outstanding by
notice to the Trustee may on behalf of the Holders of all of the Notes waive any existing Default
or Event of Default and its consequences under this Indenture except a continuing Default or Event
of Default in the payment of principal of, premium, if any, or interest, on the Notes or the
Guaranties (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 solely from
such acceleration). The waiver by the holders of any Indebtedness described in clause (4) of
Section 6.01 of the predicating default under such Indebtedness shall be deemed a waiver of such
Default or Event of Default arising under, and a rescission


 


77









 






of any acceleration resulting from the application of clause (4), from the effective date,
during the effective period and to the extent of, the waiver by the holders of such other
Indebtedness. Upon any waiver granted or deemed granted in accordance with the terms hereof, such
Default shall cease to exist, and any Event of Default arising therefrom shall be deemed to have
been cured and waived 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 of Notes 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 that an Event of Default is
continuing;




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




(3) such Holder or Holders offer and, if requested, provide to the Trustee security or
indemnity reasonably satisfactory to the Trustee against any loss, liability or expense;




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




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



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



Section 6.07 Rights of Holders of Notes to Receive Payment.




Notwithstanding any other provision of this Indenture, the right of any Holder of a Note to
receive payment of principal, premium and 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


 


78









 






such further amount as shall be sufficient to cover the costs and expenses of collection,
including the reasonable compensation, expenses, disbursements and advances of the Trustee, its
agents and counsel.



Section 6.09 Trustee May File Proofs of Claim.




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



Section 6.10 Priorities.




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




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




Second: to Holders of Notes for amounts due and unpaid on the Notes for principal,
premium and 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 of Notes
pursuant to this Section 6.10.



Section 6.11 Undertaking for Costs.




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


 


79









 






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 of a Note pursuant to Section 6.07 hereof, or a suit by Holders of more than 10%
in aggregate principal amount of the then outstanding Notes.



Section 6.12 Remedies Subject to Applicable Law.




All rights, remedies and powers provided by this Article 6 may be exercised only to the extent
that the exercise thereof does not violate any applicable provision of law, and all the provisions
of this Indenture are intended to be subject to all applicable laws, including applicable Gaming
Laws, and to be limited to the extent necessary so that they will not render this Indenture
invalid, unenforceable or not entitled to be recorded, registered or filed under the provisions of
any applicable law.



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. However, in the case of certificates or opinions specifically required by any
provision hereof to be furnished to it, the Trustee will examine the certificates and
opinions to determine whether or not they conform to the requirements of this Indenture (but
need not confirm or investigate the accuracy of mathematical calculations or other facts
stated therein).



(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.


 


80









 





(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.



(g) The Trustee shall reasonably cooperate with any Gaming Authority of any jurisdiction in
which the Company or any of its Subsidiaries conducts or proposes to conduct gaming and shall
produce any document or information as any of them may reasonably request.



Section 7.02 Rights of Trustee.




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



(b) Before the Trustee acts or refrains from acting, it may require an Officers’ Certificate
or an Opinion of Counsel or both. The Trustee 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 of its own selection and the 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 Trustee indemnity or security reasonably satisfactory to it against the losses,
liabilities and expenses that might be incurred by it in compliance with such request or direction.



(g) In no event shall the Trustee be responsible or liable for special, indirect, or
consequential loss or damage of any kind whatsoever (including, but not limited to, loss of profit)
irrespective of whether the Trustee has been advised of the likelihood of such loss or damage and
regardless of the form of action.



(h) The Trustee shall not be deemed to have notice of any Default or Event of Default unless a
Responsible Officer of the Trustee has actual knowledge thereof or unless written notice of any
event which is in fact such a Default is received by the Trustee at the Corporate Trust Office of
the Trustee, and such notice references the Notes and this Indenture.


 


81









 





(i) The rights, privileges, protections, immunities and benefits given to the Trustee,
including, without limitation, its right to be indemnified, are extended to, and shall be
enforceable by, the Trustee in each of its capacities hereunder, and each agent, custodian and
other Person employed to act hereunder.



(j) The Trustee may request that the Company deliver an Officers’ Certificate setting forth
the names of individuals and/or titles of officers authorized at such time to take specified
actions pursuant to this Indenture, which Officers’ Certificate may be signed by any person
authorized to sign an Officers’ Certificate, including any person specified as so authorized in any
such certificate previously delivered and not superseded.



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.



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



Section 7.06 Reports by Trustee to Holders of the Notes.




(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 of the
Notes a brief report dated as of such reporting date that complies with TIA § 313(a) (but if no
event described in TIA § 313(a) has occurred within the twelve months preceding the reporting date,
no report need be transmitted). The Trustee also 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 of Notes 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 or delisted therefrom.


 


82









 





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. 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, disbursements and expenses of the Trustee’s agents and counsel.



(b) The Company and the Guarantors, jointly and severally, will indemnify the Trustee against
any and all losses, claims, damages, 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 and the Guarantors (including
this Section 7.07) and defending itself against any claim (whether asserted by the Company, the
Guarantors, 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 determined to have been caused by 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 or any of the Guarantors of their obligations
hereunder. The Company or such Guarantor 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. Neither the Company nor any Guarantor need pay for any settlement
made without its consent, which consent will not be unreasonably withheld.



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



(d) To secure the Company’s and the Guarantors’ 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(6) or (7) hereof occurs, the expenses and the compensation for the services
(including the fees and expenses of its agents and counsel) are intended to constitute expenses of
administration under any Bankruptcy Law.



(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;


 


83









 






(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 at the expense of the Company.



(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.



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).


 


84









 





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 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 and each of the Guarantors will, subject to the satisfaction of the conditions
set forth in Section 8.04 hereof, be deemed to have been discharged from their obligations with
respect to all outstanding Notes (including the Guaranties) on the date the conditions set forth
below are satisfied (hereinafter, “Legal Defeasance”). For this purpose, Legal Defeasance means
that the Company and the Guarantors will be deemed to have paid and discharged the entire
Indebtedness represented by the outstanding Notes (including the Guaranties), 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 their other
obligations under such Notes, the Guaranties 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;




(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 and each of the Guarantors will, subject to the satisfaction of the conditions
set forth in Section 8.04 hereof, be released from each of their obligations under the covenants
contained in Sections 4.07, 4.08, 4.09, 4.10, 4.11, 4.12, 4.13, 4.15, 4.16, 4.17, 4.18, 4.19 hereof
and clauses (2) and (3)


 


85









 






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 and Guaranties, the
Company and the Guarantors 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 and Guaranties 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(5) 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, if any, and
interest and Additional Interest, if any, on the outstanding Notes on the stated maturity or
on the applicable redemption date, as the case may be, and the Company must specify whether
the Notes are being defeased to maturity or to a particular redemption date;




(2) in the case of an election under Section 8.02 hereof, the Company shall have
delivered to the Trustee an Opinion of Counsel reasonably acceptable to the Trustee
confirming that:




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




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




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




(3) in the case of an election under Section 8.03 hereof, the Company shall have
delivered 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;


 


86









 






(4) no Default or Event of Default shall have occurred and be continuing either:




(A) on the date of such deposit (other than a Default or Event of Default
resulting from transactions occurring contemporaneously with the borrowing of funds,
or the borrowing of funds, to be applied to such deposit); or




(B) insofar as Events of Default resulting from bankruptcy or insolvency events
are concerned, at any time in the period ending on the 91st day after the date of
deposit (in which case such defeasance shall have been effective on the date of
deposit until the time of such occurrence and, upon such occurrence, shall
immediately cease to be effective);




(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 Restricted Subsidiaries is a party or by
which the Company or any of its Restricted Subsidiaries is bound;




(6) the Company must have delivered to the Trustee an Opinion of Counsel (which may be
subject to customary exceptions) to the effect that after the 91st day following the
deposit, the trust funds will not be subject to avoidance as preferential transfers in any
proceeding by or gainst the Company under any applicable Bankruptcy Law;




(7) 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 of Notes over
the other creditors of the Company with the intent of defeating, hindering, delaying or
defrauding creditors of the Company or others; and




(8) 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 any Obligor 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.



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


 


87









 






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 and the Guarantors’ obligations under this
Indenture and the Notes and the Guaranties 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 of Notes.




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




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




(2) to provide for uncertificated Notes in addition to or in place of certificated
Notes;




(3) to provide for the assumption of the Company’s or a Guarantor’s obligations to the
Holders of the Notes and Guaranties by a successor to the Company or such Guarantor pursuant
to Article 5 or Article 10 hereof;




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


 


88









 






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




(6) to comply with requirements of applicable Gaming Laws or to provide for
requirements imposed by applicable Gaming Authorities;




(7) 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 July 27, 2009,
relating to the initial offering of the Notes, to the extent that such provision in that
“Description of notes” was intended to be a verbatim recitation of a provision of this
Indenture, the Guaranties or the Notes;




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




(9) to allow any Guarantor to execute a supplemental indenture and/or a Notation of
Guaranty with respect to the Notes.



