Document:

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                                                                   EXHIBIT 10.20

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                    AMENDED AND RESTATED TERM LOAN AGREEMENT

                           Dated as of October 9, 2002

                                      among

                               MTS, INCORPORATED,

                            THE LENDERS NAMED HEREIN,

                                       and

                              JPMORGAN CHASE BANK,
                 as Administrative Agent and as Collateral Agent

                         -------------------------------

        THIS AGREEMENT IS SUBJECT TO THAT CERTAIN INTERCREDITOR AGREEMENT
        DATED AS OF OCTOBER 9, 2002, AMONG THE PARTIES HERETO AND THE CIT
         GROUP/BUSINESS CREDIT, INC., A NEW YORK CORPORATION, AS AGENT.

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                                                       [CS&M Reference 6700-570]

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                                TABLE OF CONTENTS

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ARTICLE I DEFINITIONS........................................................................1
        SECTION 1.01.   Defined Terms........................................................1
        SECTION 1.02.   Terms Generally......................................................6

ARTICLE II THE LOANS.........................................................................7
        SECTION 2.01.   Loans................................................................7
        SECTION 2.02.   Repayment of Loans; Evidence of Debt.................................7
        SECTION 2.03.   Interest.............................................................7
        SECTION 2.04.   Mandatory Prepayment.................................................8
        SECTION 2.05.   Optional Prepayment..................................................9
        SECTION 2.06.   Sharing of Setoffs..................................................10
        SECTION 2.07.   Payments............................................................10
        SECTION 2.08.   Taxes...............................................................10

ARTICLE III CERTAIN COVENANTS...............................................................12
        SECTION 3.01.   Guarantee Requirement; Collateral Requirement; Further Assurances...12
        SECTION 3.02.   Notices of Amendments, Waivers and Defaults.........................13
        SECTION 3.03.   Business and Liabilities of Pipernick...............................13
        SECTION 3.04.   Amendment of Agreements by the Borrower.............................13

ARTICLE IV INCORPORATION BY REFERENCE.......................................................13

ARTICLE V THE AGENT.........................................................................15

ARTICLE VI MISCELLANEOUS....................................................................17
        SECTION 6.01.   Notices.............................................................17
        SECTION 6.02.   Survival of Agreement...............................................17
        SECTION 6.03.   Binding Effect......................................................17
        SECTION 6.04.   Successors and Assigns..............................................17
        SECTION 6.05.   Expenses; Indemnity.................................................20
        SECTION 6.06.   Right of Setoff.....................................................21
        SECTION 6.07.   Applicable Law......................................................21
        SECTION 6.08.   Waivers; Amendment..................................................21
        SECTION 6.09.   Interest Rate Limitation............................................22
        SECTION 6.10.   Entire Agreement....................................................22
        SECTION 6.11.   WAIVER OF JURY TRIAL................................................22
        SECTION 6.12.   Severability........................................................23
        SECTION 6.13.   Counterparts........................................................23
        SECTION 6.14.   Headings............................................................23
        SECTION 6.15.   Jurisdiction; Consent to Service of Process.........................23
        SECTION 6.16.   Confidentiality.....................................................24
        SECTION 6.17.   Certain Agreements..................................................24
</TABLE>

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        AMENDED AND RESTATED TERM LOAN AGREEMENT dated as of October 9, 2002,
among MTS, INCORPORATED, a California corporation (the "Borrower") the lenders
listed in Schedule 2.01 hereto or becoming parties hereto pursuant to Section
6.04 (the "Lenders") and JPMORGAN CHASE BANK (f/k/a The Chase Manhattan Bank), a
New York banking corporation, as administrative agent for the Lenders and as
collateral agent for the Lenders (in such capacities, the "Agent") .

        The Borrower has requested the Lenders, and the Lenders and the Agent
have agreed, pursuant to the terms of the Assignment, Purchase and Amendment
Agreement, to amend and restate the Existing Credit Agreement in the form of
this Agreement and to permit the loans outstanding under the Existing Credit
Agreement on the date hereof and after giving effect to the payments and
assignments provided for in the Assignment, Purchase and Amendment Agreement to
remain outstanding as term loans under this Agreement.

        Accordingly, the Borrower, the Lenders and the Agent agree as follows:

                                    ARTICLE I
                                   DEFINITIONS

        SECTION 1.01. Defined Terms. Except as expressly set forth in Article IV
hereof, capitalized terms used but not defined herein shall have the meanings
assigned to such terms in the other Loan Documents. As used in this Agreement,
the following terms shall have the meanings specified below:

        "Administrative Questionnaire" means an administrative questionnaire in
a form supplied by the Agent.

        "Affiliate" means, when used with respect to a specified person, another
person that directly, or indirectly through one or more intermediaries, Controls
or is Controlled by or is under common Control with the person specified and in
any case shall include, when used with respect to the Borrower or any
Subsidiary, any joint venture in which the Borrower or such Subsidiary holds an
equity interest.

        "Assignment and Acceptance" means an assignment and acceptance entered
into by a Lender and an assignee (with the consent of any party whose consent is
required by Section 6.04), and accepted by the Agent, in a form approved by the
Agent.

        "Assignment, Purchase and Amendment Agreement" means the Assignment,
Purchase and Amendment Agreement dated as of the date hereof among the Borrower,
the Lenders and the Agent.

        "Broadway Mortgage" means the mortgage on the Broadway Property to
secure loans under the CIT Credit Agreement.

        "Broadway Property" means the real property located at 692 Broadway, 14
E. 4th Street Units, New York, NY.

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        "Business Day" means any day (other than a day which is a Saturday,
Sunday or legal holiday in the State of New York) on which banks are open for
business in New York City.

        "CIT" means CIT Group/Business Credit, Inc.

        "CIT Credit Agreement" means the Credit Agreement dated as of October 9,
2002 between the Borrower, the lenders party thereto and CIT, as agent for such
lenders.

        "CIT Facility" means the senior secured revolving credit facility in an
aggregate principal amount of $75,000,000 established by the CIT Credit
Agreement.

        "CIT Real Estate Facility" means the real estate subfacility of the CIT
Facility in an aggregate principal amount of $7,500,000.

        "Collateral" shall have the meaning assigned to such term in the
Security Documents.

        "Collateral Requirement" means at any date that, except as set forth in
Schedule 1.01A, (a) the Pledge Agreements create in favor of the Agent, for the
benefit of the Secured Parties, perfected pledges of and security interests in
all capital stock or other equity interests and all Indebtedness (including all
capital stock or other equity interests in each Subsidiary (including Pipernick
Corp.) and all intercompany loans or advances among MTS and the Subsidiaries)
owned by the Borrower or any Subsidiary, (b) the Security Agreements create in
favor of the Agent, for the benefit of the Lenders, perfected security interests
in the Collateral of the Borrower and each Subsidiary, in each case as security
for the Obligations, (c) the Mortgages create in favor of the Agent, for the
benefit of the Lenders, perfected liens on each of the Mortgaged Properties
(other than the Designated Mortgaged Properties referred to in the Existing
Credit Agreement and, so long as any obligations remain outstanding under the
CIT Credit Agreement, other than the property subject to the Broadway Mortgage)
as security for the Obligations (or, in the case of any Mortgaged Property, such
amount of the Obligations as shall be specified opposite such Mortgaged Property
in Schedule 5.09 to the Existing Credit Agreement), and the Mortgaged Properties
subject to the Mortgages include all interests in real property that have been
mortgaged by the Borrower or any Subsidiary to secure obligations under the CIT
Credit Agreement (other than, so long as any obligations remain outstanding
under the CIT Credit Agreement, the Broadway Mortgage) provided, that, if CIT
releases the lien on the Broadway Property evidenced by the Broadway Mortgage
during such time as any obligations remain outstanding under the CIT Credit
Agreement, the Borrower shall grant a mortgage in favor of the Agent, for the
benefit of the Lenders, which mortgage shall create a perfected lien on the
Broadway Property, to secure at least $18,000,000 of the Obligations, (d) the
pledges, security interests and liens referred to in the preceding clauses (a),
(b) and (c) are prior to all other liens other than (i) the liens securing the
Lender Debt Obligations (as defined in the Intercreditor Agreement) and
Permitted Liens (as defined in the Existing Credit Agreement) and (e) the
Administrative Agent shall have received either (i) a counterpart of each of the
Security Documents, duly executed and delivered on behalf of all Loan Parties
party thereto, or (ii) in the case of any Person that becomes a Loan Party after
the date hereof, a supplement to each Security Document, in the form specified
therein, duly executed and delivered on behalf of such Loan Party; provided that
the Agent may agree that the liens of the Security Documents will not be
perfected with respect to specified assets if it shall determine and shall
notify the Lenders

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(and, if any Lender shall object in writing, the Required Lenders shall also
determine), based on information provided by the Borrower which is, in the
judgment of the Agent and, if applicable, the Required Lenders, sufficient to
make the determination in question, that the expense or difficulty of perfecting
such liens with respect to such assets would be excessive in view of the benefit
to the Lenders that would result therefrom.

        "Control" means the possession, directly or indirectly, of the power to
direct or cause the direction of the management or policies of a person, whether
through the ownership of voting securities, by contract or otherwise, and
"Controlling" and "Controlled" shall have meanings correlative thereto.

        "Default" means any event or condition that constitutes an Event of
Default or that upon notice or lapse of time or both would become an Event of
Default.

        "dollars" or "$" means lawful money of the United States of America.

        "EBITDA" shall mean, for a given period, all earnings from operations of
the Borrower and the Subsidiaries before all (a) interest and tax obligations,
(b) depreciation and (c) amortization for said period, all determined in
accordance with GAAP on a consistent basis with the latest audited consolidated
financial statements of the Borrower, but excluding the effect of non-cash gains
or losses for such period, determined in accordance with GAAP.

        "Event of Default" means any of the events set forth in Section 10.1 of
the CIT Credit Agreement, as incorporated by reference in Article III hereof.

        "Existing Credit Agreement" means Credit Agreement dated as of April 27,
2001, as amended by a First Amendment dated as of October 5, 2001, a Second
Amendment dated as of April 1, 2002, a Third Amendment dated as of April 30,
2002, a Fourth Amendment dated as of June 23, 2002, Fifth Amendment dated as of
September 12, 2002, a Sixth Amendment dated as of September 30, 2002, and a
Seventh Amendment dated as of October 4, 2002.

        "Fixed Charge Coverage Amount" shall mean, for any specified period with
respect to the Borrower and the Subsidiaries, the difference between (a) EBITDA
and (b) the sum of (i) Capital Expenditures (as defined in the CIT Credit
Agreement), (ii) income taxes paid or accrued and (iii) Fixed Charges (as
defined in the CIT Credit Agreement).

        "GAAP" means United States generally accepted accounting principles,
applied on a consistent basis.

        "Governmental Authority" means the government of the United States, any
other nation or any political subdivision thereof, whether state or local, and
any agency, authority, instrumentality, regulatory body, court, central bank or
other entity exercising executive, legislative, judicial, taxing, regulatory or
administrative powers or functions of or pertaining to government.

        "Guarantee Agreement" means the Amended and Restated Guarantee Agreement
dated as of April 27, 2001, among the Guarantors and the Administrative Agent
acting on behalf of the

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Lenders, as the same may be amended, modified or supplemented from time to time
in accordance with the provisions hereof.

        "Guarantee Requirement" means at any date that the Parent, the Borrower
and each Subsidiary is a Guarantor, in accordance with the terms of the
Guarantee Agreement; provided that any Subsidiary that is not a US Subsidiary
will not guarantee the Obligations of MTS; provided further, however, that any
Subsidiary (including any Subsidiary that is not a US Subsidiary) that is a
borrower or a guarantor of the obligations under the CIT Credit Agreement shall
in any event be a Guarantor under the Guarantee Agreement.

        "Guarantors" means the parties to the Guarantee Agreement on the date
hereof and each other Subsidiary that becomes a party to the Guarantee Agreement
pursuant to Section 3.01 or otherwise.

        "Indemnity, Subrogation and Contribution Agreement" means the Indemnity,
Subrogation and Contribution Agreement dated as of April 27, 2001, among the
Guarantors and the Agent acting on behalf of the Secured Parties, as the same
may be amended, modified or supplemented from time to time in accordance with
the provisions hereof.

        "Intercreditor Agreement" means the Intercreditor Agreement dated as of
October 9, 2002 between CIT and JPMCB, as Agent for the Lenders, in
substantially the form of Exhibit B hereto.

        "Irish Security Agreement" means the Security Agreement dated as of
April 27, 2001, among the Borrower, Ireland TR, Incorporated and the Agent
acting on behalf of the Secured Parties, as the same may be amended, modified or
supplemented from time to time in accordance with the provisions hereof.

        "JPMCB" means JPMorgan Chase Bank.

        "Loan Documents" means this Agreement, the Guarantee Agreement and the
Security Documents.

        "Loan Parties" means the Parent, the Borrower and each Subsidiary that
is party to the Guarantee Agreement or any Security Document.

        "Loans" means loans made by the Lenders to the Borrower under the
Existing Credit Agreement and continuing outstanding as term loans under this
Agreement.

        "Maturity Date" means April 1, 2005, or any earlier date on which the
CIT Facility matures or is terminated pursuant to the terms of the CIT Credit
Agreement.

        "Mortgage" shall mean one or more mortgages or deeds of trust, in form
and substance satisfactory to the Borrowers' Agent and the Agent.

        "Mortgaged Property" shall mean each parcel of real property owned by
MTS or any US Subsidiary and listed on Schedule 5.09 to the Existing Credit
Agreement.

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        "Net Proceeds" means with respect to any refinancing of any Real Estate
Collateral permitted under Section 9.9(q) of the CIT Credit Agreement (after
giving effect to any amendments and waivers thereto) or sale of Real Estate
Collateral permitted under Section 9.7(b) (x) of the CIT Credit Agreement (after
giving effect to any amendments and waivers thereto), the cash proceeds received
in respect thereof, including any cash received in respect of any non-cash
proceeds, but only as and when received, net of the sum of all fees and
out-of-pocket expenses paid by the Borrower or any Subsidiary to persons other
than Affiliates in connection therewith.

