Document:

EXHIBIT 4.47

 

[LOUISIANA]

 

 

MORTGAGE, ASSIGNMENT OF LEASES AND RENTS,

SECURITY AGREEMENT AND FIXTURE FILING

 

BY

 

JALOU BREAUX BRIDGE, LLC

 

Mortgagor,

 

TO

 

WELLS FARGO BANK, NATIONAL ASSOCIATION,

 

as Trustee,

 

Mortgagee

 

Securing Principal Indebtedness of $148,000,000

 

Dated as of March 2, 2005

 

 

Relating to Premises located in:

 

St. Martin Parish, Louisiana

 

 

 

 

After recording, please return to:

 

Milbank, Tweed, Hadley & McCloy, LLP

601 South Figueroa Street, 30th Floor

Los Angeles, California 90017

Attn: Matthew S. Meza, Esq.

 

 

 

TABLE OF CONTENTS

 

	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  PREAMBLE

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  RECITALS

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  AGREEMENT

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE I

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  DEFINITIONS
  AND INTERPRETATION

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  SECTION 1.1

  	
   

  	
  Definitions

  	
   

  
	
  SECTION 1.2

  	
   

  	
  Interpretation

  	
   

  
	
  SECTION 1.3

  	
   

  	
  Resolution of
  Drafting Ambiguities

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE II

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  GRANTS AND SECURED
  OBLIGATIONS

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  SECTION 2.1

  	
   

  	
  Grant of Mortgaged
  Property

  	
   

  
	
  SECTION 2.2

  	
   

  	
  Assignment of
  Leases and Rents

  	
   

  
	
  SECTION 2.3

  	
   

  	
  Secured
  Obligations

  	
   

  
	
  SECTION 2.4

  	
   

  	
  Future
  Advances

  	
   

  
	
  SECTION 2.5

  	
   

  	
  No Release

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE III

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  REPRESENTATIONS
  AND WARRANTIES OF MORTGAGOR

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  SECTION
  3.1

  	
   

  	
  Authority
  and Validity

  	
   

  
	
  SECTION 3.2

  	
   

  	
  Warranty of
  Title

  	
   

  
	
  SECTION 3.3

  	
   

  	
  Condition
  of Mortgaged Property

  	
   

  
	
  SECTION 3.4

  	
   

  	
  Leases

  	
   

  
	
  SECTION 3.5

  	
   

  	
  Insurance

  	
   

  
	
  SECTION 3.6

  	
   

  	
  Charges

  	
   

  
	
  SECTION 3.7

  	
   

  	
  Environmental

  	
   

  
	
  SECTION 3.8

  	
   

  	
  No Conflicts,
  Consents, etc

  	
   

  
	
  SECTION 3.9

  	
   

  	
  Benefit to the
  Mortgagor

  	
   

  

 

i

 

	
  ARTICLE IV

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  CERTAIN COVENANTS OF
  MORTGAGOR

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  SECTION 4.1

  	
   

  	
  Preservation of
  Corporate Existence

  	
   

  
	
  SECTION 4.2

  	
   

  	
  Title

  	
   

  
	
  SECTION 4.3

  	
   

  	
  Maintenance and Use
  of Mortgaged Property; Alterations

  	
   

  
	
  SECTION 4.4

  	
   

  	
  Notices
  Regarding Certain Defaults

  	
   

  
	
  SECTION 4.5

  	
   

  	
  Access to Mortgaged
  Property, Books and Records; Other Information

  	
   

  
	
  SECTION
  4.6

  	
   

  	
  Limitation
  on Liens; Transfer Restrictions

  	
   

  
	
  SECTION 4.7

  	
   

  	
  Environmental

  	
   

  
	
  SECTION 4.8

  	
   

  	
  Estoppel
  Certificates

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE V

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  LEASES

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  SECTION 5.1

  	
   

  	
  Mortgagor’s
  Affirmative Covenants with Respect to Leases

  	
   

  
	
  SECTION
  5.2

  	
   

  	
  Mortgagor’s
  Negative Covenants with Respect to Leases

  	
   

  
	
  SECTION
  5.3

  	
   

  	
  Additional
  Requirements with Respect to New Leases

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE VI

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  CONCERNING
  ASSIGNMENT OF LEASES AND RENTS

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  SECTION
  6.1

  	
   

  	
  Present
  Assignment; License to the Mortgagor

  	
   

  
	
  SECTION
  6.2

  	
   

  	
  Collection
  of Rents by the Mortgagee

  	
   

  
	
  SECTION 6.3

  	
   

  	
  No Release

  	
   

  
	
  SECTION 6.4

  	
   

  	
  Irrevocable
  Interest

  	
   

  
	
  SECTION 6.5

  	
   

  	
  Amendment to
  Leases

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE VII

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  TAXES
  AND CERTAIN STATUTORY LIENS

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  SECTION 7.1

  	
   

  	
  Payment of
  Charges

  	
   

  
	
  SECTION 7.2

  	
   

  	
  Escrow of Taxes

  	
   

  
	
  SECTION 7.3

  	
   

  	
  Certain Statutory
  Liens

  	
   

  
	
  SECTION 7.4

  	
   

  	
  Stamp and Other Taxes

  	
   

  
	
  SECTION 7.5

  	
   

  	
  Certain Tax Law
  Changes

  	
   

  
	
  SECTION 7.6

  	
   

  	
  Proceeds of Tax
  Claim

  	
   

  

 

ii

 

	
  ARTICLE VIII

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  INSURANCE

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  SECTION 8.1

  	
   

  	
  Required
  Insurance Policies and Coverages

  	
   

  
	
  SECTION 8.2

  	
   

  	
  Delivery
  After Foreclosure

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE IX

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  CONTESTING OF
  PAYMENTS

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  SECTION 9.1

  	
   

  	
  Contesting of Taxes and
  Certain Statutory Liens

  	
   

  
	
  SECTION 9.2

  	
   

  	
  Contesting of Insurance

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE X

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  DESTRUCTION, CONDEMNATION AND
  RESTORATION

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  SECTION 10.1

  	
   

  	
  Destruction

  	
   

  
	
  SECTION 10.2

  	
   

  	
  Condemnation

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE XI

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  EVENTS OF DEFAULT AND REMEDIES

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  SECTION
  11.1

  	
   

  	
  Events
  of Default

  	
   

  
	
  SECTION
  11.2

  	
   

  	
  Remedies
  in Case of an Event of Default

  	
   

  
	
  SECTION 11.3

  	
   

  	
  Sale of Mortgaged Property if
  Event of Default Occurs; Proceeds of Sale

  	
   

  
	
  SECTION 11.4

  	
   

  	
  Additional Remedies in Case of an Event
  of Default

  	
   

  
	
  SECTION 11.5

  	
   

  	
  Legal Proceedings After an Event of
  Default

  	
   

  
	
  SECTION
  11.6

  	
   

  	
  Remedies
  Not Exclusive

  	
   

  
	
  SECTION
  11.7

  	
   

  	
  Special
  Louisiana Provisions

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE
  XII

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  SECURITY AGREEMENT AND FIXTURE
  FILING

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  SECTION
  12.1

  	
   

  	
  Security
  Agreement

  	
   

  
	
  SECTION 12.2

  	
   

  	
  Fixture Filing

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE
  XIII

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  FURTHER
  ASSURANCES

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  SECTION 13.1

  	
   

  	
  Recording Documentation To Assure
  Security

  	
   

  

 

iii

 

	
  SECTION
  13.2

  	
   

  	
  Further
  Acts

  	
   

  
	
  SECTION 13.3

  	
   

  	
  Additional Security

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE
  XIV

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  MISCELLANEOUS

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  SECTION 14.1

  	
   

  	
  Covenants To Run with the Land

  	
   

  
	
  SECTION
  14.2

  	
   

  	
  No
  Merger

  	
   

  
	
  SECTION
  14.3

  	
   

  	
  Concerning
  Mortgagee

  	
   

  
	
  SECTION 14.4

  	
   

  	
  Mortgagee May Perform; Mortgagee
  Appointed Attorney-in-Fact

  	
   

  
	
  SECTION
  14.5

  	
   

  	
  Expenses

  	
   

  
	
  SECTION
  14.6

  	
   

  	
  Indemnity

  	
   

  
	
  SECTION 14.7

  	
   

  	
  Continuing Security Interest; Assignment

  	
   

  
	
  SECTION 14.8

  	
   

  	
  Termination; Release

  	
   

  
	
  SECTION 14.9

  	
   

  	
  Modification in Writing

  	
   

  
	
  SECTION
  14.10

  	
   

  	
  Notices

  	
   

  
	
  SECTION 14.11

  	
   

  	
  GOVERNING LAW; SERVICE OF PROCESS;
  WAIVER OF JURY TRIAL

  	
   

  
	
  SECTION
  14.12

  	
   

  	
  Severability
  of Provisions

  	
   

  
	
  SECTION 14.13

  	
   

  	
  Limitation on Interest Payable

  	
   

  
	
  SECTION 14.14

  	
   

  	
  Business Days

  	
   

  
	
  SECTION 14.15

  	
   

  	
  Relationship

  	
   

  
	
  SECTION 14.16

  	
   

  	
  Waiver of Stay

  	
   

  
	
  SECTION 14.17

  	
   

  	
  No Credit for Payment of Taxes or
  Impositions

  	
   

  
	
  SECTION
  14.18

  	
   

  	
  No
  Claims Against the Mortgagee

  	
   

  
	
  SECTION
  14.19

  	
   

  	
  Obligations
  Absolute

  	
   

  
	
  SECTION
  14.20

  	
   

  	
  Last
  Dollars Secured

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  SIGNATURE AND
  ACKNOWLEDGMENT

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  SCHEDULE A

  	
   

  	
  Legal
  Description

  	
   

  
	
  SCHEDULE B

  	
   

  	
  Prior Liens

  	
   

  
	
  SCHEDULE C

  	
   

  	
  Leases
  Affecting the Mortgaged Property

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  EXHIBIT 1

  	
   

  	
  Form of
  Subordination, Non-Disturbance and Attornment Agreement

  	
   

  

 

iv

 

MORTGAGE, ASSIGNMENT OF LEASES AND RENTS, SECURITY

AGREEMENT AND FIXTURE FILING

 

MORTGAGE, ASSIGNMENT OF
LEASES AND RENTS, SECURITY AGREEMENT AND FIXTURE FILING (as amended, amended
and restated, supplemented or otherwise modified from time to time, the “Mortgage”),
dated as of March 2, 2005, made by JALOU BREAUX BRIDGE, LLC, a Louisiana
limited liability company having an office at 1869 Mills Highway, Breaux
Bridge, Louisiana 70517, as mortgagor, assignor and debtor (in such capacities
and together with any successors in such capacities, the “Mortgagor”),
in favor of WELLS FARGO BANK, NATIONAL ASSOCIATION, a national banking
association having an office at  213
Court Street, Suite 703, Middletown, CT 06457, in its capacity as trustee
pursuant to the Indenture (as hereinafter defined), as mortgagee, assignee and
secured party (in such capacities and together with any successors in such
capacities, the “Mortgagee”).

 

R
E  C  I  T  A  L
S :

 

A.  Gameco, Inc.
n/k/a Jacobs Entertainment, Inc. (the “Issuer”), certain of its
Subsidiaries (as hereinafter defined), the Mortgagor and the Mortgagee have, in
connection with the execution and delivery of this Mortgage, entered into that
certain Indenture, dated as of February 8, 2002, as supplemented by the First
Supplemental Indenture, dated as of February 22, 2002, the Second Supplemental
Indenture, dated as of June 14, 2002, the Third Supplemental Indenture, dated
as of June 4, 2003, the Fourth Supplemental Indenture, dated as of the date
hereof, and the Fifth Supplemental Indenture, dated as of the date hereof
(collectively, as amended, amended and restated, supplemented, or otherwise
modified from time to time, the “Indenture”), pursuant to which the
Issuer has issued, from time to time, its 117/8% Senior
Secured Notes due 2009 (the “Senior Secured Notes”) in the aggregate
principal amount of $148,000,000.  It is
contemplated that the Issuer may, after the date hereof, issue Additional Notes
(as defined in the Indenture) and Exchange Notes (as defined in the Indenture);
the Exchange Notes, together with the Additional Notes and the Senior Secured
Notes, the “Notes”), in each case, pursuant to the provisions of the
Indenture.

 

B.  The Issuer
owns, directly or through its Subsidiaries, all of the issued and outstanding
shares of the Mortgagor.

 

C.  The
Mortgagor has, pursuant to the Indenture, among other things, unconditionally
guaranteed (the “Guarantee”) the obligations of the Issuer under the
Indenture and the Notes.

 

D.  The
Mortgagor will receive substantial benefits from the execution and delivery of,
and the performance of the obligations under, the Indenture and the Notes, and
is therefore willing to enter into this Mortgage.

 

E.  The Mortgagor
is or will be the legal owner of the Mortgaged Property (as hereinafter
defined).

 

F.  This
Mortgage is given by the Mortgagor in favor of the Mortgagee for its benefit
and for the benefit of the Holders of the Notes (collectively, the “Secured
Parties”) to secure the payment and performance of all of the Secured
Obligations (as hereinafter defined).

 

1

 

A  G  R  E  E  M  E  N  T:

 

NOW THEREFORE, in consideration of the foregoing
premises and other good and valuable consideration, the receipt and sufficiency
of which are hereby acknowledged, the Mortgagor hereby covenants and agrees
with the Mortgagee as follows:

 

ARTICLE I

 

DEFINITIONS
AND INTERPRETATION

 

SECTION 1.1  Definitions.  Capitalized terms used but not otherwise
defined herein shall have the meanings assigned to such terms in the
Indenture.  The following terms used in
this Mortgage shall have the following meanings:

 

“ACM” shall have the meaning assigned to such
term in Section 4.7(ii) hereof.

 

“Affiliate” shall have the meaning assigned to
such term in the Indenture.

 

“Alteration” shall mean any and all
alterations, installations, improvements, additions, modifications or changes
of a structural nature of or to the Premises.

 

“Business Day” shall have the meaning assigned
to such term in the Indenture.

 

“Charges” shall mean any and all real estate,
property and other taxes, assessments and special assessments, levies, fees,
all water and sewer rents and charges and all other governmental charges or
Liens imposed upon or assessed against, and all claims (including, without
limitation, landlords’, carriers’, mechanics’, workmen’s, repairmen’s, laborers’,
materialmen’s, suppliers’ and warehousemen’s Liens and other claims arising by
operation of law) against, all or any portion of the Mortgaged Property.

 

“Collateral Account” shall have the meaning
assigned to such term in the Indenture.

 

“Collateral Documents” shall have the meaning
assigned to such term in the Indenture.

 

“Contested Liens” shall mean, collectively, any
Liens incurred in respect of any Charges to the extent that the amounts owing
in respect thereof are not yet delinquent or are being contested and otherwise
comply with the provisions of Section 9.1 hereof.

 

“Contracts” shall mean, collectively, any and
all right, title and interest of the Mortgagor in and to any and all contracts,
instruments, documents and other general intangibles, whether now existing or
hereafter arising or entered into, relating to the Mortgaged Property
(including, without limitation, all reciprocal easements and/or operating
agreements, covenants, conditions and restrictions and similar agreements
affecting all or any portion of the Mortgaged Property and any and all present
or future options to sell or lease the Mortgaged Property or any interest
therein) and all reserves, deferred payments, deposits or other security or
advance payments (including, without limitation, those made by or on behalf of
the Mortgagor to others with respect to (i) utility service regarding the
Mortgaged Property, (ii) cleaning, maintenance,

 

2

 

repair or similar services regarding the Mortgaged
Property, (iii) refuse removal or sewage service regarding the Mortgaged
Property, (iv) rentals of equipment, if any, used in the operation by or on
behalf of Mortgagor regarding the Mortgaged Property, and/or (v) parking or
similar services or rights regarding the Mortgaged Property), refunds, liens,
security interests, guarantees, remedies and claims of every kind, nature or
character relating thereto.

 

“Default Rate” shall mean the rate per annum
equal to the highest rate then payable under the Indenture.

 

“Destruction” shall mean any and all damage to,
or loss or destruction of, the Premises or any part thereof.

 

“Environmental Law” shall mean any applicable
federal, state, local or municipal statute, law, rule, regulation, ordinance,
code, policy or rule of common law and any judicial or administrative
interpretation thereof, including any judicial or administrative order, consent
decree or judgment binding on the Mortgagor, relating to pollution or
protection of the environment, or health or safety including, without limitation,
any relating to the release or threatened release of any Hazardous Materials.

 

“Event of Default” shall have the meaning
assigned to such term in the Indenture.

 

“Fixture” shall mean all machinery, apparatus,
equipment, fittings, fixtures, improvements and articles of personal property
of every kind, description and nature whatsoever now or hereafter attached or
affixed to the Land or any other Improvement or used in connection with the use
and enjoyment of the Land or any other Improvement or the maintenance or
preservation thereof, which by the nature of their location thereon or attachment
thereto are fixtures under the UCC or any other applicable law including,
without limitation, all utility systems, fire sprinkler and security systems,
drainage facilities, lighting facilities, all water, sanitary and storm sewer,
drainage, electricity, steam, gas, telephone and other utility equipment and
facilities, pipes, fittings and other items of every kind and description now
or hereafter attached to or located on the Land which by the nature of their
location thereon or attachment thereto are real property under applicable law,
HVAC equipment, boilers, electronic data processing, telecommunications or
computer equipment, refrigeration, electronic monitoring, water or lighting
systems, power, sanitation, waste removal, elevators, maintenance or other
systems or equipment and all additions thereto and betterments, renewals,
substitutions and replacements thereof.

 

“Governmental Authority” shall mean any
federal, state, local, foreign or other governmental, quasi-governmental or
administrative (including self-regulatory) body, instrumentality, department,
agency, authority, board, bureau, commission, office of any nature whatsoever
or other subdivision thereof, or any court, tribunal, administrative hearing
body, arbitration panel or other similar dispute-resolving body, whether now or
hereafter in existence, or any officer or official thereof, having jurisdiction
over the Mortgagor or the Mortgaged Property or any portion thereof.

 

“Guarantee” shall have the meaning assigned to
such term in Recital C hereof.

 

“Guarantors” shall have the meaning assigned to
such term in the Indenture.

 

3

 

“Hazardous Materials” shall mean any substance,
chemical, material, pollutant, waste, contaminant or constituent, which is
subject to regulation under or could give rise to liability under any Environmental
Law.

 

“Holder” shall have the meaning assigned to
such term in the Indenture.

 

“Improvements” shall mean all buildings,
structures and other improvements of every kind or description and any and all
Alterations now or hereafter located, attached or erected on the Land
including, without limitation, (i) all Fixtures, (ii) all
attachments, railroad tracks, foundations, sidewalks, drives, roads, curbs, streets,
ways, alleys, passages, passageways, sewer rights, parking areas, driveways,
fences and walls and (iii) all materials now or hereafter located on the
Land intended for the construction, reconstruction, repair, replacement,
alteration, addition or improvement of or to such buildings, Fixtures,
structures and improvements, all of which materials shall be deemed to be part
of the Improvements immediately upon delivery thereof on the Land and to be
part of the Improvements immediately upon their incorporation therein.

 

“Indemnified Liabilities” shall have the
meaning assigned to such term in Section 14.6(i) hereof.

 

“Indemnitees” shall have the meaning assigned
to such term in Section 14.6(i) hereof.

 

“Indenture” shall have the meaning assigned to
such term in Recital A hereof.

 

“Insurance Policies” means the insurance
policies and coverages required to be maintained by the Mortgagor with respect
to the Mortgaged Property pursuant to Section 4.19(b) of the Indenture and all
renewals and extensions thereof.

 

“Insurance Requirements” means, collectively,
all provisions of the Insurance Policies, all requirements of the issuer of any
of the Insurance Policies and all orders, rules, regulations and any other
requirements of the National Board of Fire Underwriters (or any other body
exercising similar functions) binding upon the Mortgagor and applicable to the
Mortgaged Property or any use or condition thereof.

 

“Issuer” shall have the meaning assigned to
such term in Recital A hereof.

 

“Land” shall mean those certain tracts or
parcels of land described in Schedule A annexed to this Mortgage,
together with all of the Mortgagor’s reversionary rights therein and all of the
Mortgagor’s rights in and to any and all easements, rights-of-way, strips and
gores of land, drives, roads, curbs, streets, ways, alleys, passages, passage
ways, sewer rights, waters, water courses, water rights, mineral, gas and oil
rights, and all power, air, light and other rights, estates, titles, interests,
privileges, liberties, servitudes, licenses, tenements, hereditaments and
appurtenances whatsoever, in any way belonging, relating or appertaining
thereto, or any part thereof, or which hereafter shall in any way belong,
relate or be appurtenant thereto.

 

“Landlord” shall mean any landlord, lessor,
franchisor, licensor or grantor, as applicable.

 

4

 

“Leases” shall mean, collectively, any and all
right, title and interests of the Mortgagor, as Landlord, in all leases and
subleases of space, tenancies, franchise agreements, licenses, occupancy,
rental, access or concession agreements and any other agreements pursuant to
which any Person is granted a possessory interest in or right to use or occupy
all or any portion of the Mortgaged Property (including, without limitation,
all of the Mortgagor’s rights to enforce all such leases, subleases, tenancies
or other agreements and to receive and enforce any rights that the Mortgagor
may have to collect Rents thereunder), in each case whether now existing or
hereafter entered into, whether or not of record, relating in any manner to the
Premises or the use or occupancy thereof and any and all amendments,
modifications, supplements, replacements, extensions, renewals and/or
guarantees, if any thereof, whether now in effect or hereafter coming into
effect.

 

“Lien” shall have the meaning assigned to such
term in the Indenture.

 

“Mortgage” shall have the meaning assigned to
such term in the Preamble hereof.

 

“Mortgaged Property” shall have the meaning
assigned to such term in Section 2.1 hereof.

 

“Mortgagee” shall have the meaning assigned to
such term in the Preamble hereof.

 

“Mortgagor” shall have the meaning assigned to
such term in the Preamble hereof.

 

“Mortgagor’s Interest” shall have the meaning
assigned to such term in Section 2.2 hereof.

 

“Net Loss Proceeds” shall have the meaning
assigned to such term in the Indenture.

 

“Notes” shall have the meaning assigned to such
term in Recital A hereof.

 

“Officers’ Certificate” shall have the meaning
assigned to such term in the Indenture.