Upon the request of the Company accompanied by a resolution of its Board 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 and the
Guarantors in the execution of any amended or supplemental indenture authorized or permitted by the
terms of this Indenture and to make any further appropriate agreements and stipulations that may be
therein contained, but the Trustee 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 of Notes.




Except as provided below in this Section 9.02, the Company and the Trustee may amend or
supplement this Indenture (including, without limitation, Section 3.09, 4.10 and 4.15 hereof and
the defined terms used therein) and the Notes and the Guaranties 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 or the Guaranties 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). Without the consent of at least
66-2/3% in aggregate principal amount of the Notes then outstanding (including consents obtained in
connection with a tender offer or exchange offer for, or purchase of, such Notes), no waiver or
amendment to this Indenture may make any change in the provisions of Article 10 hereof that
releases any Guarantor from its obligations under any Guaranty, that adversely affects the rights
of any Holder of Notes. Section 2.08 hereof shall determine which Notes are considered to be
“outstanding” for purposes of this Section 9.02.



Upon the request of the Company accompanied by a resolution of its Board authorizing the
execution of any such amended or supplemental indenture, and upon the filing with the Trustee of
evidence satisfactory to the Trustee of the consent of the Holders of Notes as aforesaid, and upon
receipt by the Trustee of the documents described in Section 7.02 hereof, the Trustee will join
with the Company


 


89









 






and the Guarantors 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 of Notes 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 of Notes affected thereby a notice briefly describing the
amendment, supplement or waiver. Any failure of the Company to mail such notice, or any defect
therein, 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 any Obligor with any provision of this Indenture or
the Notes or the Guaranties. 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) reduce the principal amount of Notes whose Holders must consent to an amendment,
supplement or waiver,




(2) reduce the principal of or change the fixed maturity of any Note or alter the
provisions with respect to the redemption of the Notes (other than provisions relating to
Sections 3.09, 4.10 and 4.15 hereof),




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




(4) waive a Default or Event of Default in the payment of principal of or premium, if
any, or interest or Additional Interest, if any, 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),




(5) make any Note payable in money other than that stated in the Notes,




(6) make any change in the provisions of this Indenture relating to waivers of past
Defaults or the rights of Holders of Notes to receive payments of principal of or premium,
if any, or interest or Additional Interest, if any, on the Notes,




(7) waive a redemption payment with respect to any Note (other than a payment required
by one of the conditions in Sections 3.09, 4.10 and 4.15 hereof), or




(8) make any change in the foregoing amendment and waiver provisions.



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.


 


90









 





Section 9.04 Revocation and Effect of Consents.




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



Section 9.05 Notation on or Exchange of Notes.




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



Failure to make the appropriate notation or issue a new Note 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 the Company approves it. In executing any amended or supplemental indenture, the
Trustee will be provided with and (subject to Section 7.01 hereof) will be fully protected in
relying upon, in addition to the documents required by Section 12.04 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

NOTE GUARANTIES




Section 10.01 Guaranty.




(a) Subject to this Article 10, each of the Guarantors hereby, jointly and severally,
unconditionally guarantees to each Holder of a Note authenticated and delivered by the Trustee and
to the Trustee and its successors and assigns, irrespective of the validity and enforceability of
this Indenture, the Notes or the obligations of the Company hereunder or thereunder, that:




(1) the principal of, premium and Additional Interest, if any, and interest on, the
Notes will be promptly paid in full when due, whether at maturity, by acceleration,
redemption or otherwise, and interest on the overdue principal of and interest on the Notes,
if any, if lawful, and all other obligations of the Company to the Holders or the Trustee
hereunder or thereunder will be promptly paid in full or performed, all in accordance with
the terms hereof and thereof; and




(2) in case of any extension of time of payment or renewal of any Notes or any of such
other obligations, that same will be promptly paid in full when due or performed in
accordance


  


91









 








with the terms of the extension or renewal, whether at stated maturity, by acceleration
or otherwise.



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



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



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



(d) Each Guarantor agrees that it will not be entitled to any right of subrogation in relation
to the Holders in respect of any obligations guaranteed hereby until payment in full of all
obligations guaranteed hereby. Each Guarantor further agrees that, as between the Guarantors, on
the one hand, and the Holders and the Trustee, on the other hand, (1) the maturity of the
obligations guaranteed hereby may be accelerated as provided in Article 6 hereof for the purposes
of this Guaranty, notwithstanding any stay, injunction or other prohibition preventing such
acceleration in respect of the obligations guaranteed hereby, and (2) in the event of any
declaration of acceleration of such obligations as provided in Article 6 hereof, such obligations
(whether or not due and payable) will forthwith become due and payable by the Guarantors for the
purpose of this Guaranty. The Guarantors will have the right to seek contribution from any
non-paying Guarantor so long as the exercise of such right does not impair the rights of the
Holders under the Guaranty.



Section 10.02 Limitation on Guarantor Liability.




Each Guarantor, and by its acceptance of Notes, each Holder, hereby confirms that it is the
intention of all such parties that the Guaranty of such Guarantor not constitute a fraudulent
transfer or conveyance for purposes of Bankruptcy Law, the Uniform Fraudulent Conveyance Act, the
Uniform Fraudulent Transfer Act or any similar federal or state law to the extent applicable to any
Guaranty. To effectuate the foregoing intention, the Trustee, the Holders and the Guarantors
hereby irrevocably agree that the obligations of such Guarantor will be limited to the maximum
amount that will, after giving effect to such maximum amount and all other contingent and fixed
liabilities of such Guarantor that are relevant under such laws, and after giving effect to any
collections from, rights to receive contribution from or payments made by or on behalf of any other
Guarantor in respect of the obligations of such other Guarantor under this Article 10, result in
the obligations of such Guarantor under its Guaranty not constituting a fraudulent transfer or
conveyance.


 


92









 





Section 10.03 Execution and Delivery of Guaranty.




To evidence its Guaranty set forth in Section 10.01 hereof, each Guarantor hereby agrees that
a notation of such Guaranty substantially in the form attached as Exhibit D hereto will be endorsed
by an Officer of such Guarantor on each Note authenticated and delivered by the Trustee and that
this Indenture will be executed on behalf of such Guarantor by one of its Officers.



Each Guarantor hereby agrees that its Guaranty set forth in Section 10.01 hereof will remain
in full force and effect notwithstanding any failure to endorse on each Note a notation of such
Guaranty.



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



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



In the event that the Company or any of its Subsidiaries creates or acquires any Material
Restricted Subsidiary after the date of this Indenture or if a Subsidiary becomes a Material
Restricted Subsidiary after the Issue Date, if required by Section 4.18 hereof, the Company will
cause such Material Restricted Subsidiary to comply with the provisions of Section 4.18 hereof and
this Article 10, to the extent applicable.



Section 10.04 Releases.




(a) In the event of any sale or other disposition of all or substantially all of the assets of
any Guarantor, by way of merger, consolidation or otherwise, or a sale or other disposition
(including by way of liquidation permitted hereunder) of all of the Capital Stock of any Guarantor,
in each case to a Person that is not (either before or after giving effect to such transactions)
the Company or a Restricted Subsidiary of the Company, then such Guarantor (in the event of a sale
or other disposition, by way of merger, consolidation or otherwise, of all of the Capital Stock of
such Guarantor) or the Person acquiring the property (in the event of a sale or other disposition
of all or substantially all of the assets of such Guarantor) will be released and relieved of any
obligations under its Guaranty; provided that the Net Cash Proceeds of such sale or other
disposition are applied in accordance with the applicable provisions of this Indenture, including
without limitation Section 4.10 hereof. Upon delivery by the Company to the Trustee of an
Officers’ Certificate and an Opinion of Counsel to the effect that such sale or other disposition
was made by the Company in accordance with the provisions of this Indenture, including without
limitation Section 4.10 hereof, the Trustee will execute any documents reasonably required in order
to evidence the release of any Guarantor from its obligations under its Guaranty.



(b) Upon designation of any Guarantor as an Unrestricted Subsidiary in accordance with the
terms of this Indenture, such Guarantor will be released and relieved of any obligations under its
Guaranty.



(c) Upon Legal Defeasance in accordance with Article 8 hereof or satisfaction and discharge of
this Indenture in accordance with Article 11 hereof, each Guarantor will be released and relieved
of any obligations under its Guaranty.



Any Guarantor not released from its obligations under its Guaranty as provided in this Section
10.04 will remain liable for the full amount of principal of and interest and premium and
Additional


 


93









 






Interest, if any, on the Notes and for the other obligations of any Guarantor under this
Indenture as provided in this Article 10.



ARTICLE 11

SATISFACTION AND DISCHARGE




Section 11.01 Satisfaction and Discharge.




