Exhibit 10.12


 


SECOND AMENDMENT TO FIRST PREFERRED SHIP MORTGAGE


 


This SECOND AMENDMENT TO FIRST
PREFERRED SHIP MORTGAGE (this “Amendment”) is entered into as of July 12,
2005, between DIAMOND JO, LLC (formerly known as
Peninsula Gaming Company, LLC), a Delaware limited liability company (the “Shipowner”),
and WELLS FARGO FOOTHILL, INC., a
California corporation, as the arranger and agent for the Lenders (“Agent”;
Agent, together with its successors and assigns, is referred to herein as the “Mortgagee”).


 


W I T N E S S E T H:


 


WHEREAS, the Shipowner,
Diamond Jo Worth, LLC, a Delaware limited liability company, and The Old
Evangeline Downs, L.L.C., a Louisiana limited liability company, as borrowers (collectively,
“Borrowers”), the Mortgagee, and the ‘Lenders’ (as defined therein) are
parties to that certain Loan and Security Agreement dated as of June 16,
2004, as amended by that certain First Amendment to Loan and Security Agreement
dated as of November 10, 2004, as further amended by that certain Second
Amendment to Loan and Security Agreement dated as of even date herewith (the “Second
Amendment to Loan Agreement”) and as supplemented by that certain Borrower
Supplement No. 1 dated as of May 13, 2005 (as amended, restated,
supplemented or otherwise modified from time to time, the “Loan Agreement”);


 


WHEREAS, as an inducement
for the Mortgagee and the Lenders to enter into the Loan Agreement, the
Shipowner executed and delivered that certain First Preferred Ship Mortgage
dated as of June 16, 2004, recorded on June 16, 2004, at 11:19 a.m.,
Eastern time, recorded in Batch No. 255033, Doc. ID 2290064 in the
official records of the National Vessel Documentation Center, as amended by
that certain First Amendment to First Preferred Ship Mortgage dated as of November 10,
2004, recorded on November 10, 2004 at 12:35 p.m., Eastern time, recorded
in Batch No. 308221, Doc. ID 2884534 in the official records of the
National Vessel Documentation Center (as amended, the “Mortgage”;
capitalized terms used herein and not otherwise defined herein shall have the
meanings ascribed to such terms in the Mortgage), in favor of the Mortgagee for
the benefit of the Lender Group;


 


WHEREAS, Borrowers, the Mortgagee
and the Lenders have agreed to amend the Loan Agreement pursuant to the Second
Amendment to Loan Agreement; and


 


WHEREAS, the Shipowner
and the Mortgagee have agreed to amend the Mortgage on the terms and conditions
set forth herein;


 


NOW THEREFORE, in
consideration of the foregoing premises and other good and valuable consideration,
the receipt and sufficiency of which are hereby acknowledged, the parties
hereto hereby agree as follows:


 


1.             Amendments to
the Mortgage.


 


(a)           The cover page of
the Mortgage is hereby modified and amended by deleting “$50,000,000” therefrom
and in place thereof inserting “$64,666,667”.


 





















 


(b)           The preamble of the
Mortgage is hereby modified and amended by deleting “the Shipowner and The Old
Evangeline Downs, L.L.C., a Louisiana limited liability company, as borrowers”
therefrom and in place thereof inserting “the Shipowner, Diamond Jo Worth, LLC,
a Delaware limited liability company, and The Old Evangeline Downs, L.L.C., a
Louisiana limited liability company, as borrowers”.


 


(c)           Section 4 of
the Mortgage is hereby modified and amended by “$50,000,000” therefrom and in
place thereof inserting “$64,666,667”.


