Exhibit 10.10


 


RECORDING REQUESTED BY,
AND


WHEN RECORDED RETURN TO:


 


Paul, Hastings, Janofsky &
Walker LLP


600 Peachtree Street, Suite 2400


Atlanta, Georgia 30308


Attention:  Douglas A. Park, Esq.


 


 


SUBORDINATION AGREEMENT


 


 


NOTICE:  THIS SUBORDINATION AGREEMENT RESULTS IN YOUR
SECURITY INTEREST IN THE PROPERTY BECOMING SUBJECT TO AND OF LOWER PRIORITY
THAN THE LIEN OF SOME OTHER OR LATER SECURITY INSTRUMENT.


 


This
Subordination Agreement (this “Subordination Agreement”), dated as of July 12,
2005, is executed by Diamond Jo, LLC
(formerly known as Peninsula Gaming
Company, LLC), a Delaware limited liability company (“Borrower”),
and U.S. Bank National Association, as trustee under the Junior Indenture (as
hereinafter defined) (“Junior Beneficiary”), in favor of Wells Fargo Foothill, Inc., as agent for the Lenders (as defined in the
hereinafter defined Senior Loan Agreement) (“Senior
Beneficiary”), with reference to the following facts:


 


A.            Borrower is the owner of the real
property described in Exhibit “A” attached hereto and incorporated
herein by this reference, and is the sublessee of the real property described
in Exhibit ”B” attached hereto and incorporated herein by this
reference (collectively, the “Property”).


 


B.            Junior Beneficiary is the present
owner and holder of that certain Mortgage, Leasehold Mortgage, Assignment of
Rents, Security Agreement and Fixture Filing Statement made as of April 16,
2004, and effective as of the April 16, 2004 (as amended, restated,
supplemented or otherwise modified from time to time, the “Junior Mortgage”),
executed by Borrower in favor of Junior Beneficiary, for the benefit of the
holders of the Junior Notes (as hereinafter defined), encumbering the Property
and recorded April 20, 2004,  as
Instrument No. 6362-2004 in the Official Records of Dubuque County,
Iowa.  The Junior Mortgage secures (i) the
due and punctual payment


 





















 


of the principal of, and interest on, those certain $233,000,000
aggregate principal amount of 8 3/4% Senior Secured Notes due 2012 of even date
therewith issued by Borrower and The Old Evangeline Downs Capital Corp., a
Delaware corporation (“OED Capital”), and such other securities as may
be issued from time to time under that certain Indenture as of even date
therewith among Borrower, Junior Beneficiary, OED Capital and certain
Subsidiary Guarantors (as defined in the hereinafter defined Junior Indenture)
with respect to the Junior Notes (as amended, restated, supplemented or
otherwise modified from time to time, the “Junior Indenture”) (collectively,
the “Junior Notes”), and (ii) the payment of any fees, expenses and
all other amounts at any time and from time to time payable by Borrower with
respect to the Junior Notes or under the Junior Indenture or any of the
Security Documents (as defined in the Junior Indenture) (items (i) and (ii) above,
collectively, the “Junior Obligations”). 
The Junior Mortgage, together with all other Security Documents now or
hereafter executed by Borrower as security for the Junior Obligations (each as
amended, restated, supplemented or otherwise modified from time to time), are
collectively referred to herein as the “Junior Security Documents”.  The Junior Notes, the Junior Indenture, the
Junior Security Documents, and any other documents heretofore or hereafter
executed with or in favor of Junior Beneficiary with respect to the Secured
Obligations, are collectively referred to herein as the “Junior Note
Documents”.


 