        "Obligations" means the due and punctual payment of (i) the principal of
and interest (including interest accruing during the pendency of any bankruptcy,
insolvency, receivership or other similar proceeding, regardless of whether
allowed or allowable in such proceeding) on the Loans, when and as due, whether
at maturity, by acceleration, upon one or more dates set for prepayment or
otherwise, and (ii) all other monetary obligations, including fees, costs,
expenses and indemnities, whether primary, secondary, direct, contingent, fixed
or otherwise (including monetary obligations incurred during the pendency of any
bankruptcy, insolvency, receivership or other similar proceeding, regardless of
whether allowed or allowable in such proceeding), of the Loan Parties to the
Lenders under this Agreement, the Guarantee Agreement and the other Loan
Documents.

        "person" means any natural person, corporation, business trust, joint
venture, limited liability company, association, company, partnership or
government, or any agency or political subdivision thereof.

        "Pledge Agreements" means (a) the Amended and Restated Pledge Agreement
dated as of April 27, 2001, among MTS, the applicable Subsidiaries and the Agent
acting on behalf of the Secured Parties, as the same may be amended, modified or
supplemented from time to time in accordance with the provisions hereof and (b)
in connection with the pledge of any equity interests in any Subsidiary that is
not a US Subsidiary, any other pledge agreement that the Agent shall deem
necessary or advisable to create liens on such equity interests to secure the
Obligations or any of them.

        "Prime Rate" means the rate of interest per annum publicly announced
from time to time by JPMCB as its prime rate in effect at its principal office
in New York City; each change in the Prime Rate shall be effective from and
including the date such change is publicly announced as being effective.

        "Register" shall have the meaning given such term in Section 6.04(d).

        "Related Parties" means, with respect to any specified person, such
person's Affiliates and the respective directors, officers, employees, agents
and advisors of such person and such person's Affiliates.

        "Required Lenders" means, at any time, Lenders in the aggregate holding
at least a majority of the aggregate unpaid principal amount of the Loans.

        "Secured Parties" shall have the meaning assigned to such term in the
Security Documents.

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        "Security Agreements" means (a) the US Security Agreement, (b) the UK
Security Agreement and (c) the Irish Security Agreement.

        "Security Documents" means the Security Agreements, the Pledge
Agreements, the Mortgages, the Indemnity, Subrogation and Contribution Agreement
and each other security agreement, mortgage or other instrument or document
executed and delivered pursuant to Section 3.01.

        "subsidiary" means, with respect to any person, any corporation,
partnership, limited liability company, association or other business entity of
which securities or other ownership interests representing more than 50% of the
equity or more than 50% of the ordinary voting power or more than 50% of the
general partnership or limited liability company interests are, at the time any
determination is being made, owned, controlled or held by such person.

        "Subsidiary" means any subsidiary of the Borrower.

        "TRKK" means Tower Records Kabushiki Kaisha, a Japanese corporation and,
prior to the effectiveness of this Agreement, a wholly owned subsidiary of the
Borrower.

        "TRKK Sale" means the sale by the Borrower to Valtona Holding B.V., a
corporation wholly owned by Nikko Principal Investments Japan Ltd., pursuant to
a stock purchase agreement dated as of April 11, 2002, of all of the issued and
outstanding capital stock of TRKK and the Japanese trademarks, service marks and
trade names associated with the business conducted by TRKK.

        "Trust Note" shall mean the Secured Promissory Note, dated as of the
date hereof, issued by the Borrower to the order of The Russell M. Solomon and
Doris E. Solomon 1994 Children's Trust.

        "UK Security Agreement" means the Security Agreement dated as of April
27, 2001, among the Borrower, T.R. Services Incorporated and the Agent acting on
behalf of the Secured Parties, as the same may be amended, modified or
supplemented from time to time in accordance with the provisions hereof.

        "US Security Agreement" means the Amended and Restated Security
Agreement dated as of April 27, 2001, among the Borrower, certain US
Subsidiaries and the Agent acting on behalf of the Secured Parties, as the same
may be amended, modified or supplemented from time to time in accordance with
the provisions hereof.

        "US Subsidiary" means any Subsidiary that is organized under the laws of
the United States or any state or other political subdivision, territory or
possession thereof.

        SECTION 1.02. Terms Generally. The definitions of terms herein shall
apply equally to the singular and plural forms of the terms defined. Whenever
the context may require, any pronoun shall include the corresponding masculine,
feminine and neuter forms. The words "include", "includes" and "including" shall
be deemed to be followed by the phrase "without limitation". The word "will"
shall be construed to have the same meaning and effect as the word "shall".
Unless the context requires otherwise (a) any definition of or reference to any

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agreement, instrument or other document (other than in Article IV) shall be
construed as referring to such agreement, instrument or other document as
amended, supplemented or otherwise modified from time to time, (b) any reference
herein to any person shall be construed to include such Person's successors and
assigns, (c) the words "herein", "hereof" and "hereunder", and words of similar
import, shall be construed to refer to this Agreement in its entirety and not to
any particular provision hereof, (d) all references herein to Articles,
Sections, Exhibits and Schedules shall be construed to refer to Articles and
Sections of, and Exhibits and Schedules to, this Agreement and (e) the words
"asset" and "property" shall be construed to have the same meaning and effect
and to refer to any and all tangible and intangible assets and properties,
including cash, securities, accounts and contract rights.

                                   ARTICLE II
                                    THE LOANS

        SECTION 2.01. Loans. On the date hereof, Loans outstanding under the
Existing Credit Agreement in the aggregate principal amount of $26,000,000 shall
continue outstanding as Loans under this Agreement. The aggregate principal
amounts of the Loans of the Lenders on the Closing Date are set forth opposite
their respective names in Schedule 2.01. Principal amounts paid or prepaid in
respect of Loans may not be reborrowed.

        SECTION 2.02. Repayment of Loans; Evidence of Debt. The Borrower hereby
unconditionally promises to pay to the Agent for the accounts of the Lenders the
outstanding principal amounts of the Loans on the Maturity Date. Each Lender
shall maintain in accordance with its usual practice an account or accounts
evidencing the Loans of such Lender, including the amounts of principal and
interest payable and paid to such Lender from time to time under this Agreement.
The Agent shall maintain accounts in which it will record (i) the amount of any
principal or interest due and payable or to become due and payable from the
Borrower to each Lender hereunder and (ii) the amount of any sum received by the
Agent hereunder from the Borrower and each Lender's share thereof. The entries
made in the accounts maintained pursuant to this Section 2.03 shall be prima
facie evidence of the existence and amounts of the obligations therein recorded;
provided, however, that the failure of any Lender or the Agent to maintain such
accounts or any error therein shall not in any manner (i) affect the obligations
of the Borrower to repay the Loans in accordance with their terms or (ii) cause
the Borrower's obligations to be greater than they would have been absent such
failure or error.

        SECTION 2.03. Interest.

               (a) Subject to the provisions of paragraph (b) below, the Loans
shall bear interest on each day (computed on the basis of the actual number of
days elapsed over a year of 360 days) at a rate per annum equal to the greater
of (i) 11% per annum and (ii) the Prime Rate on such day plus 5% per annum;
provided, however, that in the event that the Loans shall not have been prepaid
in the amount of at least $5,000,000 with the Net Proceeds of one or more
transactions set forth in Sections 2.04(c) or 2.04(d) by the first anniversary
of the date of this Agreement, the interest rate applicable to the Loans for
each day after such anniversary shall be the interest rate otherwise applicable
to such Loans on such day plus 4% per annum. Accrued interest on the Loans shall
be payable in arrears on the last Business Day in each month and on the Maturity
Date.

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               (b) At all times during the continuance of any Event of Default,
and at all times during the continuance of any Default or Event of Default (each
as defined in the CIT Credit Agreement), the Loans shall bear interest at a rate
per annum (computed on the basis of the actual number of days elapsed over a
year of 360 days) equal to the rate in effect at such time under paragraph (a)
above plus 2% per annum.

        SECTION 2.04. Mandatory Prepayment.

               (a) The Borrower shall prepay $1,000,000 in aggregate principal
amount of the Loans on the date upon which the CIT Credit Agreement becomes
effective with a portion of the proceeds of the Trust Note.

               (b) The Borrower shall prepay $500,000 in aggregate principal
amount of the Loans on August 1, November 1, February 1 and May 1 of each year,
beginning August 1, 2003.

               (c) In the event and on each occasion that any Net Proceeds are
received by or on behalf of the Borrower or any Subsidiary from any refinancing
of any Real Property Collateral (as defined in the CIT Credit Agreement) in a
transaction permitted under Section 9.9(q) of the CIT Credit Agreement (after
giving effect to any amendments and waivers thereto), the Borrower shall
substantially simultaneously apply such Net Proceeds to prepay the Loans in an
amount equal to 50% of such Net Proceeds, but only so long as (i) no Default or
Event of Default (each as defined in the CIT Credit Agreement) shall then exist
or would occur after giving effect thereto; provided, however, that the
condition set forth in this clause (i) shall not, in and of itself, serve to
excuse the making of a payment under this Section 2.04(c) for more than 180 days
and (ii) Net Proceeds from any refinancings of any Real Property Collateral (as
defined in the CIT Credit Agreement) in transactions permitted under Section
9.9(q) of the CIT Credit Agreement (after giving effect to any amendments and
waivers thereto) shall first have been applied (or, if such application is not
permitted under the CIT Credit Agreement, shall be available for application
subject only to the obtaining of any necessary consent of the lenders under the
CIT Facility) to prepay (A) first, the then outstanding Real Estate Loans (as
defined in the CIT Credit Agreement) or until all amounts outstanding with
respect thereto up to $7,500,000 have been paid in full, (B) second, the other
Obligations (as defined in the CIT Credit Agreement) then outstanding in an
amount equal to (1) $7,500,000 minus (2) the aggregate amount repaid under
clause (A) above, and (C) third, the other Obligations (as defined in the CIT
Credit Agreement) then outstanding in an amount equal to 50% of such Net
Proceeds in excess of $7,500,000. If the conditions to payment set forth in this
paragraph are not satisfied on the date any prepayment required under this
paragraph would otherwise be payable, such prepayment shall be deferred until
the first date on which such conditions are satisfied.

               (d) In the event and on the occasion that any Net Proceeds are
received by or on behalf of the Borrower or any Subsidiary from any sale of the
Real Property Collateral (as defined in the CIT Credit Agreement) in a
transaction permitted under Section 9.7(b) (x) of the CIT Credit Agreement
(after giving effect to any amendments and waivers thereto), the Borrower shall
substantially simultaneously apply such Net Proceeds to prepay the Loans in an
amount equal to 50% of such Net Proceeds, but only so long as (i) no Default or
Event of Default (each as defined in the CIT Credit Agreement) shall then exist
or would occur after giving effect thereto; provided, however, that the
condition set forth in this clause (i) shall not, in and of itself,

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serve to excuse the making of a payment under this Section 2.04(d) for more than
180 days; (ii) Excess Availability (as defined the CIT Credit Agreement) shall
have been or shall be, as the case may be, $25,000,000 or greater (A) at all
times during the 90-day period immediately preceding such payment and (B) after
giving effect to such payment; and (iii) Net Proceeds from sales of Real Estate
Collateral shall have first been applied (or, if such application is not
permitted under the CIT Credit Agreement, shall be available for application
subject only to the obtaining of any necessary consent of the lenders under the
CIT Facility) to prepay the then outstanding Obligations (as defined in the CIT
Credit Agreement) in an amount equal to (A) $20,000,000 plus (B) 50% of such
proceeds in excess of $20,000,000. If the conditions to payment set forth in
this paragraph are not satisfied on the date any prepayment required under this
paragraph would otherwise be payable, such prepayment shall be deferred until
the first date on which such conditions are satisfied.

               (e) Not later than the date on which audited financial statements
are required to be delivered for any fiscal year of the Borrower pursuant to
Section 9.6 of the CIT Credit Agreement, as incorporated by reference in Article
IV hereof, the Borrower will prepay Loans in an aggregate principal amount equal
to 75% of the positive Fixed Charge Coverage Amount, if any, for such fiscal
year; provided, however, that such prepayment shall not be payable unless (i) no
Default or Event of Default (each as defined in the CIT Credit Agreement) shall
then exist or would occur after giving effect to such payment; provided,
however, that the condition set forth in this clause (i) shall not, in and of
itself, serve to excuse the making of a payment under this Section 2.04(e) for
more than 180 days; and (ii) Excess Availability (as defined in the CIT Credit
Agreement) shall have been or shall be, as the case may be, $25,000,000 or
greater (A) at all times during the 90-day period immediately preceding such
payment (B) after giving effect to such payment, and (C) on a pro forma basis
for the 12-month period following such payment, as determined by CIT, in its
sole discretion, based upon its review of the Borrower's consolidated and
consolidating financial projections for such period provided to CIT upon the
Borrower's request to make such payment. If the conditions to payment set forth
in this paragraph are not satisfied on the date any prepayment required under
this paragraph would otherwise be payable, such prepayment shall be deferred
until the first date on which such conditions are satisfied.

               (f) At the time of each prepayment required under this Section,
the Borrower shall deliver to the Agent a certificate signed by an authorized
representative of the Borrower setting forth in reasonable detail the
calculation of the amount of such prepayment. All prepayments under this Section
shall be subject to Section 2.06, but otherwise without premium or penalty, and
shall be accompanied by accrued interest on the principal amount being prepaid
to (but not including) the date of prepayment.

        SECTION 2.05. Optional Prepayment.

               (a) The Borrower shall have the right at any time and from time
to time, subject to the obtaining of any consent required under the CIT Credit
Agreement, to prepay the Loans, in whole or in part.