 

“Permit” shall mean any and all permits,
certificates, approvals, authorizations, consents, licenses, variances,
franchises or other instruments, however characterized, of any Governmental
Authority (or any Person acting on behalf of a Governmental Authority) now or
hereafter acquired or held, together with all amendments, modifications,
extensions, renewals and replacements of any thereof issued or in any way
furnished in connection with the Mortgaged Property including, without
limitation, building permits, certificates of occupancy, environmental
certificates, industrial permits or licenses and certificates of operation.

 

“Permitted Collateral Liens” shall have the
meaning assigned to such term in Section 4.6 hereof.

 

“Permitted Liens” shall have the meaning
assigned to such term in the Indenture.

 

“Person” shall have the meaning assigned to
such term in the Indenture.

 

“Premises” shall mean, collectively, the Land
and the Improvements.

 

5

 

“Prior Liens” shall mean, collectively, the
Liens identified in Schedule B annexed to this Mortgage.

 

“Proceeds” shall mean, collectively, any and
all cash proceeds and noncash proceeds derived or to be derived from the
Mortgaged Property and shall include, without limitation, all (i) proceeds
of the sale, transfer or conveyance of the Mortgaged Property or the
conversion, voluntary or involuntary, of any of the Mortgaged Property or any
portion thereof into cash or liquidated claims, (ii) proceeds of any insurance
(except payments made to a Person, other than the Issuer or any Subsidiary
thereof, that is not a party to this Mortgage), indemnity, warranty, guaranty
or claim payable to the Mortgagee or to the Mortgagor from time to time with
respect to any of the Mortgaged Property including, without limitation, all Net
Loss Proceeds relating thereto, (iii) payments (in any form whatsoever)
made or due and payable to the Mortgagor from time to time in connection with
any requisition, confiscation, condemnation, seizure or forfeiture of all or
any portion of the Mortgaged Property by any Governmental Authority (or any
Person acting on behalf of a Governmental Authority) including, without
limitation, all Net Loss Awards relating thereto, (iv) products of the Mortgaged
Property, (v) other amounts from time to time paid or payable under or in
connection with any of the Mortgaged Property including, without limitation,
refunds of real estate taxes and assessments, including interest thereon and
any unearned insurance premiums relating thereto and (vi) the right to enforce
any and all rights that the Mortgagor has or may have to collect all such
proceeds, including, without limitation, the Mortgagor’s rights to commence any
and all appropriate collection or enforcement actions incident thereto.

 

“Property Material Adverse Effect” shall mean,
as of any date of determination and whether individually or in the aggregate
(a) any event, circumstance, occurrence or condition which has caused or
resulted in (or would reasonably be expected to cause or result in) a material
adverse effect on the business or operations as presently conducted at the
Mortgaged Property; (b) any event, circumstance, occurrence or condition which
has caused or resulted in (or would reasonably be expected to cause or result
in) a material adverse effect on the value or utility of the Mortgaged
Property; and (c) any event, circumstance, occurrence or condition which
has caused or resulted in (or would reasonably be expected to cause or result
in) a material adverse effect on the legality, priority or enforceability of
the Lien created by this Mortgage or the rights and remedies of the Mortgagee
hereunder.

 

“Prudent Operator” shall mean the standard of
care taken by a prudent operator of property similar in use and configuration
to the Premises and located in the locality where the Premises are located.

 

 “Records”
shall mean, collectively, any and all right, title and interest of the
Mortgagor in and to any and all drawings, plans, specifications, file materials,
operating and maintenance records, catalogues, tenant lists, correspondence,
advertising materials, operating manuals, warranties, guarantees, appraisals,
studies and data relating to the Mortgaged Property or the construction of any
Alteration or the maintenance of any Permit.

 

“Rents” shall mean, collectively, any and all
rents, additional rents, royalties, issues, cash, guaranties, letters of
credit, bonds, sureties or security deposited under any Lease to secure
performance of the Tenant’s obligations thereunder, revenues, earnings,
profits, bonuses and income, advance rental payments, payments incident to
assignment, sublease or surrender of a Lease, claims for forfeited deposits and
claims for damages, now due or hereafter to become due, with respect to any
Lease, any indemnification

 

6

 

against, or reimbursement for, sums paid and costs and
expenses incurred by the Mortgagor under any Lease or otherwise, and any award
in the event of the bankruptcy of any Tenant under or guarantor of a Lease.

 

“Requirements of Law” shall mean, collectively,
any and all requirements of any Governmental Authority including, without
limitation, any and all orders, decrees, determinations, laws, treaties,
ordinances, rules, regulations or similar statutes or case law.

 

“Secured Obligations” shall mean all
obligations (whether or not constituting future advances, obligatory or
otherwise) of the Issuer and any and all of the Guarantors from time to time
arising under or in respect of this Mortgage, the Indenture, the Notes and the
other Collateral Documents (including, without limitation, the obligations to
pay principal, interest and all other charges, fees, expenses, commissions,
reimbursements, premiums, indemnities and other payments related to or in
respect of the obligations contained in this Mortgage, the Indenture, the Notes
and the other Collateral Documents), in each case whether (i) such obligations
are direct or indirect, secured or unsecured, joint or several, absolute or
contingent, due or to become due whether at stated maturity, by acceleration or
otherwise, (ii) arising in the regular course of business or otherwise, (iii)
for payment or performance and/or (iv) now existing or hereafter arising
(including, without limitation, interest and other obligations arising or
accruing after the commencement of any bankruptcy, insolvency, reorganization
or similar proceeding with respect to the Issuer, any Guarantor or any other
Person, or which would have arisen or accrued but for the commencement of such
proceeding, even if such obligation or the claim therefor is not enforceable or
allowable in such proceeding).

 

“Secured Parties” shall have the meaning
assigned to such term in Recital F hereof.

 

“Senior Secured Notes” shall have the meaning
assigned to such term in Recital A hereof.

 

“Subordination Agreement” shall mean a
subordination, nondisturbance and attornment agreement substantially in the
form of Exhibit 1 annexed to this Mortgage.

 

“Subsidiaries” shall have the meaning assigned
to such term in the Indenture.

 

“Taking” shall mean any taking of the Mortgaged
Property or any part thereof, in or by condemnation or other eminent domain
proceedings pursuant to any law, general or special, or by reason of the
temporary requisition of the use or occupancy of the Mortgaged Property or any
part thereof, by any Governmental Authority, civil or military.

 

“Tax Escrow Fund” shall have the meaning
assigned to such term in Section 7.2 hereof.

 

“Tenant” shall mean any tenant, subtenant,
lessee, sublessee, franchisee, licensee, grantee or obligee, as applicable.

 

“UCC” shall mean the Uniform Commercial Code as
in effect on the date hereof in the jurisdiction in which the Premises are
located; provided, however, that if by reason of mandatory
provisions of law, the perfection or the effect of perfection or non-perfection
of the security interest in any item or portion of the Mortgaged Property is
governed by the Uniform Commercial Code as in effect in a jurisdiction

 

7

 

other than the jurisdiction in which the Premises are
located, “UCC” shall mean the Uniform Commercial Code as in effect in such
other jurisdiction for purposes of the provisions hereof relating to such
perfection or effect of perfection or non-perfection.

 

SECTION 1.2  Interpretation.  In this Mortgage, unless otherwise specified,
(i) singular words include the plural and plural words include the singular,
(ii) words importing any gender include the other gender, (iii) references to
any Person include such Person’s successors and assigns and in the case of an
individual, the word “successors” includes such Person’s heirs, devisees,
legatees, executors, administrators and personal representatives, (iv)
references to any statute or other law include all applicable rules,
regulations and orders adopted or made thereunder and all statutes or other
laws amending, consolidating or replacing the statute or law referred to, (v)
the words “consent,” “approve” and “agree,” and derivations thereof or words of
similar import, mean the prior written consent, approval or agreement of the
Person in question not to be unreasonably withheld, (vi) the words “include”
and “including,” and words of similar import, shall be deemed to be followed by
the words “without limitation,” (vii) the words “hereto,” “herein,” “hereof”
and “hereunder,” and words of similar import, refer to this Mortgage in its
entirety, (viii) references to Articles, Sections, Schedules, Exhibits,
subsections, paragraphs and clauses are to the Articles, Sections, Schedules,
Exhibits, subsections, paragraphs and clauses hereof, (ix) the Schedules and
Exhibits to this Mortgage, in each case as amended, amended and restated,
supplemented or otherwise modified from time to time in accordance with the
provisions hereof, are incorporated herein by reference, (x) the titles and
headings of Articles, Sections, Schedules, Exhibits, subsections, paragraphs
and clauses are inserted as a matter of convenience only and shall not affect the
constructions of any provisions hereof and (xi) all obligations of the Mortgagor
hereunder shall be satisfied by the Mortgagor at the Mortgagor’s sole cost and
expense.

 

SECTION 1.3  Resolution
of Drafting Ambiguities.  The
Mortgagor acknowledges and agrees that it was represented by counsel in
connection with the execution and delivery hereof, that it and its counsel
reviewed and participated in the preparation and negotiation hereof and that
any rule of construction to the effect that ambiguities are to be resolved
against the drafting party (i.e., Mortgagee) shall not be employed in
the interpretation hereof.

 

ARTICLE II

 

GRANTS
AND SECURED OBLIGATIONS

 

SECTION 2.1  Grant
of Mortgaged Property. 
The Mortgagor hereby grants, mortgages, bargains, sells, assigns and
conveys to the Mortgagee (for its benefit and for the benefit of the other
Secured Parties), and hereby grants to the Mortgagee (for its benefit and for
the benefit of the other Secured Parties), a security interest in and upon all
of the Mortgagor’s estate, right, title and interest in, to and under the
following property, whether now owned or held or hereafter acquired from time
to time (collectively, the “Mortgaged Property”):

 

(i)            Land;

 

(ii)           Improvements;

 

8

 

(iii)          Leases;

 

(iv)          Rents;

 

(v)           Permits;

 

(vi)          Contracts;

 

(vii)         Records; and

 

(viii)        Proceeds.

 

Notwithstanding the foregoing provisions of this Section 2.1,
Mortgaged Property shall not include a grant of any of the Mortgagor’s right,
title or interest in (i) any Contract to which the Mortgagor is a party or any
of its rights or interests thereunder (other than (x) the right to receive any
payment of money (including without limitation accounts, general intangibles
and payment intangibles (each as defined in the UCC) or any other rights
referred to in Sections 9-406(f), 9-407(a) or 9-408(a) of the UCC and (y) any
proceeds, substitutions or replacements thereof) to the extent, but only to the
extent, that such a grant would, under the terms of such Contract, result in a
breach or termination of the terms of, or constitute a default under or
termination of such Contract and (ii) any Permit to the extent, but only to the
extent that, such grant shall constitute or result in abandonment, invalidation
or rendering unenforceable any right, title or interest of the Mortgagor
therein; provided, however, that at such time as any Contract or
Permit described in clauses (i) and (ii) of this sentence is no longer subject
to such restriction, such applicable Contract or Permit shall (without any act
or delivery by any Person) constitute Mortgaged Property hereunder.

 

TO HAVE AND TO HOLD the Mortgaged Property, together
with all estate, right, title and interest of the Mortgagor and anyone claiming
by, through or under the Mortgagor in and to the Mortgaged Property and all
rights and appurtenances relating thereto, unto the Mortgagee, its successors
and assigns, for the purpose of securing the payment and performance in full of
all the Secured Obligations.

 

SECTION 2.2  Collateral Assignment and
Pledge of Mortgagor’s Interest as Additional Security.  As additional collateral security for the
prompt and punctual payment and satisfaction of the Secured Obligations, and
all additional advances that the Mortgagee may make on the Mortgagor’s behalf
pursuant to this Mortgage, together with interest thereon as provided herein,
the Mortgagor hereby assigns, pledges and grants to the Mortgagee (for its
benefit and for the benefit of the other Secured Parties), a continuing
security interest in and to all of the Mortgagor’s estate, right, title,
interest, claim and demand, as Landlord, under any and all of the Leases
including, without limitation, the following (such assigned rights, the “Mortgagor’s
Interest”):

 

(i)            the immediate and continuing right
to receive and collect Rents payable by the Tenants pursuant to the Leases;

 

(ii)           all claims, rights, powers,
privileges and remedies of the Mortgagor, whether provided for in the Leases or
arising by statute or at law or in equity or otherwise, consequent on any
failure on the part of the Tenants to perform or comply with any term of the
Leases including damages or other amounts payable to the Mortgagor as a result
of such failure;

 

9

 

(iii)          all rights to take all actions upon
the happening of a default under the Leases as shall be permitted by the Leases
or by law including, without limitation, the commencement, conduct and
consummation of proceeding at law or in equity; and

 

(iv)          the full power and authority, in the
name of the Mortgagor or otherwise, to enforce, collect, receive and receipt
for any and all of the foregoing and to take all other actions whatsoever which
the Mortgagor, as Landlord, is or may be entitled to take under the Leases.

 

SECTION 2.3  Secured
Obligations.  This Mortgage secures,
and the Mortgaged Property is collateral security for, the payment and
performance in full when due of the Secured Obligations.

 

SECTION 2.4  Mortgage
Securing Future Indebtedness. 
This Mortgage has been executed by Mortgagor pursuant to Article 3298 of
the Louisiana Civil Code for the purpose of securing the Mortgagor’s
indebtedness (including, without limitation, the Secured Obligations) that may
now be existing or that may arise in the future as provided herein and in the
Indenture, with the preferences and priorities provided under applicable
Louisiana law.  This Mortgage shall be
further entitled to the preferences and priorities as provided under the
Louisiana Private Works Act (La. R.S. 9:4801, et seq.).  However, nothing under this Mortgage shall be
construed as limiting the duration of this Mortgage or the purpose or purposes
for which the Mortgagor’s indebtedness (including, without limitation, the
Secured Obligations) may be requested or extended.  The Mortgagor’s additional indebtedness will
automatically be secured by this Mortgage without the necessity that the
Mortgagor agrees or consents to such a result at the time additional
indebtedness is made and that the note or notes evidencing such additional
indebtedness reference the fact that such notes are secured by this
Mortgage.  The Mortgagor understands that
the Mortgagor may not subsequently have a change of mind and insist that the
Mortgagor’s additional indebtedness not be secured by this Mortgage unless the
Mortgagee specifically agrees to such a request in writing.

 

SECTION 2.5  No
Release.  Nothing set forth in this
Mortgage shall relieve the Mortgagor from the performance of any term,
covenant, condition or agreement on the Mortgagor’s part to be performed or
observed under or in respect of any of the Mortgaged Property or from any
liability to any Person under or in respect of any of the Mortgaged Property or
shall impose any obligation on the Mortgagee or any other Secured Party to
perform or observe any such term, covenant, condition or agreement on the
Mortgagor’s part to be so performed or observed or shall impose any liability
on the Mortgagee or any other Secured Party for any act or omission on the part
of the Mortgagor relating thereto or for any breach of any representation or
warranty on the part of the Mortgagor contained in this Mortgage, the
Indenture, the Notes or the Collateral Documents, or under or in respect of the
Mortgaged Property or made in connection herewith or therewith.  The obligations of the Mortgagor contained in
this Section 2.5 shall survive the termination hereof and the
discharge of the Mortgagor’s other obligations under this Mortgage and the
Indenture, the Notes and the Collateral Documents.

 

10

 

ARTICLE III

 

REPRESENTATIONS
AND WARRANTIES OF MORTGAGOR

 

SECTION 3.1  Authority
and Validity.

 

The Mortgagor represents and warrants that as of the date hereof:

 

(i)            it is duly organized or formed,
validly existing and, if applicable, in good standing under the laws of the jurisdiction
of its organization;

 

(ii)           it is duly qualified to transact
business and is in good standing in the state in which the Mortgaged Property
is located;

 

(iii)          it has full corporate or other
organizational power and lawful authority to execute and deliver this Mortgage
and to mortgage and grant a Lien on and security interest in the Mortgaged
Property and otherwise assign the Mortgagor’s Interest and otherwise perform
its obligations as contemplated herein, and all corporate and governmental
actions, consents, authorizations and approvals necessary or required therefor
have been duly and effectively taken or obtained; and

 

(iv)          this Mortgage is a legal, valid and binding
obligation of the Mortgagor, enforceable against the Mortgagor in accordance
with its terms, except as enforceability may be limited by applicable
bankruptcy, insolvency or similar laws affecting the enforcement of creditors’
rights generally or by equitable principles relating to enforceability.

 

SECTION 3.2  Warranty
of Title.  The Mortgagor
represents and warrants that:

 

(i)            it has good fee simple title to the
Premises and the Landlord’s interest and estate under or in respect of the
Leases and good title to the interest it purports to own or hold in and to each
of the Permits, the Contracts and the Records, in each case subject to no
Liens, except for Permitted Collateral Liens;

 

(ii)           it has good title to the interest it
purports to own or hold in and to all rights and appurtenances to or that
constitute a portion of the Mortgaged Property, except for Permitted Collateral
Liens;

 

(iii)          it is in compliance with each term,
condition and provision of any obligation of the Mortgagor which is secured by the
Mortgaged Property or the noncompliance with which would result in a Property
Material Adverse Effect; and

 

(iv)          this Mortgage creates and constitutes
a valid and enforceable first priority Lien on the Mortgaged Property subject
to Permitted Collateral Liens, and, to the extent any of the Mortgaged Property
shall consist of Fixtures, a first priority security interest in the Fixtures,
which first priority Lien and first priority security interest are subject only
to Permitted Collateral Liens.

 

11

 

SECTION 3.3  Condition
of Mortgaged Property.  The Mortgagor
represents and warrants that:

 

(i)            there has been issued and there
remains in full force and effect subject to no revocation, suspension,
forfeiture or modification, each and every Permit necessary for the present
use, operation and occupancy of the Premises by the Mortgagor and its Tenants
and the conduct of their respective businesses and all required zoning,
building code, land use, environmental and other similar Permits, except where
the failure to be so issued and to be in full force and effect would not result
in a Property Material Adverse Effect;

 

(ii)           the Premises and the present and
contemplated use and occupancy thereof comply with all applicable zoning
ordinances, building codes, land use laws, setback or other development and/or
use requirements of Governmental Authorities except where such noncompliance
would not result in a Property Material Adverse Effect;

 

(iii)          the Premises are served by all
utilities (including, without limitation, water and sewer systems) necessary
for the present use thereof, and all utility services are provided by public or
private utilities and the Premises have accepted or are equipped to accept such
utility services and the Mortgagor has not received notice of termination of
such utility service, except where the failure to be so served would not result
in a Property Material Adverse Effect;

 

(iv)          the Mortgagor has access to the
Premises from roads sufficient to allow the Mortgagor and its Tenants and
invitees to conduct their respective businesses at the Premises in accordance
with sound commercial practices and the Mortgagor has not received notice of
termination of such access, except where the failure to have such access would
not result in a Property Material Adverse Effect;

 

(v)           the Mortgagor has not received notice
of any Taking or the commencement or pendency of any action or proceeding
therefor, other than such Takings as would not result in a Property Material
Adverse Effect;

 

(vi)          there has not occurred any Destruction
of the Premises or any portion thereof as a result of any fire or other
casualty that, as of the date hereof, has not been repaired in all material
respects, other than such Destruction as would not have a Property Material
Adverse Effect;

 

(vii)         there are no disputes regarding
boundary lines, location, encroachments or possession of any portions of the
Mortgaged Property and no state of facts exists which could give rise to any
such claim other than such disputes as would not result in a Property Material
Adverse Effect;

 

(viii)        all liquid and solid waste disposal,
septic and sewer systems located on the Premises are in a good and safe
condition and repair and in compliance with all Requirements of Law, except
where the failure to so comply would not result in a Property Material Adverse
Effect;

 

(ix)           no portion of the Premises is located
in an area identified by the Federal Emergency Management Agency or any
successor thereto as an area having special flood hazards pursuant to

 

12

 

the Flood Insurance Acts or, if any portion of the Premises is located
within such area, the Mortgagor has obtained the insurance prescribed in Article VIII
hereof;

 

(x)            the Premises are assessed for real
estate tax purposes as one or more wholly independent tax lot or lots, separate
from any adjoining land or improvements not constituting a portion of such lot
or lots, and no other land or improvements are assessed and taxed together with
the Premises or any portion thereof, other than such cases where the failure to
be so assessed would not result in a Property Material Adverse Effect; and

 

(xi)           there are no options or rights of
first refusal to purchase or acquire all or any portion of the Mortgaged
Property, other than such options or rights of first refusal as would not
result in a Property Material Adverse Effect.

 

SECTION 3.4  Leases.  The Mortgagor represents and warrants that as
of the date hereof:

 

(i)            the Leases identified in Schedule C
attached hereto are the only Leases in existence on the date hereof relating to
the Premises;

 

(ii)           true copies of such Leases have been
previously delivered to the Mortgagee and there are no agreements with any
Tenant under such Leases other than those agreements expressly set forth
therein;

 

(iii)          the Mortgagor is the sole owner of all
of the Mortgagor’s Interest in such Leases;

 

(iv)          each of such Leases is in full force
and effect, constitutes a legal, valid and binding obligation of the Mortgagor
and the applicable Tenant thereunder, and is enforceable against the Mortgagor
and such Tenant in accordance with its terms, except as enforceability may be
limited by applicable bankruptcy, insolvency or similar laws affecting the enforcement
of creditors’ rights generally or by equitable principles relating to
enforceability;

 

(v)           there is no default under any of such
Leases and there is existing no condition which with the giving of notice or
passage of time or both would cause a default thereunder;

 

(vi)          all Rents due under such Leases have
been paid in full;

 

(vii)         none of the Rents reserved under such
Leases have been assigned or otherwise pledged or hypothecated except in favor
of the Mortgagee pursuant to the provisions hereof;

 

(viii)        none of the Rents (other than any
security deposit collected in accordance with the provisions of the applicable
Lease) have been collected for more than one (1) month in advance;

 

(ix)           there exist no offsets or defenses to
the payment of any portion of the Rents and the Mortgagor owes no monetary
obligation to any Tenant under any such Lease;

 

(x)            the Mortgagor has received no notice
from any Tenant challenging the validity or enforceability of any such Lease;

 

13

 

(xi)           no such Lease contains any option to
purchase, right of first refusal to purchase, right of first refusal to relet,
or any other similar provision; and

 

(xii)          each such Lease is subordinate to this
Mortgage either pursuant to its terms or pursuant to a recordable Subordination
Agreement.