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




(1) either:




(a) all Notes that have been authenticated, except lost, stolen or destroyed Notes that
have been replaced or paid and Notes for whose payment money has been deposited in trust and
thereafter repaid to the Company, have been delivered to the trustee for cancellation; or




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




(2) no Default or Event of Default has occurred and is continuing on the date of the
deposit (other than a Default or Event of Default resulting from transactions occurring
contemporaneously with the borrowing of funds, or the borrowing of funds, to be applied to
such deposit) and the deposit will not result in a breach or violation of, or constitute a
default under, any other instrument to which the Company or any Guarantor is a party or by
which the Company or any Guarantor is bound;




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




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



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



Upon compliance with the foregoing, the Trustee shall execute proper instrument(s)
acknowledging the satisfaction and discharge of all the Company’s and the Guarantors’ obligations
under the Notes, the Guaranties and this Indenture.



Notwithstanding the satisfaction and discharge of this Indenture, if money has been deposited
with the Trustee pursuant to subclause (b) of clause (1) of this Section 11.01, the provisions of
Sections



 


94









 







12.02 and 8.06 hereof will survive. In addition, nothing in this Section 11.01 will be deemed
to discharge those provisions of Section 7.07 hereof, that, by their terms, survive the
satisfaction and discharge of this Indenture.



Section 11.02 Application of Trust Money.




Subject to the provisions of Section 8.06 hereof, all money deposited with the Trustee
pursuant to Section 11.01 hereof shall be held in trust and applied by it, in accordance with the
provisions of the Notes and this Indenture, to the payment, either directly or through any Paying
Agent (including the Company acting as its own Paying Agent) as the Trustee may determine, to the
Persons entitled thereto, of the principal (and premium and Additional Interest, if any) and
interest for whose payment such money has been deposited with the Trustee; but such money need not
be segregated from other funds except to the extent required by law.



If the Trustee or Paying Agent is unable to apply any money or Government Securities in
accordance with Section 11.01 hereof by reason of any legal proceeding or by reason of any order or
judgment of any court or governmental authority enjoining, restraining or otherwise prohibiting
such application, the Company’s and any Guarantor’s obligations under this Indenture and the Notes
shall be revived and reinstated as though no deposit had occurred pursuant to Section 11.01 hereof;
provided that if the Company has made any payment of principal of, premium or Additional Interest,
if any, or interest on, any Notes because of the reinstatement of its obligations, the Company
shall be subrogated to the rights of the Holders of such Notes to receive such payment from the
money or Government Securities held by the Trustee or Paying Agent.



ARTICLE 12

MISCELLANEOUS




Section 12.01 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 12.02 Notices.




Any notice or communication by the Company, any Guarantor 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 and/or any Guarantor:




Pinnacle Entertainment, Inc.

3800 Howard Hughes Parkway

Las Vegas, Nevada 89169

Facsimile No.: (702) 784-7778

Attention: John A. Godfrey, Esq.



 


95









 








With a copy to:




Irell & Manella LLP

1800 Avenue of the Stars, Suite 900

Los Angeles, California 90067

Facsimile No.: (310) 203-7199

Attention: C. Kevin McGeehan, Esq.




If to the Trustee:

The Bank of New York Mellon Trust Company, N.A.

700 South Flower Street, Suite 500

Los Angeles, California 90017

Facsimile No.: (213) 630-6298

Attention: Corporate Unit



The Company, any Guarantor 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.



The Trustee agrees to accept and act upon instructions or directions pursuant to this
Indenture sent by unsecured e-mail, facsimile transmission or other similar unsecured electronic
methods; provided, however, that (a) the party providing such written instructions, subsequent to
such transmission of written instructions, shall provide the originally executed instructions or
directions to the Trustee in a timely manner, and (b) such originally executed instructions or
directions shall be signed by an authorized representative of the party providing such instructions
or directions. If the party elects to give the Trustee e-mail or facsimile instructions (or
instructions by a similar electronic method) and the Trustee in its discretion elects to act upon
such instructions, the Trustee’s understanding of such instructions shall be deemed controlling.
The Trustee shall not be liable for any losses, costs or expenses arising directly or indirectly
from the Trustee’s reliance upon and compliance with such instructions notwithstanding such
instructions conflict or are inconsistent with a subsequent written instruction. The party
providing electronic instructions agrees to assume all risks arising out of the use of such
electronic methods to submit instructions and directions to the Trustee, including without
limitation the risk of the Trustee acting on unauthorized instructions, and the risk or
interception and misuse by third parties.



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.


 


96









 





Section 12.03 Communication by Holders of Notes with Other Holders of Notes.




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



Section 12.04 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, except the initial authentication and delivery of the Notes on the Issue Date, 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 12.05 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 12.05 hereof) stating that, in the
opinion of such counsel, all such conditions precedent and covenants have been satisfied.
Such counsel may rely on representations, warranties and certificates of other Persons as to
matters of fact, and may qualify the Opinion of Counsel with customary assumptions and
exceptions.



Section 12.05 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;




(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 12.06 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 12.07 No Personal Liability of Directors, Officers, Employees and Stockholders.




No past, present or future director, officer, employee, agent, manager, partner, member,
incorporator or stockholder of any Obligor, in such capacity, will have any liability for any
obligations of


 


97









 






any Obligor under the Notes, this Indenture or the Guaranties or for any claim based on, in
respect of, or by reason of, such obligations or their creation. Each Holder of Notes by accepting
a Note waives and releases all such liability. The waiver and release are part of the consideration
for issuance of the Notes and the Guaranties.



Section 12.08 Governing Law.




THE INTERNAL LAW OF THE STATE OF NEW YORK WILL GOVERN AND BE USED TO CONSTRUE THIS INDENTURE,
THE NOTES AND THE GUARANTIES 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 12.09 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 12.10 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. All agreements of each
Guarantor in this Indenture will bind its successors, except as otherwise provided in Section 10.04
hereof.



Section 12.11 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.



Section 12.12 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 12.13 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.



Section 12.14 Waiver of Jury Trial.




EACH OF THE COMPANY AND THE TRUSTEE HEREBY IRREVOCABLY WAIVES, TO THE FULLEST EXTENT PERMITTED
BY APPLICABLE LAW, ANY AND ALL RIGHT TO TRIAL BY JURY IN ANY LEGAL PROCEEDING ARISING OUT OF OR
RELATING TO THIS INDENTURE, THE NOTES OR THE TRANSACTION CONTEMPLATED HEREBY.


 


98









 





Section 12.15 Force Majeure




In no event shall the Trustee be responsible or liable for any failure or delay in the
performance of its obligations hereunder arising out of or caused by, directly or indirectly,
forces beyond its control, including, without limitation, strikes, work stoppages, accidents, acts
of war or terrorism, civil or military disturbances, nuclear or natural catastrophes or acts of
God, and interruptions, loss or malfunctions of utilities, communications or computer (software and
hardware) services; it being understood that the Trustee shall use reasonable efforts which are
consistent with accepted practices in the banking industry to resume performance as soon as
practicable under the circumstances.



(Signatures on following page)




 


99









 







SIGNATURES




Dated as of August 10, 2009




	 	 	 	 	 	 	 	 	 
	 	 	Pinnacle Entertainment, Inc.
	 
	 	 	 	 	 	 	 	 
	 	 	By:	 	/s/ Stephen H. Capp
	 	 	 	 	 
	 	 	 	 	Name:	 	Stephen H. Capp
	 	 	 	 	Title:	 	Executive Vice President and
Chief Financial Officer
	 
	 	 	 	 	 	 	 	 
	 	 	ACE Gaming, LLC
	 
	 	 	 	 	 	 	 	 
	 	 	By:	 	PNK Development 13, LLC
	 	 	Its:	 	Sole Member
	 
	 	 	 	 	 	 	 	 
	 	 	 	 	By:	 	Biloxi Casino Corp.
	 	 	 	 	Its:	 	Sole Member
	 
	 	 	 	 	 	 	 	 
	 

	 	 	 	 	 	By:
	 	/s/ Stephen H. Capp
	 

	 	 	 	 	 	 	 	 
	 

	 	 	 	 	 	Name:
	 	Stephen H. Capp
	 

	 	 	 	 	 	Title:
	 	Chief Financial Officer and Treasurer
	 
	 	 	 	 	 	 	 	 
	 	 	AREH MLK LLC
	 
	 	 	 	 	 	 	 	 
	 	 	By:	 	Biloxi Casino Corp.
	 	 	Its:	 	Sole Member
	 
	 	 	 	 	 	 	 	 
	 	 	 	 	By:	 	/s/ Stephen H. Capp
	 	 	 	 	 	 	 
	 	 	 	 	Name:	 	Stephen H. Capp
	 	 	 	 	Title:	 	Chief Financial Officer and Treasurer
	 
	 	 	 	 	 	 	 	 
	 	 	AREP Boardwalk Properties LLC
	 
	 	 	 	 	 	 	 	 
	 	 	By:	 	Biloxi Casino Corp.
	 	 	Its:	 	Sole Member
	 
	 	 	 	 	 	 	 	 
	 	 	 	 	By:	 	/s/ Stephen H. Capp
	 	 	 	 	 	 	 
	 	 	 	 	Name:	 	Stephen H. Capp
	 	 	 	 	Title:	 	Chief Financial Officer and Treasurer





 


 









 





	 	 	 	 	 	 	 	 	 
	 	 	Belterra Resort Indiana, LLC
	 
	 	 	 	 	 	 	 	 
	 	 	By:	 	Pinnacle Entertainment, Inc.
	 	 	Its:	 	Sole Member
	 
	 	 	 	 	 	 	 	 
	 	 	 	 	By:	 	/s/ Stephen H. Capp
	 	 	 	 	 	 	 
	 	 	 	 	Name:	 	Stephen H. Capp
	 	 	 	 	Title:	 	Executive Vice President and
Chief Financial Officer
	 
	 	 	 	 	 	 	 	 
	 	 	Biloxi Casino Corp.
	 