               (b) All prepayments under this Section shall be subject to
Section 2.06, but otherwise without premium or penalty, and shall be accompanied
by accrued interest on the principal amount being prepaid to the date of
prepayment.

                                       9
<PAGE>

        SECTION 2.06. Sharing of Setoffs. Each Lender agrees that if it shall,
through the exercise of a right of banker's lien, setoff or counterclaim against
the Borrower, or pursuant to a secured claim under Section 506 of Title 11 of
the United States Code or other security or interest arising from, or in lieu
of, such secured claim, received by such Lender under any applicable bankruptcy,
insolvency or other similar law or otherwise, or by any other means, obtain
payment (voluntary or involuntary) in respect of any Loan as a result of which
the unpaid principal portion of any Loan shall be proportionately less than the
unpaid principal portion of such of any other Lender, it shall be deemed
simultaneously to have purchased from such other Lender at face value, and shall
promptly pay to such other Lender the purchase price for, a participation in the
Loan of such other Lender so that the aggregate unpaid principal amount of the
Loans and participations in Loans held by each Lender shall be in the same
proportion to the aggregate unpaid principal amount of all Loans then
outstanding as the principal amount of its Loans and participations in Loans
prior to such exercise of banker's lien, setoff or counterclaim or other event
was to the principal amount of all Loans outstanding prior to such exercise of
banker's lien, setoff or counterclaim or other event; provided, however, that,
if any such purchase or purchases or adjustments shall be made pursuant to this
Section and the payment giving rise thereto shall thereafter be recovered, such
purchase or purchases or adjustments shall be rescinded to the extent of such
recovery and the purchase price or prices or adjustment restored without
interest. The Borrower expressly consents to the foregoing arrangements and
agrees that any Lender holding a participation in a Loan deemed to have been so
purchased may exercise any and all rights of banker's lien, setoff or
counterclaim with respect to any and all moneys owing by the Borrower to such
Lender by reason thereof as fully as if such Lender had made a Loan directly to
the Borrower in the amount of such participation.

        SECTION 2.07. Payments. The Borrower shall make each payment hereunder
not later than 12: 00 (noon), New York City time, on the date when due in
dollars to the Agent at its offices at 270 Park Avenue, New York, New York, in
immediately available funds, without setoff or counterclaim. Any amounts
received after such time on any date may, in the discretion of the Agent, be
deemed to have been received on the next succeeding Business Day for purposes of
calculating interest thereon. Whenever any payment hereunder shall become due,
or otherwise would occur, on a day that is not a Business Day, such payment may
be made on the next succeeding Business Day, and such extension of time shall in
such case be included in the computation of interest, if applicable. Each
payment or prepayment of principal or interest on the Loans shall be allocated
pro rata among the Lenders in accordance with their respective principal amounts
of the Loans.

        SECTION 2.08. Taxes.

               (a) Any and all payments by the Borrower hereunder shall be made,
in accordance with Section 2.07, free and clear of and without deduction for any
and all present or future taxes, levies, imposts, deductions, charges or
withholdings, and all liabilities with respect thereto, excluding (i) taxes
imposed on any Lender's (or any transferee's or assignee's, including a
participation holder's (any such entity a "Transferee")) net income and (ii)
franchise taxes imposed on any Lender (or Transferee), in each case by the
jurisdiction under the laws of which such Lender or Transferee is organized or
in which its applicable lending office is located or any political subdivision
thereof (all such nonexcluded taxes, levies, imposts, deductions, charges,
withholdings and liabilities being hereinafter referred to as "Taxes"). If the
Borrower shall be

                                       10
<PAGE>

required by law to deduct any Taxes from or in respect of any sum payable
hereunder to any Lender (or Transferee) or the Agent, (i) the sum payable shall
be increased by the amount necessary so that after making all required
deductions (including deductions applicable to additional sums payable under
this Section) such Lender (or Transferee) or the Agent shall receive an amount
equal to the sum it would have received had no such deductions been made, (ii)
the Borrower shall make such deductions and (iii) the Borrower shall pay the
full amount deducted to the relevant taxing authority or other Governmental
Authority in accordance with applicable law.

               (b) In addition, the Borrower agrees to pay any present or future
stamp or documentary taxes or any other excise or property taxes, charges or
similar levies which arise from any payment made hereunder or from the
execution, delivery or registration of, or otherwise with respect to, this
Agreement or any other Loan Document (hereinafter referred to as "Other Taxes").

               (c) The Borrower will indemnify each Lender (or Transferee) and
the Agent for the full amount of Taxes and Other Taxes (including any Taxes or
Other Taxes imposed by any jurisdiction on amounts payable under this Section)
paid by such Lender (or Transferee) or the Agent, as the case may be, and any
liability (including penalties, interest and expenses) arising therefrom or with
respect thereto, whether or not such Taxes or Other Taxes were correctly or
legally asserted by the relevant taxing authority or other Governmental
Authority. Such indemnification shall be made within 30 days after the date any
Lender (or Transferee) or the Agent, as the case may be, makes written demand
therefor. If a Lender (or Transferee) or the Agent shall become aware that it is
entitled to receive a refund in respect of Taxes or Other Taxes, it shall
promptly notify the Borrower of the availability of such refund and shall,
within 30 days after receipt of a request by the Borrower, apply for such refund
at the Borrower's expense. If any Lender (or Transferee) or the Agent receives a
refund in respect of any Taxes or Other Taxes for which such Lender (or
Transferee) or the Agent has received payment from the Borrower hereunder it
shall promptly notify the Borrower of such refund and shall, within 30 days
after receipt of a request by the Borrower (or promptly upon receipt, if the
Borrower has requested application for such refund pursuant hereto), repay such
refund to the Borrower (but only to the extent of indemnity payments made, or
additional amounts paid, by the Borrower under this Section with respect to the
Taxes or Other Taxes giving rise to such refund), net of all out-of-pocket
expenses of such Lender (or Transferee) or the Agent and without interest;
provided that the Borrower, upon the request of such Lender (or Transferee) or
the Agent, agrees to return such refund (plus penalties, interest or other
charges) to such Lender (or Transferee) or the Agent in the event such Lender
(or Transferee) or the Agent is required to repay such refund.

               (d) Within 30 days after the date of any payment of Taxes or
Other Taxes withheld by the Borrower in respect of any payment to any Lender (or
Transferee) or the Agent, the Borrower will furnish to the Agent, at its address
referred to in Section 5.01, the original or a certified copy of a receipt
issued by the appropriate Governmental Authority evidencing payment thereof.

               (e) Without prejudice to the survival of any other agreement
contained herein, the agreements and obligations contained in this Section shall
survive the payment in full of the principal of and interest on all Loans made
hereunder.

                                       11
<PAGE>

               (f) Any Lender organized outside the United States (a "Foreign
Lender") that is entitled to an exemption from or reduction of withholding tax
under the law of the United States, or any treaty to which the United States is
a party, with respect to payments under this Agreement shall deliver to the
Borrower (with a copy to the Agent), at the time or times prescribed by
applicable law, such properly completed and executed documentation prescribed by
applicable law or reasonably requested by the Borrower as will permit such
payments to be made without withholding or at a reduced rate, provided that such
Foreign Lender has received written notice from the Borrower advising it of the
availability of such exemption or reduction and supplying all applicable
documentation. Notwithstanding any other provision of this Section, a Foreign
Lender shall not be required to deliver any form that it is not legally able to
deliver.

               (g) Any Lender (or Transferee) claiming any additional amounts
payable pursuant to this Section shall use reasonable efforts (consistent with
legal and regulatory restrictions) to file any certificate or document requested
by the Borrower or to change the jurisdiction of its applicable lending office
if the making of such a filing or change would avoid the need for or reduce the
amount of any such additional amounts which may thereafter accrue and would not,
in the sole determination of such Lender, be otherwise disadvantageous to such
Lender (or Transferee).

                                   ARTICLE III
                                CERTAIN COVENANTS

        SECTION 3.01. Guarantee Requirement; Collateral Requirement; Further
Assurances.

               (a) The Borrower will take all such actions as shall be
necessary, or as the Required Lenders, the Agent may reasonably request, to
cause the Guarantee Requirement and the Collateral Requirement to be met at all
times.

               (b) The Borrower will, and will cause the Parent and each
Subsidiary to, execute any and all further documents, financing statements,
agreements and instruments, and take all further action (including filing
Uniform Commercial Code and other financing statements) that may be required
under applicable law, or that the Required Lenders, the Agent may reasonably
request, in order to grant and perfect security interests securing the
Obligations in any assets designated by the Administrative Agent or the Required
Lenders that shall not already be subject to the liens of the Security
Documents. Such security interests and liens shall be created under the Security
Documents and other security agreements, mortgages, deeds of trust and other
instruments and documents in form and substance satisfactory to the Agent, and
the Borrower shall deliver or cause to be delivered to the Lenders all such
instruments and documents (including legal opinions and lien searches) as the
Agent shall reasonably request to evidence compliance with this paragraph.

               (c) The Borrower shall provide from time to time such evidence as
the Agent or the Required Lenders shall reasonably request as to the perfection
and priority status of each security interest created by the Security Documents.

                                       12
<PAGE>

        SECTION 3.02. Notices of Amendments, Waivers and Defaults. The Borrower
shall promptly, but in no event later than one (1) Business Day following the
earlier of (i) receipt of notice from CIT of, and (ii) it becoming aware of, any
Default or Event of Default or any waiver, amendment or other modification to
any Financing Agreement, provide written notice to the Agent of such Default,
Event of Default, waiver, amendment or modification pursuant to the terms set
forth in Section 5.01.

        SECTION 3.03. Business and Liabilities of Pipernick. The Borrower will
not permit Pipernick Corp. to (i) incur, assume or permit to exist any
liabilities or obligations other than (A) ordinary course liabilities and
obligations not constituting Indebtedness incidental to its existence as a
corporation, such as taxes and administrative expenses, (B) liabilities and
obligations incurred through its holding and operation of the Broadway Property,
(C) the Broadway Mortgage (and then only to the extent that it secures no more
than $18,000,000 of loans outstanding under the CIT Credit Agreement) or any
other mortgage that secures the Obligations, and (D) liabilities or obligations
incurred in connection with its guarantee of the Obligations and the obligations
under the CIT Credit Agreement, (ii) have any subsidiaries or hold any Equity
Interests in any Person or (iii) engage in any activity other than holding the
Broadway Property and activities incidental thereto.

        SECTION 3.04. Amendment of Agreements by the Borrower. The Borrower
covenants that it will act in good faith in its dealings with CIT and otherwise
to carry out the purposes of this Agreement and so as not to be prevented from
carrying out its obligations as set forth in this Agreement and the documents
executed in connection herewith, each as in effect on the date hereof, including
to permit the payments and prepayments set forth in Article 2 of this Agreement
to be made, subject to the satisfaction of the conditions set forth herein. The
Borrower hereby agrees that it shall not enter into any amendment, waiver or
other modification of any provision of the Intercreditor Agreement, the CIT
Credit Agreement or any document executed prior to, on or following the date
hereof in connection therewith that would (i) prohibit it or any Subsidiary from
carrying out, or prohibit it or any Subsidiary from making, the payment to the
Lenders of the proceeds of any financing, sale or transfer of any real property
of the Borrower or any Subsidiary, including the Broadway Property, or any other
payment required to be made under this Agreement, (ii) result in the Borrower or
any Subsidiary being permitted to enter into any sale and leaseback transaction
with respect to any real property of the Borrower or any Subsidiary under the
CIT Credit Agreement or otherwise or (iii) increase the amount of obligations
under the CIT Credit Agreement that are secured by the Broadway Mortgage, in
each case until the written consent of each Lender has been received.

                                   ARTICLE IV
                           INCORPORATION BY REFERENCE

        The provisions of the following Sections of and Schedules to the CIT
Credit Agreement, as in effect on the date hereof, are incorporated herein by
reference in their entirety with the same effect as if set forth in full herein
(with the defined terms used therein, including defined terms used in other
defined terms, having the meanings assigned to them in the CIT Credit Agreement
except as expressly set forth below):

                                       13
<PAGE>

        Sections 5.2, 6.3(a), 6.3(b), 6.3(d), 7.1, 7.2, 7.3, 7.4, 7.5, 7.6, 7.7,
8.1, 8.2, 8.3, 8.4, 8.5, 8.6, 8.7, 8.8, 8.9, 8.10, 8.11, 8.12, 8.13, 8.14, 8.15,
8.16, 8.17, 8.18, 8.19, 8.20, 9.1, 9.2, 9.3, 9.4, 9.5, 9.6, 9.7, 9.8, 9.9
(excluding the proviso in paragraph (g) thereof), 9.10, 9.11, 9.12, 9.13, 9.14,
9.15, 9.16, 9.17, 9.18, 9.19, 9.20, 9.21, 9.22, 9.23,10.1 and 10.2, and
Schedules 8.1, 8.2(a), 8.2(b), 8.2(c), 8.4, 8.6, 8.8, 8.10, 8.11, 8.12, 8.14,
8.16, 8.18, 9.9 and 9.10 (except that references in such Sections or Schedules
or in the definitions employed therein to the "Agent" or any "Co-Lead Arranger"
shall be deemed references to the Agent hereunder; references to "Lenders" shall
be deemed references to Lenders hereunder; references to "Loans" and the
borrowing or repurchase thereof shall be deemed to be references to Loans and
the borrowing or repayment thereof, respectively, hereunder; references to "this
Agreement", and the words "herein" and "hereunder", shall be deemed references
to this Agreement; references to "Defaults" and "Events of Default" shall be
deemed references to Defaults and Events of Default hereunder; references to the
"Obligations" shall be deemed references to the Obligations hereunder;
references to "Collateral" shall be deemed references to Collateral hereunder;
references to "Inventory" shall be deemed references to Inventory hereunder;
references to "Accounts" shall be deemed references to Accounts hereunder;
references to "Equipment" shall be deemed references to Equipment hereunder;
references to "Receivables" shall be deemed references to "Accounts Receivable"
hereunder; references to "Financing Agreements" shall be deemed references to
Loan Documents hereunder; references to "Required Lenders" shall be deemed
references to Required Lenders hereunder; references to "Revolving Loans" shall
be deemed references to Loans hereunder; references to "Letter of Credit
Accommodations" shall be deemed references to Loans hereunder; references to
"JPMC Indebtedness" shall be deemed references to Obligations hereunder;
references to the "JPMC Intercreditor Agreement" shall be deemed references to
the Intercreditor Agreement hereunder; and references to "JPMC Agreements" shall
be deemed references to Loan Documents hereunder; provided, however, that solely
for purposes of Section 9.8 of the CIT Credit Agreement incorporated by
reference herein, references to "Agent" shall be deemed references to "CIT" and
references to "Lenders" shall be deemed to the lenders under the CIT Credit
Agreement; and provided further, however, that solely for purposes of Section
10.1(l) of the CIT Credit Agreement incorporated by reference herein, references
to "JPMC Agreements" shall be deemed references to the CIT Credit Agreement and
all agreements executed and delivered in connection therewith).