 

SECTION 3.5  Insurance.  The Mortgagor represents and warrants that,
except where the failure of clauses (i), (ii) or (iii) hereof to be true would
not have a Property Material Adverse Effect, (i) the Premises and the use,
occupancy and operation thereof comply with all Insurance Requirements and
there exists no default under any Insurance Requirement, (ii) all premiums due
and payable with respect to the Insurance Policies have been paid,
(iii) all Insurance Policies are in full force and effect and the
Mortgagor has not received notice of violation or cancellation thereof and
(iv) all insurance certificates required pursuant to the Indenture have
been delivered to the Mortgagee.

 

SECTION 3.6  Charges.  The Mortgagor represents and warrants that
all Charges imposed upon or assessed against the Mortgaged Property have been
paid and discharged except to the extent such Charges constitute a Lien not yet
due and payable or to the extent such Charges are being contested in accordance
with Section 9.1 hereof.

 

SECTION 3.7  Environmental.  The Mortgagor represents and warrants that:

 

(i)            it has obtained all Permits which
are necessary with respect to the ownership and operation of its business and
the Mortgaged Property under any and all applicable Environmental Laws and is
in compliance with all terms and conditions thereof, except where the failure
so to obtain or to be in compliance would not result in a Property Material
Adverse Effect;

 

(ii)           it is in compliance with any and all
applicable Environmental Laws including, without limitation, all other
limitations, restrictions, conditions, standards, prohibitions, requirements,
obligations, schedules and timetables contained in the Environmental Laws,
except where the failure so to be in compliance would not result in a Property
Material Adverse Effect;

 

(iii)          there is no civil, criminal or
administrative action, suit, demand, claim, hearing, notice of violation,
investigation, proceeding, notice of demand letter pending or threatened
against it or any Affiliate under the Environmental Laws which would result in
a fine, penalty or other cost or expense other than such instances that would
not result in a Property Material Adverse Effect; and

 

(iv)          there are no past or present events,
conditions, circumstances, activities, practices, incidents, actions or plans
which may interfere with or prevent compliance with the Environmental Laws, or
which may give rise to any common law or legal liability including, without
limitation, liability under the Comprehensive Environmental Response, Compensation
and Liability Act of 1980, as amended, or any other Environmental Law or
related common law theory or otherwise form the basis of any claim, action,
demand, suit, proceeding, hearing or notice of violation, study or
investigation, based on or related to the manufacture, processing,
distribution, use, generation, treatment, storage, disposal, transport or
handling, or the emission, discharge, release or threatened release into the environment,
of any Hazardous Materials which would result in a fine, penalty or

 

14

 

other cost or expense other than such instances that
would not result in a Property Material Adverse Effect .

 

SECTION 3.8  No
Conflicts, Consents, etc. 
Neither the execution and delivery hereof by the Mortgagor nor the
consummation of the transactions herein contemplated nor the fulfillment of the
terms hereof (i) violates the terms of any agreement, indenture, mortgage, deed
of trust, equipment lease, instrument or other document to which the Mortgagor
is a party, or by which it may be bound or to which any of its properties or
assets may be subject, (ii) conflicts with any Requirement of Law applicable to
the Mortgagor or its property or (iii) results in or requires the creation or
imposition of any Lien (other than the Lien contemplated hereby) upon or with
respect to any of the Mortgaged Property, except where such violation, conflict,
creation or imposition would not have a Property Material Adverse Effect.  No consent of any party (including, without
limitation, equityholders or creditors of the Mortgagor) and no consent,
authorization, approval, license or other action by, and no notice to or filing
with, any Governmental Authority or regulatory body or other Person (other than
with respect to any required Permits) is required for (i) the granting of
a mortgage Lien on and security interest in the Mortgaged Property by the
Mortgagor granted by it pursuant to this Mortgage or for the execution,
delivery or performance hereof by the Mortgagor except for the filing of this
Mortgage and the other filings contemplated hereby or (ii) the exercise by
the Mortgagee of the remedies in respect of the Mortgaged Property pursuant to
this Mortgage other than those required by law in connection with the exercise
of the applicable remedy.

 

SECTION 3.9  Benefit to the Mortgagor.  The Mortgagor represents and warrants that it
will receive substantial benefit as a result of the execution, delivery, and
performance of the Indenture, the Notes and the Collateral Documents.

 

ARTICLE IV

 

CERTAIN COVENANTS OF
MORTGAGOR

 

SECTION 4.1  Preservation
of Corporate Existence.  The
Mortgagor shall:

 

(i)            preserve and maintain in full force
and effect its existence and good standing under the laws of the jurisdiction
of its organization;

 

(ii)           preserve and maintain in full force
and effect its qualification to transact business and good standing in the
state in which the Mortgaged Property is located; and

 

(iii)          preserve and maintain in full force
and effect all consents, authorizations and approvals necessary or required of
any Governmental Authority or any other Person relating to the execution,
delivery and performance hereof, except where the failure to do so would not
result in a Property Material Adverse Effect.

 

SECTION 4.2  Title.  The Mortgagor shall:

 

(i)            (A) keep in effect all material
rights and appurtenances to or that constitute a part of the Mortgaged Property
and (B) protect, preserve and defend its interest in the Mortgaged Property

 

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and title thereto, except against Permitted Collateral
Liens (other than the Lien created by this Mortgage);

 

(ii)           (A) comply, in all material respects,
with each of the terms, conditions and provisions of any obligation of the
Mortgagor which is secured by the Mortgaged Property, except where the failure
to so comply would not result in a Property Material Adverse Effect, or the
noncompliance with which may result in the imposition of a Lien on the
Mortgaged Property, (B) forever warrant and defend to the Mortgagee the
Lien and security interests created and evidenced hereby and the validity and
priority hereof in any action or proceeding against the claims of any and all
Persons whomsoever affecting or purporting to affect the Mortgaged Property or
any of the rights of the Mortgagee hereunder, except against Permitted
Collateral Liens (other than the Lien of this Mortgage), and (C) maintain
a valid and enforceable first priority Lien, except for Permitted Collateral
Liens (other than the Lien of this Mortgage) on the Mortgaged Property and, to
the extent any of the Mortgaged Property shall consist of Fixtures, a first
priority security interest in the Mortgaged Property, which first priority Lien
and security interest shall be subject only to Permitted Collateral Liens; and

 

(iii)          immediately upon obtaining knowledge
of the pendency of any proceedings for the eviction of the Mortgagor from the
Mortgaged Property or any part thereof by paramount title or otherwise
questioning the Mortgagor’s right, title and interest in, to and under the
Mortgaged Property as warranted in this Mortgage, or of any condition that
could give rise to any such proceedings, notify the Mortgagee thereof.  The Mortgagee may participate in such
proceedings and the Mortgagor will deliver or cause to be delivered to the
Mortgagee all instruments requested by the Mortgagee to permit such
participation.  In any such proceedings,
the Mortgagee may be represented by counsel reasonably satisfactory to the
Mortgagee at the reasonable expense of the Mortgagor.  If, upon the resolution of such proceedings,
the Mortgagor shall suffer a loss of the Mortgaged Property or any part thereof
or interest therein and title insurance proceeds shall be payable in connection
therewith, such proceeds are hereby assigned to and shall be paid to the
Mortgagee for deposit into the Collateral Account and shall be applied in the
manner applicable to Net Loss Proceeds in accordance with the provisions of
Sections 4.16, 10.05(c) and 11.02 of the Indenture.

 

SECTION 4.3  Maintenance
and Use of Mortgaged Property; Alterations.

 

(i)            Maintenance.  The Mortgagor shall cause the representations
and warranties set forth in Section 3.3 hereof to continue to be true in
each and every respect and shall pay or cause to be paid when due all Charges,
costs and expenses relating thereto, other than such Charges being contested in
accordance with Section 9.1 hereof.

 

(ii)           Maintenance of Premises.  The Mortgagor shall not commit or suffer any
waste on the Premises.  The Mortgagor
shall, at all times, maintain the Premises in good working order, condition and
repair, reasonable wear and tear excepted, and shall use commercially
reasonable efforts to make or cause to be made all repairs, structural or
nonstructural, which are necessary or appropriate in the conduct of the
Mortgagor’s business.  The Mortgagor
shall not, except as permitted in Section 4.3(iii) hereof, alter the
occupancy or use of all or any portion of the Premises without the prior
written consent of the Mortgagee, which consent shall not be unreasonably
withheld.  Except to the extent permitted
pursuant to the provisions of Section 4.3(iii) hereof, the
Mortgagor shall not remove, demolish or alter the structural character

 

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of any Improvement now or hereafter erected upon all
or any portion of the Premises, or permit any such removal, demolition or
alteration, without the prior written consent of the Mortgagee, which consent
shall not be unreasonably withheld.

 

(iii)          Alterations.  The Mortgagor shall not, without the prior
written consent of the Mortgagee, which consent shall not be unreasonably
withheld, make any Alteration to the Premises except as permitted by Sections
10.04 and 10.06 of the Indenture. 
Whether or not the making of any Alteration shall require the consent of
the Mortgagee pursuant to the immediately preceding sentence, the Mortgagor
shall (A) complete each Alteration promptly, in a good and workmanlike
manner and in compliance, in all material respects, with all applicable local
laws, ordinances and requirements and (B) pay when due all claims for
labor performed and materials furnished in connection with such Alteration,
unless contested in accordance with the provisions of Article IX
hereof.

 

(iv)          Permits.  The Mortgagor shall maintain, or cause to be
maintained, in full force and effect all Permits contemplated by and subject to
Section 3.3(i) hereof.  Unless and
to the extent contested by the Mortgagor in accordance with the provisions of Article IX
hereof, the Mortgagor shall comply, in all material respects, with all
requirements set forth in the Permits and all Requirements of Law applicable to
all or any portion of the Mortgaged Property or the condition, use or occupancy
of all or any portion thereof or any recorded deed of restriction, declaration,
covenant running with the land or otherwise, now or hereafter in force, subject
to the provisions of Section 3.3 hereof.

 

(v)           Zoning.  The Mortgagor shall not initiate, join in, or
consent to any change in the zoning or any other permitted use classification
of the Premises without the prior written consent of the Mortgagee, which
consent shall not be unreasonably withheld.

 

SECTION 4.4  Notices
Regarding Certain Defaults. 
The Mortgagor shall, promptly upon receipt of any written notice
regarding (i) any default by the Mortgagor relating to the Mortgaged
Property or any portion thereof or (ii) the failure to discharge any of
Mortgagor’s obligations with respect to the Mortgaged Property or any portion
thereof described herein, furnish a copy of such notice to the Mortgagee.

 

SECTION 4.5  Access
to Mortgaged Property, Books and Records; Other Information.  Upon request to the Mortgagor, the Mortgagee,
its agents, accountants and attorneys shall have full and free access to visit
and inspect, as applicable, during normal business hours and such other
reasonable time as may be requested by the Mortgagee, all of the Mortgaged
Property including, without limitation, all of the books, correspondence and
records of the Mortgagor relating thereto. 
The Mortgagee and its representatives may examine the same, take
extracts therefrom and make photocopies thereof.  The Mortgagor shall, at any and all times,
within a reasonable time after written request by the Mortgagee, furnish or
cause to be furnished to the Mortgagee, in such manner and in such detail as
may be reasonably requested by the Mortgagee, additional information with respect
to the Mortgaged Property.

 

SECTION 4.6  Limitation
on Liens; Transfer Restrictions.  The
Mortgagor may not, without the prior written consent of the Mortgagee, further
mortgage, encumber, hypothecate, sell, convey or assign all or any part of the
Mortgaged Property or suffer or allow any of the foregoing to occur by operation
of law or otherwise; provided, however, that the Mortgagor shall
have the right to (1) sell, convey or assign all or any portion of the Mortgaged
Property in accordance with the provisions of the Indenture and 

 

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(2) suffer
to exist the following Liens in respect of the Mortgaged Property:
(i) Prior Liens (but not extensions, amendments, supplements or
replacements of Prior Liens unless (A) extended, amended, supplemented or
replaced in a manner permitted by the Indenture or (B) consented to by the
Mortgagee which consent shall not be unreasonably withheld), (ii) the Lien
and security interest created by this Mortgage or any other Collateral
Document, (iii) Contested Liens, (iv) Liens described in clause (9) of the
definition of Permitted Liens (provided, however, that such Liens
shall not extend to or cover any Mortgaged Property other than equipment
subject to Capital Leases Obligations or Purchase Money Obligations incurred in
accordance with the provisions of the Indenture) or clause (4) of the
definition of Permitted Liens, and (v) Leases to the extent permitted pursuant
to the provisions of Article V hereof (the Liens described in clauses
(i) through (v) of this sentence, collectively, “Permitted Collateral Liens”).

 

SECTION 4.7  Environmental.

 

(i)            Hazardous Materials.  Except where the failure to do so would not
result in a Property Material Adverse Effect, the Mortgagor shall
(A) comply with any and all present and future Environmental Laws
applicable to the Mortgaged Property, (B) not release, store, treat,
handle, generate, discharge or dispose of any Hazardous Materials at, on, under
or from the Mortgaged Property in violation of or in a manner that could result
in any material liability under any present and future Environmental Law and
(C) take all necessary steps to initiate and expeditiously complete all
remedial, corrective and other action to eliminate any such effect.  In the event the Mortgagor fails to comply
with the covenants in the preceding sentence, the Mortgagee may, in addition to
any other remedies set forth herein, as agent for the Mortgagor and at the
Mortgagor’s sole cost and expense, cause any remediation, removal or response
action relating to Hazardous Materials required by applicable Environmental
Laws to be taken and the Mortgagor shall provide to the Mortgagee and its
agents and employees access to the Mortgaged Property for such purpose.  Any reasonable costs or expenses incurred by
the Mortgagee for such purpose shall be immediately due and payable by the
Mortgagor and shall bear interest at the Default Rate. The Mortgagee shall have
the right at any time when an Event of Default shall have occurred and be
continuing and at such other times when a potential violation of any present or
future Environmental Law exists which in the Mortgagee’s reasonable judgment
could result in any material liability or obligation under such Environmental
Law, at the sole cost and expense of the Mortgagor, to conduct an environmental
audit of the Mortgaged Property by such persons or firms appointed by the
Mortgagee, and the Mortgagor shall cooperate in all respects in the conduct of
such environmental audit, including, without limitation, by providing access to
the Mortgaged Property and to all records relating thereto.  To the extent that any such environmental
audit identifies conditions which in the Mortgagee’s reasonable judgment would
result in any material liability or obligation under any present or future
Environmental Law, the Mortgagor agrees to expeditiously correct any such
violation or respond to conditions giving rise to such liability or obligations
in a manner which complies in all material respects with the Environmental Laws
and mitigates associated health and environmental risks.  The Mortgagor shall indemnify and hold the
Mortgagee and each of the other Secured Parties harmless from and against all
loss, cost, damage or reasonable expense (including, without limitation,
reasonable attorneys’ and consultants’ fees and disbursements) that the
Mortgagee or any other Secured Party may sustain by reason of the assertion
against the Mortgagee or any Secured Party by any party of any claim relating
to such Hazardous Materials on, under or from the Mortgaged Property or actions
taken with respect thereto as authorized hereunder, except to the extent
arising from the gross negligence or willful misconduct of the Mortgagee or any
other Secured Party.  The foregoing
indemnification shall survive repayment of all Secured Obligations and any
release or assignment hereof; and

 

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(ii)           Asbestos. The Mortgagor shall
not install nor permit to be installed in or removed from the Mortgaged
Property, asbestos or any asbestos-containing material (collectively, “ACM”)
except in compliance, in all material respects, with all applicable
Environmental Laws, and with respect to any ACM currently present in the
Mortgaged Property, the Mortgagor shall promptly either (A) remove any ACM
which such Environmental Laws require to be removed or (B) otherwise
comply, in all material respects, with such Environmental Laws with respect to
such ACM, all at the Mortgagor’s sole cost and expense.  If the Mortgagor shall fail so to remove any
ACM or otherwise comply, in all material respects, with such laws or
regulations, the Mortgagee may, in addition to any other remedies set forth
herein, take reasonable or necessary steps to eliminate any ACM from the
Mortgaged Property or otherwise comply, in all material respects, with
applicable law, regulations or orders and the Mortgagor shall provide to the
Mortgagee and its agents and employees access to the Mortgaged Property for
such purpose.  Any reasonable costs or
expenses incurred by the Mortgagee for such purpose shall be immediately due
and payable by the Mortgagor and bear interest at the Default Rate.  The Mortgagor shall indemnify and hold the
Mortgagee and the other Secured Parties harmless from and against all loss,
cost, damage and expense (including, without limitation, reasonable attorneys’
and consultants’ fees and disbursements) that the Mortgagee or the other
Secured Parties may sustain, as a result of the presence of any ACM and any
removal thereof or compliance with all applicable Environmental Laws, except to
the extent arising from the gross negligence or willful misconduct of the
Mortgagee or any other Secured Party. 
The foregoing indemnification shall survive repayment of all Secured
Obligations and any release or assignment hereof.

 

SECTION 4.8  Estoppel
Certificates.  The Mortgagor shall,
from time to time, upon thirty (30) days’ prior written reasonable request of
the Mortgagee, execute, acknowledge and deliver to the Mortgagee an Officers’
Certificate stating that this Mortgage, the Indenture, the Notes and the
Collateral Documents are unmodified and in full force and effect (or, if there
have been modifications, that this Mortgage, the Indenture, the Notes and the
Collateral Documents, as applicable, is or are in full force and effect as
modified and setting forth such modifications) and stating the date to which
principal and interest have been paid on the Notes.

 

ARTICLE V

 

LEASES

 

SECTION 5.1  Mortgagor’s
Affirmative Covenants with Respect to Leases.  With respect to each Lease, the Mortgagor
shall:

 

(i)            observe and perform, in all material
respects, all the obligations imposed upon the Landlord under such Lease;

 

(ii)           promptly send copies to the Mortgagee
of all notices of default which the Mortgagor shall send or receive thereunder;
and

 

(iii)          enforce all of the terms, covenants
and conditions contained in such Lease upon the part of the Tenant thereunder
to be observed or performed to the extent it would be commercially reasonable
to do so.

 

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SECTION 5.2  Mortgagor’s
Negative Covenants with Respect to Leases. 
With respect to each Lease, the Mortgagor shall not, without the prior
written consent of the Mortgagee, which consent shall not be unreasonably
withheld:

 

(i)            receive or collect, or permit the
receipt or collection of, any Rent under such Lease more than one (1) month in
advance of the respective period in respect of which such Rent is to accrue,
except:

 

(A)           in connection with the execution and
delivery of such Lease (or of any amendment to such Lease), Rent thereunder may
be collected and received in advance in an amount not in excess of one (1)
month’s Rent;

 

(B)             the amount held by Landlord as a
reasonable security deposit thereunder; and

 

(C)             any amount received and collected for
escalation and other charges in accordance with the terms of such Lease;

 

(ii)           assign, transfer or hypothecate
(other than to the Mortgagee hereunder) any Rent under such Lease whether then
due or to accrue in the future or the interest of the Mortgagor as Landlord
under such Lease;

 

(iii)          enter into any amendment or
modification of such Lease which would materially decrease the unexpired term
thereof or decrease the amount of the Rents payable thereunder or materially
impair the value or utility of the Mortgaged Property or the security provided
by this Mortgage;

 

(iv)          terminate (whether by exercising any
contractual right of the Mortgagor to recapture leased space or otherwise) or
permit the termination of such Lease or accept surrender of all or any portion
of the space demised under such Lease prior to the end of the term thereof or
accept assignment of such Lease to the Mortgagor unless:

 

(A)           the Tenant under such Lease has not paid the
equivalent of two (2) months’ Rent and the Mortgagor has made reasonable
efforts to collect such Rent; and

 

(B)             it would be commercially reasonable to
terminate such Lease; or

 

(v)           waive, excuse, condone or in any
manner discharge or release any Tenants of or from the material obligations of
such Tenants under their respective Leases or guarantors of Tenants from any
material obligations under any guarantees of the Leases except as the same
would be done by a Prudent Operator with due regard for the security afforded
the Mortgagee thereby.

 

SECTION 5.3  Additional
Requirements with Respect to New Leases. 
In addition to the requirements of Sections 5.1 and 5.2
hereof, the Mortgagor shall not enter into any Lease after the date hereof
unless the Tenant under such Lease has entered into a Subordination Agreement
and has otherwise complied with the provisions of Section 10.06 of the
Indenture.

 

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ARTICLE VI

 

CONCERNING
ASSIGNMENT OF LEASES AND RENTS

 

SECTION 6.1  Present Assignment; License to
the Mortgagor.  Section 2.2 of this
Mortgage constitutes a present, absolute, effective, irrevocable and complete
assignment by the Mortgagor to the Mortgagee of the Leases and Rents and the
right, subject to applicable law, to collect all sums payable to the Mortgagor
thereunder and apply the same as the Mortgagee may, in its sole discretion,
determine to be appropriate (including the payment of reasonable costs and
expenses in connection with the maintenance, operation, improvement, insurance,
taxes and upkeep of the Mortgaged Property), which is not conditioned upon the
Mortgagee being in possession of the Premises. 
The Mortgagee hereby grants to the Mortgagor, however, a license to
collect and apply the Rents and to enforce the obligations of Tenants under the
Leases.  Immediately upon the occurrence
of and during the continuance of any Event of Default or a Default, the license
granted in the immediately preceding sentence shall cease and terminate, with
or without any notice, action or proceeding or the intervention of a receiver
appointed by a court.

 

SECTION 6.2  Collection
of Rents by the Mortgagee.

 

(i)            From and after the occurrence and
during the continuance of an Event of Default or a Default, any Rents
receivable by the Mortgagee hereunder, after payment of all proper costs and
expenses as Mortgagee may, in its sole discretion, determine to be appropriate
(including the payment of reasonable costs and expenses in connection with the
maintenance, operation, improvement, insurance, taxes and upkeep of the
Mortgaged Property), shall be applied to the Secured Obligations or, at the
option of the Mortgagee, shall be held by the Mortgagee as additional
collateral to secure the performance by the Mortgagor of the Secured Obligations.  The Mortgagee shall be accountable to the
Mortgagor only for Rents actually received by the Mortgagee.  The collection of such Rents and the
application thereof shall not cure or waive any Event of Default or a Default
or waive, modify or affect notice of Event of Default or a Default or
invalidate any act done pursuant to such notice.