	 	 	 	 	 	 	 	 
	 	 	By:	 	/s/ Stephen H. Capp
	 	 	 	 	 
	 	 	 	 	Name:	 	Stephen H. Capp
	 	 	 	 	Title:	 	Chief Financial Officer and Treasurer
	 
	 	 	 	 	 	 	 	 
	 	 	Boomtown, LLC
	 
	 	 	 	 	 	 	 	 
	 	 	By:	 	Pinnacle Entertainment, Inc.
	 	 	Its:	 	Sole Member
	 
	 	 	 	 	 	 	 	 
	 	 	 	 	By:	 	/s/ Stephen H. Capp
	 	 	 	 	 	 	 
	 	 	 	 	Name:	 	Stephen H. Capp
	 	 	 	 	Title:	 	Executive Vice President and
Chief Financial Officer
	 
	 	 	 	 	 	 	 	 
	 	 	Casino Magic Corp.
	 
	 	 	 	 	 	 	 	 
	 	 	By:	 	/s/ Stephen H. Capp
	 	 	 	 	 
	 	 	 	 	Name:	 	Stephen H. Capp
	 	 	 	 	Title:	 	Chief Financial Officer
	 
	 	 	 	 	 	 	 	 
	 	 	Casino One Corporation
	 
	 	 	 	 	 	 	 	 
	 	 	By:	 	/s/ Stephen H. Capp
	 	 	 	 	 
	 	 	 	 	Name:	 	Stephen H. Capp
	 	 	 	 	Title:	 	Treasurer





 


 









 





	 	 	 	 	 	 	 	 	 
	 	 	LOUISIANA — I Gaming, A Louisiana Partnership
	 	 	in Commendam
	 
	 	 	 	 	 	 	 	 
	 	 	By:	 	Boomtown, LLC
	 	 	Its:	 	General Partner
	 
	 	 	 	 	 	 	 	 
	 	 	 	 	By:	 	Pinnacle Entertainment, Inc.
	 	 	 	 	Its:	 	Sole Member
	 
	 	 	 	 	 	 	 	 
	 

	 	 	 	 	 	By:
	 	/s/ Stephen H. Capp
	 

	 	 	 	 	 	 	 	 
	 

	 	 	 	 	 	Name:
	 	Stephen H. Capp
	 

	 	 	 	 	 	Title:
	 	Executive Vice President and
Chief Financial Officer
	 
	 	 	 	 	 	 	 	 
	 	 	Mitre Associates LLC
	 
	 	 	 	 	 	 	 	 
	 	 	By:	 	PNK Development 13, LLC
	 	 	Its:	 	Sole Member
	 
	 	 	 	 	 	 	 	 
	 	 	 	 	By:	 	Biloxi Casino Corp.
	 	 	 	 	Its:	 	Sole Member
	 
	 	 	 	 	 	 	 	 
	 

	 	 	 	 	 	By:
	 	/s/ Stephen H. Capp
	 

	 	 	 	 	 	 	 	 
	 

	 	 	 	 	 	Name:
	 	Stephen H. Capp
	 

	 	 	 	 	 	Title:
	 	Chief Financial Officer and Treasurer
	 
	 	 	 	 	 	 	 	 
	 	 	OGLE HAUS, LLC
	 
	 	 	 	 	 	 	 	 
	 	 	By:	 	Belterra Resort Indiana, LLC
	 	 	Its:	 	Sole Member and Manager
	 
	 	 	 	 	 	 	 	 
	 	 	 	 	By:	 	Pinnacle Entertainment, Inc.
	 	 	 	 	Its:	 	Sole Member
	 
	 	 	 	 	 	 	 	 
	 	 	 	 	By:	 	/s/ Stephen H. Capp
	 	 	 	 	 	 	 
	 

	 	 	 	 	 	Name:
	 	Stephen H. Capp
	 

	 	 	 	 	 	Title:
	 	Executive Vice President and
Chief Financial Officer





 


 









 





	 	 	 	 	 	 	 	 	 
	 	 	PNK (BATON ROUGE) Partnership
	 
	 	 	 	 	 	 	 	 
	 	 	By:	 	PNK Development 8, LLC
	 	 	Its:	 	Managing Partner
	 
	 	 	 	 	 	 	 	 
	 	 	 	 	By:	 	Pinnacle Entertainment, Inc.
	 	 	 	 	Its:	 	Sole Member
	 
	 	 	 	 	 	 	 	 
	 

	 	 	 	 	 	By:
	 	/s/ Stephen H. Capp
	 

	 	 	 	 	 	 	 	 
	 

	 	 	 	 	 	Name:
	 	Stephen H. Capp
	 

	 	 	 	 	 	Title:
	 	Executive Vice President and
Chief Financial Officer
	 
	 	 	 	 	 	 	 	 
	 	 	PNK (BOSSIER CITY), Inc.
	 
	 	 	 	 	 	 	 	 
	 	 	By:	 	/s/ Stephen H. Capp
	 	 	 	 	 
	 	 	 	 	Name:	 	Stephen H. Capp
	 	 	 	 	Title:	 	Treasurer
	 
	 	 	 	 	 	 	 	 
	 	 	PNK (CHILE 1), LLC
	 
	 	 	 	 	 	 	 	 
	 	 	By:	 	Pinnacle Entertainment, Inc.
	 	 	Its:	 	Sole Member
	 
	 	 	 	 	 	 	 	 
	 	 	 	 	By:	 	/s/ Stephen H. Capp
	 	 	 	 	 	 	 
	 	 	 	 	Name:	 	Stephen H. Capp
	 	 	 	 	Title:	 	Executive Vice President and
Chief Financial Officer
	 
	 	 	 	 	 	 	 	 
	 	 	PNK (CHILE 2), LLC
	 
	 	 	 	 	 	 	 	 
	 	 	By:	 	Pinnacle Entertainment, Inc.
	 	 	Its:	 	Sole Member
	 
	 	 	 	 	 	 	 	 
	 	 	 	 	By:	 	/s/ Stephen H. Capp
	 	 	 	 	 	 	 
	 	 	 	 	Name:	 	Stephen H. Capp
	 	 	 	 	Title:	 	Executive Vice President and
Chief Financial Officer





 


 









 





	 	 	 	 	 	 	 	 	 
	 	 	PNK Development 7, LLC
	 
	 	 	 	 	 	 	 	 
	 	 	By:	 	Pinnacle Entertainment, Inc.
	 	 	Its:	 	 Sole Member
	 
	 	 	 	 	 	 	 	 
	 	 	 	 	By:	 	/s/ Stephen H. Capp
	 	 	 	 	 	 	 
	 	 	 	 	Name:	 	Stephen H. Capp
	 	 	 	 	Title:	 	Executive Vice President and
Chief Financial Officer
	 
	 	 	 	 	 	 	 	 
	 	 	PNK Development 8, LLC
	 
	 	 	 	 	 	 	 	 
	 	 	By:	 	Pinnacle Entertainment, Inc.
	 	 	Its:	 	Sole Member
	 
	 	 	 	 	 	 	 	 
	 	 	 	 	By:	 	/s/ Stephen H. Capp
	 	 	 	 	 	 	 
	 	 	 	 	Name:	 	Stephen H. Capp
	 	 	 	 	Title:	 	Executive Vice President and
Chief Financial Officer
	 
	 	 	 	 	 	 	 	 
	 	 	PNK Development 9, LLC
	 
	 	 	 	 	 	 	 	 
	 	 	By:	 	Pinnacle Entertainment, Inc.
	 	 	Its:	 	Sole Member
	 
	 	 	 	 	 	 	 	 
	 	 	 	 	By:	 	/s/ Stephen H. Capp
	 	 	 	 	 	 	 
	 	 	 	 	Name:	 	Stephen H. Capp
	 	 	 	 	Title:	 	Executive Vice President and
Chief Financial Officer
	 
	 	 	 	 	 	 	 	 
	 	 	PNK Development 13, LLC
	 
	 	 	 	 	 	 	 	 
	 	 	By:	 	Biloxi Casino Corp.
	 	 	Its:	 	Sole Member
	 
	 	 	 	 	 	 	 	 
	 	 	 	 	By:	 	/s/ Stephen H. Capp
	 	 	 	 	 	 	 
	 	 	 	 	Name:	 	Stephen H. Capp
	 	 	 	 	Title:	 	Chief Financial Officer and Treasurer





 


 









 





	 	 	 	 	 	 	 	 	 
	 	 	PNK (ES), LLC
	 
	 	 	 	 	 	 	 	 
	 	 	By:	 	Pinnacle Entertainment, Inc.
	 	 	Its:	 	Sole Member
	 
	 	 	 	 	 	 	 	 
	 	 	 	 	By:	 	/s/ Stephen H. Capp
	 	 	 	 	 	 	 
	 	 	 	 	Name:	 	Stephen H. Capp
	 	 	 	 	Title:	 	Executive Vice President and
Chief Financial Officer
	 
	 	 	 	 	 	 	 	 
	 	 	PNK (LAKE CHARLES), L.L.C.
	 