        Notwithstanding anything in this Agreement to the contrary, other than
upon the acceleration of the Obligations upon an Event of Default, (a) the only
payments and prepayments required to made under the terms of this Agreement in
respect of the principal of and interest on Loans are those set forth in
Sections 2.02, 2.03 and 2.04 of this Agreement and those provisions of Section
10.1 of the CIT Credit Agreement incorporated by reference herein which provide
for the acceleration of the Loans thereunder, and (b) the Sections of the CIT
Credit Agreement incorporated by reference herein which require the Borrower or
any other person to prepay or otherwise remit funds for application to the
Obligations (as defined in the CIT Credit Agreement) shall not be deemed to
require any such payments or application of funds with respect to the Loans.

        Notwithstanding anything in this Agreement to the contrary, the Sections
of the CIT Credit Agreement incorporated by reference herein which grant the
"Agent" control or possession of, or the right to determine any actions taken
with respect to, any Collateral, shall be deemed to grant such control,
possession and rights to CIT, in its capacity as agent for the

                                       14
<PAGE>

lenders under the CIT Credit Agreement, at all times at which loans and/or other
amounts are outstanding under the CIT Credit Agreement, provided that, to the
extent set forth in the Intercreditor Agreement, CIT has agreed to transfer any
such Collateral held by it to the Agent at such time as the loans and other
amounts outstanding under the CIT Credit Agreement are paid in full.

        It is agreed that the purpose of the foregoing incorporation is to
afford the Lenders, with respect to their Loans, substantially the protections
afforded by the incorporated provisions to the lenders of the CIT Loans with
respect to such CIT Loans, and the provisions set forth or incorporated by
reference in this Article IV shall be construed accordingly.

                                    ARTICLE V
                                    THE AGENT

        Each of the Lenders hereby irrevocably appoints the Agent as its agent
and authorizes the Agent to take such actions on its behalf and to exercise such
powers as are delegated to the Agent by the terms hereof, together with such
actions and powers as are reasonably incidental thereto.

        The bank serving as the Agent hereunder shall have the same rights and
powers in its capacity as a Lender as any other Lender and may exercise the same
as though it were not the Agent, and such bank and its Affiliates may accept
deposits from, lend money to and generally engage in any kind of business with
any Borrower or any subsidiary or other Affiliate thereof as if it were not the
Agent hereunder.

        The Agent shall not have any duties or obligations except those
expressly set forth herein. Without limiting the generality of the foregoing,
(a) the Agent shall not be subject to any fiduciary or other implied duties
(other than as expressly assumed in the Security Documents), regardless of
whether a Default has occurred and is continuing, (b) the Agent shall not have
any duty to take any discretionary action or exercise any discretionary powers,
except discretionary rights and powers expressly contemplated hereby that the
Agent is required to exercise in writing by the Required Lenders (or such other
number or percentage of the Lenders as shall be necessary under the
circumstances as provided in Section 6.08), and (c) except as expressly set
forth herein, the Agent shall not have any duty to disclose, and shall not be
liable for the failure to disclose, any information relating to the Borrower or
any of its subsidiaries that is communicated to or obtained by the bank serving
as Agent or any of its Affiliates in any capacity. The Agent shall not be liable
for any action taken or not taken by it with the consent or at the request of
the Required Lenders (or such other number or percentage of the Lenders as shall
be necessary under the circumstances as provided in Section 6.08) or in the
absence of its own gross negligence or willful misconduct. The Agent shall be
deemed not to have knowledge of any Default unless and until written notice
thereof is given to the Agent by the Borrower or a Lender, and the Agent shall
not be responsible for or have any duty to ascertain or inquire into (i) any
statement, warranty or representation made in or in connection with this
Agreement or any other Loan Document, (ii) the contents of any certificate,
report or other document delivered hereunder or under any other Loan Document or
in connection herewith or therewith, (iii) the performance or observance of any
of the covenants, agreements or other terms or conditions set forth herein, (iv)
the validity, enforceability, effectiveness or genuineness of this Agreement or

                                       15
<PAGE>

any other agreement, instrument or document, or (v) the satisfaction of any
condition set forth in Article IV or elsewhere herein, other than to confirm
receipt of items expressly required to be delivered to the Agent.

        The Agent shall be entitled to rely upon, and shall not incur any
liability for relying upon, any notice, request, certificate, consent,
statement, instrument, document or other writing believed by it to be genuine
and to have been signed or sent by the proper Person. The Agent also may rely
upon any statement made to it orally or by telephone and believed by it to be
made by the proper Person, and shall not incur any liability for relying
thereon. The Agent may consult with legal counsel (who may be counsel for a
Borrower), independent accountants and other experts selected by it, and shall
not be liable for any action taken or not taken by it in accordance with the
advice of any such counsel, accountants or experts.

        The Agent may perform any and all its duties and exercise its rights and
powers by or through any one or more sub-agents appointed by the Agent. The
Agent and any such sub-agent may perform any and all its duties and exercise its
rights and powers through their respective Related Parties. The exculpatory
provisions of the preceding paragraphs shall apply to any such sub-agent and to
the Related Parties of any the Agent and any such sub-agent.

        Subject to the appointment and acceptance of a successor Agent as
provided in this paragraph, the Agent may resign at any time by notifying the
Lenders and the Borrower or the Borrower and the Required Lenders may replace
the Agent. Upon any such resignation, the Required Lenders shall have the right,
in consultation with the Borrower (and with the Borrower's consent, unless an
Event of Default shall have occurred and be continuing), to appoint a successor.
If no successor shall have been so appointed by the Required Lenders and shall
have accepted such appointment within 30 days after the retiring Agent gives
notice of its resignation, then the retiring Agent may, on behalf of the
Lenders, appoint a successor Agent. Upon any such replacement, the Borrowers and
the Required Lenders shall cause the successor Agent to purchase all of the
replaced Agent's Commitments and the related Loans at the time owing to the
replaced Agent. Upon the acceptance of its appointment as Agent hereunder by a
successor, such successor shall succeed to and become vested with all the
rights, powers, privileges and duties of the retiring Agent, and the retiring
Agent shall be discharged from its duties and obligations hereunder. The fees
payable by the Borrowers to a successor Agent shall be the same as those payable
to its predecessor unless otherwise agreed between the Borrower and such
successor. After the Agent's resignation or replacement hereunder, the
provisions of this Article and Section 6.05 shall continue in effect for the
benefit of such retiring or replaced Agent, its sub-agents and their respective
Related Parties in respect of any actions taken or omitted to be taken by any of
them while it was acting as Agent.

        Each Lender acknowledges that it has, independently and without reliance
upon the Agent or any other Lender and based on such documents and information
as it has deemed appropriate, made its own credit analysis and decision to enter
into this Agreement. Each Lender also acknowledges that it will, independently
and without reliance upon the Agent or any other Lender and based on such
documents and information as it shall from time to time deem appropriate,
continue to make its own decisions in taking or not taking action under or based
upon this Agreement, any related agreement or any document furnished hereunder
or thereunder.

                                       16
<PAGE>

                                   ARTICLE VI
                                  MISCELLANEOUS

        SECTION 6.01. Notices. All notices and other communications provided for
herein shall be in writing and shall be delivered by hand or overnight courier
service, mailed or sent by graphic scanning or other telegraphic communications
equipment of the sending party, as follows:

               (a) if to the Borrower, to it at MTS, Incorporated, 2500 Del
Monte, West Sacramento, California 95691, attention of Mr. DeVaughn D. Searson
(Telecopy No. 916-373-2471);

               (b) if to the Administrative Agent, to it at JPMorgan Chase Bank,
Loan and Agency Services Group, One Chase Manhattan Plaza, 8th Floor, New York,
New York 10081, Attention of Janet Belden (Telecopy No. (212) 552-5658), with a
copy to JPMorgan Chase Bank, 270 Park Avenue, New York, NY 10017, Attention of
Susan Atkins (Telecopy No. (212) 622-4834); and

               (c) if to a Lender, to it at its address (or telecopy number) set
forth in Schedule 2.01 or in the Assignment and Acceptance pursuant to which
such Lender shall have become a party hereto.

All notices and other communications given to any party hereto in accordance
with the provisions of this Agreement shall be deemed to have been given on the
date of receipt. Any party hereto may change its address or telecopy number for
notices and other communications hereunder by notice to the other parties
hereto.

        SECTION 6.02. Survival of Agreement. All covenants, agreements,
representations and warranties made by the Borrower herein and in the
certificates or other instruments prepared or delivered in connection with or
pursuant to this Agreement or any other Loan Document shall be considered to
have been relied upon by the Lenders and shall survive the extension by the
Lenders of the maturity of the Loans, regardless of any investigation made by
the Lenders or on their behalf, and shall continue in full force and effect as
long as the principal of or any accrued interest on any Loan or any other amount
payable under this Agreement or any other Loan Document is outstanding and
unpaid.

        SECTION 6.03. Binding Effect. This Agreement shall become effective as
provided in the Assignment, Purchase and Amendment Agreement, and thereafter
shall be binding upon and inure to the benefit of the Borrower, the Agent and
each Lender and their respective successors and assigns, except that the
Borrower shall not have the right to assign its rights hereunder or any interest
herein without the prior consent of all the Lenders.

        SECTION 6.04. Successors and Assigns.

               (a) The provisions of this Agreement shall be binding upon and
inure to the benefit of the parties hereto and their respective successors and
assigns permitted hereby, except that the Borrower may not assign or otherwise
transfer any of its rights or obligations hereunder without the prior written
consent of each Lender (and any attempted assignment or transfer by

                                       17
<PAGE>

the Borrower without such consent shall be null and void). Nothing in this
Agreement, expressed or implied, shall be construed to confer upon any person
(other than the parties hereto, their respective successors and assigns
permitted hereby and, to the extent expressly contemplated hereby, the
Affiliates of each of the Agent and the Lenders) any legal or equitable right,
remedy or claim under or by reason of this Agreement.

               (b) Any Lender may assign to one or more assignees all or a
portion of its rights and obligations under this Agreement (including all or a
portion of the Loans at the time owing to it) provided that (i) except in the
case of an assignment to a Lender or an Affiliate of a Lender, each of the
Borrower and the Agent must give their prior written consent to such assignment
(which consent shall not be unreasonably withheld or delayed), (ii) except in
the case of an assignment to a Lender or an Affiliate of a Lender or an
assignment of the entire remaining amount of the assigning Lender's Loans, the
amount of the Loans of the assigning Lender subject to each such assignment
(determined as of the date the Assignment and Acceptance with respect to such
assignment is delivered to the Agent) shall not be less than $500,000 unless
each of the Borrower and the Agent otherwise consent, (iii) the parties to each
assignment shall execute and deliver to the Agent an Assignment and Acceptance,
together with a processing and recordation fee of $3,500, and (iv) the assignee,
if it shall not be a Lender, shall deliver to the Agent an Administrative
Questionnaire; and provided further that any consent of the Borrower otherwise
required under this paragraph shall not be required if an Event of Default has
occurred and is continuing. Subject to acceptance and recording thereof pursuant
to paragraph (d) of this Section, from and after the effective date specified in
each Assignment and Acceptance the assignee thereunder shall be a party hereto
and, to the extent of the interest assigned by such Assignment and Acceptance,
have the rights and obligations of a Lender under this Agreement, and the
assigning Lender thereunder shall, to the extent of the interest assigned by
such Assignment and Acceptance, be released from its obligations under this
Agreement (and, in the case of an Assignment and Acceptance covering all of the
assigning Lender's rights and obligations under this Agreement, such Lender
shall cease to be a party hereto but shall continue to be entitled to the
benefits of Sections 2.08 and 6.05). Any assignment or transfer by a Lender of
rights or obligations under this Agreement that does not comply with this
paragraph shall be treated for purposes of this Agreement as a sale by such
Lender of a participation in such rights and obligations in accordance with
paragraph (e) of this Section.

               (c) The Agent, acting for this purpose as the Agent of the
Borrower, shall maintain at one of its offices in The City of New York a copy of
each Assignment and Acceptance delivered to it and a register for the
recordation of the names and addresses of the Lenders and the principal amount
of the Loans owing to each Lender pursuant to the terms hereof from time to time
(the "Register"). The entries in the Register shall be conclusive, and the
Borrower, the Agent and the Lenders may treat each person whose name is recorded
in the Register pursuant to the terms hereof as a Lender hereunder for all
purposes of this Agreement, notwithstanding notice to the contrary. The Register
shall be available for inspection by the Borrower and any Lender, at any
reasonable time and from time to time upon reasonable prior notice.