 


2.             No Other
Amendments or Waivers.  Except as
expressly set forth above, the execution, delivery and effectiveness of this
Amendment shall not operate as an amendment of any right, power or remedy of the
Mortgagee or the Lenders under the Mortgage or any of the other Loan Documents,
nor constitute a waiver of any provision of the Mortgage or any of the other
Loan Documents.  Except as expressly set
forth above, the text of the Mortgage and all other Loan Documents shall remain
unchanged and in full force and effect and the Shipowner hereby ratifies and
confirms its obligations thereunder. 
This Amendment shall not constitute a modification of the Mortgage or
any of the other Loan Documents or a course of dealing with the Mortgagee or the
Lenders at variance with the Mortgage or the other Loan Documents such as to
require further notice by the Mortgagee or the Lenders to require strict
compliance with the terms of the Mortgage and the other Loan Documents in the
future, except as expressly set forth herein. 
The Shipowner acknowledges and expressly agrees that the Mortgagee and the
Lenders reserve the right to, and do in fact, require strict compliance with
all terms and provisions of the Mortgage and the other Loan Documents, as
amended herein.  The Shipowner has no
knowledge of any challenge to the Mortgagee’s or any Lender’s claims arising
under the Loan Documents, or to the effectiveness of the Loan Documents.


 


3.             Conditions
Precedent to Effectiveness.  This
Amendment shall become effective as of the date hereof when, and only when, the
Mortgagee shall have received:


 


(a)           counterparts of this
Amendment duly executed and delivered by the Shipowner and the Mortgagee;


 


(b)           evidence in form and
substance satisfactory to the Mortgagee that the Shipowner shall have received
all licenses (including the Gaming Licenses), approvals or evidence of other
actions required by any Governmental Authority, including the Louisiana
Regulatory Authorities and the Iowa Gaming Authorities, in connection with the
execution and delivery by the Shipowner of this Amendment or with the
consummation of the transactions contemplated hereby; and


 


(c)           such other
information, documents, instruments or approvals as the Mortgagee or the
Mortgagee’s counsel may reasonably require.


 


4.             Representations
and Warranties of the Shipowner.  In
consideration of the execution and delivery of this Amendment by the Mortgagee,
the Shipowner hereby represents and warrants in favor of the Mortgagee and the
Lenders as follows:


 


(a)           the execution,
delivery, and performance by the Shipowner of this Amendment have been duly
authorized by all necessary action on the part of the Shipowner;


 


2





















 


(b)           the execution,
delivery, and performance by the Shipowner of this Amendment do not and will
not (i) violate any provision of federal, state, or local law or
regulation applicable to the Shipowner, the Governing Documents of the
Shipowner, or any order, judgment, or decree of any court or other Governmental
Authority binding on the Shipowner, (ii) conflict with, result in a breach
of, or constitute (with due notice or lapse of time or both) a default under
any material contractual obligation of the Shipowner, (iii) result in or
require the creation or imposition of any Lien of any nature whatsoever upon
any properties or assets of the Shipowner, other than Permitted Liens (as
defined in the Loan Agreement), or (iv) require any approval of the
Shipowner’s members or shareholders or any approval or consent of any person or
entity under any material contractual obligation of the Shipowner;


 


(c)           the execution,
delivery, and performance by the Shipowner of this Amendment do not and will
not require any registration with, consent, or approval of, or notice to, or
other action with or by, any Governmental Authority or other person or entity,
other than any consent or approval that has been obtained and remains in full
force and effect;


 


(d)           this Amendment, when
executed and delivered by the Shipowner, will be the legally valid and binding
obligation of the Shipowner, enforceable against the Shipowner in accordance
with its terms, except as enforcement may be limited by equitable principles or
by bankruptcy, insolvency, reorganization, moratorium, or similar laws relating
to or limiting creditors’ rights generally;


 


(e)           No Default or Event
of Default exists under the Mortgage or the other Loan Documents; and


 


(f)            As of the date
hereof, all representations and warranties of the Shipowner set forth in the Mortgage
and the other Loan Documents are true, correct and complete in all material
respects, except to the extent such representation or warranty expressly
relates to an earlier date (in which case such statement was true and correct
on and as of such earlier date).


 


5.             Counterparts.  This Amendment may be executed in multiple
counterparts, each of which shall be deemed to be an original and all of which,
taken together, shall constitute one and the same agreement.  In proving this Amendment in any judicial
proceedings, it shall not be necessary to produce or account for more than one
such counterpart signed by the party against whom such enforcement is
sought.  Any signatures delivered by a party
by facsimile transmission or by e-mail transmission of an adobe file format
document (also known as a PDF file) shall be deemed an original signature
hereto.