	 	 	 	 	 	 	 	 
	 	 	By:	 	Pinnacle Entertainment, Inc.
	 	 	Its:	 	Sole Member and Manager
	 
	 	 	 	 	 	 	 	 
	 	 	 	 	By:	 	/s/ Stephen H. Capp
	 	 	 	 	 	 	 
	 	 	 	 	Name:	 	Stephen H. Capp
	 	 	 	 	Title:	 	Executive Vice President and
Chief Financial Officer
	 
	 	 	 	 	 	 	 	 
	 	 	PNK (Reno), LLC
	 
	 	 	 	 	 	 	 	 
	 	 	By:	 	Pinnacle Entertainment, Inc.
	 	 	Its:	 	Sole Member
	 
	 	 	 	 	 	 	 	 
	 	 	 	 	By:	 	/s/ Stephen H. Capp
	 	 	 	 	 	 	 
	 	 	 	 	Name:	 	Stephen H. Capp
	 	 	 	 	Title:	 	Executive Vice President and Chief Financial Officer
	 
	 	 	 	 	 	 	 	 
	 	 	PNK (SCB), L.L.C.
	 
	 	 	 	 	 	 	 	 
	 	 	By:	 	PNK Development 7, LLC
	 	 	Its:	 	 Sole Member
	 
	 	 	 	 	 	 	 	 
	 	 	 	 	By:	 	Pinnacle Entertainment, Inc.
	 	 	 	 	Its:	 	Sole Member
	 
	 	 	 	 	 	 	 	 
	 

	 	 	 	 	 	By:
	 	/s/ Stephen H. Capp
	 

	 	 	 	 	 	 	 	 
	 

	 	 	 	 	 	Name:
	 	Stephen H. Capp
	 

	 	 	 	 	 	Title:
	 	Executive Vice President and Chief Financial Officer





 


 









 





	 	 	 	 	 	 	 	 	 
	 	 	PNK (ST. LOUIS RE), LLC
	 
	 	 	 	 	 	 	 	 
	 	 	By:	 	Pinnacle Entertainment, Inc.
	 	 	Its:	 	Sole Member
	 
	 	 	 	 	 	 	 	 
	 	 	 	 	By:	 	/s/ Stephen H. Capp
	 	 	 	 	 	 	 
	 	 	 	 	Name:	 	Stephen H. Capp
	 	 	 	 	Title:	 	Executive Vice President and
Chief Financial Officer
	 
	 	 	 	 	 	 	 	 
	 	 	PNK (STLH), LLC
	 
	 	 	 	 	 	 	 	 
	 	 	By:	 	Pinnacle Entertainment, Inc.
	 	 	Its:	 	Sole Member
	 
	 	 	 	 	 	 	 	 
	 	 	 	 	By:	 	/s/ Stephen H. Capp
	 	 	 	 	 	 	 
	 	 	 	 	Name:	 	Stephen H. Capp
	 	 	 	 	Title:	 	Executive Vice President and
Chief Financial Officer
	 
	 	 	 	 	 	 	 	 
	 	 	President Riverboat Casino—Missouri, Inc.
	 
	 	 	 	 	 	 	 	 
	 	 	 	 	By:	 	/s/ Stephen H. Capp
	 	 	 	 	 	 	 
	 	 	 	 	Name:	 	Stephen H. Capp
	 	 	 	 	Title:	 	Chief Financial Officer and Treasurer
	 
	 	 	 	 	 	 	 	 
	 	 	PSW Properties LLC
	 
	 	 	 	 	 	 	 	 
	 	 	By:	 	Biloxi Casino Corp.
	 	 	Its:	 	Sole Member
	 
	 	 	 	 	 	 	 	 
	 	 	 	 	By:	 	/s/ Stephen H. Capp
	 	 	 	 	 	 	 
	 	 	 	 	Name:	 	Stephen H. Capp
	 	 	 	 	Title:	 	Chief Financial Officer and Treasurer
	 
	 	 	 	 	 	 	 	 
	 	 	St. Louis Casino Corp.
	 
	 	 	 	 	 	 	 	 
	 	 	By:	 	/s/ Stephen H. Capp
	 	 	 	 	 
	 	 	 	 	Name:	 	Stephen H. Capp
	 	 	 	 	Title:	 	Chief Financial Officer





 


 









 





	 	 	 	 	 	 	 	 	 
	 	 	Yankton Investments, LLC
	 
	 	 	 	 	 	 	 	 
	 	 	By:	 	/s/ John A. Godfrey
	 	 	 	 	 
	 	 	 	 	Name:	 	John A. Godfrey
	 	 	 	 	Title:	 	Manager





 


 









 





	 	 	 	 	 	 	 	 	 
	 	 	THE TRUSTEE
	Dated as of August 10, 2009
	 	 	 	 	 	 	 	 
	 	 	The Bank of New York Mellon Trust Company, N.A.,
	 	 	as Trustee
	 
	 	 	 	 	 	 	 	 
	 	 	By:	 	/s/ Raymond Torres
	 	 	 	 	 
	 	 	 	 	Name:	 	Raymond Torres
	 	 	 	 	Title:	 	Senior Associate






 


 









 







EXHIBIT A




[Face of Note]




CUSIP/CINS ____________




8.625% Senior Notes due 2017




			
	 	 	 
	No.
 _____ 

	 	$____________







PINNACLE ENTERTAINMENT, INC.




promises to pay to [______] or registered assigns,




the principal sum of
________________________
DOLLARS on August 1, 2017.



Interest Payment Dates: August 1 and February 1




Record Dates: July 15 and January 15




Dated: _______________, 200_




	 	 	 	 	 
	 	PINNACLE ENTERTAINMENT, INC.

 	 
	 	By:  	 	 
	 	 	Name:  	 	 
	 	 	Title:  	 	 
	 




This is one of the Notes referred to

in the within-mentioned Indenture:



THE BANK OF NEW YORK MELLON TRUST COMPANY, N.A.,
  as
Trustee



	 	 	 	 	 
	By:

	 	 
	 	 
	 

	 	 	 	 
	 

	 	Authorized Signatory	 	 






 


A-1









 







[Back of Note]

8.625% Senior Notes due 2017




[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]




THE NOTES REPRESENTED BY THIS CERTIFICATE ARE SUBJECT TO RESTRICTIONS ON OWNERSHIP AND
TRANSFER IMPOSED BY APPLICABLE GAMING LAWS, THE PROVISIONS OF ARTICLE XIII OF THE COMPANY’S
RESTATED CERTIFICATE OF INCORPORATION, INCLUDING ANY AMENDMENTS THERETO OR ANY SUCCESSOR PROVISIONS
THERETO, AND SECTION 3.07(e) OF THE INDENTURE (WHICH IS SUMMARIZED ON THIS CERTIFICATE). A COPY OF
ARTICLE XIII OF THE COMPANY’S RESTATED CERTIFICATE OF INCORPORATION IS ON FILE AT THE OFFICE OF THE
COMPANY, AND MADE A PART HEREOF AS FULLY AS THOUGH THE PROVISIONS OF SAID PROVISIONS OF THE
COMPANY’S RESTATED CERTIFICATE OF INCORPORATION WERE PRINTED IN FULL ON THIS CERTIFICATE, TO ALL OF
WHICH THE HOLDER OF THIS CERTIFICATE, BY ACCEPTANCE HEREOF, ASSENTS AND AGREES TO BE BOUND. ANY
HOLDER OF A NOTE MAY OBTAIN, UPON REQUEST AND WITHOUT CHARGE, A COPY OF SUCH PROVISIONS OF THE
COMPANY’S RESTATED CERTIFICATE OF INCORPORATION. ANY SUCH REQUEST SHALL BE ADDRESSED TO THE
SECRETARY OF THE COMPANY.



