Exhibit 4.2


 


AMENDMENT
NO. 3

TO SECOND AMENDED AND RESTATED LOAN AGREEMENT


 


This Amendment No. 3 to
Second Amended and Restated Loan Agreement (this “Amendment”) dated as of
April 16, 2004 is made with reference to the Second Amended and Restated
Loan Agreement, dated as of June 29, 2001 (as amended from time to time,
the “Loan Agreement”), among Eldorado Resorts LLC, a Nevada limited liability
company (the “Borrower”), the Banks referred to therein, and Bank of America,
N.A., as Administrative Agent.  Capitalized
terms used in this Amendment but not defined herein are used with the meanings
set forth for those terms in the Loan Agreement.  This amendment is entered into with reference to the following
facts:


 


RECITALS



 


A.                                   On or about
July 31, 1996, Borrower and Eldorado Capital Corp. (“Eldorado Capital”)
issued $100,000,000 principal amount of 10 1/2% Senior Subordinated Notes due
2006 (the “Senior Subordinated Notes”) pursuant to the Indenture dated as of
July 31, 1996, among Borrower, Eldorado Capital and Fleet National Bank,
as trustee (the “Existing Indenture”).


 


B.                                     Substantially
concurrently with the effectiveness of this Amendment, Borrower and Eldorado
Capital intend to issue $64,700,000 principal amount of Senior Notes due 2014
(the “Senior Notes”) pursuant to an Indenture among Borrower, Eldorado Capital
and U.S. Bank National Association, as trustee.


 


C.                                     Substantially
concurrently with the issuance of the Senior Notes, the Borrower and Eldorado
Capital will enter into a Redemption Deposit Agreement (the “Redemption Deposit
Agreement”) with the Trustee for the holders of the Senior Subordinated Notes
pursuant to which they shall deposit all of the proceeds of the Senior Notes
together with other funds borrowed under the Loan Agreement (in the approximate
amount of $2,472,329.50) with the Trustee under the Indenture relating to the
Senior Subordinated Notes to provide for the repayment thereof and call the
remaining principal balance of the Senior Subordinated Notes for redemption.


 


D.                                    Borrower has
requested that the Banks enter into this Amendment to allow for the issuance of
the Senior Notes, the making of the required deposit for the payment of the
Senior Subordinated Notes in accordance with the Redemption Deposit Agreement,
and the prepayment of the Senior Subordinated Notes.


 


NOW, THEREFORE, in
consideration of the mutual covenants and benefits contained herein, and for
other good and valuable consideration, the receipt and sufficiency of which are
acknowledged, the Borrower, the Administrative Agent and the Banks hereby agree
as follows:


 


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AGREEMENT


 


1.                                       Consent to
Prepayment of Senior Subordinated Notes.  Notwithstanding Section 6.1 and Section 6.9 of the Loan
Agreement, the Banks hereby consent that the Borrower may call the remaining
balance of the Senior Subordinated Notes for redemption, concurrently with the
issuance of the Senior Notes, may deposit proceeds of the Senior Notes
(together with additional funds borrowed under the Loan Agreement) equal to the
sum required to repay the remaining Senior Subordinated Notes with U.S. Bank,
National Association, as trustee under the Existing Indenture, provided that
the Senior Subordinated Notes shall thereafter be prepaid using such deposited
funds not later than thirty-five days following the issuance of the Senior
Notes. 


 


2.                                       New Definitions.  Section 1.1 of the Loan Agreement is
hereby amended to add new definitions of “Senior Notes” and “Senior Secured
Debt to EBITDA Ratio” to read as follows:


 


“Senior
Notes” means the $64,700,000 in 9.00% Senior Notes due 2014 anticipated to
be issued by Eldorado Resorts LLC and Eldorado Capital pursuant to the
Indenture to be dated on or about April 20, 2004, among Eldorado Resorts
LLC, Eldorado Capital and U.S. Bank National Association, as Trustee, and any
refinancings thereof permitted by Section 6.1A hereof.