 

(ii)           The Mortgagor hereby irrevocably
authorizes and directs Tenant under each Lease to rely upon and comply with any
and all notices or demands from the Mortgagee for payment of Rents to the
Mortgagee and the Mortgagor shall have no claim against Tenant for Rents paid
by Tenant to the Mortgagee pursuant to such notice or demand.

 

SECTION 6.3  No
Release.  Neither this
Mortgage nor any action or inaction on the part of the Mortgagee shall release
any Tenant under any Lease, any guarantor of any Lease or the Mortgagor from
any of their respective obligations under such Leases or constitute an
assumption of any such obligation on the part of the Mortgagee.  No action or failure to act on the part of
the Mortgagor shall adversely affect or limit the rights of the Mortgagee under
this Mortgage or, through this Mortgage, under such Leases.  Nothing contained herein shall operate or be
construed to (i) obligate the Mortgagee to perform any of the terms,
covenants or conditions contained in any Lease or otherwise to impose any
obligation upon the Mortgagee with respect to such Lease (including, without
limitation, any obligation arising out of any covenant of quiet enjoyment contained
in such Lease in the event that Tenant under such Lease shall have been joined
as a party defendant in any action by which the estate of such Tenant shall be
terminated) or (ii) place upon the Mortgagee any obligation for the
operation, control, care, management or repair of the Premises.

 

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SECTION 6.4  Irrevocable
Interest.  All rights, powers and
privileges of the Mortgagee herein set forth are coupled with an interest and
are irrevocable, subject to the terms and conditions hereof, and the Mortgagor
shall not take any action under the Leases or otherwise which is inconsistent
with this Mortgage or any of the terms hereof and any such action inconsistent
herewith or therewith shall be void.

 

SECTION 6.5  Amendment
to Leases.  Each Lease, including,
without limitation, all amendments, modifications, supplements, replacements,
extensions and renewals thereof, shall continue to be subject to the provisions
hereof without the necessity of any further act by any of the parties hereto.

 

ARTICLE VII

 

TAXES AND CERTAIN STATUTORY LIENS

 

SECTION 7.1  Payment
of Charges.  Unless and to the extent
contested by the Mortgagor in accordance with the provisions of Article IX
hereof, the Mortgagor shall pay and discharge, or cause to be paid and
discharged, from time to time when the same shall become due (or within any
applicable grace period) , all Charges subject to this Article VII.  The Mortgagor shall, upon the Mortgagee’s
request, deliver to the Mortgagee receipts evidencing the payment of all such
Charges.

 

SECTION 7.2  Escrow
of Taxes.  From and after the
occurrence and during the continuance of an Event of Default or a Default, at
the option and upon the request of the Mortgagee, the Mortgagor shall deposit
with the Mortgagee in an account maintained by the Mortgagee (the “Tax
Escrow Fund”), on the first day of each month, an amount estimated by the
Mortgagee to be equal to one-twelfth of the annual real property taxes and
other annual Charges required to be discharged by the Mortgagor under Section 7.1
hereof.  Such amounts shall be held by
the Mortgagee without interest to the Mortgagor and applied to the payment of
the obligations in respect of which such amounts were deposited, in such
priority as the Mortgagee shall determine, on or before the respective dates on
which such obligations or any part thereof would become delinquent.  Nothing contained in this Article VII
shall (i) affect any right or remedy of the Mortgagee under any provision
hereof or of any statute or rule of law to pay any such amount as provided
above from its own funds and to add the amount so paid, together with interest
at the Default Rate during such time that any amount remains outstanding, to
the Secured Obligations or (ii) relieve the Mortgagor of its obligations
to make or provide for the payment of the annual real property taxes and other
annual Charges required to be discharged by the Mortgagor under Section 7.1
hereof.

 

SECTION 7.3  Certain
Statutory Liens.  Unless and to the
extent contested by the Mortgagor in accordance with the provisions of Article IX
hereof, the Mortgagor shall timely pay, or cause to be paid, all lawful claims
and demands of mechanics, materialmen, laborers, government agencies
administering worker’s compensation insurance, old age pensions and social
security benefits and all other claims, judgments, demands or amounts of any
nature which, if unpaid, would result in, or permit the creation of, a Lien on
the Mortgaged Property or any part thereof, or which would result in forfeiture
of all or any part of the Mortgaged Property.

 

SECTION 7.4  Stamp
and Other Taxes.  Unless and to the
extent contested by the Mortgagor in accordance with the provisions of Article IX
hereof, the Mortgagor shall pay any United States documentary stamp taxes, with
interest and fines and penalties, and any mortgage recording taxes, with

 

22

 

interest
and fines and penalties, that may hereafter be levied, imposed or assessed
under or upon or by reason hereof or the Secured Obligations or any instrument
or transaction affecting or relating to either thereof and in default thereof
the Mortgagee may advance the same and the amount so advanced shall be payable
by the Mortgagor to the Mortgagee in accordance with the provisions of Section 14.5
hereof.

 

SECTION 7.5  Certain
Tax Law Changes.  In the event of the
passage after the date hereof of any law deducting from the value of real
property, for the purpose of taxation, amounts in respect of any Lien thereon
or changing in any way the laws for the taxation of mortgages or debts secured
by mortgages for state or local purposes or the manner of the collection of any
Charges, and imposing any Charges, either directly or indirectly, on this
Mortgage, the Indenture or any other Collateral Document, the Mortgagor shall
promptly pay to the Mortgagee such amount or amounts as may be necessary from
time to time to pay any such Charges.

 

SECTION 7.6  Proceeds of Tax Claim.  In the event that the proceeds of any tax
claim are paid after the Mortgagee has exercised its right to foreclose the
Lien hereof, such proceeds shall be paid to the Mortgagee to satisfy any
deficiency remaining after such foreclosure. 
The Mortgagee shall retain its interest in the proceeds of any tax claim
during any redemption period.  The amount
of any such proceeds in excess of any deficiency claim of the Mortgagee shall
in a prompt manner be released to the Mortgagor.

 

ARTICLE VIII

 

INSURANCE

 

SECTION 8.1  Required
Insurance Policies and Coverages. 
The Mortgagor shall maintain in respect of the Premises the insurance
policies and coverages required under Section 4.19(b) of the Indenture.

 

SECTION 8.2  Delivery
After Foreclosure.  In the event that
the proceeds of any insurance claim are paid after the Mortgagee has exercised
its right to foreclose the Lien hereof, such proceeds shall be paid to the
Mortgagee to satisfy any deficiency remaining after such foreclosure.  Mortgagee shall retain its interest in the
Insurance Policies required to be maintained pursuant to this Mortgage during
any redemption period. The amount of any such proceeds in excess of any
deficiency claim of the Mortgagee shall be released to the Mortgagor.

 

ARTICLE IX

 

CONTESTING OF PAYMENTS

 

SECTION 9.1  Contesting
of Taxes and Certain Statutory Liens. 
The Mortgagor may at its own expense contest the validity, amount or
applicability of any Charges as long as the contest thereof shall be conducted
in accordance with, and permitted pursuant to the provisions of, the
Indenture.  Notwithstanding the foregoing
provisions of this Section 9.1, (i) no contest of any such
obligations may be pursued by the Mortgagor (A) if such contest would expose
the Mortgagee or any Holder to any possible criminal liability or
(B) unless the Mortgagor shall have furnished a bond or other security
therefor reasonably

 

23

 

 

satisfactory
to the Mortgagee or such Holder, as the case may be, including for any
additional civil liability for failure to comply with such obligations and
(ii) if at any time payment or performance of any obligation contested by
the Mortgagor pursuant to this Section 9.1 shall become necessary to
prevent the imminent imposition of remedies because of non-payment, the
Mortgagor shall pay or perform the same in sufficient time to prevent the imposition
of remedies in respect of such default or prospective default.

 

SECTION 9.2  Contesting
of Insurance.  The Mortgagor shall
not take any action that would reasonably be expected to cause the termination,
revocation or denial of any insurance coverage required to be maintained under
this Mortgage or that would be the basis for a defense to any claim under any
Insurance Policy maintained in respect of the Premises and the Mortgagor shall
otherwise comply in all respects with all Insurance Requirements in respect of
the Premises; provided, however, that the Mortgagor may, at its
own expense and after written notice to the Mortgagee, (i) contest the
applicability or enforceability of any such Insurance Requirements by
appropriate legal proceedings, prosecution of which does not constitute a basis
for cancellation or revocation of any insurance coverage required under Article
VIII hereof or (ii) cause the Insurance Policy containing any such Insurance
Requirement to be replaced by a new policy complying with the provisions of Article
VIII hereof.

 

ARTICLE X

 

DESTRUCTION, CONDEMNATION AND RESTORATION

 

SECTION 10.1  Destruction.  If there shall occur any Destruction,
individually or in the aggregate, in excess of $100,000, the Mortgagor shall
promptly send to the Mortgagee a written notice setting forth the nature and extent
of such Destruction.  The proceeds of any
insurance payable in respect of such Destruction are hereby assigned and shall
be paid to the Mortgagee.  The Net Loss
Proceeds arising out of such Destruction, shall be applied in accordance with
the provisions of Sections 4.16, 10.05(c) and 11.02 of the Indenture.

 

SECTION 10.2  Condemnation.  If there shall occur any Taking or the
commencement of any proceeding thereof, the Mortgagor shall immediately notify
the Mortgagee upon receiving notice of such Taking or commencement of
proceedings therefor.  The Mortgagee may,
at its option, participate in any proceedings or negotiations which might
result in any Taking, and the Mortgagor shall deliver or cause to be delivered
to the Mortgagee all instruments requested by it to permit such
participation.  The Mortgagee may be
represented by counsel reasonably satisfactory to it at the reasonable expense
of the Mortgagor in connection with any such participation.  The Mortgagor shall pay all reasonable fees,
costs and expenses incurred by the Mortgagee in connection with any Taking and
in seeking and obtaining any award or payment on account thereof.  Any proceeds, award or payment in respect of
any Taking are hereby assigned and shall be paid to the Mortgagee.  The Mortgagor shall take all steps necessary
to notify the condemning authority of such assignment.  The Net Loss Proceeds arising out of such
Taking shall be applied in accordance with the provisions of Sections 4.16, 10.05(c)
and 11.02 of the Indenture.

 

24

 

ARTICLE XI

 

EVENTS OF DEFAULT AND REMEDIES

 

SECTION 11.1  Events
of Default.  It shall be
an Event of Default hereunder if there shall have occurred and be continuing an
Event of Default under the Indenture.

 

SECTION 11.2  Remedies
in Case of an Event of Default.  If
any Event of Default shall have occurred and be continuing, the Mortgagee may
at its option, in addition to any other action permitted under this Mortgage or
the Indenture or by law, statute or in equity, take one or more of the
following actions to the greatest extent permitted by local law:

 

(i)                                     by
written notice to the Issuer and the Mortgagor, declare the entire unpaid
amount of the Secured Obligations to be due and payable immediately;

 

(ii)                                  personally,
or by its agents or attorneys, (A) enter into and upon and take possession
of all or any part of the Premises together with the books, records and
accounts of the Mortgagor relating thereto and, exclude the Mortgagor, its
agents and servants wholly therefrom, (B) use, operate, manage and control
the Premises and conduct the business thereof, (C) maintain and restore
the Premises, (D) make all necessary or proper repairs, renewals and
replacements and such useful Alterations thereto and thereon as the Mortgagee
may deem advisable, (E) manage, lease and operate the Premises and carry
on the business thereof and exercise all rights and powers of the Mortgagor
with respect thereto either in the name of the Mortgagor or otherwise or
(F) collect and receive all Rents. 
The Mortgagee shall be under no liability for or by reason of any such
taking of possession, entry, removal or holding, operation or management except
that any amounts so received by the Mortgagee shall be applied in accordance
with the provisions of the Indenture;

 

(iii)                               with
or without entry, personally or by its agents or attorneys, (A) sell the
Mortgaged Property and all estate, right, title and interest, claim and demand
therein at one or more sales in one or more parcels, in accordance with the
provisions of Section 11.3 or (B) institute and prosecute
proceedings for the complete or partial foreclosure of the Lien and security
interests created and evidenced hereby; or

 

(iv)                              take
such steps to protect and enforce its rights whether by action, suit or
proceeding at law or in equity for the specific performance of any covenant,
condition or agreement in the Indenture, the Notes and the Collateral
Documents, or in aid of the execution of any power granted in this Mortgage, or
for any foreclosure hereunder, or for the enforcement of any other appropriate
legal or equitable remedy or otherwise as the Mortgagee shall elect.

 

SECTION 11.3  Sale of Mortgaged Property if
Event of Default Occurs; Proceeds of Sale.

 

(i)                                     If
any Event of Default shall have occurred and be continuing, the Mortgagee may
institute an action to foreclose this Mortgage or take such other action as may
be permitted and available to the Mortgagee at law or in equity for the
enforcement of the Indenture and the Notes and realization on the Mortgaged
Property and proceeds thereon through power of sale or to final judgment and
execution thereof for the Secured Obligations, and in furtherance thereof the
Mortgagee may sell the Mortgaged Property at

 

25

 

one or more sales,
as an entirety or in parcels, at such time and place, upon such terms and after
such notice thereof as may be required or permitted by law or statute or in
equity.  The Mortgagee may execute and deliver
to the purchaser at such sale a conveyance of the Mortgaged Property in fee
simple and an assignment or conveyance of all the Mortgagor’s Interest in the
Leases and the Mortgaged Property, each of which conveyances and assignments
shall contain recitals as to the Event of Default upon which the execution of
the power of sale herein granted depends, and the Mortgagor hereby constitutes
and appoints the Mortgagee the true and lawful attorney in fact of the
Mortgagor to make any such recitals, sale, assignment and conveyance, and all
of the acts of the Mortgagee as such attorney in fact are hereby ratified and
confirmed.  The Mortgagor agrees that
such recitals shall be binding and conclusive upon the Mortgagor and that any
assignment or conveyance to be made by the Mortgagee shall divest the Mortgagor
of all right, title, interest, equity and right of redemption, including any
statutory redemption, in and to the Mortgaged Property.  The power and agency hereby granted are
coupled with an interest and are irrevocable by death or dissolution, or
otherwise, and are in addition to any and all other remedies which the
Mortgagee may have hereunder, at law or in equity.  So long as the Secured Obligations, or any
part thereof, remain unpaid, the Mortgagor agrees that possession of the
Mortgaged Property by the Mortgagor, or any person claiming under the
Mortgagor, shall be as tenant, and, in case of a sale under power or upon
foreclosure as provided in this Mortgage, the Mortgagor and any person in
possession under the Mortgagor, as to whose interest such sale was not made
subject, shall, at the option of the purchaser at such sale, then become and be
tenants holding over, and shall forthwith deliver possession to such purchaser,
or be summarily dispossessed in accordance with the laws applicable to tenants
holding over.  In case of any sale under
this Mortgage by virtue of the exercise of the powers herein granted, or
pursuant to any order in any judicial proceeding or otherwise, the Mortgaged
Property may be sold as an entirety or in separate parcels in such manner or
order as the Mortgagee in its sole discretion may elect.  One or more exercises of powers herein
granted shall not extinguish or exhaust such powers, until the entire Mortgaged
Property is sold or all amounts secured hereby are paid in full.

 

(ii)                                  In
the event of any sale made under or by virtue of this Article XI,
the entire principal of, and interest in respect of the Secured Obligations, if
not previously due and payable, shall, at the option of the Mortgagee, immediately
become due and payable, anything in this Mortgage to the contrary notwithstanding.

 

(iii)                               The
proceeds of any sale made under or by virtue of this Article XI,
together with any other sums which then may be held by the Mortgagee under this
Mortgage, whether under the provisions of this Article XI or
otherwise, shall be applied in accordance with the provisions of the Indenture;

 

(iv)                              The
Mortgagee may bid for and acquire the Mortgaged Property or any part thereof at
any sale made under or by virtue of this Article XI and, in lieu of
paying cash therefor, may make settlement for the purchase price by crediting
against the purchase price the unpaid amounts (whether or not then due and
owing) in respect of the Secured Obligations, after deducting from the sales
price the expense of the sale and the reasonable costs of the action or
proceedings and any other sums that the Mortgagee is authorized to deduct under
this Mortgage.

 

(v)                                 The
Mortgagee may adjourn from time to time any sale by it to be made under or by
virtue hereof by announcement at the time and place appointed for such sale or
for such adjourned sale or sales, and, the Mortgagee, without further notice or
publication, may make such sale at the time and place to which the same shall
be so adjourned.

 

26

 

(vi)                              If
the Premises is comprised of more than one parcel of land, the Mortgagee may
take any of the actions authorized by this Section 11.3 in respect of
any or a number of individual parcels.

 

SECTION 11.4  Additional
Remedies in Case of an Event of Default.

 

(i)                                     The
Mortgagee shall be entitled to recover judgment as aforesaid either before,
after or during the pendency of any proceedings for the enforcement of the
provisions hereof, and the right of the Mortgagee to recover such judgment
shall not be affected by any entry or sale hereunder, or by the exercise of any
other right, power or remedy for the enforcement of the provisions hereof, or
the foreclosure of, or absolute conveyance pursuant to, this Mortgage.  In case of proceedings against the Mortgagor
in insolvency or bankruptcy or any proceedings for its reorganization or
involving the liquidation of its assets, the Mortgagee shall be entitled to
prove the whole amount of principal and interest and other payments, charges
and costs due in respect of the Secured Obligations to the full amount thereof
without deducting therefrom any proceeds obtained from the sale of the whole or
any part of the Mortgaged Property; provided, however, that in no
case shall the Mortgagee receive a greater amount than the aggregate of such
principal, interest and such other payments, charges and costs (with interest
at the Default Rate) from the proceeds of the sale of the Mortgaged Property
and the distribution from the estate of the Mortgagor.

 

(ii)                                  Any
recovery of any judgment by the Mortgagee and any levy of any execution under
any judgment upon the Mortgaged Property shall not affect in any manner or to
any extent the Lien and security interests created and evidenced hereby upon
the Mortgaged Property or any part thereof, or any conveyances, powers, rights
and remedies of the Mortgagee hereunder, but such conveyances, powers, rights
and remedies shall continue unimpaired as before.

 

(iii)                               Any
monies collected by the Mortgagee under this Section 11.4 shall be
applied in accordance with the provisions of Section 11.3(iii).

 

SECTION 11.5  Legal
Proceedings After an Event of Default.

 

(i)                                     After
the occurrence and during the continuance of any Event of Default and immediately
upon the commencement of any action, suit or legal proceedings to obtain
judgment for the Secured Obligations or any part thereof, or of any proceedings
to foreclose the Lien and security interest created and evidenced hereby or
otherwise enforce the provisions hereof or of any other proceedings in aid of
the enforcement hereof, the Mortgagor shall enter its voluntary appearance in
such action, suit or proceeding.

 

(ii)                                  Upon
the occurrence and during the continuance of an Event of Default, the Mortgagee
shall be entitled forthwith as a matter of right, concurrently or independently
of any other right or remedy hereunder either before or after declaring the
Secured Obligations or any part thereof to be due and payable, to the
appointment of a receiver without giving notice to any party and without regard
to the adequacy or inadequacy of any security for the Secured Obligations or
the solvency or insolvency of any person or entity then legally or equitably
liable for the Secured Obligations or any portion thereof.  The Mortgagor hereby consents to the
appointment of such receiver. 
Notwithstanding the appointment of any receiver, the Mortgagee shall be
entitled as pledgee to the possession and control of any cash, deposits or
instruments at the time held by or payable or deliverable under the terms of
the Indenture to the Mortgagee.

 

27

 

(iii)                               The
Mortgagor shall not (A) at any time insist upon, or plead, or in any
manner whatsoever claim or take any benefit or advantage of any stay or
extension or moratorium law, any exemption from execution or sale of the
Mortgaged Property or any part thereof, wherever enacted, now or at any time
hereafter in force, which may affect the covenants and terms of performance hereof,
(B) claim, take or insist on any benefit or advantage of any law now or
hereafter in force providing for the valuation or appraisal of the Mortgaged
Property, or any part thereof, prior to any sale or sales of the Mortgaged
Property which may be made pursuant to this Mortgage, or pursuant to any
decree, judgment or order of any court of competent jurisdiction or
(C) after any such sale or sales, claim or exercise any right under any
statute heretofore or hereafter enacted to redeem the property so sold or any
part thereof.  To the extent permitted by
applicable law, the Mortgagor hereby expressly (A) waives all benefit or
advantage of any such law or laws, including, without limitation, any statute
of limitations applicable to this Mortgage, (B) waives all rights to have the
Mortgaged Property marshalled on any foreclosure of this Mortgage, (C) waives
any and all rights to trial by jury in any action or proceeding related to the
enforcement hereof, (D) waives any objection which it may now or hereafter
have to the laying of venue of any action, suit or proceeding brought in
connection with this Mortgage and further waives and agrees not to plead that
any such action, suit or proceeding brought in any such court has been brought
in an inconvenient forum and (E) covenants not to hinder, delay or impede the
execution of any power granted or delegated to the Mortgagee by this Mortgage
but to suffer and permit the execution of every such power as though no such
law or laws had been made or enacted. 
The Mortgagee shall not be liable for any incorrect or improper payment
made pursuant to this Article XI in the absence of gross negligence
or willful misconduct.

 

SECTION 11.6  Remedies
Not Exclusive.  No remedy conferred
upon or reserved to the Mortgagee by this Mortgage is intended to be exclusive
of any other remedy or remedies, and each and every such remedy shall be
cumulative and shall be in addition to every other remedy given under this
Mortgage or now or hereafter existing at law or in equity.  Any delay or omission of the Mortgagee to
exercise any right or power accruing on any Event of Default shall not impair
any such right or power and shall not be construed to be a waiver of or
acquiescence in any such Event of Default. 
Every power and remedy given by this Mortgage may be exercised from time
to time concurrently or independently, when and as often as may be deemed
expedient by the Mortgagee in such order and manner as the Mortgagee, in its
sole discretion, may elect.  If the
Mortgagee accepts any monies required to be paid by the Mortgagor under this
Mortgage after the same become due, such acceptance shall not constitute a
waiver of the right either to require prompt payment, when due, of all other
sums secured by this Mortgage or to declare an Event of Default with regard to
subsequent defaults.  If the Mortgagee
accepts any monies required to be paid by the Mortgagor under this Mortgage in
an amount less than the sum then due, such acceptance shall be deemed an acceptance
on account only and on the condition that it shall not constitute a waiver of
the obligation of the Mortgagor to pay the entire sum then due, and the
Mortgagor’s failure to pay the entire sum then due shall be and continue to be
a default hereunder notwithstanding acceptance of such amount on account.