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




(1) Interest. Pinnacle Entertainment, Inc., a Delaware corporation
(the “Company”), promises to pay interest on the principal amount of this Note at 8.625% per
annum from
____________, 20___
until maturity and shall pay the Additional Interest, if
any, payable pursuant to Section 5 of the Registration Rights Agreement referred to below.
The Company will pay interest and Additional Interest, if any, semi-annually in arrears on
August 1 and February 1 of each year, or if any such day is not a Business Day, on the next
succeeding Business Day (each, an “Interest Payment Date”). Interest on the Notes will
accrue from the most recent date to which interest has been paid or, if no interest has been
paid, from the date of issuance; provided that if there is no existing Default in the
payment of interest, and if this Note is authenticated between a record date referred to on
the face hereof and the next succeeding Interest Payment Date, interest shall accrue from
such next succeeding Interest Payment Date; provided further that the first Interest Payment
Date shall be
____________, 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 that is 1% per annum in excess of the 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 of Notes at the close of business on the July 15 or January 15 next
preceding the Interest Payment Date, even if such Notes are canceled after such record date
and on or before such Interest Payment Date, except as provided in Section 2.12 of the
Indenture with respect to defaulted interest. The Notes



 


A-2









 








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, The Bank of New York
Mellon Trust Company, N.A., 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 August 10, 2009 (the “Indenture”) among the Company, the Guarantors and the Trustee.
The terms of the Notes include those stated in the Indenture and those made part of the
Indenture by reference to the 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
the Notes that may be issued thereunder.




(5) Optional Redemption.




(a) Except as set forth in subparagraphs (b), (c), (d) and (e) of this Paragraph 5, the
Company will not have the option to redeem the Notes prior to August 1, 2013. On or after
August 1, 2013, the Company will have the option to redeem the Notes, in whole or in part,
upon not less than 15 nor more than 60 days’ notice, at the redemption prices (expressed as
percentages of principal amount thereof) set forth below plus accrued and unpaid interest
and Additional Interest, if any, on the Notes redeemed, to the applicable redemption date,
if redeemed during the twelve-month period beginning on August 1 of the years indicated
below:



	 	 	 	 	 
	Year	 	Percentage	 
	2013
	 	 	104.313	%
	2014
	 	 	102.156	%
	2015 and thereafter
	 	 	100.000	%







Unless the Company defaults in the payment of the redemption price, interest and the
Additional Interest, if any, 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 August 1, 2012, the Company may redeem up to 35% of the initially outstanding
aggregate principal amount of Notes issued under this Indenture at a redemption price in
cash of 108.625% of the principal amount thereof, plus accrued and unpaid interest and
Additional Interest, if any, to the redemption date, with the net cash proceeds of one or
more Equity Offerings of the Company; provided that at least 65% of the initially
outstanding



 


A-3









 








aggregate principal amount of Notes (excluding Notes held by the Company and its
Subsidiaries) remains outstanding immediately after the occurrence of such redemption,
notice of any such redemption shall be given by the Company to the Holders and the Trustee
within 15 days after the consummation of any such Equity Offering, and such redemption shall
occur within 60 days of the date of such notice.




(c) At any time prior to August 1, 2013, the Company may also redeem all or a part of
the Notes upon not less than 15 nor more than 60 days’ prior notice mailed by first-class
mail to each Holder’s registered address, at a redemption price equal to 100% of the
principal amount of notes redeemed plus the Applicable Premium as of, and accrued and unpaid
interest and Additional Interest, if any, to the Redemption Date, subject to the rights of
holders of Notes on the relevant record dates occurring prior to the Redemption Date to
receive interest due on the relevant interest payment date.




(d) In addition to the foregoing, if (1) any Gaming Authority makes a determination of
unsuitability of a Holder or beneficial owner of Notes (or of an Affiliate of such Holder or
beneficial owner), or (2) any Gaming Authority requires that a Holder or beneficial owner of
Notes (or an Affiliate thereof) must (i) be licensed, qualified or found suitable under any
applicable Gaming Laws or (ii) reduce its position in the Notes to below a level that would
require licensure, qualification or a finding of suitability, and such Holder or beneficial
owner (or Affiliate thereof): (A) fails to apply for a license, qualification or a finding
of suitability within 30 days (or such shorter period as may be required by the applicable
Gaming Authority) after being requested to do so by the Gaming Authority, (B) fails to
reduce its position in the Notes appropriately, or (C) is denied such license or
qualification or not found suitable, the Company shall have the right at any time from or
after August 10, 2009, at its option: (1) to require any such Holder or beneficial owner to
dispose of all or a portion of its Notes within 30 days (or such earlier date as may be
required by the applicable Gaming Authority) of receipt of such notice or finding by such
Gaming Authority, or (2) to call for the redemption of all or a portion of the Notes of such
Holder or beneficial owner at a redemption price equal to the least of: (A) the principal
amount thereof, (B) the price at which such Holder or beneficial owner acquired the Notes,
in the case of either clause (A) above or this clause (B), together with accrued and unpaid
interest and Additional Interest, if any, to the earlier of the date of redemption or the
date of the denial of license or qualification or of the finding of unsuitability by such
Gaming Authority (subject to the rights of Holders of Notes on the relevant record dates
occurring prior to such redemption date to receive interest on the relevant interest payment
date), or (C) such other lesser amount as may be required by any Gaming Authority.
Immediately upon a determination by a Gaming Authority that a Holder or beneficial owner of
the Notes (or an Affiliate thereof) will not be licensed, qualified or found suitable or is
denied a license, qualification or finding of suitability, the Holder or beneficial owner
will not have any further rights with respect to the Notes to: (1) exercise, directly or
indirectly, through any Person, any right conferred by the Notes; or (2) receive any
interest or Additional Interest, if any, or any 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; or (3) receive any remuneration in any
form from the Company or its Affiliates for services rendered or otherwise, except the
redemption price of the Notes. The Company shall notify the Trustee in writing of any such
redemption as soon as practicable. The Holder or beneficial owner (of an Affiliate thereof)
applying for a license, qualification or a finding of suitability must pay all costs of the
licensure or investigation for such qualification or finding of suitability.




(e) In addition, by accepting a Note, each Holder or beneficial owner of a Note will be
agreeing to comply with all requirements of the Gaming Laws and Gaming



 


A-4









 








Authorities in each jurisdiction where the Company and its Affiliates are licensed or
registered under applicable Gaming Laws or conduct gaming activities. Each Holder or
beneficial owner will also be agreeing that the Notes held by such Holder or beneficial
owner shall be subject to the provisions of Article XIII of the Company’s Restated
Certificate of Incorporation (dealing with Gaming Laws and gaming-related restrictions on
ownership and transfer), including any amendments thereto or any successor provisions
thereto, a copy of which is on file at the office of the Company, and made a part hereof as
fully as though the provisions of said provisions of the Company’s Restated Certificate of
Incorporation were printed in full on this certificate, to all of which the Holder of this
certificate, by acceptance hereof, assents and agrees to be bound. Any Holder of a Note may
obtain, upon request and without charge, a copy of such provisions of the Company’s
Certificate of Incorporation. Any such request shall be addressed to the Secretary of the
Company.




(6) Mandatory Redemption. The Company is not required to make
mandatory redemption or sinking fund payments with respect to the Notes.




(7) Repurchase at the Option of Holder.




(a) Upon the occurrence of a Change of Control, each Holder of Notes will have the
right to require the Company to repurchase all or any part (equal to $2,000 or an integral
multiple of $1,000 in excess of $2,000) of such Holder’s Notes pursuant to the offer
described in Section 4.15 of the Indenture (the “Change of Control Offer”) at an offer price
in cash (the “Change of Control Payment”) equal to 101% of the aggregate principal amount of
Notes plus accrued and unpaid interest thereon and Additional Interest, if any, to the date
of repurchase. Within 30 days following any Change of Control, the Company will mail a
notice to the Trustee and each Holder describing the transaction or transactions that
constitute the Change of Control and offering to repurchase Notes on the date specified in
such notice, which date shall be no earlier than 30 days nor later than 60 days from the
date such notice is mailed (the “Change of Control Payment Date”), pursuant to the
procedures required by the Indenture and described in such notice.




(b) Upon the consummation of an Asset Sale, the Company or the affected Obligor will be
required to apply an amount equal to all Net Cash Proceeds that are received from such Asset
Sale within 360 days of the receipt thereof either (1) to reinvest (or enter into a binding
commitment to invest, if such investment is effected within 360 days after the date of such
commitment) in Productive Assets or in Asset Acquisitions not otherwise prohibited by the
Indenture, or (2) to permanently prepay or repay Indebtedness of any Obligor other than
Indebtedness that is subordinate in right of payment to the Notes or any Guaranty.