C.            Borrower has executed, or is about
to execute, that certain Mortgage, Leasehold Mortgage, Assignment of Rents,
Security Agreement and Fixture Financing Statement dated June 16, 2004, in
favor of Senior Beneficiary, for the benefit of the Lender Group (as defined in
the hereinafter defined Senior Loan Agreement) (as amended by that certain
First Amendment to Iowa Shore Mortgage dated as of November 10, 2004,
between DJO and Senior Beneficiary, as further amended by that certain Second
Amendment to Iowa Shore Mortgage dated as of July 12, 2005, between DJO
and Senior Beneficiary, and as otherwise amended, restated, supplemented or
otherwise modified from time to time, the “Senior Mortgage”),
encumbering the Property and securing various obligations more particularly
described therein, including, without limitation, Borrower’s obligations to the
Lender Group under that certain Loan and Security Agreement dated as of June 16,
2004, among Senior Beneficiary, the Lenders, Borrower, Diamond Jo Worth, LLC, a
Delaware limited liability company (“DJW”) and The Old Evangeline Downs,
L.L.C., a Louisiana limited liability company (“OED”) (as amended by
that certain First Amendment to Loan and Security Agreement dated as of November 10,
2004, among Borrower, OED, Senior Beneficiary and the Lenders party thereto, as
further amended by that certain Second Amendment to Loan and Security Agreement
dated as of July 12, 2005, among Borrower, DJW, OED, Senior Beneficiary
and the Lenders party thereto, as supplemented by that certain Borrower
Supplement No. 1 dated as of May 13, 2005, by DJW, and as otherwise amended,
restated, supplemented or otherwise modified from time to time, the “Senior
Loan Agreement”), with respect to loans (collectively, the “Senior Loan”)
in the aggregate principal amount of $64,666,667.  The Senior Mortgage, together with all other
security documents now or hereafter executed by Borrower as security for the
Senior Loan and other Secured Obligations (as defined in the Senior Mortgage)
(each as amended, restated, supplemented or otherwise modified from time to
time), are collectively referred to herein as the “Senior Security Documents”.  The Senior Loan Agreement, the Senior
Security Documents, and any other documents included within the definition of “Loan
Documents” under the Senior Loan Agreement, are collectively referred to herein
as the “Senior Loan Documents.” 
Capitalized terms used and not otherwise defined in this Subordination
Agreement have the meanings set forth for them in the Senior Loan Agreement.


 


2





















 


D.            Junior Beneficiary and Senior
Beneficiary have executed that certain Intercreditor Agreement dated April 16,
2004 (as amended, restated, supplemented or otherwise modified from time to
time, the “Intercreditor Agreement”), concerning their respective rights
with respect to, among other things, the priority of their respective security
interests in and liens on the Property and other now owned and hereafter
acquired assets of Borrower as described in the Junior Note Documents and the
Senior Loan Documents.  Pursuant to the
terms and conditions of the Intercreditor Agreement, it is a condition
precedent to induce Agent and Lenders to continue to make the financial
accommodations under the Senior Loan Documents that the Senior Mortgage shall
be and remain a lien upon the Property and such other assets prior to the lien
of the Junior Mortgage.


 


In
consideration of the foregoing, and for other valuable consideration, the
receipt and sufficiency of which are hereby acknowledged, Junior Beneficiary
and Borrower hereby agree as hereinafter provided:


 


1.             Pursuant to the terms and
conditions of the Intercreditor Agreement, the liens and charges in favor of
Senior Beneficiary under the Senior Mortgage and the other Senior Security
Documents, and any renewals and extensions, amendments and other modifications
thereof, whether relating to real property, fixtures, personal property or any
combination thereof, shall unconditionally be and remain at all times a lien or
charge on the Property (and all other property, rights and assets of Borrower
which are encumbered by both the Senior Security Documents and the Junior
Security Documents) prior and superior to the lien and charge of the Junior
Mortgage and the other Junior Security Documents.


 


2.             If there is a conflict between
the terms and conditions of this Subordination Agreement and the Intercreditor
Agreement, the terms and conditions of the Intercreditor Agreement shall govern
and control.


 


3.             This Subordination Agreement
shall bind, and shall inure to the benefit of, the successors and assigns of
the parties.  This document may be
executed in counterparts with the same force and effect as if the parties had
executed one instrument, and each such counterpart shall constitute an original
hereof.  This Subordination Agreement
shall be governed by the laws of the State of Iowa.


 


NOTICE:  THIS SUBORDINATION AGREEMENT CONTAINS A
PROVISION WHICH ALLOWS THE PERSON OBLIGATED ON YOUR REAL PROPERTY SECURITY TO
OBTAIN A LOAN, A PORTION OF WHICH MAY BE EXPENDED FOR PURPOSES OTHER THAN
IMPROVEMENT OF THE PROPERTY.