               (d) Upon its receipt of a duly completed Assignment and
Acceptance executed by an assigning Lender and an assignee, the assignee's
completed Administrative Questionnaire (unless the assignee shall already be a
Lender hereunder), the processing and

                                       18
<PAGE>

recordation fee referred to in paragraph (b) of this Section and any written
consent to such assignment required by paragraph (b) of this Section, the Agent
shall accept such Assignment and Acceptance and record the information contained
therein in the Register. No assignment shall be effective for purposes of this
Agreement unless it has been recorded in the Register as provided in this
paragraph.

               (e) Any Lender may, without the consent of the Borrower or the
Agent, sell participations to one or more banks or other entities (a
"Participant") in all or a portion of such Lender's rights and obligations under
this Agreement (including all or a portion of the Loans owing to it) provided
that (i) such Lender's obligations under this Agreement shall remain unchanged,
(ii) such Lender shall remain solely responsible to the other parties hereto for
the performance of such obligations and (iii) the Borrower, the Agent and the
other Lenders shall continue to deal solely and directly with such Lender in
connection with such Lender's rights and obligations under this Agreement. Any
agreement or instrument pursuant to which a Lender sells such a participation
shall provide that such Lender shall retain the sole right to enforce the Loan
Documents and to approve any amendment, modification or waiver of any provision
of the Loan Documents; provided that such agreement or instrument may provide
that such Lender will not, without the consent of the Participant, agree to any
amendment, modification or waiver described in the first proviso to Section
6.08(b) that affects such Participant. Subject to paragraph (f) of this Section,
the Borrower agrees that each Participant shall be entitled to the benefits of
Section 2.08 to the same extent as if it were a Lender and had acquired its
interest by assignment pursuant to paragraph (b) of this Section. To the extent
permitted by law, each Participant also shall be entitled to the benefits of
Section 6.06 as though it were a Lender, provided such Participant agrees to be
subject to Section 2.06 as though it were a Lender.

               (f) A Participant shall not be entitled to receive any greater
payment under Section 2.08 than the applicable Lender would have been entitled
to receive with respect to the participation sold to such Participant, unless
the sale of the participation to such Participant is made with the Borrower's
prior written consent. A Participant that would be a Foreign Lender if it were a
Lender shall not be entitled to the benefits of Section 2.08 unless the Borrower
is notified of the participation sold to such Participant and such Participant
agrees, for the benefit of the Borrower, to comply with Section 2.08(f) as
though it were a Lender.

               (g) Any Lender may at any time pledge or assign a security
interest in all or any portion of its rights under this Agreement to secure
obligations of such Lender, including any pledge or assignment to secure
obligations to a Federal Reserve Bank, and this Section shall not apply to any
such pledge or assignment of a security interest; provided that no such pledge
or assignment of a security interest shall release a Lender from any of its
obligations hereunder or substitute any such pledgee or assignee for such Lender
as a party hereto.

                                       19
<PAGE>

        SECTION 6.05. Expenses; Indemnity.

               (a) The Borrower agrees to pay all reasonable out-of-pocket
expenses incurred by the Agent in connection with the preparation of this
Agreement and the other Loan Documents or in connection with any amendments,
modifications or waivers of the provisions hereof or thereof (whether or not the
transactions contemplated hereby shall be consummated) or incurred by the Agent
or any Lender in connection with the enforcement or protection of their rights
in connection with this Agreement and the other Loan Documents or in connection
with the Loans, including the reasonable fees, charges and disbursements of
Cravath, Swaine & Moore, counsel for the Agent, and, in connection with any such
amendment, modification or waiver or any such enforcement or protection, the
fees, charges and disbursements of any other counsel for the Agent or any
Lender.

               (b) The Borrower agrees to indemnify the Agent, each Lender and
each of their respective directors, officers, employees and agents (each such
person being called an "Indemnitee") against, and to hold each Indemnitee
harmless from, any and all losses, claims, damages, liabilities and related
expenses, including counsel fees, charges and disbursements, incurred by or
asserted against any Indemnitee arising out of, in any way connected with, or as
a result of (i) the execution or delivery of or any acts taken or not taken
under this Agreement or the Existing Credit Agreement or any other Loan Document
or the Intercreditor Agreement or any amendment to or any agreement or
instrument contemplated by any of the foregoing, the performance by the parties
thereto of their respective obligations thereunder or the consummation of the
transactions contemplated thereby, (ii) the use of the proceeds of the Loans,
(iii) any default in payment or prepayment of the principal amount of the Loans
or any part thereof or interest accrued thereon, as and when due and payable (at
the due date thereof, whether by scheduled maturity, acceleration, irrevocable
notice of prepayment or otherwise), (iv) the occurrence of any Default or Event
of Default or (v) any claim, litigation, investigation or proceeding relating to
any of the foregoing, whether or not any Indemnitee is a party thereto; provided
that such indemnity shall not, as to any Indemnitee, be available to the extent
that such losses, claims, damages, liabilities or related expenses have resulted
from the gross negligence or willful misconduct of such Indemnitee.

               (c) To the extent that the Borrower fails to pay any amount
required to be paid by it to the Agent under paragraph (a) or (b) of this
Section, each Lender severally agrees to pay to the Agent such Lender's pro rata
share (determined as of the time that the applicable unreimbursed expense or
indemnity payment is sought) of such unpaid amount; provided that the
unreimbursed expense or indemnified loss, claim, damage, liability or related
expense, as the case may be, was incurred by or asserted against the Agent in
its capacity as such. For purposes hereof, a Lender's "pro rata share" shall be
determined based upon its share of the sum of the total outstanding Loans at or
most recently prior to the time.

               (d) To the extent permitted by applicable law, neither the
Borrower nor any of its Affiliates shall assert, and each hereby waives, any
claim against any Indemnitee, on any theory of liability, for special, indirect,
consequential or punitive damages (as opposed to direct or actual damages)
arising out of, in connection with or as a result of this Agreement, any
agreement or instrument contemplated hereby or any act of any person in
connection herewith.

                                       20
<PAGE>

               (e) The provisions of this Section shall remain operative and in
full force and effect regardless of the expiration of the term of this
Agreement, the consummation of the transactions contemplated hereby, the
repayment of any of the Loans, the invalidity or unenforceability of any term or
provision of this Agreement or any other Loan Document, or any investigation
made by or on behalf of the Agent or any Lender. All amounts due under this
Section shall be payable on written demand therefor.

        SECTION 6.06. Right of Setoff. If an Event of Default shall have
occurred and be continuing, each Lender is hereby authorized at any time and
from time to time, to the fullest extent permitted by law, to set off and apply
any and all deposits (general or special, time or demand, provisional or final)
at any time held and other indebtedness at any time owing by such Lender to or
for the credit or the account of the Borrower against any of and all the
obligations of the Borrower now or hereafter existing under this Agreement and
other Loan Documents held by such Lender, irrespective of whether or not such
Lender shall have made any demand under this Agreement or such other Loan
Document and although such obligations may be unmatured. The rights of each
Lender under this Section are in addition to other rights and remedies
(including other rights of setoff) which such Lender may have.

        SECTION 6.07. APPLICABLE LAW. THIS AGREEMENT AND THE OTHER LOAN
DOCUMENTS SHALL BE CONSTRUED IN ACCORDANCE WITH AND GOVERNED BY THE LAWS OF THE
STATE OF NEW YORK.

        SECTION 6.08. Waivers; Amendment.

               (a) No failure or delay of the Agent or any Lender in exercising
any power or right hereunder shall operate as a waiver thereof, nor shall any
single or partial exercise of any such right or power, or any abandonment or
discontinuance of steps to enforce such a right or power, preclude any other or
further exercise thereof or the exercise of any other right or power. The rights
and remedies of the Agent and the Lenders hereunder and under the other Loan
Documents are cumulative and are not exclusive of any rights or remedies which
they would otherwise have. No waiver of any provision of this Agreement or any
other Loan Document or consent to any departure by the Borrower therefrom shall
in any event be effective unless the same shall be permitted by paragraph (b)
below, and then such waiver or consent shall be effective only in the specific
instance and for the purpose for which given. No notice or demand on the
Borrower in any case shall entitle the Borrower to any other or further notice
or demand in similar or other circumstances.

               (b) None of this Agreement or any of the other Loan Documents or
any provision hereof or thereof may be waived, amended or modified except, in
the case of this Agreement, pursuant to an agreement or agreements in writing
entered into by the Borrower and the Required Lenders or, in the case of any
other Loan Document, pursuant to an agreement or agreements in writing entered
into by the Agent and the Loan Party or Loan Parties that are parties thereto,
in each case with the consent of the Required Lenders; provided, however, that
no such agreement shall (i) decrease the principal amount of, or extend the
maturity of or any scheduled principal payment date or date for the payment of
any interest on any Loan, or waive or excuse any such payment or any part
thereof, or decrease the rate of interest on any Loan or any fees, without the
prior written consent of each Lender affected thereby, (ii) change

                                       21
<PAGE>

Section 2.04, or any provision of this Agreement in a manner that would alter
the pro rata sharing of payments required thereby, without the written consent
of each Lender, (iii) amend or modify the provisions of this Section, the
definition of "Required Lenders" or any other provision of any Loan Document
specifying the number or percentage of Lenders required to waive, amend or
modify any rights thereunder or make any determination or grant any consent
thereunder, without the prior written consent of each Lender, (iv) release any
substantial part of the Collateral without the prior written consent of each
Lender or (v) release any Subsidiary from its guarantee under the Guarantee
Agreement, or limit its liability in respect of such guarantee, without the
written consent of each Lender; provided further that no such agreement shall
amend, modify or otherwise affect the rights or duties of the Agent hereunder
without the prior written consent of the Agent.

               (c) Notwithstanding any other provision of this Agreement to the
contrary, each amendment or waiver of this Agreement entered into or deemed to
have been entered into pursuant to Section 2(e) of the Intercreditor Agreement
shall terminate at such time as all the loans under the CIT Facility shall have
been repaid or purchased as contemplated by Section 6.18 with the same effect as
if such amendment or waiver had never become effective.

        SECTION 6.09. Interest Rate Limitation. Notwithstanding anything herein
to the contrary, if at any time the interest rate applicable to any Loan,
together with all fees, charges and other amounts which are treated as interest
on such Loan under applicable law (collectively the "Charges"), shall exceed the
maximum lawful rate (the "Maximum Rate") which may be contracted for, charged,
taken, received or reserved by the Lender holding such Loan in accordance with
applicable law, the rate of interest payable in respect of such Loan hereunder,
together with all Charges payable in respect thereof, shall be limited to the
Maximum Rate and, to the extent lawful, the interest and Charges that would have
been payable in respect of such Loan but were not payable as a result of the
operation of this Section shall be cumulated and the interest and Charges
payable to such Lender in respect of other Loans or periods shall be increased
(but not above the Maximum Rate therefor) until such cumulated amount, together
with interest thereon at the Federal Funds Effective Rate to the date of
repayment, shall have been received by such Lender.

        SECTION 6.10. Entire Agreement. This Agreement and the other Loan
Documents constitute the entire contract between the parties relative to the
subject matter hereof. Any previous agreement among the parties with respect to
the subject matter hereof is superseded by this Agreement and the other Loan
Documents. Nothing in this Agreement or in the other Loan Documents, expressed
or implied, is intended to confer upon any party other than the parties hereto
and thereto any rights, remedies, obligations or liabilities under or by reason
of this Agreement or the other Loan Documents.

        SECTION 6.11. WAIVER OF JURY TRIAL. EACH PARTY HERETO HEREBY WAIVES, TO
THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY RIGHT IT MAY HAVE TO A TRIAL
BY JURY IN RESPECT OF ANY LITIGATION OR OTHER PROCEEDING DIRECTLY OR INDIRECTLY
ARISING OUT OF, UNDER OR IN CONNECTION WITH THIS AGREEMENT OR ANY OF THE OTHER
LOAN DOCUMENTS. EACH PARTY HERETO (A) CERTIFIES THAT NO REPRESENTATIVE, AGENT OR
ATTORNEY OF ANY OTHER PARTY HAS REPRESENTED, EXPRESSLY OR

                                       22
<PAGE>

OTHERWISE, THAT SUCH OTHER PARTY WOULD NOT, IN THE EVENT OF LITIGATION, SEEK TO
ENFORCE THE FOREGOING WAIVER AND (B) ACKNOWLEDGES THAT IT AND THE OTHER PARTIES
HERETO HAVE BEEN INDUCED TO ENTER INTO THIS AGREEMENT AND THE OTHER LOAN
DOCUMENTS, AS APPLICABLE, BY, AMONG OTHER THINGS, THE MUTUAL WAIVERS AND
CERTIFICATIONS IN THIS SECTION 6.11.

        SECTION 6.12. Severability. In the event any one or more of the
provisions contained in this Agreement or in any other Loan Document should be
held invalid, illegal or unenforceable in any respect, the validity, legality
and enforceability of the remaining provisions contained herein and therein
shall not in any way be affected or impaired thereby. The parties shall endeavor
in good-faith negotiations to replace the invalid, illegal or unenforceable
provisions with valid provisions the economic effect of which comes as close as
possible to that of the invalid, illegal or unenforceable provisions.

        SECTION 6.13. Counterparts. This Agreement may be executed in two or
more counterparts, each of which shall constitute an original but all of which
when taken together shall constitute but one contract. Delivery of an executed
counterpart of a signature page of this Agreement by telecopy shall be effective
as delivery of a manually executed counterpart of this Agreement.

        SECTION 6.14. Headings. Article and Section headings and the Table of
Contents used herein are for convenience of reference only, are not part of this
Agreement and are not to affect the construction of, or to be taken into
consideration in interpreting, this Agreement.

        SECTION 6.15. Jurisdiction; Consent to Service of Process.