On the 361st day after an Asset Sale or such earlier date, if any, as the Board of
the Company or the affected Obligor determines not to apply the Net Cash Proceeds relating
to such Asset Sale as set forth in clauses (1) or (2) of the preceding paragraph (each a
“Net Proceeds Offer Trigger Date”), such aggregate amount of Net Cash Proceeds which have
not been applied on or before such Net Proceeds Offer Trigger Date as permitted in clauses
(1) or (2) of the preceding paragraph (each a “Net Proceeds Offer Amount”), will be
applied by the Company to make an offer to purchase (the “Net Proceeds Offer”), on a date
(the “Net Proceeds Offer Payment Date”) not less than 30 nor more than 60 days following
the applicable Net Proceeds Offer Trigger Date, on a pro rata basis (A) Notes at a
purchase price in cash equal to 100% of the aggregate principal amount of Notes, in each
case, plus accrued and unpaid interest thereon and Additional Interest, if any, on the Net
Proceeds Offer Payment Date



 


A-5









 








and (B) other Indebtedness Incurred by the Company or an Obligor which is pari passu
with the Notes, in each case to the extent required by the terms thereof; provided that if
at any time within 360 days after an Asset Sale any non-cash consideration received by the
Company or the affected Obligor in connection with such Asset Sale is converted into or
sold or otherwise disposed of for cash, then such conversion or disposition will be deemed
to constitute an Asset Sale hereunder and the Net Cash Proceeds thereof will be applied in
accordance with this covenant. To the extent that the aggregate principal amount of Notes
or other pari passu Indebtedness tendered pursuant to the Net Proceeds Offer is less than
the Net Proceeds Offer Amount, the Obligors may use any remaining proceeds of such Asset
Sales for general corporate purposes (but subject to the other terms of the Indenture).
Upon completion of a Net Proceeds Offer, the Net Proceeds Offer Amount relating to such
Net Proceeds Offer will be deemed to be zero for purposes of any subsequent Asset Sale. In
the event that a Restricted Subsidiary consummates an Asset Sale, only that portion of the
Net Cash Proceeds therefrom (including any Net Cash Proceeds received upon the sale or
other disposition of any noncash proceeds received in connection with an Asset Sale) that
are distributed to or received by any Obligor will be required to be applied by the
Obligors in accordance with the provisions of this paragraph.




Notwithstanding the foregoing, if a Net Proceeds Offer Amount is less than $25
million the application of the Net Cash Proceeds constituting such Net Proceeds Offer
Amount to a Net Proceeds Offer may be deferred until such time as such Net Proceeds Offer
Amount plus the aggregate amount of all Net Proceeds Offer Amounts arising subsequent to
the date of the Indenture from all Asset Sales by the Obligors in respect of which a Net
Proceeds Offer has not been made aggregate at least $25 million at which time the affected
Obligor will apply all Net Cash Proceeds constituting all Net Proceeds Offer Amounts that
have been so deferred to make a Net Proceeds Offer (each date on which the aggregate of
all such deferred Net Proceeds Offer Amounts is equal to $25 million or more will be
deemed to be a Net Proceeds Offer Trigger Date). In connection with any Asset Sale with
respect to assets having a book value in excess of $25 million or as to which it is
expected that the aggregate consideration therefor to be received by the affected Obligor
will exceed $25 million in value, such Asset Sale will be approved, prior to the
consummation thereof, by the Board of the applicable Obligor.




(8) Notice of Redemption. Notice of redemption will be mailed at
least 15 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 $2,000 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. A notice of redemption
may be conditional in that the Company may, notwithstanding the giving of the notice of
redemption, condition the redemption of the Notes specified in the notice of redemption upon
the completion of other transactions, such as refinancings or acquisitions (whether of the
Company or by the Company).




(9) Denominations, Transfer, Exchange. The Notes are in registered
form without coupons of $2,000 and integral multiples of $1,000 in excess of $2,000. 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



 


A-6









 








any Notes for a period of 15 days before a selection of Notes to be redeemed or during
the period between a record date and the corresponding Interest Payment Date.




(10) Persons Deemed Owners. The registered Holder of a Note may be
treated as its owner for all purposes.




(11) Amendment, Supplement and Waiver. Subject to certain
exceptions, the Indenture or the Notes or the Guaranties 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 or the Guaranties 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 of a Note, the Indenture or the
Notes or the Guaranties may be amended or supplemented to cure any ambiguity, defect or
inconsistency, to provide for uncertificated Notes in addition to or in place of
certificated Notes, to provide for the assumption of the Company’s or a Guarantor’s
obligations to Holders of the Notes and Guaranties in case of a merger or consolidation, to
make any change that would provide any additional rights or benefits to the Holders of the
Notes or that does not adversely affect the legal rights under the Indenture of any such
Holder, to comply with the requirements of the SEC in order to effect or maintain the
qualification of the Indenture under the TIA, to comply with the requirements of applicable
Gaming Laws or to provide for requirements imposed by applicable Gaming Authorities, 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 July 27, 2009, relating to the
initial offering of the Notes, to the extent that such provision in that “Description of
notes” was intended to be a verbatim recitation of a provision of the Indenture, the
Guaranties or the Notes, to provide for the issuance of Additional Notes in accordance with
the limitations set forth in the Indenture as of August 10, 2009, or to allow any Guarantor
to execute a supplemental indenture to the Indenture and/or a Guaranty with respect to the
Notes.




(12) Defaults and Remedies. Events of Default include: (i) default
for 30 days in the payment when due of interest (including any Additional Interest) on the
Notes or the Guaranties; (ii) default in payment of the principal of or premium, if any, on
the Notes or the Guaranties when due and payable, at maturity, upon acceleration, redemption
or otherwise; (iii) failure by any Obligor to comply with any of its other agreements in the
Indenture, the Notes or the Guaranties for 60 days after written notice to the Company by
the Trustee or the Holders of at least 25% in principal amount of the Notes then outstanding
voting as a single class; (iv) default under any mortgage, indenture or instrument under
which there may be issued or by which there may be secured or evidenced any Indebtedness for
money borrowed by any Obligor (or the payment of which is guaranteed by any Obligor) whether
such Indebtedness or guarantee now exists, or is created after the Issue Date, which default
is caused by a failure to pay principal of or premium, if any, or interest, if any, on such
Indebtedness prior to the expiration of the grace period provided in such Indebtedness on
the date of such default (a “Payment Default”), or results in the acceleration of such
Indebtedness prior to its express maturity and, in each case, the principal amount of any
such Indebtedness, together with the principal amount of any other such Indebtedness under
which there has been a Payment Default or the maturity of which has been so accelerated,
aggregates $25 million or more; (v) certain final judgments for the payment of money that
remain undischarged for a period of 60 days after such judgment or judgments become final
and non-appealable; and (vi) certain events of bankruptcy or insolvency with respect to any
Obligor. If any Event of Default occurs and is continuing, the Trustee or the Holders of at
least 25% in aggregate principal amount of the then outstanding Notes may declare


 


A-7









 






all the Notes to be due and payable immediately. Notwithstanding the foregoing, in the
case of an Event of Default arising from certain events of bankruptcy or insolvency, all
outstanding Notes will become due and payable immediately without further action or notice.
Holders may not enforce the Indenture or the Notes except as provided in the Indenture.
Subject to certain limitations, Holders of a majority in aggregate principal amount of the
then outstanding Notes may direct the Trustee in its exercise of any trust or power. The
Trustee shall be under no obligation to exercise any of the rights or powers at the request
or direction of any of the Holders unless such Holders shall have offered to the Trustee
security or indemnity satisfactory to the Trustee against the costs, expenses and
liabilities which might be incurred by it in compliance with such request or direction. The
Trustee may withhold from Holders of the Notes notice of any continuing Default or Event of
Default (except a Default or Event of Default relating to the payment of principal or
interest or premium or Additional Interest, if any,) if it determines that withholding
notice is in their interest. Notwithstanding any other provision of the Indenture, the sole
remedy for an Event of Default relating to the failure to comply with the reporting
obligations described under the Indenture, and for any failure to comply with the
requirements of section 314(a) of the TIA, will for the 365 days after the occurrence of
such an Event of Default consist exclusively of the right to receive Additional Interest on
the principal amount of the Notes at a rate equal to 0.50% per annum. The Holders of 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, rescind an acceleration or waive
any existing Default or Event of Default and its consequences under the Indenture except a
continuing Default or Event of Default in the payment of interest or premium or Additional
Interest, if any, on, or the principal of, the Notes. The Company is required to deliver to
the Trustee annually a statement regarding compliance with the Indenture, and the Company is
required, upon becoming aware of any Default or Event of Default, to deliver to the Trustee
a statement specifying such Default or Event of Default.




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




(14) No Recourse Against Others. A director, officer, employee,
incorporator or stockholder of the Company or any of the Guarantors, as such, will not have
any liability for any obligations of the Company or the Guarantors under the Notes, the
Guaranties 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.




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




(16) 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).