 

SECTION 11.7  Special
Louisiana Provisions.

 

(i)                                     Without
limiting the generality of the foregoing, should one or more Events of Default
occur or exist and be continuing under this Mortgage, as provided above, the
Mortgagee, at its option, may exercise any one or more of the following rights
and remedies, in addition to any other rights and remedies provided by law and
under this Mortgage to the greatest extent permitted by applicable Louisiana
law.  Nothing contained herein shall be
construed as constituting the Mortgagee as mortgagee in possession in absence
of the actual taking of possession of the Premises by the Mortgagee.

 

28

 

(ii)                                  The
Mortgagee shall have the right, at its sole option, to accelerate the maturity
and demand immediate payment in full of any and all of the Secured
Obligations.  The Mortgagee shall then
have the right to commence appropriate foreclosure proceedings against the
Mortgaged Property and against the Mortgagor’s rights as provided in this
Mortgage.

 

(iii)                               In
the event that the Mortgagee elects to commence appropriate Louisiana
foreclosure proceedings under this Mortgage, the Mortgagee may cause the
Mortgaged Property, or any part or parts thereof, to be immediately seized and
sold, whether in term of court or in vacation, under ordinary or executory
process, in accordance with applicable Louisiana law, to the highest bidder for
cash, with or without appraisement, and without the necessity of making
additional demand upon or notifying the Mortgagor or placing the Mortgagor in
default, all of which are expressly waived.

 

(iv)                              For
purposes of foreclosure under Louisiana executory process procedures, the
Mortgagor confesses judgment and acknowledges to be indebted to the Mortgagee,
up to the full amount of the indebtedness in principal, interest, costs, expenses,
reasonable attorney’s fees and other fees and charges and amounts contemplated
hereunder.  The Mortgagor further
confesses judgment and acknowledges to be indebted unto and in favor of the
Mortgagee in the amount of all future advances that the Mortgagee may make on
the Mortgagor’s behalf pursuant to this Mortgage, together with interest
thereon.  To the extent permitted under
applicable Louisiana law, the Mortgagor additionally waives:  (1) the benefit of appraisal as provided in
Articles 2332, 2336, 2723, and 2724 of the Louisiana Code of Civil Procedure,
and all other laws with regard to appraisal upon judicial sale; (2) the demand
and three (3) days’ delay provided under Articles 22639 and 2721 of the
Louisiana Code of Civil Procedure; (3) the notice of seizure as provided under
Articles 2293 and 2721 of the Louisiana Code of Civil Procedure; (4) the three
(3) days’ delay provided under Articles 2331, 2722 and 2723 of the Louisiana
Code of Civil Procedure and all other Articles not specifically mentioned
above.  The Mortgagor further agrees that
any declaration of fact made by authentic act before a Notary Public and two
witnesses, by a Person declaring that such facts are within his or her
knowledge, shall constitute authentic evidence of such facts for purposes of
foreclosure under applicable Louisiana law and for purposes of La. R.S.
9:3504(D)(6) and La. R.S. 10:9-508, to the extent applicable.

 

(v)                                 Should
any or all of the Mortgaged Property be seized as an incident to an action for
the recognition or enforcement of this Mortgage, by executory process,
sequestration, attachment, writ of fieri facias or otherwise, the Mortgagor
hereby agrees that the court issuing any such order shall, if requested by the
Mortgagee, appoint the Mortgagee, or any agent designated by the Mortgagee or
any Person named by the Mortgagee at the time such seizure is requested, or any
time thereafter, as Keeper of the Mortgaged Property as provided under La. R.S.
9:5136, et seq.  Such a Keeper shall be
entitled to reasonable compensation.  The
Mortgagor agrees to pay the reasonable fees of such Keeper which compensation
to the Keeper shall also be secured by this Mortgage in the form of any future
advances as provided in this Mortgage.

 

(vi)                              Should
it become necessary for the Mortgagee to foreclose under this Mortgage, all
declarations of fact, which are made under an authentic act before a Notary
Public in the presence of two witnesses, by a person declaring such facts to
lie within his or her knowledge, shall constitute authentic evidence for
purposes of executory process and also for purposes of La. R.S. 9:3509.1, La.
R.S. 9:3504(D)(6) and La. R.S. 10:9-508, where applicable.

 

29

 

(vii)                           Should
one or more Events of Default occur or exist under this Mortgage, the Mortgagee
shall have the additional right, at its sole option, to separately sell the
aforesaid rights, or any part of parts thereof, at private or public
compensation, or on credit, or for future delivery, without the assumption of
any credit risk.  The sale of the
aforesaid rights may be without appraisement, the benefit of which is also
expressly waived by the Mortgagor.  The
Mortgagee may exercise any other remedies with regard to the Mortgagor’s rights
as may be authorized under the Louisiana Commercial Laws (La. R.S. 10:9-101, et
seq.).

 

(viii)                        To
the extent provided by law, and in the event of foreclosure under this
Mortgage, or other transfer of title or assignment of the Mortgaged Property,
or any part or parts thereof, in lieu of payment of the Secured Obligations,
whether in whole or in part, all policies of insurance and other rights applicable
to the foreclosed Mortgaged Property upon transfer of the Mortgaged Property
shall automatically inure to the benefit of and shall pass to the purchaser(s)
or transferee(s) thereof, subject to the rights of the purchaser(s) or
transferee(s) to reject such insurance coverage and/or rights at its or their
sole option and election.

 

(ix)                                The
Mortgagee may, in addition to or in lieu of the foregoing remedies, in the
Mortgagee’s sole discretion, commence an appropriate action against the
Mortgagor seeking specific performance of any covenant contained in this
Mortgage or in aid of the execution or enforcement of any power in this
Mortgage granted.

 

(x)                                   Except
as may be prohibited by applicable law, all of the Mortgagee’s rights and
remedies, whether evidenced by this Mortgage or by any other writing, shall be
cumulative and may be exercised singularly or concurrently.  Election by the Mortgagee to pursue any
remedy shall not exclude pursuit of any other remedy, and an election to make
expenditures or to take action to perform an obligation of the Mortgagor under
this Mortgage, after the Mortgagor’s failure to perform shall not affect the
Mortgagee’s right to declare a default and exercise its remedies.  Nothing under this Mortgage or otherwise
shall be construed so as to limit or restrict the rights and remedies available
to the Mortgagee following an Event of Default, or in any way to limit or
restrict the rights and abilities of the Mortgagee to proceed directly against
Mortgagor and/or against any other co-maker, guarantor, surety or endorser of
the Secured Obligations, and/or to proceed against any other collateral
directly or indirectly securing the Secured Obligations.

 

ARTICLE XII

 

SECURITY AGREEMENT AND FIXTURE FILING

 

SECTION 12.1  Security
Agreement.

 

(i) This Mortgage shall constitute a Security Agreement as defined in
the Louisiana Commercial Laws, La. R.S. § 10:101 et seg., and shall create and
evidence a security interest in all the equipment and in all the other items of
Mortgaged Property in which a security interest may be granted pursuant to the
Louisiana Commercial Laws (collectively, “Personal Property”).

 

(ii) The remedies for any violation of the covenants, terms and
conditions of the agreements herein contained shall be as prescribed herein or
by general Louisiana law or, as to such part of the

 

30

 

security
which is also reflected in any financing statement filed to perfect the
security interest herein created, by the specific statutory provisions now or
hereinafter enacted and specified in the Louisiana Commercial Laws, all at
Mortgagee’s sole election.  The mention
in any financing statement of (1) the rights in or the proceeds of any fire or
hazard insurance policy, or (2) any award in eminent domain proceedings for a
taking or for loss of value, or (3) Mortgagor’s interest as lessor in any
present or future lease or rights to income growing out of the use or occupancy
of the Mortgaged Property whether pursuant to lease or otherwise, shall never
be construed as in any way altering any of the rights of Mortgagee under this
Mortgage or impugning the priority of the Mortgagee’s lien granted hereby or by
any other recorded document.  Rather,
such mention in the financing statement is declared to be for the protection of
the Mortgagee in the event any court or judge shall at any time hold with
respect to (1), (2) and (3) above, that notice of Mortgagee’s priority of
interest to be effective against a particular class of persons, including, but
not limited to, the Federal Government and any subdivisions or entity of the
Federal Government, must be filed with the clerk of court of any parish (or St.
Martin Parish Recorder of Mortgages) pursuant to Section 9-401 of the Louisiana
Commercial Laws.

 

SECTION 12.2  Fixture
Filing.  From the date of its
recording, this Mortgage shall be effective as a fixture financing statement
with respect to all goods constituting part of the Mortgaged Property which are
to become fixtures related to the Land. 
For this purpose, the following information is set forth:

 

(a)  Name
and Address of Debtor:

 

Jalou
Breaux Bridge, LLC

1869
Mills Highway

Breaux Bridge, Louisiana 70517

 

and

 

(b)  Name
and Address of Secured Party:

 

Wells
Fargo Bank, National Association

Corporate Trust Services 

213 Court Street, Suite 703

Middletown, Connecticut 06457

 

(c)  This
document covers goods which are to become fixtures.  All items that are fixtures on the date of
this Mortgage shall be subject to the mortgage Lien granted hereunder.

 

ARTICLE XIII

 

FURTHER ASSURANCES

 

SECTION 13.1  Recording
Documentation To Assure Security. 
The Mortgagor shall, forthwith after the execution and delivery hereof
and thereafter, from time to time, cause this Mortgage and any financing
statement, continuation statement or similar instrument relating to any thereof
or to any property

 

31

 

intended
to be subject to the Lien hereof to be filed, registered and recorded in such
manner and in such places as may be required by any present or future law in order
to publish notice of and fully to protect the validity and priority thereof or
the Lien hereof purported to be created upon the Mortgaged Property and the
interest and rights of the Mortgagee therein. 
The Mortgagor shall pay or cause to be paid all taxes and fees incident
to such filing, registration and recording, and all reasonable expenses
incident to the preparation, execution and acknowledgment thereof, and of any
instrument of further assurance, and all Federal or state stamp taxes or other
taxes, duties and charges arising out of or in connection with the execution
and delivery of such instruments.

 

SECTION 13.2  Further
Acts.  The Mortgagor shall, at the
sole cost and expense of the Mortgagor, do, execute, acknowledge and deliver
all and every such further acts, deeds, conveyances, mortgages, assignments,
notices of assignment, transfers, financing statements, continuation
statements, instruments and assurances as the Mortgagee shall from time to time
reasonably request, which may be necessary in the judgment of the Mortgagee
from time to time to assure, perfect, convey, assign, mortgage, transfer and
confirm unto the Mortgagee, the property and rights hereby conveyed or assigned
or which the Mortgagor may be or may hereafter become bound to convey or assign
to the Mortgagee or for carrying out the intention or facilitating the
performance of the terms hereof or the filing, registering or recording
hereof.  Without limiting the generality
of the foregoing, in the event that the Mortgagee desires to exercise any
remedies, consensual rights or attorney-in-fact powers set forth in this
Mortgage and determines it necessary to obtain any approvals or consents of any
Governmental Authority or any other Person therefor, then, upon the reasonable
request of the Mortgagee, the Mortgagor agrees to use its reasonable efforts to
assist and aid the Mortgagee to obtain as soon as practicable any necessary approvals
or consents for the exercise of any such remedies, rights and powers.  In the event the Mortgagor shall fail
(i) within ten (10) Business Days after demand, to execute or take any
action required to be executed or taken by the Mortgagor under this Section
13.2 to the extent same is necessary to maintain perfection of the Lien
granted to Mortgagee hereunder or (ii) such failure shall constitute an Event
of Default, to execute or take any action required to be executed or taken by
the Mortgagor under this Section 13.2 (other than the type described in
clause (i) of this sentence) then, in each of the cases described in clauses
(i) and (ii) of this sentence, the Mortgagee may execute or take the same as
the attorney-in-fact for the Mortgagor, such power of attorney being coupled
with an interest and is irrevocable.

 

SECTION 13.3  Additional
Security.  Without notice to or
consent of the Mortgagor and without impairment of the Lien and rights created
by this Mortgage, the Mortgagee may accept (but the Mortgagor shall not be
obligated to furnish) from the Mortgagor or from any other Person, additional
security for the Secured Obligations. 
Neither the giving hereof nor the acceptance of any such additional
security shall prevent the Mortgagee from resorting, first, to such additional
security, and, second, to the security created by this Mortgage without
affecting the Mortgagee’s Lien and rights under this Mortgage.

 

ARTICLE XIV

 

MISCELLANEOUS

 

SECTION 14.1  Covenants
To Run with the Land.  All of the
grants, covenants, terms, provisions and conditions in this Mortgage shall run
with the Land and shall apply to, and bind the successors

 

32

 

and
assigns of, the Mortgagor.  If there
shall be more than one mortgagor with respect to the Mortgaged Property, the
covenants and warranties hereof shall be joint and several.

 

SECTION 14.2  No
Merger.  The rights and
estate created by this Mortgage shall not, under any circumstances, be held to
have merged into any other estate or interest now owned or hereafter acquired
by the Mortgagee unless the Mortgagee shall have consented to such merger in
writing, such consent not to be unreasonably withheld.

 

SECTION 14.3  Concerning
Mortgagee.

 

(i)                                     The
Mortgagee has been appointed as trustee pursuant to the Indenture.  The actions of the Mortgagee hereunder are
subject to the provisions of the Indenture. 
The Mortgagee shall have the right hereunder to make demands, to give notices,
to exercise or refrain from exercising any rights, and to take or refrain from
taking action (including, without limitation, the release or substitution of the
Mortgaged Property), in accordance with this Mortgage and the Indenture.  The Mortgagee may employ agents and
attorneys-in-fact in connection herewith and shall not be liable for the
negligence or misconduct of any such agents or attorneys-in-fact selected by it
in good faith.  The Mortgagee may resign
and a successor Mortgagee may be appointed in the manner provided in the
Indenture.  Upon the acceptance of any
appointment as the Mortgagee by a successor Mortgagee, that successor Mortgagee
shall thereupon succeed to and become vested with all the rights, powers,
privileges and duties of the retiring Mortgagee under this Mortgage, and the
retiring Mortgagee shall thereupon be discharged from its duties and
obligations under this Mortgage.  After
any retiring Mortgagee’s resignation, the provisions hereof shall inure to its
benefit as to any actions taken or omitted to be taken by it under this
Mortgage while it was the Mortgagee.

 

(ii)                                  The
Mortgagee shall be deemed to have exercised reasonable care in the custody and
preservation of the Mortgaged Property in its possession if such Mortgaged
Property is accorded treatment substantially equivalent to that which the
Mortgagee, in its individual capacity, accords its own property consisting of
similar instruments or interests, it being understood that neither the
Mortgagee nor any of the Secured Parties shall have responsibility for taking
any necessary steps to preserve rights against any Person with respect to any
Mortgaged Property.

 

(iii)                               The
Mortgagee shall be entitled to rely upon any written notice, statement,
certificate, order or other document or any telephone message believed by it to
be genuine and correct and to have been signed, sent or made by the proper
person, and, with respect to all matters pertaining to this Mortgage and its
duties hereunder, upon advice of counsel selected by it.

 

(iv)                              If
any portion of the Mortgaged Property also constitutes collateral granted to
the Mortgagee under any other deed of trust, mortgage, security agreement,
pledge or instrument of any type, in the event of any conflict between the
provisions hereof and the provisions of such other deed of trust, mortgage,
security agreement, pledge or instrument of any type in respect of such
collateral, the Mortgagee, in its sole discretion, shall select which provision
or provisions shall control.

 

SECTION 14.4  Mortgagee
May Perform; Mortgagee Appointed Attorney-in-Fact.  If the Mortgagor shall fail to perform any
covenants contained in this Mortgage, subject to any applicable grace periods
or contest rights permitted pursuant to Article IX hereof or as
otherwise permitted by any Collateral Document (including, without limitation,
the Mortgagor’s covenants to (i) pay the premiums in respect of

 

33

 

all
required insurance policies hereunder, (ii) pay Charges, (iii) make repairs,
(iv) discharge Liens or (v) pay or perform any obligations of the Mortgagor
under any Mortgaged Property) or if any warranty on the part of the Mortgagor
contained herein shall be breached, the Mortgagee may (but shall not be
obligated to) do the same or cause it to be done or remedy any such breach, and
may expend funds for such purpose; provided, however, that the
Mortgagee shall in no event be bound to inquire into the validity of any tax,
Lien, imposition or other obligation which the Mortgagor fails to pay or
perform as and when required hereby and which the Mortgagor does not contest in
accordance with the provisions of Article IX hereof.  Any and all amounts reasonably so expended by
the Mortgagee shall be paid by the Mortgagor in accordance with the provisions
of Section 14.5 hereof.  Neither
the provisions of this Section 14.4 nor any action taken by the
Mortgagee pursuant to the provisions of this Section 14.4 shall prevent
any such failure to observe any covenant contained in this Mortgage nor any
breach of warranty from constituting an Event of Default.  Upon the occurrence and during the
continuance of an Event of Default the Mortgagor hereby appoints the Mortgagee
its attorney-in-fact, with full authority in the place and stead of the
Mortgagor and in the name of the Mortgagor to take any action and to execute
any instrument consistent with the terms hereof and the other Collateral
Documents which the Mortgagee may deem necessary or advisable to accomplish the
purposes hereof.  The foregoing grant of
authority is a power of attorney coupled with an interest and such appointment
shall be irrevocable for the term hereof. 
The Mortgagor hereby ratifies all that such attorney shall lawfully do
or cause to be done by virtue hereof.

 

SECTION 14.5  Expenses  The Mortgagor will upon demand pay to the
Mortgagee the amount of any and all reasonable costs and expenses, including
the reasonable fees and expenses of its counsel and the reasonable fees and
expenses of any experts and agents which the Mortgagee may incur in connection
with (i) any action, suit or other proceeding affecting the Mortgaged Property
or any part thereof commenced, in which action, suit or proceeding the
Mortgagee is made a party or participates or in which the right to use the
Mortgaged Property or any part thereof is threatened, or in which it becomes
necessary in the judgment of the Mortgagee to defend or uphold the Lien hereof
(including, without limitation, any action, suit or proceeding to establish or
uphold the compliance of the Mortgaged Property with any Requirements of Law),
(ii) the collection of the Secured Obligations, (iii) the enforcement
and administration hereof, (iv) the custody or preservation of, or the sale of,
collection from, or other realization upon, any of the Mortgaged Property, (v)
the exercise or enforcement of any of the rights of the Mortgagee or any
Secured Party hereunder or (vi) the failure by the Mortgagor to perform or
observe any of the provisions hereof. 
All amounts expended by the Mortgagee and payable by the Mortgagor under
this Section 14.5 shall be due upon demand therefor (together with
interest thereon accruing at the Default Rate during the period from and
including the date on which such funds were so expended to the date of
repayment) and shall be part of the Secured Obligations.  The Mortgagor’s obligations under this Section 14.5
shall survive the termination hereof and the discharge of the Mortgagor’s other
obligations under this Mortgage.

 

SECTION 14.6  Indemnity.

 

(i)                                     The
Mortgagor agrees to indemnify, pay and hold harmless the Mortgagee and each of
the other Secured Parties and the officers, directors, employees, agents and
Affiliates of the Mortgagee and each of the other Secured Parties (collectively,
the “Indemnitees”) from and against any and all other liabilities,
obligations, losses, damages, penalties, actions, judgments, suits, claims,
costs (including, without limitation, settlement costs), expenses or
disbursements of any kind or nature whatsoever (including, without limitation,
the reasonable fees and disbursements of counsel for such Indemnitees in
connection with any investigative, administrative or judicial proceeding,
commenced or threatened, whether or not

 

34

 

such Indemnitee
shall be designated a party thereto), which may be imposed on, incurred by or
asserted against that Indemnitee, in any manner relating to or arising out
hereof, the Indenture, the Notes, any other Collateral Document or any other
document evidencing the Secured Obligations (including, without limitation, any
misrepresentation by the Mortgagor in this Mortgage, the Indenture, the Notes,
any other Collateral Document or any other document evidencing the Secured
Obligations (the “Indemnified Liabilities”); provided, however,
that the Mortgagor shall have no obligation to an Indemnitee hereunder with
respect to Indemnified Liabilities to the extent it has been determined by a
final decision (after all appeals and the expiration of time to appeal) by a
court of competent jurisdiction that such Indemnified Liabilities arose from
the gross negligence or willful misconduct of that Indemnitee.  To the extent that the undertaking to
indemnify, pay and hold harmless set forth in the preceding sentence may be
unenforceable because it is violative of any law or public policy, the
Mortgagor shall contribute the maximum portion which it is permitted to pay and
satisfy under applicable law, to the payment and satisfaction of all
Indemnified Liabilities incurred by the Indemnitees or any of them.

 

(ii)                                  Survival.  The obligations of the Mortgagor contained in
this Section 14.6 shall survive the termination hereof and the discharge
of the Mortgagor’s other obligations under this Mortgage, the Indenture and the
other Collateral Documents.

 

(iii)                               Reimbursement.  Any amount paid by any Indemnitee as to which
such Indemnitee has the right to reimbursement shall constitute Secured
Obligations secured by the Mortgaged Property.

 

SECTION 14.7  Continuing
Security Interest; Assignment.  This
Mortgage shall create a continuing Lien on and security interest in the
Mortgaged Property and shall (i) be binding upon the Mortgagor, its
respective successors and assigns and (ii) inure, together with the rights
and remedies of the Mortgagee hereunder, to the benefit of the Mortgagee and
the other Secured Parties and each of their respective successors, transferees
and assigns.  No other Persons (including,
without limitation, any other creditor of Mortgagor) shall have any interest
herein or any right or benefit with respect hereto.  Without limiting the generality of the
foregoing clause (ii), any Holder of the Notes may assign or otherwise
transfer any indebtedness held by it that is secured by this Mortgage to any
other Person, and such other Person shall thereupon become vested with all the
benefits in respect thereof granted to such Holder, herein or otherwise,
subject however, to the provisions of the Indenture.

 

SECTION 14.8  Termination;
Release.  The Mortgaged Property
shall be released from the Lien of this Mortgage in accordance with the
provisions of Article 10 of the Indenture.