               (a) The Borrower hereby irrevocably and unconditionally submits,
for itself and its property, to the nonexclusive jurisdiction of any New York
State court or Federal court of the United States of America sitting in New York
City, and any appellate court from any thereof, in any action or proceeding
arising out of or relating to this Agreement or the other Loan Documents, or for
recognition or enforcement of any judgment, and each of the parties hereto
hereby irrevocably and unconditionally agrees that all claims in respect of any
such action or proceeding may be heard and determined in such New York State or,
to the extent permitted by law, in such Federal court. Each of the parties
hereto agrees that a final judgment in any such action or proceeding shall be
conclusive and may be enforced in other jurisdictions by suit on the judgment or
in any other manner provided by law. Nothing in this Agreement shall affect any
right that any party may otherwise have to bring any action or proceeding
relating to this Agreement or the other Loan Documents against any other party
or its properties in the courts of any jurisdiction.

               (b) The Borrower hereby irrevocably and unconditionally waives,
to the fullest extent it may legally and effectively do so, any objection which
it may now or hereafter have to the laying of venue of any suit, action or
proceeding arising out of or relating to this agreement or the other Loan
Documents in any New York State or Federal court. Each of the parties hereto
hereby irrevocably waives, to the fullest extent permitted by law, the defense
of an inconvenient forum to the maintenance of such action or proceeding in any
such court.

                                       23
<PAGE>

               (c) Each party to this Agreement irrevocably consents to service
of process in the manner provided for notices in Section 6.01. Nothing in this
Agreement will affect the right of any party to this Agreement to serve process
in any other manner permitted by law.

        SECTION 6.16. Confidentiality.

               (a) The Agent and each Lender agrees to maintain the
confidentiality of the Information (as defined below), except that Information
may be disclosed (a) to its and its Affiliates' directors, officers, employees
and agents, including accountants, legal counsel and other advisors (it being
understood that the persons to whom such disclosure is made will be informed of
the confidential nature of such Information and instructed to keep such
Information confidential), (b) to the extent requested by any regulatory
authority, (c) to the extent required by applicable laws or regulations or by
any subpoena or similar legal process, (d) to any other party to this Agreement,
(e) in connection with the exercise of any remedies hereunder or any suit,
action or proceeding relating to this Agreement or the enforcement of rights
hereunder, (f) subject to an agreement containing provisions substantially the
same as those of this Section, to any assignee of or Participant in, or any
prospective assignee of or Participant in, any of its rights or obligations
under this Agreement, (g) with the written consent of the Borrower or (h) to the
extent such Information (i) becomes publicly available other than as a result of
a breach of this Section or (ii) becomes available to the Agent or any Lender on
a nonconfidential basis from a source other than a Borrower. For the purposes of
this Section, "Information" means all information received from the Borrower
relating to the Borrower or its business, other than any such information that
is available to the Agent or any Lender on a nonconfidential basis prior to
disclosure by the Borrower; provided that, in the case of information received
from the Borrower after the date hereof, such information is clearly identified
at the time of delivery as confidential. Any Person required to maintain the
confidentiality of Information as provided in this Section shall be considered
to have complied with its obligation to do so if such Person has exercised the
same degree of care to maintain the confidentiality of such Information as such
Person would accord to its own confidential information.

               (b) Each Transferee shall be deemed, by accepting any assignment
or participation hereunder, to have agreed to be bound by this Section 6.16.

        SECTION 6.17. CERTAIN AGREEMENTS. EACH LENDER, BY EXECUTING THIS
AGREEMENT, IRREVOCABLY AUTHORIZES THE AGENT TO EXECUTE AND DELIVER THE
INTERCREDITOR AGREEMENT AND ALL AGREEMENTS AND INSTRUMENTS EXECUTED IN
CONNECTION WITH THE SALE AND ASSIGNMENT OF THE MORTGAGE LOANS AND THE NEW YORK
MORTGAGE (AS EACH SUCH TERM IS DEFINED IN THE ASSIGNMENT, PURCHASE AND AMENDMENT
AGREEMENT TO WHICH THIS AGREEMENT IS ATTACHED AS AN EXHIBIT) AND TO MAKE ON ITS
BEHALF THE REPRESENTATIONS AND WARRANTIES AND AGREE ON ITS BEHALF TO THE
COVENANTS AND AGREEMENTS CONTAINED THEREIN. EACH LENDER AGREES THAT IT WILL HAVE
THE SOLE RESPONSIBILITY FOR THE ACCURACY AND PERFORMANCE OF ALL REPRESENTATIONS,
WARRANTIES, COVENANTS AND AGREEMENTS MADE IN SUCH AGREEMENTS AND INSTRUMENTS
INSOFAR AS THEY RELATE TO IT AND AGREES PROMPTLY TO INDEMNIFY THE AGENT FOR ANY
LOSSES, LIABILITIES OR EXPENSES THAT MAY RESULT OR BE ALLEGED TO RESULT FROM ANY
BREACH OF ANY REPRESENTATION, WARRANTY, COVENANT OR AGREEMENT ATTRIBUTABLE TO IT
OR TO ANY ACT OR FAILURE TO ACT BY IT.

                                       24
<PAGE>

        SECTION 6.18. Purchase of CIT Obligations. In the event the Lenders
shall purchase any Term Loans (as such term is defined in the CIT Credit
Agreement) pursuant to Section 12 of the Intercreditor Agreement, the Borrower
and the Lenders agree that such Term Loans shall at all times after the
effectiveness of such purchase constitute, and be governed by the terms
(including maturity, interest rates and prepayment events) applicable to,
"Loans" under and as defined in this Agreement for all purposes of this
Agreement and each other Loan Document (whether entered into prior to, on or
after the Closing Date). The Borrower further agrees that any such Loans shall
continue to be secured by all the Collateral securing the other Loans on the
date of such purchase (in addition to any real property of any Loan Party
securing such Loans at the time of such purchase), and the Borrower covenants
and agrees to execute and deliver any agreements or other documents deemed
necessary or advisable by the Collateral Agent in order to give effect to the
foregoing, including any documentation providing for the assignment of any
mortgage of real property securing such Loans to the Collateral Agent on behalf
of the Lenders.

                                       25
<PAGE>

        IN WITNESS WHEREOF, the Borrower, the Agent and the Lenders have caused
this Agreement to be duly executed by their respective authorized officers as of
the day and year first above written.

                                        MTS, INCORPORATED

                                        By:  /s/  DeVaughn Searson
                                           -------------------------------------
                                        Name:  DeVaughn Searson
                                        Title: Secretary

                                        JPMORGAN CHASE BANK, individually and as
                                        Administrative Agent,

                                        By:  /s/  Susan E. Atkins
                                           -------------------------------------
                                        Name:  Susan E. Atkins
                                        Title: Managing Director

<PAGE>

                                        SIGNATURE PAGE TO AMENDED AND RESTATED
                                        MTS TERM LOAN AGREEMENT DATED ON OR
                                        ABOUT OCTOBER 7, 2002

                                        To Approve the Agreement

                                        Name of Institution:

                                        BNP Paribas

                                        By:  /s/  Edward V. Canale
                                           -------------------------------------
                                        Name:  Edward V. Canale
                                        Title: Managing Director

                                        By:  /s/  Albert A. Young, Jr.
                                           -------------------------------------
                                        Name:  Albert A. Young, Jr.
                                        Title: Managing Director

<PAGE>

                                        SIGNATURE PAGE TO AMENDED AND RESTATED
                                        MTS TERM LOAN AGREEMENT DATED ON OR
                                        ABOUT OCTOBER 7, 2002

                                        To Approve the Agreement

                                        Name of Institution:

                                        California Bank & Trust

                                        By:  /s/  Robert K. Chaulk
                                           -------------------------------------
                                        Name:  Robert K. Chaulk
                                        Title: Senior Vice President

<PAGE>

                                        SIGNATURE PAGE TO AMENDED AND RESTATED
                                        MTS TERM LOAN AGREEMENT DATED ON OR
                                        ABOUT OCTOBER 7, 2002

                                        To Approve the Agreement

                                        Name of Institution:

                                        Lloyds TSB Bank Plc

                                        By:  /s/  Matthew A.L. Packham
                                           -------------------------------------
                                        Name:  Matthew A.L. Packham
                                        Title: Assistant Director
                                               Credit Services

                                        By:  /s/  Mark Grant
                                           -------------------------------------
                                        Name:  Mark Grant
                                        Title: Senior Vice President
                                               & Chief Credit Officer

<PAGE>

                                        SIGNATURE PAGE TO AMENDED AND RESTATED
                                        MTS TERM LOAN AGREEMENT DATED ON OR
                                        ABOUT OCTOBER 7, 2002

                                        To Approve the Agreement

                                        Name of Institution:

                                        The Mitsubishi Trust and Banking
                                        Corporation

                                        By:  /s/  Yasushi Ishikawa
                                           -------------------------------------
                                        Name:  Yasushi Ishikawa
                                        Title: Senior Vice President

<PAGE>

                                        SIGNATURE PAGE TO AMENDED AND RESTATED
                                        MTS TERM LOAN AGREEMENT DATED ON OR
                                        ABOUT OCTOBER 7, 2002

                                        To Approve the Agreement

                                        Name of Institution:

                                        Mizuho Corporate Bank, Ltd.
                                        (f/k/a/ The Fuji Bank, Limited)

                                        By:  /s/  Masahito Fukuda
                                           -------------------------------------
                                        Name:  Masahito Fukuda
                                        Title: Senior Vice President

<PAGE>

                                        SIGNATURE PAGE TO AMENDED AND RESTATED
                                        MTS TERM LOAN AGREEMENT DATED ON OR
                                        ABOUT OCTOBER 7, 2002

                                        To Approve the Agreement

                                        Name of Institution:

                                        Societe Generale

                                        By:  /s/  R. Wayne Hutton
                                           -------------------------------------
                                        Name:  R. Wayne Hutton
                                        Title: Director Corporate Banking

<PAGE>

                                        SIGNATURE PAGE TO AMENDED AND RESTATED
                                        MTS TERM LOAN AGREEMENT DATED ON OR
                                        ABOUT OCTOBER 7, 2002

                                        To Approve the Agreement

                                        Name of Institution:

                                        Sumitomo Mitsui Banking Corporation

                                        By:  /s/  David A. Buck
                                           -------------------------------------
                                        Name:  David A. Buck
                                        Title: Senior Vice President

<PAGE>

                                        SIGNATURE PAGE TO AMENDED AND RESTATED
                                        MTS TERM LOAN AGREEMENT DATED ON OR
                                        ABOUT OCTOBER 7, 2002

                                        To Approve the Agreement

                                        Name of Institution:

                                        UFJ Bank Limited

                                        By:  /s/  Toshiko Boyd
                                           -------------------------------------
                                        Name:  Toshiko Boyd
                                        Title: Vice President

<PAGE>

                                        SIGNATURE PAGE TO AMENDED AND RESTATED
                                        MTS TERM LOAN AGREEMENT DATED ON OR
                                        ABOUT OCTOBER 7, 2002

                                        To Approve the Agreement

                                        Name of Institution:

                                        Union Bank of California, N.A.

                                        By:  /s/  Cecilia M. Valente
                                           -------------------------------------
                                        Name:  Cecilia M. Valente
                                        Title: Senior Vice President

<PAGE>

                                        SIGNATURE PAGE TO AMENDED AND RESTATED
                                        MTS TERM LOAN AGREEMENT DATED ON OR
                                        ABOUT OCTOBER 7, 2002

                                        To Approve the Agreement

                                        Name of Institution:

                                        U.S. Bank

                                        By:  /s/  Mark A. Esnoz
                                           -------------------------------------
                                        Name:  Mark A. Esnoz
                                        Title: Vice President

<PAGE>

                                        SIGNATURE PAGE TO AMENDED AND RESTATED
                                        MTS TERM LOAN AGREEMENT DATED ON OR
                                        ABOUT OCTOBER 7, 2002

                                        To Approve the Agreement

                                        Name of Institution:

                                        Wachovia Bank, National Association

                                        By:  /s/  Colleen McCullum
                                           -------------------------------------
                                        Name:  Colleen McCullum
                                        Title: DirectorQuickLinks
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Exhibit 10.15  

 
 

FORM OF
  INDEMNITY AGREEMENT    
  

        THIS INDEMNITY AGREEMENT is made and entered into as of            , 2002, by and between Wynn Resorts, Limited, a Nevada
corporation (the
"Company") and                        (the "Indemnitee"), as an
"Agent" (as hereinafter defined) of the Company. 

RECITALS  

        A.    The Company recognizes that competent and experienced individuals are reluctant to serve as directors or officers of corporations unless they are
protected by comprehensive liability insurance or indemnification, or both, due to increased exposure to litigation costs and risks resulting from their service to such corporations, and due to the
fact that the exposure frequently bears no reasonable relationship to the compensation of such directors and officers; 

        B.    The
Company and the Indemnitee are aware of the substantial growth in the number of lawsuits filed against corporate officers and directors in connection with their
activities in such capacities and by reason of their status as such; 

        C.    The
statutes and judicial decisions regarding the duties of directors and officers are often difficult to apply, ambiguous or conflicting, and therefore fail to provide
such directors and officers with adequate or reliable advance knowledge or guidance with respect to the legal risks and potential liabilities to which they may be come personally exposed or
information regarding the proper course of action to take in performing their duties in good faith for the Company; 

        D.    The
Company and the Indemnitee recognize that plaintiffs often seek damages in such large amounts and the costs of litigation may be so enormous (whether or not the case
is meritorious), that the
defense and/or settlement of such litigation is often beyond the financial resources of officers and directors; 

        E.    The
Company believes that it is unfair for its directors and officers and the directors and officers of its subsidiaries to assume the risk of huge judgments and other
Expenses which may occur in cases in which the director or officer received no personal profit and in cases where the director or officer was not culpable; 

        F.    The
Company, after reasonable investigation, has determined that the liability insurance coverage presently available to the Company and its subsidiaries is inadequate
and/or unreasonably expensive. The Company believes that the interests of the Company and its stockholders would best be served by a combination of such insurance as the Company or its subsidiaries
may hereafter obtain and the indemnification by the Company of the directors and officers of the Company and its subsidiaries; 

        G.    Section 78.7502
of the Nevada Revised Statutes, as amended ("NRS"), empowers the Company to indemnify its officers,
directors, employees and agents and indemnify persons who serve or served, at the request of the Company, as the directors, officers, employees or agents of another corporation, partnership, joint
venture, trust or other enterprise and NRS 78.751(2) further provides that the articles, bylaws or an agreement may provide that the expenses of officers and directors incurred in defending a civil or
criminal action, suit or proceeding must be paid by the Company as they are incurred and in advance. 