(17) Additional Rights of Holders of Restricted Global Notes and
Restricted Definitive Notes. In addition to the rights provided to Holders of Notes
under the Indenture, Holders of Restricted Global Notes and Restricted Definitive Notes will
have all the rights set forth in the Registration Rights Agreement dated as of August 10,
2009, among the Company, the Guarantors and the other parties named on the signature pages
thereof or, in the case of



 


A-8









 








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, among
the Company, the Guarantors and the other parties thereto, relating to rights given by the
Company and the Guarantors to the purchasers of any Additional Notes (collectively, the
“Registration Rights Agreement”).




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




(19) GOVERNING LAW. THE INTERNAL LAW OF THE STATE OF NEW YORK WILL
GOVERN AND BE USED TO CONSTRUE THE INDENTURE, THIS NOTE AND THE GUARANTIES 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:




Pinnacle Entertainment, Inc.

3800 Howard Hughes Parkway

Las Vegas, Nevada 89169

Attention: John A. Godfrey, Esq.


 


A-9









 





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-10









 









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
4.15 of the Indenture, check the appropriate box below:



	 	 	 
	o Section 4.10
	 	o Section 4.15






If you want to elect to have only part of the Note purchased by the Company pursuant to
Section 4.10 or Section 4.15 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-11









 









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-12









 







EXHIBIT B




FORM OF CERTIFICATE OF TRANSFER




Pinnacle Entertainment, Inc.

3800 Howard Hughes Parkway

Las Vegas, 89169




[Registrar address block]




Re: 8.625% Senior Notes due 2017



Reference is hereby made to the Indenture, dated as of August 10, 2009 (the “Indenture”),
among Pinnacle Entertainment, Inc., as issuer (the “Company”), the Guarantors party thereto and The
Bank of New York Mellon Trust Company, N.A., 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 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


 


B-1









 






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 to the Company or a subsidiary thereof;



or




(b) o such Transfer is being effected to an Institutional Accredited Investor or
other Person 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
and (2) 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, all in form and substance satisfactory to the Company, the Trustee and the
Registrar. 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
Global Note and/or 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.



(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.


 


B-2









 





(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.



(d) o Check if Transfer is Pursuant to Registration Statement. (i) The 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 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 a 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




Pinnacle Entertainment, Inc.

3800 Howard Hughes Parkway

Las Vegas, 89169




[Registrar address block]




Re: 8.625% Senior Notes due 2017



(CUSIP ____________)




Reference is hereby made to the Indenture, dated as of August 10, 2009 (the “Indenture”),
among Pinnacle Entertainment, Inc., as issuer (the “Company”), the Guarantors party thereto and The
Bank of New York Trust Company, N.A., 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 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


 


C-1









 






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] o 144A Global Note, o Regulation S Global
Note with an equal principal amount, the Owner hereby certifies (i) the beneficial interest is
being acquired for the Owner’s own account without transfer and (ii) such Exchange has been
effected in compliance with the transfer restrictions applicable to the Restricted Global Notes and
pursuant to and in accordance with the Securities Act, and in compliance with any applicable blue
sky securities laws of any state of the United States. Upon consummation of the proposed Exchange
in accordance with the terms of the Indenture, the beneficial interest issued will be subject to
the restrictions on transfer enumerated in the Private Placement Legend printed on the relevant
Restricted Global Note and in the Indenture and the Securities Act.


 


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 NOTATION OF GUARANTY]




For value received, each Guarantor (which term includes any successor Person under the
Indenture) has, jointly and severally, unconditionally guaranteed, to the extent set forth in the
Indenture and subject to the provisions in the Indenture dated as of August 10, 2009 (the
"Indenture”) among Pinnacle Entertainment, Inc. (the “Company"), the Guarantors party thereto and
The Bank of New York Mellon Trust Company, N.A., as trustee (the “Trustee”), (a) the due and
punctual payment of the principal of, premium and Additional Interest, if any, and interest on, the
Notes, whether at maturity, by acceleration, redemption or otherwise, the due and punctual payment
of interest on overdue principal of and interest on the Notes, if any, if lawful, and the due and
punctual performance of all other obligations of the Company to the Holders or the Trustee all in
accordance with the terms of the Indenture and (b) in case of any extension of time of payment or
renewal of any Notes or any of such other obligations, that the same will be promptly paid in full
when due or performed in accordance with the terms of the extension or renewal, whether at stated
maturity, by acceleration or otherwise. The obligations of the Guarantors to the Holders of Notes
and to the Trustee pursuant to the Guaranty and the Indenture are expressly set forth in Article 10
of the Indenture and reference is hereby made to the Indenture for the precise terms of the
Guaranty. Each Holder of a Note, by accepting the same, (a) agrees to and shall be bound by such
provisions and (b) appoints the Trustee attorney-in-fact of such Holder for such purpose.



Capitalized terms used but not defined herein have the meanings given to them in the
Indenture.



	 	 	 	 	 
	 	[Name of Guarantor(s)]

 	 
	 	By:  	 	 
	 	 	Name:  	 	 
	 	 	Title:  	 	 
	 



 


D-1









 







EXHIBIT E




[FORM OF SUPPLEMENTAL INDENTURE

TO BE DELIVERED BY SUBSEQUENT GUARANTORS]





Supplemental Indenture (this “Supplemental Indenture”), dated as of
 _____ 
,
200
 _____ 
, among
 _____ 
(the “Guarantying Subsidiary”), a subsidiary of Pinnacle
Entertainment, Inc. (or its permitted successor), a Delaware corporation (the “Company”), the
Company, the other Guarantors (as defined in the Indenture referred to herein) and The Bank of New
York Mellon Trust Company, N.A., as trustee under the Indenture referred to below (the “Trustee”).



W I T N E S S E T H




WHEREAS, the Company has heretofore executed and delivered to the Trustee an indenture (the
"Indenture”), dated as of August 10, 2009 providing for the issuance of 8.625% Senior Notes due
2017 (the “Notes”);



WHEREAS, the Indenture provides that under certain circumstances the Guarantying Subsidiary
shall execute and deliver to the Trustee a supplemental indenture pursuant to which the Guarantying
Subsidiary shall unconditionally guarantee all of the Company’s Obligations under the Notes and the
Indenture on the terms and conditions set forth herein (the “Guaranty”); and



WHEREAS, pursuant to Section 9.01 of the Indenture, the Trustee is authorized to execute and
deliver this Supplemental Indenture.



NOW, THEREFORE, in consideration of the foregoing and for other good and valuable
consideration, the receipt of which is hereby acknowledged, the Guarantying Subsidiary and the
Trustee mutually covenant and agree for the equal and ratable benefit of the Holders of the Notes
as follows:



1. Capitalized Terms. Capitalized terms used herein without definition shall have
the meanings assigned to them in the Indenture.



2. Agreement to Guaranty. The Guarantying Subsidiary hereby agrees to provide an
unconditional Guaranty on the terms and subject to the conditions set forth in the Guaranty and in
the Indenture including but not limited to Article 10 thereof.



4. No Recourse Against Others. No past, present or future director, officer,
employee, incorporator, stockholder or agent of the Guarantying Subsidiary, as such, shall have any
liability for any obligations of the Company or any Guarantying Subsidiary under the Notes, any
Guaranties, the Indenture or this Supplemental Indenture or for any claim based on, in respect of,
or by reason of, such obligations or their creation. Each Holder of the Notes by accepting a Note
waives and releases all such liability. The waiver and release are part of the consideration for
issuance of the Notes. Such waiver may not be effective to waive liabilities under the federal
securities laws and it is the view of the SEC that such a waiver is against public policy.



5. NEW YORK LAW TO GOVERN. THE INTERNAL LAW OF THE STATE OF NEW YORK SHALL GOVERN AND BE USED
TO CONSTRUE THIS SUPPLEMENTAL INDENTURE 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.


 


E-1









 





EXHIBIT E




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



7. Effect of Headings. The Section headings herein are for convenience only and
shall not affect the construction hereof.



8. The Trustee. The Trustee shall not be responsible in any manner whatsoever for or
in respect of the validity or sufficiency of this Supplemental Indenture or for or in respect of
the recitals contained herein, all of which recitals are made solely by the Guarantying Subsidiary
and the Company.


 


E-2









 





EXHIBIT E




IN WITNESS WHEREOF, the parties hereto have caused this Supplemental Indenture to be duly
executed and attested, all as of the date first above written.



Dated:
_______________,  20_____ 




	 	 	 	 	 
	 	[Guarantying Subsidiary]

 	 
	 	By:  	 	 
	 	 	Name:  	 	 
	 	 	Title:  	 	 
	 
	 	Pinnacle Entertainment, Inc.

 	 
	 	By:  	 	 
	 	 	Name:  	 	 
	 	 	Title:  	 	 
	 
	 	[Existing Guarantors]

 	 
	 	By:  	 	 
	 	 	Name:  	 	 
	 	 	Title:  	 	 
	 
	 	The Bank of New York Mellon Trust Company, N.A.,

  as Trustee

 	 
	 	By:  	 	 
	 	 	Authorized Signatory 	 
	 	 	 	 
	 




 


E-3