 

SECTION 14.9  Modification
in Writing.  No amendment,
modification, supplement, termination or waiver of or to any provision hereof,
nor consent to any departure by the Mortgagor therefrom, shall be effective
unless the same shall be done in accordance with the terms of the Indenture and
unless in writing and signed by the Mortgagee and Mortgagor.  Any amendment, modification or supplement of
or to any provision hereof, any waiver of any provision hereof and any consent
to any departure by the Mortgagor from the terms of any provision hereof shall
be effective only in the specific instance and for the specific purpose for
which made or given.  Except where notice
is specifically required by this Mortgage or any other Collateral Document, no
notice to or demand on the Mortgagor in any case shall entitle the Mortgagor to
any other or further notice or demand in similar or other circumstances.

 

35

 

SECTION 14.10  Notices.  Unless otherwise provided herein or in the
Indenture, any notice or other communication herein required or permitted to be
given shall be given in the manner and become effective as set forth in the
Indenture, if to the Mortgagor, addressed to it at the address of the Issuer
set forth in the Indenture, and as to the Mortgagee, addressed to it at its
address set forth in the Indenture, or in each case at such other address as
shall be designated by such party in a written notice to the other party complying
as to delivery with the terms of this Section 14.10.

 

SECTION 14.11  GOVERNING LAW; SERVICE OF
PROCESS; WAIVER OF JURY TRIAL.  THIS
MORTGAGE SHALL BE GOVERNED BY, AND SHALL BE CONSTRUED AND ENFORCED IN
ACCORDANCE WITH, THE LAWS OF THE STATE IN WHICH THE PREMISES ARE LOCATED,
WITHOUT REGARD TO PRINCIPLES OF CONFLICTS OF LAWS, EXCEPT TO THE EXTENT THAT
THE VALIDITY OR PERFECTION OF THE SECURITY INTEREST HEREUNDER, OR REMEDIES
HEREUNDER, IN RESPECT OF ANY PARTICULAR ITEM OR TYPE OF MORTGAGED PROPERTY ARE
GOVERNED BY THE LAWS OF A JURISDICTION OTHER THAN SUCH STATE.  THE MORTGAGOR AGREES THAT SERVICE OF PROCESS
IN ANY PROCEEDING MAY BE EFFECTED BY MAILING A COPY THEREOF BY REGISTERED OR
CERTIFIED MAIL (OR ANY SUBSTANTIALLY SIMILAR FORM OF MAIL), POSTAGE PREPAID, TO
THE ISSUER AT ITS ADDRESS SET FORTH IN THE INDENTURE OR AT SUCH OTHER ADDRESS
OF WHICH THE MORTGAGEE SHALL HAVE BEEN NOTIFIED PURSUANT THERETO.  IF ANY AGENT APPOINTED BY THE MORTGAGOR
REFUSES TO ACCEPT SERVICE, THE MORTGAGOR HEREBY AGREES THAT SERVICE UPON IT BY
MAIL SHALL CONSTITUTE SUFFICIENT NOTICE. 
NOTHING HEREIN SHALL AFFECT THE RIGHT TO SERVE PROCESS IN ANY OTHER
MANNER PERMITTED BY LAW OR SHALL LIMIT THE RIGHT OF THE MORTGAGEE TO BRING
PROCEEDINGS AGAINST THE MORTGAGOR IN THE COURTS OF ANY OTHER JURISDICTION.  THE MORTGAGOR HEREBY IRREVOCABLY WAIVES ALL
RIGHT TO A TRIAL BY JURY IN ANY ACTION, PROCEEDING OR COUNTERCLAIM ARISING OUT
OF OR RELATING TO THIS AGREEMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY.

 

SECTION 14.12  Severability
of Provisions.  Any provision hereof
which is prohibited or unenforceable in any jurisdiction shall, as to such
jurisdiction, be ineffective to the extent of such prohibition or
unenforceability without invalidating the remaining provisions hereof or
affecting the validity or enforceability of such provision in any other jurisdiction.

 

SECTION 14.13  Limitation
on Interest Payable.  It is the
intention of the parties to conform strictly to the usury laws, whether state
or Federal, that are applicable to the transaction of which this Mortgage is a
part.  All agreements between the
Mortgagor and the Mortgagee, whether now existing or hereafter arising and
whether oral or written, are hereby expressly limited so that in no contingency
or event whatsoever shall the amount paid or agreed to be paid by the Mortgagor
for the use, forbearance or detention of the money to be loaned or advanced
under the Indenture or any related document or for the payment or performance
of any covenant or obligation contained herein or in the Indenture or any related
document exceed the maximum amount permissible under applicable Federal or
state usury laws.  If under any circumstances
whatsoever fulfillment of any such provision, at the time performance of such
provision shall be due, shall involve exceeding the limit of validity
prescribed by law, then the obligation to be fulfilled shall be reduced to the
limit of such validity.  If under any
circumstances the Mortgagor shall have paid an amount deemed interest by applicable
law, which would exceed the highest lawful rate, such

 

36

 

amount
that would be excessive interest under applicable usury laws shall be applied
to the reduction of the principal amount owing in respect of the Secured
Obligations and not to the payment of interest, or if such excessive interest
exceeds the unpaid balance of principal and any other amounts due hereunder,
the excess shall be refunded to the Mortgagor. 
All sums paid or agreed to be paid for the use, forbearance or detention
of the principal under any extension of credit by the Mortgagee shall, to the
extent permitted by applicable law, and to the extent necessary to preclude
exceeding the limit of validity prescribed by law, be amortized, prorated,
allocated and spread from the date hereof until payment in full of the Secured
Obligations so that the actual rate of interest on account of such principal
amounts is uniform throughout the term hereof.

 

SECTION 14.14  Business
Days.  In the event any time period
or any date provided in this Mortgage ends or falls on a day other than a
Business Day, then such time period shall be deemed to end and such date shall
be deemed to fall on the next succeeding Business Day, and performance herein
may be made on such Business Day, with the same force and effect as if made on
such other day.

 

SECTION 14.15  Relationship.  The relationship of the Mortgagee to the
Mortgagor hereunder is strictly and solely that of lender and borrower and
mortgagor and mortgagee and nothing contained in the Indenture, the Notes, this
Mortgage or any other document or instrument now existing and delivered in connection
therewith or otherwise in connection with the Secured Obligations is intended
to create, or shall in any event or under any circumstance be construed as
creating a partnership, joint venture, tenancy-in-common, joint tenancy or
other relationship of any nature whatsoever between the Mortgagee and the
Mortgagor other than as lender and borrower and mortgagor and mortgagee.

 

SECTION 14.16  Waiver
of Stay.

 

(i)                                     The
Mortgagor agrees that in the event that the Mortgagor or any property or assets
of the Mortgagor shall hereafter become the subject of a voluntary or
involuntary proceeding under the Bankruptcy Code or the Mortgagor shall
otherwise be a party to any Federal or state bankruptcy, insolvency, moratorium
or similar proceeding to which the provisions relating to the automatic stay
under Section 362 of the Bankruptcy Code or any similar provision in any such
law is applicable, then, in any such case, whether or not the Mortgagee has
commenced foreclosure proceedings under this Mortgage, the Mortgagee shall be
entitled to relief from any such automatic stay as it relates to the exercise
of any of the rights and remedies (including, without limitation, any foreclosure
proceedings) available to the Mortgagee as provided in this Mortgage, in any
other Collateral Document or any other document evidencing the Secured
Obligations.

 

(ii)                                  The
Mortgagee shall have the right to petition or move any court having
jurisdiction over any proceeding described in Section 14.16(i) hereof
for the purposes provided therein, and the Mortgagor agrees (i) not to oppose
any such petition or motion and (ii) at the Mortgagor’s sole cost and expense,
to assist and cooperate with the Mortgagee, as may be requested by the
Mortgagee from time to time, in obtaining any relief requested by the
Mortgagee, including, without limitation, by filing any such petitions,
supplemental petitions, requests for relief, documents, instruments or other
items from time to time requested by the Mortgagee or any such court.

 

SECTION 14.17  No
Credit for Payment of Taxes or Impositions.  The Mortgagor shall not be entitled to any
credit against the principal, premium, if any, or interest payable under the
Indenture

 

37

 

or the
Notes, and the Mortgagor shall not be entitled to any credit against any other
sums which may become payable under the terms thereof or hereof, by reason of
the payment of any Charge on the Mortgaged Property or any part thereof.

 

SECTION 14.18  No
Claims Against the Mortgagee. 
Nothing contained in this Mortgage shall constitute any consent or
request by the Mortgagee, express or implied, for the performance of any labor
or services or the furnishing of any materials or other property in respect of
the Premises or any part thereof, nor as giving the Mortgagor any right, power
or authority to contract for or permit the performance of any labor or services
or the furnishing of any materials or other property in such fashion as would
permit the making of any claim against the Mortgagee in respect thereof or any
claim that any Lien based on the performance of such labor or services or the
furnishing of any such materials or other property is prior to the Lien hereof.

 

SECTION 14.19  Obligations
Absolute.  All obligations of the
Mortgagor hereunder shall be absolute and unconditional irrespective of:

 

(i)                                     any
bankruptcy, insolvency, reorganization, arrangement, readjustment, composition,
liquidation or the like of the Mortgagor, the Issuer or any other Guarantor;

 

(ii)                                  any
lack of validity or enforceability of the Indenture, the Notes or any other
agreement or instrument relating thereto;

 

(iii)                               any
change in the time, manner or place of payment of, or in any other term of, all
or any of the Secured Obligations, or any other amendment or waiver of or any
consent to any departure from the Indenture, the Notes or any other agreement
or instrument relating thereto;

 

(iv)                              any
exchange, release or non-perfection of any other collateral, or any release or
amendment or waiver of or consent to any departure from any guarantee, for all
or any of the Secured Obligations;

 

(v)                                 any
exercise or non-exercise, or any waiver of any right, remedy, power or
privilege under or in respect hereof, the Indenture, the Notes or any agreement
or instrument relating thereto except as specifically set forth in a waiver
granted pursuant to the provisions of Section 14.9 hereof; or

 

(vi)                              any
other circumstances which might otherwise constitute a defense available to, or
a discharge of, the Mortgagor.

 

SECTION 14.20  Last
Dollars Secured.  This
Mortgage secures only a portion of the Indebtedness owing or which may become
owing by the Mortgagor.  The parties
agree that any payments or repayments of such Indebtedness by the Mortgagor
shall be and be deemed to be applied first to the portion of the Indebtedness
that is not secured hereby, it being the parties’ intent that the portion of
the Indebtedness last remaining unpaid shall be secured hereby.

 

[REMAINDER OF THIS PAGE INTENTIONALLY LEFT BLANK]

 

38

 

THUS DONE AND PASSED, on the day, month and year first written above,
effective as of the Effective Date, in the State and Parish aforesaid, by the
undersigned Mortgagor in the presence of the undersigned Notary and the
undersigned competent witnesses, who hereunto sign their names with Mortgagor
after reading of the whole.

 

 

	
  WITNESSES:

  	
  MORTGAGOR:

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  JALOU BREAUX
  BRIDGE, LLC,

  	
   

  
	
   

  	
  a Louisiana
  limited liability company

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  /s/ Thomas E.
  Hamilton

  	
   

  	
  By:

  	
  /s/ Ian M.
  Stewart

  	
   

  
	
  Printed Name:
  Thomas E. Hamilton

  	
   

  	
  Ian M. Stewart

  	
   

  
	
   

  	
   

  	
  Authorized
  Officer

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  /s/ Sterling W.
  Dale, Jr.

  	
   

  	
   

  	
   

  	
   

  
	
  Printed Name:
  Sterling W. Dale, Jr.

  	
   

  	
   

  	
   

  

 

	
   

  	
    /s/
  Perryann P. Whitehurst

  	
   

  
	
   

  	
  Notary
  Public

  	
   

  

 

39

 

Schedule
A

 

Legal Description

 

That certain tract of land, together with all the
buildings and improvements thereon, situated in Sections 46, 121 and 122,
Township 9 South, Range 5 East in Anse La Butte, St. Martin Parish, Louisiana,
containing 16.86 arpents, more or less, and bounded Northerly in part by a
public road and in part by a servitude road, Southerly by property of Tony
Tortoris, et al, formerly Anatole Castille, Easterly by Lot No. 5 of plat
attached to Act No. 89612 of the official records of St. Martin Parish,
Louisiana, and Westerly by Lot 3 of said plat; said property being known and
designated as LOT 4 as shown on said plat of survey.

 

Schedule
B

 

Prior Liens

 

1.               Each
of the liens and other encumbrances excepted as being prior to the Lien hereof
as set forth in Schedule B to the marked title insurance commitment issued
by Lawyers Title Insurance Corporation, dated as of the date hereof and
delivered to the Trustee on the date hereof, bearing Lawyers Title Insurance
Corporation reference number 40889 /dd relating to the real property described
in Schedule A attached hereto.

 

2.               Zoning
and building ordinances and regulations, to the extent they constitute
Permitted Liens of the type described in clause (4) of the definition thereof.

 

 

Schedule
C

 

Leases Affecting the
Mortgaged Property

 

1.                                       That
certain Lease by and among Jalou Breaux Bridge, LLC (as Landlord) and Gerald
and Pamela Moss Arceneaux (as Tenants), of record in COB 1386, Folio 636, Entry
No. 352560 of the official records of St. Martin Parish, Louisiana

 

 

Exhibit
1

 

FORM OF SUBORDINATION,
NON-DISTURBANCE

AND ATTORNMENT AGREEMENT

 

THIS SUBORDINATION, NON-DISTURBANCE AND ATTORNMENT
AGREEMENT (the “Agreement”) is made and entered into as of the         
day of             ,
         by and between                                         ,
as trustee, having an office at                                 
(in such capacity, “Trustee”), and                                 ,
having an office at
                                                      
(“Tenant”).

 

R  E
C  I  T  A  L  S:

 

A.  Tenant is
the tenant under a certain lease dated                         ,
         between                                                      ,
as landlord (“Landlord”), and Tenant, as tenant (as amended through the date
hereof, the “Lease”), pursuant to which Tenant leased a portion (the “Leased
Premises”) of the property known as                                                  ,
located at                                                     ,
as more particularly described in Schedule A attached hereto (the “Property”).

 

B.  Landlord has
or will grant a mortgage lien on and security interest in the Property to
Trustee (for its benefit and for the benefit of the holders of certain senior secured
notes and notes issued in exchange therefor pursuant to that certain indenture
dated as of [                           ,
2002]) pursuant to one or more mortgages, deeds of trust, deeds to secure debt
or similar security instruments (collectively, the “Security Instruments”).

 

C.  Tenant has
agreed to subordinate the Lease to the Security Instruments and to the lien
thereof and Trustee has agreed not to disturb Tenant’s possessory rights in the
Leased Premises under the Lease on the terms and conditions hereinafter set
forth.

 

A  G  R  E  E
M  E  N  T:

 

NOW, THEREFORE, the parties hereto mutually agree as
follows:

 

1.  Subordination.  Notwithstanding anything to the contrary set
forth in the Lease, the Lease and the leasehold estate created thereby and all
of Tenant’s rights thereunder are and shall at all times be subject and
subordinate in all respects to the Security Instruments and the lien thereof,
and to all rights of Trustee thereunder, and to any and all advances to be made
thereunder, and to all renewals, modifications, consolidations, replacements
and extensions thereof.

 

2.  Nondisturbance.  So long as Tenant complies with the
provisions of this Agreement, pays all rents and other charges as specified in
the Lease and is not otherwise in default (beyond applicable notice and cure
periods) of any of its obligations and covenants pursuant to the Lease, Trustee
agrees for itself and its successors in interest and for any other person
acquiring title to the Property through a foreclosure (an “Acquiring Party”),
that Tenant’s possession of the Leased Premises as described in the Lease will
not be disturbed during the term of the Lease by reason of a foreclosure.  For purposes of this Agreement, a

 

 

“foreclosure”
shall include (but not be limited to) a sheriff’s or trustee’s sale under the
power of sale contained in the Security Instruments, the termination of any
superior lease of the Property and any other transfer of the Landlord’s
interest in the Property under peril of foreclosure, including, without
limitation to the generality of the foregoing, an assignment or sale in lieu of
foreclosure.

 

3.  Attornment.  Tenant agrees to attorn to, accept and
recognize any Acquiring Party as the landlord under the Lease pursuant to the
provisions expressly set forth therein for the then remaining balance of the
term of the Lease, and any extensions thereof as made pursuant to the
Lease.  The foregoing provision shall be
self-operative and shall not require the execution of any further instrument or
agreement by Tenant as a condition to its effectiveness.

 

4.  No Liability.
Notwithstanding anything to the contrary contained herein or in the Lease, it
is specifically understood and agreed that neither the Trustee, any receiver
nor any Acquiring Party shall be:

 

(a)  liable for any act,
omission, negligence or default of any prior landlord (including Landlord); or

 

(b)  liable for any failure of
any prior landlord (including Landlord) to construct any improvements or bound
by any covenant to construct any improvement either at the commencement of the
term of the Lease or upon any renewal or extension thereof or upon the addition
of additional space pursuant to any expansion right contained in the Lease; or

 

(c)  subject to any offsets,
credits, claims or defenses which Tenant might have against any prior landlord
(including Landlord); or

 

(d)  bound by any rent or
additional rent which is payable on a monthly basis and which Tenant might have
paid for more than one (1) month in advance to any prior landlord (including
Landlord) or by any security deposit or other prepaid charge which Tenant might
have paid in advance to any prior landlord (including Landlord); or

 

(e)  liable to Tenant hereunder
or under the terms of the Lease beyond its interest in the Property; or

 

(f)  bound by any assignment,
subletting, renewal, extension or any other agreement or modification of the
Lease made without the written consent of Trustee; or

 

(g)  bound by any consensual or
negotiated surrender, cancellation or termination of the Lease, in whole or in
part, agreed upon between Landlord and Tenant unless effected unilaterally by
Tenant pursuant to the express terms of the Lease.

 

Notwithstanding the foregoing, Tenant reserves its
right to any and all claims or causes of action (i) against such prior
landlord for prior losses or damages and (ii) against the successor
landlord for all losses or damages arising from and after the date that such
successor landlord takes title to the Property.

 

2

 

5.  Certain Acknowledgments
and Agreements by Tenant. 
(a) Tenant has notice that the Lease and the rents and all other
sums due thereunder have been assigned to Trustee as security for the notes
secured by the Security Instruments.  In
the event Trustee notifies Tenant of the occurrence of a default under the
Security Instruments and demands that Tenant pay its rents and all other sums
due or to become due under the Lease directly to Trustee, Tenant shall honor
such demand and pay its rent and all other sums due under the Lease directly to
Trustee or as otherwise authorized in writing by Trustee.  Landlord irrevocably authorizes Tenant to
make the foregoing payments to Trustee upon such notice and demand.

 

(b)  Tenant
shall send a copy of any and all notices or statements under the Lease to
Trustee at the same time such notices or statements are sent to Landlord.

 

(c)  This
Agreement satisfies any and all conditions or requirements in the Lease
relating to the granting of a non-disturbance agreement.

 

6.  Trustee to Receive Default
Notices.  Tenant shall notify Trustee
of any default by Landlord under the Lease which would entitle Tenant to cancel
the Lease, and agrees that, notwithstanding any provisions of the Lease to the
contrary, no notice of cancellation thereof shall be effective unless Trustee
shall have received notice of default giving rise to such cancellation and
shall have failed within sixty (60) days after receipt of such notice to cure
such default or, if such default cannot be cured within sixty (60) days, shall
have failed within sixty (60) days after receipt of such notice to commence and
thereafter diligently pursue any action necessary to cure such default.

 

7.  Estoppel.  Tenant hereby certifies and represents to
Trustee that as of the date of this Agreement:

 

(a)  the Lease is in full force
and effect;

 

(b)  all requirements for the
commencement and validity of the Lease have been satisfied and there are no
unfulfilled conditions to Tenant’s obligations under the Lease;

 

(c)  Tenant is not in default
under the Lease and has not received any uncured notice of any default by
Tenant under the Lease; to the best of Tenant’s knowledge, Landlord is not in
default under the Lease; no act, event or condition has occurred which with
notice or the lapse of time, or both, would constitute a default by Tenant or
Landlord under the Lease; no claim by Tenant of any nature exists against
Landlord under the Lease; and all obligations of Landlord have been fully performed;

 

(d)  there are no defenses,
counterclaims or setoffs against rents or charges due or which may become due
under the Lease;

 

(e)  none of the rent which
Tenant is required to pay under the Lease has been prepaid, or will in the
future be prepaid, more than one (1) month in advance;

 

(f)  Tenant has no right or
option contained in the Lease or in any other document to purchase all or any
portion of the Leased Premises;

 

3

 

(g)  the Lease has not been
modified or amended and constitutes the entire agreement between Landlord and
Tenant relating to the Leased Premises;

 

(h)  Tenant has not assigned,
mortgaged, sublet, encumbered, conveyed or otherwise transferred any or all of
its interest under the Lease; and

 

(i)  Tenant has full authority to
enter into this Agreement, which has been duly authorized by all necessary
action.

 

8.  Notices.  All notices or other written communications
hereunder shall be deemed to have been properly given (i) upon delivery, if
delivered in person with receipt acknowledged by the recipient thereof, (ii)
one (1) Business Day (hereinafter defined) after having been deposited for
overnight delivery with any reputable overnight courier service, or (iii) three
(3) Business Days after having been deposited in any post office or mail
depository regularly maintained by the United States Postal Service and sent by
registered or certified mail, postage prepaid, return receipt requested,
addressed to the receiving party at its address set forth above or addressed as
such party may from time to time designate by written notice to the other
parties.  For purposes of this Section
8, the term “Business Day” shall mean any day other than Saturday, Sunday
or any other day on which banks are required or authorized to close in New
York, New York.  Either party by notice to
the other may designate additional or different addresses for subsequent
notices or communications.

 

9.  Successors.  The obligations and rights of the parties
pursuant to this Agreement shall bind and inure to the benefit of the
successors, assigns, heirs and legal representatives of the respective parties;
provided, however, that in the event of the assignment or
transfer of the interest of Trustee, all obligations and liabilities of Trustee
under this Agreement shall terminate, and thereupon all such obligations and
liabilities shall be the responsibility of the party to whom Trustee’s interest
is assigned or transferred; and provided, further, that the
interest of Tenant under this Agreement may not be assigned or transferred
without the prior written consent of Trustee. 
In addition, Tenant acknowledges that all references herein to Landlord
shall mean the owner of the landlord’s interest in the Lease, even if said
owner shall be different from the Landlord named in the Recitals.