 


“Senior
Secured Debt to EBITDA Ratio” means, as of the last day of each Fiscal
Quarter, the ratio of (a) the sum of (i) Funded Debt, plus (ii) without duplication,
all obligations of Borrower and its Subsidiaries with respect to Swap
Agreements, plus (iii) all Contingent Obligations of Borrower and its
Subsidiaries with respect to indebtedness for borrowed money, minus (iv) the
principal amount of the then outstanding Senior Notes (or any refinancings
thereof permitted by Section 6.1A of the Loan Agreement) and of all
Subordinated Obligations, in each case as of such date, to (b) EBITDA for the
twelve month fiscal period ended on such date.


 


3.                                       References to Senior
Debt to EBITDA Ratio.  Following
the effective date of this Amendment, each reference in the Loan Agreement to
the “Senior Debt to EBITDA Ratio” shall be deemed to be a reference to the
Senior Secured Debt to EBITDA Ratio.


 


4.                                       Prepayments of
the Subordinated Notes. 
Clause (iv) of Section 6.1 of the Loan Agreement (as heretofore
amended) is hereby deleted. 


 


5.                                       Prepayments of
the Senior Notes.  The Loan
Agreement is hereby amended to add thereto a new Section 6.1A to read in
full as follows:


 


2

















 


“6.1A  
Prepayment of the Senior Notes Prohibited.  Prepay any principal, interest or other
amounts with respect to the Senior Notes prior to the date when due, or
purchase or redeem (or offer to purchase or redeem) any of the Senior Notes
prior to the date upon which the related portion of the Senior Notes become
due, or deposit any monies, securities or other Property with any trustee or
other Person to provide assurance that the principal of the Senior Notes or any
portion thereof will be paid when due or otherwise to provide for the
defeasance of the Senior Notes, provided that this covenant shall not
restrict:


 


(i) the refinancing of the
Senior Notes with Indebtedness incurred when no Default or Event of Default has
occurred and remains continuing which Indebtedness (a) is in a principal amount
which does not exceed the then outstanding principal amount of the Senior
Notes; (b) contains representations, warranties, events of default and other
terms which are not less favorable to the Borrower than those contained in the
Senior Notes, and (c) has a maturity date following that of the Senior Notes
and an average life to maturity which is longer than that of the Senior Notes,
but this covenant will thereafter apply to the refinancing Indebtedness, or


 


(ii) this covenant shall not
restrict prepayments of the principal amount of the Senior Notes which are in
an aggregate principal amount not to exceed $5,000,000 (increased by the
amount, not in excess of an additional $5,000,000, of any such prepayments made
using the net cash proceeds of Permitted Dispositions within one month
following the receipt thereof), in each case made when no Default or Event of
Default has occurred and remains continuing.”


 


6.                                       Amendment to Indebtedness
Covenant. 
Section 6.9(d) of the Loan Agreement is hereby amended and restated
in its entirety to read as follows:


 


“(d) 
the Indebtedness evidenced by the Senior Notes in an aggregate principal
amount not to exceed $64,700,000 at any time, and any refinancings of the
Senior Notes which are permitted by Section 6.1A hereof; and”


 


7.                                       Amendments to
Debt Documents. 
Section 6.16 of the Loan Agreement is hereby amended to read in
full as follows:


 


“6.16  Amendments to Senior Notes and to
Subordinated Obligations.  Amend or
modify any term or provision of any indenture, agreement or instrument
evidencing or governing the Senior Notes or governing any Subordinated
Obligation in any respect that will or may adversely affect the interests of
the Banks.”


 


8.                                       Conditions
Precedent.  The effectiveness of this Amendment
shall be subject to the conditions precedent that:


 


a.                                       The
Administrative Agent shall have received counterparts of this Amendment
executed by Borrower, and a memorandum of the execution of this Amendment shall
have been recorded in the Official Records of Washoe County, Nevada in a format
reasonably acceptable to the Administrative Agent;


 


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b.                                      Eldorado
Capital, which has guaranteed the Obligations of the Borrower, shall have
executed a written consent hereto in the form of Exhibit A hereto;


 


c.                                       The
Administrative Agent shall have received assurance from the Title Company that
it is committed to issue through First American Title Insurance Company all
necessary endorsements to the existing ALTA 1970 form lenders title insurance
policy issued by First American Title Insurance Company insuring the validity
and priority of the Lien of the Deed of Trust with respect to the Eldorado
Hotel, subject only to such exceptions as may be acceptable to Administrative
Agent;


 


d.                                      The
Administrative Agent shall have received a certificate of Borrower attaching a
copy of the executed Indenture governing the Senior Notes and the Redemption
Deposit Agreement, and stating that, giving effect to the issuance thereof,
that no Default or Event of Default has occurred and remains continuing.