 


3





















 


	
   

  	
  “Junior Beneficiary”

  	
   

  
	
   

  	
  U.S. BANK NATIONAL
  ASSOCIATION, as trustee

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/Lori-Anne Rosenberg

  	
   

  
	
   

  	
  Name:

  	
  Lori-Anne Rosenberg

  	
   

  
	
   

  	
  Title:

  	
  Vice President

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  “Borrower”

  
	
   

  	
   

  
	
   

  	
  DIAMOND JO, LLC
  (formerly known as Peninsula

  Gaming Company, LLC), a Delaware limited liability

  company

  
	
   

  	
  By:

  	
  /s/ M.Brent Stevens

  	
   

  
	
   

  	
  Name:

  	
  M.Brent Stevens

  	
   

  
	
   

  	
  Title:

  	
  Chief Executive Officer

  
									



 





















 


	
  STATE OF Minnesota

  	
   

  	
  )

  	
   

  
	
   

  	
  )ss:

  
	
  COUNTY OF Ramsey

  	
   

  	
  )

  	
   

  
						



 


On
this 9th  day of  May , A.D., 2005, before me, a Notary Public
in and for the State of  Minnesota , personally appeared  Lori-Anne
Rosenberg , to me personally known, who being by me duly sworn did say
that the person is (a) (the)  Vice President  of  U.S. Bank National Association, a national
banking association, executing the foregoing instrument, that the instrument
was signed on behalf of the said banking association by authority of said
banking association and the said  Lori-Anne Rosenberg acknowledged the
execution of said instrument to be the voluntary act and deed of said banking
association by it voluntarily executed.


 


	
   

  	
  /s/Nancy Savage

  	
   

  
	
   

  
	
   

  	
  Notary Public in the
  State of MN

  	
   

  
					



 


	
  STATE OF California

  	
   

  	
  )

  	
   

  
	
   

  	
  )ss:

  
	
  COUNTY OF Los Angeles

  	
   

  	
  )

  	
   

  
						



 


On
this 8th day of June, A.D., 2005, before me, a Notary Public in and for the
State of California, personally appeared M. Brent Stevens, to me personally
known, who being by me duly sworn did say that the person is (a) (the) Chief
Executive Officer of  Diamond Jo, LLC
(formerly known as Peninsula Gaming Company, LLC), a Delaware limited liability
company, executing the foregoing instrument, that the instrument was signed on
behalf of the said limited liability company by authority of the limited
liability company and the said M. Brent Stevens acknowledged the execution of
said instrument to be the voluntary act and deed of said limited liability
company by it voluntarily executed.


 


	
   

  	
   

  	
   

  
	
   

  
	
   

  	
  Notary Public in the
  State of 

  	
   

  	
   

  
						



 





















 


EXHIBIT “A”


(Description of Property)


 


 


PARCEL A


 


Lot
3 of Adams Company’s 2nd Addition in the City of Dubuque, Dubuque
County, Iowa, according to the recorded plat thereof.


 


PARCEL B


 


Lots
7 and 8 of Ice Harbor Development, in the City of Dubuque, Dubuque County,
Iowa, according to the recorded plat thereof. 
Together with:


 


(a)                                  A perpetual, non-exclusive fifteen
(15) foot wide maintenance easement over and across Lot 6 in Ice Harbor
Development for maintenance of Lots 7 and 8 in Ice Harbor Development.


 


(b)                                 A perpetual, non-exclusive easement
for ingress and egress to and from Lots 7 and 8 in Ice Harbor Development over
and across the “Ingress-Egress Easement” abutting the Southern terminus of Bell
Street.


 


(c)                                  A perpetual, non-exclusive easement
for ingress and egress to Lots 7 and 8 in Ice Harbor Development over and
across Lots 6 and 10 in Ice Harbor Development, all as shown on the final plat
of Ice Harbor Development, in the City of Dubuque, Iowa, filed as Instrument No. 6167-95
in the office of the Dubuque County Recorder.


 


PARCEL C


 


Lot
1 of Adams Company’s 1st Addition in the City of Dubuque, Dubuque
County, Iowa, according to the recorded plat thereof.


 


PARCEL D


 


Lot
1 in Adams Company’s 3rd Addition in the City of Dubuque, Dubuque County, Iowa,
according to the recorded plat thereof.


 





















 


EXHIBIT “B”


 


(The Leases and the Real Property

Subject to Leasehold Interests)


 


Lots 5 and 6 of Ice Harbor Development in the City of
Dubuque, Iowa.