 

10.  Duplicate Original;
Counterparts.  This Agreement may be
executed in any number of duplicate originals and each duplicate original shall
be deemed to be an original.  This
Agreement may be executed in several counterparts, each of which counterparts
shall be deemed an original instrument and all of which together shall
constitute a single Agreement.

 

11.  Limitation of Trustee’s
Liability.  (a)  Trustee
shall have no obligations nor incur any liability with respect to any
warranties of any nature whatsoever, whether pursuant to the Lease or
otherwise, including, without limitation, any warranties respecting use,
compliance with zoning, Landlord’s title, Landlord’s authority, habitability,
fitness for purpose or possession.

 

(b)  In the
event that Trustee shall acquire title to the Leased Premises or the Property,
Trustee shall have no obligation, nor incur any liability, beyond Trustee’s
then equity interest, if any, in the Leased Premises, and Tenant shall look
exclusively to such equity interest of Trustee, if any, in the Leased Premises
for the payment and discharge of any obligations imposed upon Trustee hereunder
or under the Lease, and Trustee is hereby released and relieved of any other
obligations hereunder and under the Lease.

 

4

 

12.  Modification in Writing.  This Agreement may not be modified except by
an agreement in writing signed by the parties hereto or their respective
successors in interest.

 

13.  Lien of Security
Instruments.  Nothing contained in
this Agreement shall in any way impair or affect the lien created by the
Security Instruments or the provisions thereof.

 

14.  Compliance with Lease.  Tenant agrees that in the event there is any
inconsistency between the terms and provisions hereof and the terms and provisions
of the Lease, the terms and provisions hereof shall be controlling.

 

15.  Governing Law;
Severability.  This Agreement shall
be governed by the laws of the State of
[            ].  If any term of this Agreement or the application
thereof to any person or circumstances shall to any extent be invalid or
unenforceable, the remainder of this Agreement or the application of such terms
to any person or circumstances other than those as to which it is invalid or
unenforceable shall not be affected thereby, and each term of this Agreement
shall be valid and enforceable to the fullest extent permitted by law.

 

16.  Further Actions.  Tenant agrees at its own expense to execute
and deliver, at any time and from time to time upon the request of Trustee or
any Acquiring Party, such documents and instruments (in recordable form, if
requested) as may be necessary or appropriate, in the opinion of Trustee or any
Acquiring Party, to fully implement or to further evidence the understandings
and agreements contained in this Agreement. 
Moreover, Tenant hereby irrevocably appoints and constitutes Trustee or
any Acquiring Party as its true and lawful attorney-in-fact to execute and
deliver any such documents or instruments which may be necessary or appropriate,
in the opinion of Trustee or any Acquiring Party, to implement or further evidence
such understandings and agreements and which Tenant, after thirty (30) days’
notice from Trustee or any Acquiring Party, has failed to execute and deliver.

 

5

 

IN WITNESS WHEREOF, Trustee and Tenant have duly
executed this Agreement as of the date first above written.

 

 

	
   

  	
   

  	
   

  	
  ,

  
	
   

  	
  as Trustee

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
   

  	
  Name:

  	
   

  
	
   

  	
   

  	
  Title:

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  ,

  
	
   

  	
  as Tenant

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
   

  	
  Name:

  	
   

  
	
   

  	
   

  	
  Title:

  	
   

  

 

The undersigned, as the Landlord named in the
Recitals, having duly executed this Agreement as of the date first written
above, and as mortgagor, pledgor, assignor or debtor under the Security
Instruments, hereby accepts and agrees for itself and its successors and
assigns, (i) to be bound by the provisions of Section 5 hereof,
(ii) that nothing contained in the foregoing Agreement (x) shall in
any way be deemed to constitute a waiver by Trustee of any of its rights or
remedies under the Security Instruments or (y) shall in any way be deemed
to release Landlord from its obligations to comply with the terms, provisions,
conditions, covenants and agreements set forth in the Security Instruments and
(iii) that the provisions of the Security Instruments remain in full force
and effect and must be complied with by Landlord.

 

	
   

  	
   

  	
   

  	
  , a

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
   

  	
  Name:

  	
   

  
	
   

  	
   

  	
  Title:

  	
   

  
					

 

 

ACKNOWLEDGMENT

 

	
  State of

  	
   

  	
  )

  
	
  ) ss.:

  
	
  County of

  	
   

  	
  )

  
				

 

[Local counsel to
provide appropriate acknowledgment]

 

 

SCHEDULE A to EXHIBIT 1

 

Description of Real PropertyExhibit 4.48

 

[LOUISIANA]

 

 

MORTGAGE, ASSIGNMENT OF LEASES AND RENTS,

SECURITY AGREEMENT AND FIXTURE FILING

 

BY

 

JALOU EUNICE, LLC

 

Mortgagor,

 

TO

 

WELLS FARGO BANK, NATIONAL ASSOCIATION,

 

as Trustee,

 

Mortgagee

 

Securing Principal Indebtedness of $148,000,000

 

Dated as of March 2, 2005

 

 

Relating to Premises located in:

 

St. Landry Parish, Louisiana

 

 

After recording, please return to:

 

Milbank, Tweed, Hadley & McCloy, LLP

601 South Figueroa Street, 30th Floor

Los Angeles, California 90017

Attn: Matthew S. Meza, Esq.

 

 

 

TABLE OF CONTENTS

 

	
  PREAMBLE

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  RECITALS

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  AGREEMENT

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE I

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  DEFINITIONS AND
  INTERPRETATION

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  SECTION 1.1

  	
   

  	
  Definitions

  	
   

  	
   

  
	
  SECTION 1.2

  	
   

  	
  Interpretation

  	
   

  	
   

  
	
  SECTION 1.3

  	
   

  	
  Resolution
  of Drafting Ambiguities

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE II

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  GRANTS AND
  SECURED OBLIGATIONS

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  SECTION 2.1

  	
   

  	
  Grant of
  Mortgaged Property

  	
   

  	
   

  
	
  SECTION 2.2

  	
   

  	
  Assignment
  of Leases and Rents

  	
   

  	
   

  
	
  SECTION 2.3

  	
   

  	
  Secured
  Obligations

  	
   

  	
   

  
	
  SECTION 2.4

  	
   

  	
  Future
  Advances

  	
   

  	
   

  
	
  SECTION 2.5

  	
   

  	
  No Release

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE III

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  REPRESENTATIONS
  AND WARRANTIES OF MORTGAGOR

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  SECTION 3.1

  	
   

  	
  Authority
  and Validity

  	
   

  	
   

  
	
  SECTION 3.2

  	
   

  	
  Warranty of
  Title

  	
   

  	
   

  
	
  SECTION 3.3

  	
   

  	
  Condition of
  Mortgaged Property

  	
   

  	
   

  
	
  SECTION 3.4

  	
   

  	
  Leases

  	
   

  	
   

  
	
  SECTION 3.5

  	
   

  	
  Insurance

  	
   

  	
   

  
	
  SECTION 3.6

  	
   

  	
  Charges

  	
   

  	
   

  
	
  SECTION 3.7

  	
   

  	
  Environmental

  	
   

  	
   

  
	
  SECTION 3.8

  	
   

  	
  No
  Conflicts, Consents, etc

  	
   

  	
   

  
	
  SECTION 3.9

  	
   

  	
  Benefit to
  the Mortgagor

  	
   

  	
   

  

 

i

 

	
  ARTICLE IV

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  CERTAIN
  COVENANTS OF MORTGAGOR

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  SECTION 4.1

  	
   

  	
  Preservation
  of Corporate Existence

  	
   

  	
   

  
	
  SECTION 4.2

  	
   

  	
  Title

  	
   

  	
   

  
	
  SECTION 4.3

  	
   

  	
  Maintenance
  and Use of Mortgaged Property; Alterations

  	
   

  	
   

  
	
  SECTION 4.4

  	
   

  	
  Notices
  Regarding Certain Defaults

  	
   

  	
   

  
	
  SECTION 4.5

  	
   

  	
  Access to
  Mortgaged Property, Books and Records; Other Information

  	
   

  	
   

  
	
  SECTION 4.6

  	
   

  	
  Limitation
  on Liens; Transfer Restrictions

  	
   

  	
   

  
	
  SECTION 4.7

  	
   

  	
  Environmental

  	
   

  	
   

  
	
  SECTION 4.8

  	
   

  	
  Estoppel
  Certificates

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE V

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  LEASES

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  SECTION 5.1

  	
   

  	
  Mortgagor’s
  Affirmative Covenants with Respect to Leases

  	
   

  	
   

  
	
  SECTION 5.2

  	
   

  	
  Mortgagor’s
  Negative Covenants with Respect to Leases

  	
   

  	
   

  
	
  SECTION 5.3

  	
   

  	
  Additional
  Requirements with Respect to New Leases

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE VI

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  CONCERNING
  ASSIGNMENT OF LEASES AND RENTS

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  SECTION 6.1

  	
   

  	
  Present
  Assignment; License to the Mortgagor

  	
   

  	
   

  
	
  SECTION 6.2

  	
   

  	
  Collection
  of Rents by the Mortgagee

  	
   

  	
   

  
	
  SECTION 6.3

  	
   

  	
  No Release

  	
   

  	
   

  
	
  SECTION 6.4

  	
   

  	
  Irrevocable
  Interest

  	
   

  	
   

  
	
  SECTION 6.5

  	
   

  	
  Amendment to
  Leases

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE VII

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  TAXES AND
  CERTAIN STATUTORY LIENS

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  SECTION 7.1

  	
   

  	
  Payment of
  Charges

  	
   

  	
   

  
	
  SECTION 7.2

  	
   

  	
  Escrow of
  Taxes

  	
   

  	
   

  
	
  SECTION 7.3

  	
   

  	
  Certain
  Statutory Liens

  	
   

  	
   

  
	
  SECTION 7.4

  	
   

  	
  Stamp and
  Other Taxes

  	
   

  	
   

  
	
  SECTION 7.5

  	
   

  	
  Certain Tax
  Law Changes

  	
   

  	
   

  
	
  SECTION 7.6

  	
   

  	
  Proceeds of
  Tax Claim

  	
   

  	
   

  

 

ii

 

	
  ARTICLE VIII

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  INSURANCE

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  SECTION 8.1

  	
   

  	
  Required
  Insurance Policies and Coverages

  	
   

  	
   

  
	
  SECTION 8.2

  	
   

  	
  Delivery
  After Foreclosure

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE IX

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  CONTESTING OF
  PAYMENTS

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  SECTION 9.1

  	
   

  	
  Contesting
  of Taxes and Certain Statutory Liens

  	
   

  	
   

  
	
  SECTION 9.2

  	
   

  	
  Contesting
  of Insurance

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE X

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  DESTRUCTION,
  CONDEMNATION AND RESTORATION

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  SECTION 10.1

  	
   

  	
  Destruction

  	
   

  	
   

  
	
  SECTION 10.2

  	
   

  	
  Condemnation

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE XI

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  EVENTS
  OF DEFAULT AND REMEDIES

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  SECTION 11.1

  	
   

  	
  Events
  of Default

  	
   

  	
   

  
	
  SECTION 11.2

  	
   

  	
  Remedies
  in Case of an Event of Default

  	
   

  	
   

  
	
  SECTION 11.3

  	
   

  	
  Sale
  of Mortgaged Property if Event of Default Occurs; Proceeds of Sale

  	
   

  	
   

  
	
  SECTION 11.4

  	
   

  	
  Additional
  Remedies in Case of an Event of Default

  	
   

  	
   

  
	
  SECTION 11.5

  	
   

  	
  Legal
  Proceedings After an Event of Default

  	
   

  	
   

  
	
  SECTION 11.6

  	
   

  	
  Remedies
  Not Exclusive

  	
   

  	
   

  
	
  SECTION 11.7

  	
   

  	
  Special
  Louisiana Provisions

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE XII

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  SECURITY
  AGREEMENT AND FIXTURE FILING

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  SECTION 12.1

  	
   

  	
  Security
  Agreement

  	
   

  	
   

  
	
  SECTION 12.2

  	
   

  	
  Fixture
  Filing

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE XIII

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  FURTHER
  ASSURANCES

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  SECTION 13.1

  	
   

  	
  Recording
  Documentation To Assure Security

  	
   

  	
   

  

 

iii

 

	
  SECTION 13.2

  	
   

  	
  Further
  Acts

  	
   

  	
   

  
	
  SECTION 13.3

  	
   

  	
  Additional
  Security

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE XIV

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  MISCELLANEOUS

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  SECTION 14.1

  	
   

  	
  Covenants
  To Run with the Land

  	
   

  	
   

  
	
  SECTION 14.2

  	
   

  	
  No
  Merger

  	
   

  	
   

  
	
  SECTION 14.3

  	
   

  	
  Concerning
  Mortgagee

  	
   

  	
   

  
	
  SECTION 14.4

  	
   

  	
  Mortgagee
  May Perform; Mortgagee Appointed Attorney-in-Fact

  	
   

  	
   

  
	
  SECTION 14.5

  	
   

  	
  Expenses

  	
   

  	
   

  
	
  SECTION 14.6

  	
   

  	
  Indemnity

  	
   

  	
   

  
	
  SECTION 14.7

  	
   

  	
  Continuing
  Security Interest; Assignment

  	
   

  	
   

  
	
  SECTION 14.8

  	
   

  	
  Termination;
  Release

  	
   

  	
   

  
	
  SECTION 14.9

  	
   

  	
  Modification
  in Writing

  	
   

  	
   

  
	
  SECTION 14.10

  	
   

  	
  Notices

  	
   

  	
   

  
	
  SECTION 14.11

  	
   

  	
  GOVERNING LAW; SERVICE OF PROCESS;
  WAIVER OF JURY TRIAL

  	
   

  	
   

  
	
  SECTION 14.12

  	
   

  	
  Severability of Provisions

  	
   

  	
   

  
	
  SECTION 14.13

  	
   

  	
  Limitation on Interest Payable

  	
   

  	
   

  
	
  SECTION 14.14

  	
   

  	
  Business Days

  	
   

  	
   

  
	
  SECTION 14.15

  	
   

  	
  Relationship

  	
   

  	
   

  
	
  SECTION 14.16

  	
   

  	
  Waiver of Stay

  	
   

  	
   

  
	
  SECTION 14.17

  	
   

  	
  No Credit for Payment of Taxes or
  Impositions

  	
   

  	
   

  
	
  SECTION 14.18

  	
   

  	
  No Claims Against the Mortgagee

  	
   

  	
   

  
	
  SECTION 14.19

  	
   

  	
  Obligations Absolute

  	
   

  	
   

  
	
  SECTION 14.20

  	
   

  	
  Last Dollars Secured

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  SIGNATURE
  AND ACKNOWLEDGMENT

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  SCHEDULE A

  	
   

  	
  Legal
  Description

  	
   

  	
   

  
	
  SCHEDULE B

  	
   

  	
  Prior
  Liens

  	
   

  	
   

  
	
  SCHEDULE C

  	
   

  	
  Leases
  Affecting the Mortgaged Property

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  EXHIBIT
  1

  	
   

  	
  Form
  of Subordination, Non-Disturbance and Attornment Agreement

  	
   

  	
   

  

 

iv

 

MORTGAGE, ASSIGNMENT OF LEASES AND RENTS, SECURITY

AGREEMENT AND FIXTURE FILING

 

MORTGAGE,
ASSIGNMENT OF LEASES AND RENTS, SECURITY AGREEMENT AND FIXTURE FILING (as
amended, amended and restated, supplemented or otherwise modified from time to
time, the “Mortgage”), dated as of
March       , 2005, made by JALOU EUNICE,
LLC, a Louisiana limited liability company having an office at 3747 Highway
190, Eunice, Louisiana 70535, as mortgagor, assignor and debtor (in such
capacities and together with any successors in such capacities, the “Mortgagor”),
in favor of WELLS FARGO BANK, NATIONAL ASSOCIATION, a national banking association
having an office at  213 Court Street,
Suite 703, Middletown, CT 06457, in its capacity as trustee pursuant to the
Indenture (as hereinafter defined), as mortgagee, assignee and secured party
(in such capacities and together with any successors in such capacities, the “Mortgagee”).

 

R E C I T A L S
:

 

A.  Gameco, Inc.
n/k/a Jacobs Entertainment, Inc. (the “Issuer”), certain of its Subsidiaries
(as hereinafter defined), the Mortgagor and the Mortgagee have, in connection
with the execution and delivery of this Mortgage, entered into that certain Indenture,
dated as of February 8, 2002, as supplemented by the First Supplemental
Indenture, dated as of February 22, 2002, the Second Supplemental
Indenture, dated as of June 14, 2002, the Third Supplemental Indenture,
dated as of June 4, 2003, the Fourth Supplemental Indenture, dated as of
the date hereof, and the Fifth Supplemental Indenture, dated as of the date
hereof (collectively, as amended, amended and restated, supplemented, or
otherwise modified from time to time, the “Indenture”), pursuant to
which the Issuer has issued, from time to time, its 117/8%
Senior Secured Notes due 2009 (the “Senior Secured Notes”) in the aggregate
principal amount of $148,000,000.  It is
contemplated that the Issuer may, after the date hereof, issue Additional Notes
(as defined in the Indenture) and Exchange Notes (as defined in the Indenture);
the Exchange Notes, together with the Additional Notes and the Senior Secured
Notes, the “Notes”), in each case, pursuant to the provisions of the
Indenture.

 

B.  The Issuer
owns, directly or through its Subsidiaries, all of the issued and outstanding
shares of the Mortgagor.

 

C.  The
Mortgagor has, pursuant to the Indenture, among other things, unconditionally
guaranteed (the “Guarantee”) the obligations of the Issuer under the
Indenture and the Notes.

 

D.  The
Mortgagor will receive substantial benefits from the execution and delivery of,
and the performance of the obligations under, the Indenture and the Notes, and
is therefore willing to enter into this Mortgage.

 

E.  The
Mortgagor is or will be the legal owner of the Mortgaged Property (as
hereinafter defined).

 

F.  This
Mortgage is given by the Mortgagor in favor of the Mortgagee for its benefit
and for the benefit of the Holders of the Notes (collectively, the “Secured
Parties”) to secure the payment and performance of all of the Secured
Obligations (as hereinafter defined).

 

1

 

A G R E E M E N T:

 

NOW THEREFORE, in consideration of the foregoing
premises and other good and valuable consideration, the receipt and sufficiency
of which are hereby acknowledged, the Mortgagor hereby covenants and agrees
with the Mortgagee as follows:

 

ARTICLE I

 

DEFINITIONS
AND INTERPRETATION

 

SECTION 1.1  Definitions.  Capitalized terms used but not otherwise
defined herein shall have the meanings assigned to such terms in the Indenture.
 The following terms used in this
Mortgage shall have the following meanings:

 

“ACM” shall have the meaning assigned to such
term in Section 4.7(ii) hereof.

 

“Affiliate” shall have the meaning assigned to
such term in the Indenture.

 

“Alteration” shall mean any and all
alterations, installations, improvements, additions, modifications or changes
of a structural nature of or to the Premises.

 

“Business Day” shall have the meaning assigned
to such term in the Indenture.

 

“Charges” shall mean any and all real estate,
property and other taxes, assessments and special assessments, levies, fees,
all water and sewer rents and charges and all other governmental charges or
Liens imposed upon or assessed against, and all claims (including, without
limitation, landlords’, carriers’, mechanics’, workmen’s, repairmen’s,
laborers’, materialmen’s, suppliers’ and warehousemen’s Liens and other claims
arising by operation of law) against, all or any portion of the Mortgaged
Property.

 

“Collateral Account” shall have the meaning
assigned to such term in the Indenture.

 

“Collateral Documents” shall have the meaning
assigned to such term in the Indenture.

 

“Contested Liens” shall mean, collectively, any
Liens incurred in respect of any Charges to the extent that the amounts owing
in respect thereof are not yet delinquent or are being contested and otherwise
comply with the provisions of Section 9.1 hereof.

 

“Contracts” shall mean, collectively, any and
all right, title and interest of the Mortgagor in and to any and all contracts,
instruments, documents and other general intangibles, whether now existing or
hereafter arising or entered into, relating to the Mortgaged Property
(including, without limitation, all reciprocal easements and/or operating
agreements, covenants, conditions and restrictions and similar agreements
affecting all or any portion of the Mortgaged Property and any and all present
or future options to sell or lease the Mortgaged Property or any interest
therein) and all reserves, deferred payments, deposits or other security or
advance payments (including, without limitation, those made by or on behalf of
the Mortgagor to others with respect to (i) utility service regarding the
Mortgaged Property, (ii) cleaning, maintenance,

 

2

 

repair or similar
services regarding the Mortgaged Property, (iii) refuse removal or sewage
service regarding the Mortgaged Property, (iv) rentals of equipment, if any,
used in the operation by or on behalf of Mortgagor regarding the Mortgaged Property,
and/or (v) parking or similar services or rights regarding the Mortgaged
Property), refunds, liens, security interests, guarantees, remedies and claims
of every kind, nature or character relating thereto.

 

“Default Rate” shall mean the rate per annum
equal to the highest rate then payable under the Indenture.

 

“Destruction” shall mean any and all damage to,
or loss or destruction of, the Premises or any part thereof.

 

“Environmental Law” shall mean any applicable
federal, state, local or municipal statute, law, rule, regulation, ordinance,
code, policy or rule of common law and any judicial or administrative
interpretation thereof, including any judicial or administrative order, consent
decree or judgment binding on the Mortgagor, relating to pollution or
protection of the environment, or health or safety including, without
limitation, any relating to the release or threatened release of any Hazardous
Materials.

 

“Event of Default” shall have the meaning
assigned to such term in the Indenture.

 

“Fixture” shall mean all machinery, apparatus,
equipment, fittings, fixtures, improvements and articles of personal property
of every kind, description and nature whatsoever now or hereafter attached or
affixed to the Land or any other Improvement or used in connection with the use
and enjoyment of the Land or any other Improvement or the maintenance or
preservation thereof, which by the nature of their location thereon or
attachment thereto are fixtures under the UCC or any other applicable law including,
without limitation, all utility systems, fire sprinkler and security systems,
drainage facilities, lighting facilities, all water, sanitary and storm sewer,
drainage, electricity, steam, gas, telephone and other utility equipment and
facilities, pipes, fittings and other items of every kind and description now
or hereafter attached to or located on the Land which by the nature of their
location thereon or attachment thereto are real property under applicable law,
HVAC equipment, boilers, electronic data processing, telecommunications or computer
equipment, refrigeration, electronic monitoring, water or lighting systems,
power, sanitation, waste removal, elevators, maintenance or other systems or
equipment and all additions thereto and betterments, renewals, substitutions
and replacements thereof.