        H.    NRS
78.751 expressly provides that the indemnification authorized by NRS 78.7502 and the advancement of expenses authorized in NRS 78.751(2) do not exclude any other
rights to which those seeking indemnification or advancement thereunder may be entitled under the articles of incorporation or any bylaw, agreement, vote of stockholders or disinterested directors or
otherwise; 

        I.    In
order to induce and encourage highly experienced and capable individuals to serve as an officer or director of the Company, to take the business risks necessary for
the success of the Company 

 

and its subsidiaries and to otherwise promote the desirable end that such persons will resist what they consider unjustifiable lawsuits and claims made against them in connection with good faith
performance of their duties to the Company, secure in the knowledge that certain expenses, costs and liabilities incurred by them in their defense of such litigation will be borne by the Company and
that they will receive the maximum protection against such risks and liabilities as may be afforded by law, the Board of Directors of the Company has determined, after due consideration and
investigation of the terms
and provisions of this Agreement and the various other options available to the Company and the Indemnitee in lieu hereof, that contractual indemnification as set forth herein is not only reasonable
and prudent but necessary to promote and ensure the best interests of the Company, its stockholders and its subsidiaries; 

        J.    The
Company desires and has requested the Indemnitee to serve or continue to serve as a director or officer of the Company and/or one or more subsidiaries of the Company,
as the case may be, free from undue concern for unpredictable, inappropriate or unreasonable legal risks and personal liabilities arising out of or related to such services to the Company and/or one
or more of its subsidiaries; 

        K.    The
Indemnitee has served or is willing to serve, or continue to serve, the Company and/or one or more of its subsidiaries provided that he or she is furnished the
indemnity provided for herein; and 

        L.    Certain
Indemnitees have recently served as an Agent (as defined herein) in reliance of the Company's promise to enter into this Agreement upon the Company's ability to
do so as a Nevada corporation. 

TERMS AND CONDITIONS  

        NOW, THEREFORE, in consideration of the above premises and the mutual covenants and agreements set forth herein, the parties hereby agree as follows: 

        1.    Definitions. As used in this Agreement: 

        (a)  The
term "Agent" of the Company shall include any person who is or was a director, officer, employee or other agent of
the Company or was a director, officer, employee or agent of a predecessor corporation of the Company or was a member, manager or managing member of a predecessor limited liability company or
affiliate of such limited liability company or is or was serving in any capacity at the request of the Company as a director, officer, employee, agent, partner, member, manager or fiduciary of, or in
any other capacity for, another corporation or any partnership, joint venture, limited liability company, trust, or other enterprise. 

        (b)  The
term "Proceeding" shall include any threatened, pending or completed action, suit or proceeding, whether brought by
or in the name of the Company or otherwise, and whether of a civil, criminal, administrative or investigative nature including, but not limited to, actions, suits, investigations or proceedings
brought under and/or predicated upon the Securities Act of 1933, as amended, and/or the Securities Exchange Act of 1934, as amended, and/or their respective state counterparts and/or any rule or
regulation promulgated thereunder, in which the Indemnitee may be or may have been involved
as a party or otherwise, by reason of the fact that the Indemnitee is or was an Agent of the Company, by reason of any action taken by him or of any inaction on his or her part while acting as an
Agent whether or not he or she is serving in such capacity at the time any liability or expense is incurred for which indemnification or reimbursement can be provided under this Agreement. 

        (c)  The
term "Expenses" shall be broadly construed and shall include all direct and indirect costs incurred, paid or accrued
of any type or nature whatsoever including, without limitation, (i) all attorneys' fees, retainers, court costs, transcripts, fees of experts, witness fees, travel expenses 

2

 

(including food and lodging expenses while traveling), duplicating costs, printing and binding costs, telephone charges, postage, delivery service, freight or other transportation fees and expenses
and related disbursements; (ii) all other disbursements and out-of-pocket costs; (iii) reasonable compensation for time spent by the Indemnitee for which he or
she is not otherwise compensated by the Company or any third party (provided the rate of compensation and estimated time involved is approved in advance by the Board of Directors), actually and
reasonably incurred by the Indemnitee in connection with either the investigation, defense or appeal of a Proceeding or establishing or enforcing a right to indemnification or advancement of expenses
under this Agreement, NRS 78.7502, NRS 78.751 or otherwise; and (iv) amounts paid in settlement by or on behalf of the Indemnitee to the extent permitted by Nevada law;  provided, however, that
"Expenses" shall not include any judgments, fines, penalties or excise taxes
imposed under the Employee Retirement Income Security Act of 1974, as amended, or other excise taxes or penalties actually levied against the Indemnitee. 

        (d)  References
to "other enterprise" shall include, without limitation, employee benefit plans; references to
"fines" shall include, without limitation, any excise tax assessed with respect to any employee benefit plan; and any service as an Agent with respect
to any employee benefit plan, its participants or beneficiaries, and a person who acts in good faith and in a manner he or she reasonably believes to be in the interest of the participants and
beneficiaries of an employee benefit plan, shall be deemed to have acted in a manner "not opposed to the best interests of the Company" as referred to
in this Agreement. 

        (e)  "Independent Legal Counsel" means a law firm, member of a law firm, or attorney that is experienced in matters of
corporate law and neither presently is, nor in the past five years has been, retained to represent: (i) the Company or Indemnitee in any matter material to either such party (other than with
respect to matters concerning the Indemnitee under this Agreement, or of other indemnitees under similar indemnification or indemnity agreements); or (ii) any other party to the Proceeding
giving rise to a claim for indemnification hereunder. Notwithstanding the foregoing, the term "Independent Legal Counsel" shall not include any person
who, under the applicable standards of professional conduct then prevailing, would have a conflict of interest in representing either the Company or Indemnitee in an action to determine Indemnitee's
rights under this Agreement. 

        2.    Agreement to Serve. Unless the Indemnitee is no longer an Agent, the Indemnitee agrees to serve and/or continue to serve
as an Agent of the Company, at his or her will or under separate agreement, as the case may be, in the capacity Indemnitee currently serves as an Agent of the Company, for so long as he or she is duly
appointed or elected and qualified in accordance with the applicable
provisions of the Bylaws of the Company until such time as he or she tenders his or her resignation in writing; provided, however, that nothing contained in this Agreement is intended to create any
right or obligation to continued employment by Indemnitee in any capacity. 

        3.    Indemnification and Contribution. The Company shall indemnify Indemnitee to the fullest extent permitted by Nevada law and
the Articles of Incorporation and Bylaws of the Company in effect on the date hereof or as Nevada law or Articles and Bylaws may from time to time be amended (but, in the case of any such amendment,
only to the extent such amendment permits the Company to provide broader indemnification rights than Nevada law and the Articles and Bylaws permitted the Company to provide before such amendment).
Such indemnification shall include, without limitation, the following: 

        (a)  Indemnity in Third Party Proceedings. The Company shall indemnify Indemnitee if the Indemnitee is a party to or is
threatened to be made a party to or otherwise involved in any Proceeding (other than a Proceeding by or in the name of the Company to procure a judgment in its favor) by reason of the fact that he or
she is or was an Agent of the Company or by reason of 

3

 

any act or inaction by him or her in any such capacity, against all Expenses, judgments, fines and amounts paid in settlement, actually and reasonably incurred by the Indemnitee in connection with
the investigation, defense, settlement or appeal of such Proceeding, if he or she either is not liable pursuant to NRS 78.138 or acted in good faith and in a manner he or she reasonably believed to be
in or not opposed to the best interests of the Company and, in the case of a criminal Proceeding, in addition had no reasonable cause to believe that his or her conduct was unlawful. The termination
of any such Proceeding by judgment, order of court, settlement, conviction or upon a plea of nolo contendere, or its equivalent, does not, of itself, create a presumption that Indemnitee is liable
pursuant to NRS 78.138 or did not act in good faith in a manner which he or she reasonably believed to be in or not opposed to the best interest of the Company, and with respect to any criminal
Proceeding, that such person had reasonable cause to believe that his or her conduct was unlawful. 

        (b)  Indemnity in Derivative Actions. The Company shall indemnify the Indemnitee if the Indemnitee is a party to or threatened
to be made a part to or otherwise involved in any Proceeding by or in the name of the Company to procure a judgment in its favor by reason of the fact that the Indemnitee was or is an Agent of the
Company or by reason of any act or inaction by him in any such capacity, against all Expenses, judgments, fines and amounts paid in settlement actually and reasonably incurred by the Indemnitee in
connection with the investigation, defense, settlement or appeal of such Proceeding, but only if the Indemnitee is not liable pursuant to NRS 78.138 and acted in good faith and in a manner he or she
reasonably believed to be in or not opposed to the best interest of the Company, except that no indemnification under this Paragraph 3 shall be made for any claim, issue or matter to which the
Indemnitee has been adjudged by a court of competent jurisdiction, after the exhaustion of all appeals therefrom, to be liable to the Company or for amounts paid in settlement to the Company, unless
and only to the extent that any court in which such Proceeding is brought or other court of competent jurisdiction determines upon application that, in view of all the circumstances of the case, the
Indemnitee is fairly and reasonably entitled to indemnity for such amounts as the court shall deem proper. 

        (c)  Indemnification of Expenses of Successful Party. Notwithstanding any other provisions of this Agreement, to the extent
that the Indemnitee has been successful on the merits or otherwise in defense of any Proceeding or in defense of any claim, issue or matter therein, including the dismissal of an action without
prejudice, the Company shall indemnify the Indemnitee against all Expenses actually and reasonably incurred by him in connection with the investigation, defense or appeal of such Proceeding. 

        (d)  Indemnification for Expenses of a Witness. Notwithstanding any other provision of this Agreement, the Company will
indemnify the Indemnitee if and whenever he or she is a witness or is threatened to be made a witness to any Proceeding to which Indemnitee is not a party, by reason of the fact that he or she is or
was an Agent or by reason of anything done or not done by him in such capacity, against all Expenses actually and reasonably incurred by the Indemnitee or on Indemnitee's behalf of in connection
therewith. 

        (e)  Contribution. If the indemnification provided in this Agreement is unavailable and may not be paid to Indemnitee for any
reason other than statutory limitations set forth in applicable law, then in respect of any threatened, pending or completed Proceeding in which the Company is jointly liable with Indemnitee (or would
be if joined in such action, suit, arbitration, proceeding, inquiry or investigation), the Company shall contribute to the amount of Expenses, judgments, fines and amounts paid in settlement actually
and reasonably incurred and paid or payable by Indemnitee in such proportion as is appropriate to reflect (i) the relative benefits received by the Company and all officers, directors or
employees of the Company other than Indemnitee who are jointly liable with Indemnitee (or would be in joined in such action, suit or proceeding), on the one hand, and Indemnitee, on the other hand,
from the transaction from which such action, suit, 

4

 

arbitration, proceeding, inquiry or investigation arose, and (ii) the relative fault of the Company and all officers, directors or employees of the Company other than Indemnitee who are
jointly liable with Indemnitee (or would be if joined in such action, suit or proceeding), on the one hand, and of Indemnitee, on the other, in connection with the events which resulted in such
Expenses, judgments, fines and amounts paid in settlement, as well as any other relevant equitable considerations. The relative fault referred to above shall be determined by reference to, among other
things, the parties' relative intent, knowledge, access to information and opportunity to correct or prevent the circumstances resulting in such Expenses, judgments, fines and amounts paid in
settlement. The Company agrees that it would not be just and equitable if contribution pursuant to this subsection were determined by pro rata allocation or any other method of allocation that does
not take account of the foregoing equitable considerations. 

        4.    Advances of Expenses. Subject to Paragraph 11 hereof, the Company shall advance all Expenses incurred by or on
behalf of the Indemnitee in connection with the investigation, defense, settlement or appeal of any Proceeding to which the Indemnitee is a party or is threatened to be made a party by reason of the
fact that the Indemnitee is or was an Agent of the Company or is a witness of the Company in any Proceeding. The Indemnitee hereby undertakes to repay such amounts advanced only if, and to the extent
that, it shall ultimately be determined by a court of competent jurisdiction that the Indemnitee is not entitled to be indemnified by the Company as authorized by this Agreement. The advances to be
made hereunder shall be paid by the Company to or on behalf of the Indemnitee within ten calendar days following delivery of a written request therefor by the Indemnitee to the Company. The request
shall reasonably evidence the Expenses incurred by the Indemnitee in connection
therewith. The Indemnitee's entitlement to advancement of Expenses shall include those incurred in connection with any Proceeding by Indemnitee seeking a determination, adjudication or award in
arbitration pursuant to this Agreement. 

        5.    Independent Legal Counsel.

        The
Company agrees to pay the reasonable fees of the Independent Legal Counsel referred to in Paragraph 1(e) and to fully indemnify such counsel against any and all expenses,
claims, liabilities and damages arising out of or relating to this Agreement or its engagement pursuant hereto. 

        6.    Procedure for Indemnification.

        (a)  Promptly
after receipt by the Indemnitee of the commencement of or the threat of commencement of any Proceeding, the Indemnitee shall, if the Indemnitee believes that
indemnification with respect thereto may be sought for the Company under this Agreement, notify the Company of the commencement or threat of commencement thereof. The notice shall include
documentation or information which is necessary for the determination of entitlement to indemnification and which is reasonably available to the Indemnitee. Delay in so notifying the Company shall not
constitute a waiver or release by Indemnitee or of any rights hereunder. 