 


9.                                       Senior
Subordinated Notes.  For so
long as funds sufficient to repay the principal, interest, premium and other
amounts outstanding in respect of the Senior Subordinated Notes have been
deposited with the Trustee for the Senior Subordinated Notes as contemplated by
the Redemption Deposit Agreement, the Senior Subordinated Notes shall not be
deemed to be outstanding indebtedness of the Borrower and its Subsidiaries for
the purpose of calculating compliance by Borrower with the financial covenants
described in Sections 6.13 or 6.14 of the Loan Agreement or for the purposes of
Section 6.9 of the Loan Agreement.


 


10.                                 Representation.  The
Borrower hereby represents and warrants to the Administrative Agent and the
Banks that (a) no Default or Event of Default has occurred under the Loan
Agreement and remains continuing, (b) the representations and warranties in the
Loan Agreement are true as of the date of this Amendment (except to the extent
such representations and warranties expressly refer to an earlier date, in
which case they shall be true and correct as of such earlier date), (c) this
Amendment is within the Borrower’s powers, has been duly authorized, and does
not conflict with the Borrower’s organizational papers, and (d) this Amendment
does not conflict with any law, agreement or obligation by which the Borrower
is bound.


 


11.                                 Expenses.  The
Borrower confirms its obligations to pay the reasonable expenses of the
Administrative Agent in connection with the preparation of this Amendment and
the issuance of the title insurance endorsement referred to above.


 


12.                                 Counterparts.  This
Amendment may be executed in as many counterparts as necessary or convenient,
and by the different parties on separate counterparts each of which, when so
executed, shall be deemed an original but all such counterparts shall
constitute but one and the same agreement.


 


13.                                 Confirmation.  In
all other respects, the terms of the Loan Agreement and the Loan Documents
executed in connection therewith are hereby confirmed.


 


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IN WITNESS WHEREOF, the parties hereto have executed
this Amendment as of the date first written above by their duly authorized
representatives.


 


	
   

  	
  BORROWER:

  
	
   

  	
   

  
	
   

  	
  ELDORADO
  RESORTS LLC,

  
	
   

  	
  a
  Nevada limited liability company

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Donald
  L. Carano

  	
   

  
	
   

  	
  Donald
  L. Carano, Chief Executive Officer

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  BANK
  OF AMERICA, N.A.,

  
	
   

  	
  as
  Administrative Agent

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Gina
  Meador

  	
   

  
	
   

  	
   

  	
  Gina Meador, Vice President

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  BANK
  OF AMERICA, N.A., as a Bank

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Scott
  L. Faber

  	
   

  
	
   

  	
  Scott
  L. Faber, Managing Director

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  U.S.
  BANK, NATIONAL ASSOCIATION, as a Bank

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Mark
  McVeigh

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  Title:

  	
    Vice President

  	
   

  
					



 


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Exhibit A


 


CONSENT OF GUARANTOR


 


Reference is hereby made
to the Second Amended and Restated Loan Agreement, dated as of June 29,
2001, among Eldorado Resorts LLC, the Banks referred to therein, and Bank of
America, N.A., as Administrative Agent. 
By executing this Consent of Guarantor, Eldorado Capital Corp., a Nevada
corporation, consents to the execution, delivery and performance of that
certain Amendment No. 3 to Second Amended and Restated Loan Agreement dated as
of the date hereof, and acknowledges that the Amended and Restated Guaranty,
dated as of June 29, 2001, executed by the undersigned in favor of Bank of
America, N.A., as Administrative Agent, and the Banks referred to therein,
remains in full force and effect.


 


	
  Dated

  	
  April 16, 2004

  	
   

  	
   

  
	
   

  	
   

  
	
  ELDORADO
  CAPITAL CORP.,

  	
   

  
	
  a
  Nevada corporation

  	
   

  
	
   

  
	
   

  
	
  By:

  	
  /s/ Donald
  L. Carano

  	
   

  
	
  Name:

  	
  Donald L.
  Carano

  	
   

  
	
  Title:

  	
  President

  	
   

  
						



 


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