 


6.             Reference to and
Effect on the Loan Documents.  Upon
the effectiveness of this Amendment, on and after the date hereof, each reference
in the Mortgage to “this Mortgage”, “hereunder”, “hereof” or words of like
import referring to the Mortgage, and each reference in the other Loan
Documents to “the Mortgage”, “thereunder”, “thereof” or words of like import
referring to the Mortgage, shall mean and be a reference to the Mortgage as
amended hereby.


 


7.             Costs, Expenses
and Taxes.  The Shipowner agrees to
pay on demand all costs and expenses in connection with the preparation,
execution, and delivery of this Amendment and the other instruments and
documents to be delivered hereunder, including, without limitation, the


 


3





















 


fees and out-of-pocket expenses of counsel for the Mortgagee with
respect thereto and with respect to advising the Mortgagee as to its rights and
responsibilities hereunder and thereunder. 
In addition, the Shipowner agrees to pay any and all stamp and other
taxes payable or determined to be payable in connection with the execution and
delivery of this Amendment and the other instruments and documents to be
delivered hereunder, and agree to save the Mortgagee and the Lenders harmless
from and against any and all liabilities with respect to or resulting from any
delay in paying or omission to pay such taxes. 
The Shipowner hereby acknowledges and agrees that the Mortgagee may,
without prior notice to Borrowers, charge such costs and fees to Borrowers’
Loan Account pursuant to Section 2.6(d) of the Loan Agreement.


 


8.             Section Titles.  The section titles contained in this
Amendment are included for the sake of convenience only, shall be without
substantive meaning or content of any kind whatsoever, and are not a part of
the agreement between the parties.


 


9.             Entire Agreement.  This Amendment and the other Loan Documents
constitute the entire agreement and understanding between the parties hereto
with respect to the transactions contemplated hereby and thereby and supersede
all prior negotiations, understandings and agreements between such parties with
respect to such transactions.


 


10.           GOVERNING LAW.  THIS AMENDMENT SHALL BE GOVERNED BY AND
CONSTRUED ACCORDING TO THE PROVISIONS IN THE SHIP MORTGAGE ACT, OR WHEN
APPLICABLE, BY THE GENERAL MARITIME LAWS OF THE UNITED STATES.


 


11.           Loan Document.  This Amendment shall be deemed to be a Loan
Document for all purposes.


 


 


[Remainder of page intentionally left blank.]


 


4





















 


IN WITNESS WHEREOF, the parties hereto have executed
and delivered this Amendment as of the day and year first written above.


 


	
  SHIPOWNER:

  	
  DIAMOND JO, LLC (formerly
  known as

  Peninsula Gaming Company, LLC), a Delaware

  limited liability company

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/Natalie A. Schramm

  
	
   

  	
  Title:

  	
  Chief Financial Officer

  
	
   

  	
   

  
	
   

  	
   

  
	
  MORTGAGEE:

  	
  WELLS FARGO FOOTHILL, INC.,

  
	
  a California
  corporation

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/Larissa Megerdichian

  
	
   

  	
  Title:

  	
  Vice President

  



 





















 


ACKNOWLEDGMENT OF THE SHIPOWNER


 


STATE OF Iowa


 


COUNTY OF Dubuque


 


On 5/10/05, the person named above acknowledged
execution of the foregoing instrument in his or her stated capacity for the purpose
therein contained.


 


 


	
   

  	
   

  	
   

  
	
   

  	
  NOTARY PUBLIC

  	
   

  
	
   

  	
   /s/Karen M.
  Beetem

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  My commission expires:

  	
  10/20/07

  



 





















 


ACKNOWLEDGMENT OF MORTGAGEE


 


STATE OF CALIFORNIA


 


COUNTY OF Los Angeles


 


On 5/11/05, the person named above acknowledged
execution of the foregoing instrument in his or her stated capacity for the
purpose therein contained.


 


 


	
   

  	
   

  	
   

  
	
   

  	
  NOTARY PUBLIC

  	
   

  
	
   

  	
  /s/ K. Melissa Chavez

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  My commission expires:

  	
  3/19/09