        (b)  Any
indemnification requested by the Indemnitee under Paragraph 3 hereof shall be made no later than 60 calendar days after receipt of the written request of
Indemnitee, unless a determination is made within said 60-day period in accordance with Paragraph 3 that the Indemnitee is not entitled to indemnification (i) by the Board of
Directors of the Company by a majority vote of a quorum thereof consisting of directors who are not parties to such Proceedings, or (ii) in the event such a quorum is not obtainable, at the
election of the Company, either by Independent Legal Counsel (selected by the Company and approved by Indemnitee, such approval not to be unreasonably withheld) in a written opinion, by the
stockholders or by a panel of arbitrators, one of whom is selected by the Company, another of whom is selected by the Indemnitee and the last of whom is selected by the first two arbitrators so
selected, that the Indemnitee has not met the relevant standards for indemnification set forth in Paragraph 3 hereof. Upon making a request for indemnification, Indemnitee shall be presumed to
be entitled to 

5

 

indemnification under this Agreement and the Company shall have the burden of proof to overcome that presumption in reaching any contrary determination. 

        (c)  Notwithstanding
a determination under Paragraph 6(b) above that the Indemnitee is not entitled to indemnification with respect to any specific Proceeding, the
Indemnitee shall have the right to apply to any court of competent jurisdiction in the State of Nevada for the purpose of enforcing the Indemnitee's right to indemnification pursuant to this
Agreement, which determination shall be made
de novo and the Indemnitee shall not be prejudiced by reason of a determination that he or she is not entitled to indemnification. The burden of proving that indemnification or advances are not
appropriate shall be on the Company. Neither the failure of the Company (including its Board of Directors, its stockholders, Independent Legal Counsel or the panel of arbitrators) to have made a
determination prior to the commencement of such action that indemnification or advances are proper in the circumstances because the Indemnitee has met the applicable standard of conduct, nor an actual
determination by the Company (including its Board of Directors, its stockholders, Independent Legal Counsel or the panel of arbitrator) that the Indemnitee has not met such applicable standard of
conduct, shall be a defense to the action or create any presumption that the Indemnitee has not met the applicable standard of conduct. 

        (d)  If
an initial determination is made or deemed to have been made pursuant to the terms of this Agreement that the Indemnitee is entitled to indemnification, the Company
shall be bound by such determination in the absence of (i) a misrepresentation of a material fact by Indemnitee in the request for indemnification or (ii) a specific finding (which has
become final) by a court of competent jurisdiction that all or any part of such indemnification is expressly prohibited by law. 

        (e)  The
Company shall indemnify the Indemnitee against all Expenses incurred in connection with any hearing or proceeding under this Paragraph 6 unless a court of
competent jurisdiction finds that each of the claims and/or defenses of the Indemnitee in any such proceeding was frivolous or made in bad faith. 

        7.    Indemnity Hereunder Not Exclusive. The provisions for indemnification and advancement of Expenses contained in this
Agreement shall not be deemed exclusive of any other rights which the Indemnitee may have under any provision of law, the Company's Articles of Incorporation or Bylaws, any vote of stockholders or
disinterested directors, other agreements, insurance, or other financial arrangements or otherwise, both as to action in his or her or her official capacity and as to action in another capacity while
occupying his or her position as an Agent of the Company, except that indemnification, unless ordered by a court pursuant to Paragraph 3 hereof or for the advancement of Expenses pursuant to
Paragraph 4 hereof, may not be made to or on behalf of the Indemnitee if a final adjudication establishes that his or her acts or omissions involved intentional misconduct, fraud or knowing
violation of the law and was material to the cause of action. The Indemnitee's rights hereunder shall continue after the Indemnitee has ceased acting as an Agent of the Company and shall inure to the
benefit of the heirs, devisees, executors, administrators and legal representatives of the Indemnitee. 

        8.    Partial Indemnification. If the Indemnitee is entitled under any provision of this Agreement to indemnification by the
Company for some or a portion of the Expenses, judgments or fines incurred by him in the investigation, defense, settlement or appeal of a Proceeding but not entitled, however, to indemnification for
the total amount thereof, the Company shall nevertheless indemnify the Indemnitee for the portion thereof to which the Indemnitee is entitled. 

        9.    Assumption of Defense. In the event the Company shall be obligated to pay the Expenses of any Proceeding against the
Indemnitee, the Company, if appropriate, shall be entitled to assume the defense of such Proceeding, with counsel approved by the Indemnitee, upon the delivery of the
Indemnitee of written notice of its election to do so. After delivery of such notice, approval of such counsel by the Indemnitee and the retention of such counsel by the Company, the Company will not
be 

6

 

liable to the Indemnitee under this Agreement for any fees of counsel subsequently incurred by the Indemnitee with respect to the same proceeding, provided that (a) the Indemnitee shall have
the right to employ his or her counsel in such Proceeding at the Indemnitee's expense; and (b) if (i) the employment of counsel by the Indemnitee has been previously authorized in
writing by the Company, (ii) the Company shall have reasonably concluded that there may be a conflict of interest between the Company and the Indemnitee in the conduct of any such defense or
(iii) the Company shall not, in fact, have employed counsel to assume the defense of such Proceeding, the fees and expenses of the Indemnitee's counsel shall be at the expense of the Company.
The Company shall not settle any action or claim that would impose any limitation or penalty on the Indemnitee without the Indemnitee's written consent. Neither the Company nor the Indemnitee will
unreasonably withhold its or his or her consent to any proposed settlement. 

        10.    Insurance. The Company shall, from time to time (including prior to the expiration of a D&O Insurance (as defined below)
policy), make the good faith determination whether or not it is practicable for the Company to obtain and maintain a policy or policies of D&O Insurance with reputable insurance companies providing
the officers and directors of the Company with coverage for liabilities arising out of their acts and/or omissions as Agents, or to ensure the Company's performance of its indemnification obligations
under this Agreement (collectively, "D&O Insurance" for this Paragraph 10). Among other considerations, the Company will weigh the costs of
obtaining such insurance coverage against the protection afforded by such coverage. To the extent the Company maintains D&O Insurance, Indemnitee shall be covered by such policies in such a manner as
to provide Indemnitee the same rights and benefits as are accorded to the most favorably insured of the Company's directors in their capacity as directors. Notwithstanding the foregoing, the Company
shall have no obligation to obtain or maintain such insurance if (a) the Company determines in good faith that (i) such insurance is not reasonably available, (ii) the premium
costs for such insurance are substantially disproportionate to the amount of coverage provided or (iii) the coverage provided by such insurance is limited by exclusions so as to provide an
insufficient benefit, or (b) Indemnitee is covered by similar insurance maintained by a subsidiary or parent of the Company or other person under common control with the Company.
Notwithstanding any other provision of the Agreement, the Company shall not be obligated to indemnify Indemnitee for Expenses, judgments, fines, or amounts paid in settlement, which have been paid
directly to Indemnitee by D&O Insurance. If the Company has D&O Insurance in effect at the time the Company receives from Indemnitee any notice of the commencement of a Proceeding, the Company shall
give prompt notice of the commencement of such Proceeding to the insurers in accordance with the procedures set forth in the policy. The Company shall thereafter take all necessary or desirable action
to cause such insurers to pay, on behalf of Indemnitee, all amounts payable as a result of such Proceeding in accordance with the terms of such policy. 

        11.    Exceptions to Indemnification. Notwithstanding any provision herein to the contrary, the Company shall not be obligated
pursuant to the terms of this Agreement: 

        (a)  To
indemnify or advance Expenses to the Indemnitee with respect to proceedings or claims initiated or brought voluntarily by the Indemnitee and not by way of defense,
except with respect to Proceedings
brought to establish or enforce a right to indemnification under this Agreement or any law or otherwise as required under NRS 78.751, but such indemnification or advancement of Expenses may be
provided by the Company in specific cases if the Board of Directors finds it to be appropriate; or 

        (b)  To
indemnify the Indemnitee for any Expenses incurred by the Indemnitee with respect to any proceeding instituted by the Indemnitee to enforce or interpret this
Agreement, if a court of competent jurisdiction determines that each of the material assertions made by the Indemnitee in such proceeding was not made in good faith or was frivolous; or 

7

 

        (c)  To
indemnify the Indemnitee under this Agreement for any amounts paid in settlement of a Proceeding effected without the Company's written consent; or 

        (d)  To
indemnify the Indemnitee on account of any Proceeding with respect to (i) remuneration paid to Indemnitee if it is determined by final judgment or other final
adjudication that such remuneration was in violation of law, (ii) which final judgment is rendered against the Indemnitee for an accounting of profits made from the purchase or sale by
Indemnitee of securities of the Company pursuant to the provisions of Section 16(b) of the Securities Exchange Act of 1934, as amended, the provisions of Section 304 of the
Sarbanes-Oxley Act of 2002 or similar provisions of any federal, state or local statute, or (iii) which it is determined by final judgment or other final adjudication that the Indemnitee
defrauded or stole from the Company or converted to his or her own personal use and benefit business or properties of the Company or was otherwise knowingly dishonest; or 

        (e)  To
indemnify the Indemnitee on account of any Proceeding by the Company to enforce against the Indemnitee or any affiliate of the Indemnitee the provisions of its
Articles of Incorporation or Bylaws with respect to compliance with gaming laws, including, without limitation, provisions governing the removal of the Indemnitee as a director of the Company or the
redemption of securities owned by the Indemnitee or an affiliate of the Indemnitee. 

        12.    Duration and Interpretation of Agreement. It is understood that the parties hereto intend this Agreement to be
interpreted and enforced so as to provide indemnification to the Indemnitee to the fullest extent now or hereafter permitted by law. This Agreement shall continue so long as the Indemnitee shall be
subject to any possible Proceeding by reason of the fact that he or she is or was an Agent and shall be applicable to Proceedings commenced or continued after execution of this Agreement, whether
arising from acts or omissions occurring before or after such execution. 

        13.    Severability. If any provision or provisions of this Agreement shall be held to be invalid, illegal or unenforceable for
any reason whatsoever, (a) the validity, legality and enforceability of the remaining provisions of this Agreement (including, without limitation, all portions of any paragraphs of this
Agreement containing any such provision held to be invalid, illegal or unenforceable, that are not themselves invalid, illegal or unenforceable) shall not in any way be affected or impaired thereby,
and (b) to the fullest extent possible, the provisions of this Agreement (including, without limitation, all portions of any paragraph of this Agreement containing any such provision held to be
invalid, illegal or unenforceable that are not themselves invalid, illegal or unenforceable) shall be construed so as to give effect to the intent manifested by the provisions held invalid, illegal or
unenforceable and to give effect to paragraph 12 hereof. 

        14.    Modification and Waiver. No supplement, modification or amendment of this Agreement shall be binding unless executed in
writing by both of the parties hereto. No waiver of any of the provisions of this Agreement shall be deemed or shall constitute a waiver of any provision hereof (whether or not similar) nor shall such
waiver constitute a continuing waiver. 

        15.    Successor and Assigns. The terms of this Agreement shall be binding upon the Company and its successors and assigns and
shall inure to the benefit of Indemnitee and his or her spouse, assigns, heirs, devisees, executors, administrators and other legal representatives. 

        16.    Notices. All notices or other communications provided for by this Agreement shall be made in writing and shall be deemed
properly delivered when (i) delivered personally or by messenger (including air courier), or (ii by the mailing of such notice to the party entitled thereto, registered or 

8

 

certified mail, postage prepaid to the parties at the following addresses (or to such other addresses designated in writing by one party to the other): 

	

 	
 	

 	
 	

 
	 	 	Company:	 	Wynn Resorts, Limited

3145 Las Vegas Boulevard South

Las Vegas, Nevada 89109

Facsimile: 702.733.4596

Attention: Legal Department
	

 	
 	

 	
 	

 
	 	 	With a copies to:	 	Irell & Manella LLP

1800 Avenue of the Stars, Suite 900

Los Angeles, California 90067

Facsimile: 310.203.7199

Attention: C. Kevin McGeehan, Esq.
	

 	
 	

 	
 	

 
	 	 	Indemnitee:	 	 
	 	 	 	 	

	 	 	 	 	

	 	 	 	 	

	 	 	 	 	

	 	 	 	 	

        17.    Governing Law. This Agreement shall be governed by and construed and enforced in accordance with
the laws of the State of Nevada. 

        18.    Consent of Jurisdiction. The Company and the Indemnitee each hereby irrevocably consent to the jurisdiction of the courts
of the State of Nevada for all purposes in connection with any action or Proceeding which arises out of or relates to this Agreement and agree that any action instituted under this Agreement shall be
brought only in the state courts of the State of Nevada. 

        19.    Subrogation. In the event of payment under this Agreement, the Company shall be subrogated to the extent of such payment
to all of the rights of recovery of Indemnitee, who shall execute all documents required and shall do all acts that may be necessary to secure such rights and to enable the Company effectively to
bring suit to enforce such rights. 

        20.    Counterparts. This Agreement may be executed in one or more counterparts, each of which will be deemed an original but
both of which together will constitute one and the same instrument. 

[signature
page follows] 

9

 

        IN
WITNESS WHEREOF, the parties hereto have duly executed this Indemnity Agreement as of the date first above written. 

	

 	
 	

 	

 
	 	 	Company:
	

 	
 	

 	

 
	 	 	WYNN RESORTS, LIMITED,

a Nevada corporation
	

 	
 	

 	

 
	 	 	By:	 
	 	 	 	

	 	 	Name:	 
	 	 	 	

	 	 	Title:	 
	 	 	 	

	

 	
 	

 	

 
	 	 	Indemnitee:
	

 	
 	

 	

 
	 	 	

	

 	
 	

 	

 
	 	 	Name:	 
	 	 	 	

10

QuickLinks

FORM OF INDEMNITY AGREEMENT

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