 

 “Governmental
Authority” shall mean any federal, state, local, foreign or other
governmental, quasi-governmental or administrative (including self-regulatory)
body, instrumentality, department, agency, authority, board, bureau,
commission, office of any nature whatsoever or other subdivision thereof, or
any court, tribunal, administrative hearing body, arbitration panel or other
similar dispute-resolving body, whether now or hereafter in existence, or any
officer or official thereof, having jurisdiction over the Mortgagor or the
Mortgaged Property or any portion thereof.

 

“Guarantee” shall have the meaning assigned to
such term in Recital C hereof.

 

“Guarantors” shall have the meaning assigned to
such term in the Indenture.

 

3

 

“Hazardous Materials” shall mean any substance,
chemical, material, pollutant, waste, contaminant or constituent, which is
subject to regulation under or could give rise to liability under any Environmental
Law.

 

“Holder” shall have the meaning assigned to
such term in the Indenture.

 

“Improvements” shall mean all buildings,
structures and other improvements of every kind or description and any and all
Alterations now or hereafter located, attached or erected on the Land
including, without limitation, (i) all Fixtures, (ii) all attachments,
railroad tracks, foundations, sidewalks, drives, roads, curbs, streets, ways,
alleys, passages, passageways, sewer rights, parking areas, driveways, fences
and walls and (iii) all materials now or hereafter located on the Land
intended for the construction, reconstruction, repair, replacement, alteration,
addition or improvement of or to such buildings, Fixtures, structures and
improvements, all of which materials shall be deemed to be part of the
Improvements immediately upon delivery thereof on the Land and to be part of
the Improvements immediately upon their incorporation therein.

 

“Indemnified Liabilities” shall have the
meaning assigned to such term in Section 14.6(i) hereof.

 

“Indemnitees” shall have the meaning assigned
to such term in Section 14.6(i) hereof.

 

“Indenture” shall have the meaning assigned to
such term in Recital A hereof.

 

“Insurance Policies” means the insurance
policies and coverages required to be maintained by the Mortgagor with respect
to the Mortgaged Property pursuant to Section 4.19(b) of the Indenture and
all renewals and extensions thereof.

 

“Insurance Requirements” means, collectively,
all provisions of the Insurance Policies, all requirements of the issuer of any
of the Insurance Policies and all orders, rules, regulations and any other
requirements of the National Board of Fire Underwriters (or any other body
exercising similar functions) binding upon the Mortgagor and applicable to the Mortgaged
Property or any use or condition thereof.

 

“Issuer” shall have the meaning assigned to
such term in Recital A hereof.

 

“Land” shall mean those certain tracts or
parcels of land described in Schedule A annexed to this Mortgage,
together with all of the Mortgagor’s reversionary rights therein and all of the
Mortgagor’s rights in and to any and all easements, rights-of-way, strips and
gores of land, drives, roads, curbs, streets, ways, alleys, passages, passage
ways, sewer rights, waters, water courses, water rights, mineral, gas and oil
rights, and all power, air, light and other rights, estates, titles, interests,
privileges, liberties, servitudes, licenses, tenements, hereditaments and
appurtenances whatsoever, in any way belonging, relating or appertaining
thereto, or any part thereof, or which hereafter shall in any way belong,
relate or be appurtenant thereto.

 

“Landlord” shall mean any landlord, lessor,
franchisor, licensor or grantor, as applicable.

 

4

 

“Leases” shall mean, collectively, any and all
right, title and interests of the Mortgagor, as Landlord, in all leases and
subleases of space, tenancies, franchise agreements, licenses, occupancy,
rental, access or concession agreements and any other agreements pursuant to
which any Person is granted a possessory interest in or right to use or occupy
all or any portion of the Mortgaged Property (including, without limitation,
all of the Mortgagor’s rights to enforce all such leases, subleases, tenancies
or other agreements and to receive and enforce any rights that the Mortgagor
may have to collect Rents thereunder), in each case whether now existing or
hereafter entered into, whether or not of record, relating in any manner to the
Premises or the use or occupancy thereof and any and all amendments,
modifications, supplements, replacements, extensions, renewals and/or
guarantees, if any thereof, whether now in effect or hereafter coming into
effect.

 

“Lien” shall have the meaning assigned to such
term in the Indenture.

 

“Mortgage” shall have the meaning assigned to
such term in the Preamble hereof.

 

“Mortgaged Property” shall have the meaning
assigned to such term in Section 2.1 hereof.

 

“Mortgagee” shall have the meaning assigned to
such term in the Preamble hereof.

 

“Mortgagor” shall have the meaning assigned to
such term in the Preamble hereof.

 

“Mortgagor’s Interest” shall have the meaning
assigned to such term in Section 2.2 hereof.

 

“Net Loss Proceeds” shall have the meaning
assigned to such term in the Indenture.

 

“Notes” shall have the meaning assigned to such
term in Recital A hereof.

 

“Officers’ Certificate” shall have the meaning
assigned to such term in the Indenture.

 

“Permit” shall mean any and all permits,
certificates, approvals, authorizations, consents, licenses, variances, franchises
or other instruments, however characterized, of any Governmental Authority (or
any Person acting on behalf of a Governmental Authority) now or hereafter
acquired or held, together with all amendments, modifications, extensions,
renewals and replacements of any thereof issued or in any way furnished in
connection with the Mortgaged Property including, without limitation, building
permits, certificates of occupancy, environmental certificates, industrial permits
or licenses and certificates of operation.

 

“Permitted Collateral Liens” shall have the
meaning assigned to such term in Section 4.6 hereof.

 

“Permitted Liens” shall have the meaning
assigned to such term in the Indenture.

 

“Person” shall have the meaning assigned to
such term in the Indenture.

 

“Premises” shall mean, collectively, the Land
and the Improvements.

 

5

 

“Prior Liens” shall mean, collectively, the
Liens identified in Schedule B annexed to this Mortgage.

 

“Proceeds” shall mean, collectively, any and
all cash proceeds and noncash proceeds derived or to be derived from the
Mortgaged Property and shall include, without limitation, all (i) proceeds
of the sale, transfer or conveyance of the Mortgaged Property or the
conversion, voluntary or involuntary, of any of the Mortgaged Property or any
portion thereof into cash or liquidated claims, (ii) proceeds of any
insurance (except payments made to a Person, other than the Issuer or any
Subsidiary thereof, that is not a party to this Mortgage), indemnity, warranty,
guaranty or claim payable to the Mortgagee or to the Mortgagor from time to
time with respect to any of the Mortgaged Property including, without
limitation, all Net Loss Proceeds relating thereto, (iii) payments (in any
form whatsoever) made or due and payable to the Mortgagor from time to time in
connection with any requisition, confiscation, condemnation, seizure or
forfeiture of all or any portion of the Mortgaged Property by any Governmental
Authority (or any Person acting on behalf of a Governmental Authority)
including, without limitation, all Net Loss Awards relating thereto,
(iv) products of the Mortgaged Property, (v) other amounts from time
to time paid or payable under or in connection with any of the Mortgaged
Property including, without limitation, refunds of real estate taxes and
assessments, including interest thereon and any unearned insurance premiums
relating thereto and (vi) the right to enforce any and all rights that the
Mortgagor has or may have to collect all such proceeds, including, without
limitation, the Mortgagor’s rights to commence any and all appropriate collection
or enforcement actions incident thereto.

 

“Property Material Adverse Effect” shall mean,
as of any date of determination and whether individually or in the aggregate
(a) any event, circumstance, occurrence or condition which has caused or
resulted in (or would reasonably be expected to cause or result in) a material
adverse effect on the business or operations as presently conducted at the
Mortgaged Property; (b) any event, circumstance, occurrence or condition which
has caused or resulted in (or would reasonably be expected to cause or result
in) a material adverse effect on the value or utility of the Mortgaged
Property; and (c) any event, circumstance, occurrence or condition which
has caused or resulted in (or would reasonably be expected to cause or result
in) a material adverse effect on the legality, priority or enforceability of
the Lien created by this Mortgage or the rights and remedies of the Mortgagee
hereunder.

 

“Prudent Operator” shall mean the standard of
care taken by a prudent operator of property similar in use and configuration
to the Premises and located in the locality where the Premises are located.

 

 “Records”
shall mean, collectively, any and all right, title and interest of the
Mortgagor in and to any and all drawings, plans, specifications, file
materials, operating and maintenance records, catalogues, tenant lists,
correspondence, advertising materials, operating manuals, warranties,
guarantees, appraisals, studies and data relating to the Mortgaged Property or
the construction of any Alteration or the maintenance of any Permit.

 

“Rents” shall mean, collectively, any and all
rents, additional rents, royalties, issues, cash, guaranties, letters of
credit, bonds, sureties or security deposited under any Lease to secure
performance of the Tenant’s obligations thereunder, revenues, earnings,
profits, bonuses and income, advance rental payments, payments incident to
assignment, sublease or surrender of a Lease, claims for forfeited deposits and
claims for damages, now due or hereafter to become due, with respect to any
Lease, any indemnification

 

6

 

against, or reimbursement for, sums paid and costs and
expenses incurred by the Mortgagor under any Lease or otherwise, and any award
in the event of the bankruptcy of any Tenant under or guarantor of a Lease.

 

“Requirements of Law” shall mean, collectively,
any and all requirements of any Governmental Authority including, without
limitation, any and all orders, decrees, determinations, laws, treaties,
ordinances, rules, regulations or similar statutes or case law.

 

“Secured Obligations” shall mean all obligations
(whether or not constituting future advances, obligatory or otherwise) of the
Issuer and any and all of the Guarantors from time to time arising under or in
respect of this Mortgage, the Indenture, the Notes and the other Collateral
Documents (including, without limitation, the obligations to pay principal,
interest and all other charges, fees, expenses, commissions, reimbursements,
premiums, indemnities and other payments related to or in respect of the obligations
contained in this Mortgage, the Indenture, the Notes and the other Collateral
Documents), in each case whether (i) such obligations are direct or indirect,
secured or unsecured, joint or several, absolute or contingent, due or to
become due whether at stated maturity, by acceleration or otherwise, (ii)
arising in the regular course of business or otherwise, (iii) for payment or
performance and/or (iv) now existing or hereafter arising (including, without
limitation, interest and other obligations arising or accruing after the commencement
of any bankruptcy, insolvency, reorganization or similar proceeding with
respect to the Issuer, any Guarantor or any other Person, or which would have
arisen or accrued but for the commencement of such proceeding, even if such
obligation or the claim therefor is not enforceable or allowable in such proceeding).

 

“Secured Parties” shall have the meaning
assigned to such term in Recital F hereof.

 

“Senior Secured Notes” shall have the meaning
assigned to such term in Recital A hereof.

 

“Subordination Agreement” shall mean a
subordination, nondisturbance and attornment agreement substantially in the
form of Exhibit 1 annexed to this Mortgage.

 

“Subsidiaries” shall have the meaning assigned
to such term in the Indenture.

 

“Taking” shall mean any taking of the Mortgaged
Property or any part thereof, in or by condemnation or other eminent domain
proceedings pursuant to any law, general or special, or by reason of the
temporary requisition of the use or occupancy of the Mortgaged Property or any
part thereof, by any Governmental Authority, civil or military.

 

“Tax Escrow Fund” shall have the meaning
assigned to such term in Section 7.2 hereof.

 

“Tenant” shall mean any tenant, subtenant,
lessee, sublessee, franchisee, licensee, grantee or obligee, as applicable.

 

“UCC” shall mean the Uniform Commercial Code as
in effect on the date hereof in the jurisdiction in which the Premises are
located; provided, however, that if by reason of mandatory
provisions of law, the perfection or the effect of perfection or non-perfection
of the security interest in any item or portion of the Mortgaged Property is
governed by the Uniform Commercial Code as in effect in a jurisdiction

 

7

 

other than the jurisdiction in which the Premises are
located, “UCC” shall mean the Uniform Commercial Code as in effect in such
other jurisdiction for purposes of the provisions hereof relating to such
perfection or effect of perfection or non-perfection.

 

SECTION 1.2  Interpretation.  In this Mortgage, unless otherwise specified,
(i) singular words include the plural and plural words include the singular,
(ii) words importing any gender include the other gender, (iii) references to
any Person include such Person’s successors and assigns and in the case of an
individual, the word “successors” includes such Person’s heirs, devisees, legatees,
executors, administrators and personal representatives, (iv) references to any
statute or other law include all applicable rules, regulations and orders
adopted or made thereunder and all statutes or other laws amending,
consolidating or replacing the statute or law referred to, (v) the words
“consent,” “approve” and “agree,” and derivations thereof or words of similar
import, mean the prior written consent, approval or agreement of the Person in
question not to be unreasonably withheld, (vi) the words “include” and “including,”
and words of similar import, shall be deemed to be followed by the words
“without limitation,” (vii) the words “hereto,” “herein,” “hereof” and “hereunder,”
and words of similar import, refer to this Mortgage in its entirety, (viii)
references to Articles, Sections, Schedules, Exhibits, subsections, paragraphs
and clauses are to the Articles, Sections, Schedules, Exhibits, subsections,
paragraphs and clauses hereof, (ix) the Schedules and Exhibits to this
Mortgage, in each case as amended, amended and restated, supplemented or
otherwise modified from time to time in accordance with the provisions hereof,
are incorporated herein by reference, (x) the titles and headings of Articles,
Sections, Schedules, Exhibits, subsections, paragraphs and clauses are inserted
as a matter of convenience only and shall not affect the constructions of any
provisions hereof and (xi) all obligations of the Mortgagor hereunder shall be
satisfied by the Mortgagor at the Mortgagor’s sole cost and expense.

 

SECTION 1.3  Resolution of Drafting Ambiguities.  The Mortgagor acknowledges and agrees that it
was represented by counsel in connection with the execution and delivery hereof,
that it and its counsel reviewed and participated in the preparation and
negotiation hereof and that any rule of construction to the effect that
ambiguities are to be resolved against the drafting party (i.e.,
Mortgagee) shall not be employed in the interpretation hereof.

 

ARTICLE II

 

GRANTS
AND SECURED OBLIGATIONS

 

SECTION 2.1  Grant of Mortgaged Property.  The Mortgagor hereby grants, mortgages,
bargains, sells, assigns and conveys to the Mortgagee (for its benefit and for
the benefit of the other Secured Parties), and hereby grants to the Mortgagee
(for its benefit and for the benefit of the other Secured Parties), a security
interest in and upon all of the Mortgagor’s estate, right, title and interest
in, to and under the following property, whether now owned or held or hereafter
acquired from time to time (collectively, the “Mortgaged Property”):

 

(i)                                     Land;

 

(ii)                                  Improvements;

 

8

 

(iii)                               Leases;

 

(iv)                              Rents;

 

(v)                                 Permits;

 

(vi)                              Contracts;

 

(vii)                           Records;
and

 

(viii)                        Proceeds.

 

Notwithstanding the foregoing provisions of this Section 2.1,
Mortgaged Property shall not include a grant of any of the Mortgagor’s right,
title or interest in (i) any Contract to which the Mortgagor is a party or any
of its rights or interests thereunder (other than (x) the right to receive any
payment of money (including without limitation accounts, general intangibles
and payment intangibles (each as defined in the UCC) or any other rights
referred to in Sections 9-406(f), 9-407(a) or 9-408(a) of the UCC and (y) any
proceeds, substitutions or replacements thereof) to the extent, but only to the
extent, that such a grant would, under the terms of such Contract, result in a
breach or termination of the terms of, or constitute a default under or
termination of such Contract and (ii) any Permit to the extent, but only to the
extent that, such grant shall constitute or result in abandonment, invalidation
or rendering unenforceable any right, title or interest of the Mortgagor
therein; provided, however, that at such time as any Contract or
Permit described in clauses (i) and (ii) of this sentence is no longer subject
to such restriction, such applicable Contract or Permit shall (without any act
or delivery by any Person) constitute Mortgaged Property hereunder.

 

TO HAVE AND TO HOLD the Mortgaged Property, together
with all estate, right, title and interest of the Mortgagor and anyone claiming
by, through or under the Mortgagor in and to the Mortgaged Property and all
rights and appurtenances relating thereto, unto the Mortgagee, its successors
and assigns, for the purpose of securing the payment and performance in full of
all the Secured Obligations.

 

SECTION 2.2  Collateral Assignment and Pledge of
Mortgagor’s Interest as Additional Security.  As additional collateral security for the
prompt and punctual payment and satisfaction of the Secured Obligations, and
all additional advances that the Mortgagee may make on the Mortgagor’s behalf
pursuant to this Mortgage, together with interest thereon as provided herein,
the Mortgagor hereby assigns, pledges and grants to the Mortgagee (for its
benefit and for the benefit of the other Secured Parties), a continuing
security interest in and to all of the Mortgagor’s estate, right, title,
interest, claim and demand, as Landlord, under any and all of the Leases
including, without limitation, the following (such assigned rights, the “Mortgagor’s
Interest”):

 

(i)                                     the
immediate and continuing right to receive and collect Rents payable by the Tenants
pursuant to the Leases;

 

(ii)                                  all
claims, rights, powers, privileges and remedies of the Mortgagor, whether provided
for in the Leases or arising by statute or at law or in equity or otherwise,
consequent on any failure on the part of the Tenants to perform or comply with
any term of the Leases including damages or other amounts payable to the
Mortgagor as a result of such failure;

 

9

 

(iii)                               all
rights to take all actions upon the happening of a default under the Leases as
shall be permitted by the Leases or by law including, without limitation, the
commencement, conduct and consummation of proceeding at law or in equity; and

 

(iv)                              the
full power and authority, in the name of the Mortgagor or otherwise, to
enforce, collect, receive and receipt for any and all of the foregoing and to
take all other actions whatsoever which the Mortgagor, as Landlord, is or may
be entitled to take under the Leases.

 

SECTION 2.3  Secured Obligations.  This Mortgage secures, and the Mortgaged
Property is collateral security for, the payment and performance in full when
due of the Secured Obligations.

 

SECTION 2.4  Mortgage Securing Future Indebtedness.  This Mortgage has been executed by Mortgagor
pursuant to Article 3298 of the Louisiana Civil Code for the purpose of
securing the Mortgagor’s indebtedness (including, without limitation, the
Secured Obligations) that may now be existing or that may arise in the future
as provided herein and in the Indenture, with the preferences and priorities
provided under applicable Louisiana law. 
This Mortgage shall be further entitled to the preferences and
priorities as provided under the Louisiana Private Works Act (La. R.S. 9:4801,
et seq.).  However, nothing under this
Mortgage shall be construed as limiting the duration of this Mortgage or the
purpose or purposes for which the Mortgagor’s indebtedness (including, without
limitation, the Secured Obligations) may be requested or extended.  The Mortgagor’s additional indebtedness will
automatically be secured by this Mortgage without the necessity that the
Mortgagor agrees or consents to such a result at the time additional
indebtedness is made and that the note or notes evidencing such additional
indebtedness reference the fact that such notes are secured by this
Mortgage.  The Mortgagor understands that
the Mortgagor may not subsequently have a change of mind and insist that the
Mortgagor’s additional indebtedness not be secured by this Mortgage unless the
Mortgagee specifically agrees to such a request in writing.

 

SECTION 2.5  No Release.  Nothing set forth in this Mortgage shall
relieve the Mortgagor from the performance of any term, covenant, condition or
agreement on the Mortgagor’s part to be performed or observed under or in
respect of any of the Mortgaged Property or from any liability to any Person
under or in respect of any of the Mortgaged Property or shall impose any obligation
on the Mortgagee or any other Secured Party to perform or observe any such
term, covenant, condition or agreement on the Mortgagor’s part to be so
performed or observed or shall impose any liability on the Mortgagee or any
other Secured Party for any act or omission on the part of the Mortgagor
relating thereto or for any breach of any representation or warranty on the
part of the Mortgagor contained in this Mortgage, the Indenture, the Notes or
the Collateral Documents, or under or in respect of the Mortgaged Property or
made in connection herewith or therewith. 
The obligations of the Mortgagor contained in this Section 2.5
shall survive the termination hereof and the discharge of the Mortgagor’s other
obligations under this Mortgage and the Indenture, the Notes and the Collateral
Documents.

 

10

 

ARTICLE III

 

REPRESENTATIONS
AND WARRANTIES OF MORTGAGOR

 

SECTION 3.1  Authority and Validity.

 

The Mortgagor represents and warrants that as of the date hereof:

 

(i)                                     it
is duly organized or formed, validly existing and, if applicable, in good
standing under the laws of the jurisdiction of its organization;

 

(ii)                                  it
is duly qualified to transact business and is in good standing in the state in
which the Mortgaged Property is located;

 

(iii)                               it
has full corporate or other organizational power and lawful authority to
execute and deliver this Mortgage and to mortgage and grant a Lien on and
security interest in the Mortgaged Property and otherwise assign the
Mortgagor’s Interest and otherwise perform its obligations as contemplated
herein, and all corporate and governmental actions, consents, authorizations
and approvals necessary or required therefor have been duly and effectively
taken or obtained; and

 

(iv)                              this
Mortgage is a legal, valid and binding obligation of the Mortgagor, enforceable
against the Mortgagor in accordance with its terms, except as enforceability
may be limited by applicable bankruptcy, insolvency or similar laws affecting
the enforcement of creditors’ rights generally or by equitable principles
relating to enforceability.

 

SECTION 3.2  Warranty of Title.  The Mortgagor represents and warrants that:

 

(i)                                     it
has good fee simple title to the Premises and the Landlord’s interest and
estate under or in respect of the Leases and good title to the interest it
purports to own or hold in and to each of the Permits, the Contracts and the
Records, in each case subject to no Liens, except for Permitted Collateral
Liens;

 

(ii)                                  it
has good title to the interest it purports to own or hold in and to all rights
and appurtenances to or that constitute a portion of the Mortgaged Property,
except for Permitted Collateral Liens;

 

(iii)                               it
is in compliance with each term, condition and provision of any obligation of
the Mortgagor which is secured by the Mortgaged Property or the noncompliance
with which would result in a Property Material Adverse Effect; and

 

(iv)                              this
Mortgage creates and constitutes a valid and enforceable first priority Lien on
the Mortgaged Property subject to Permitted Collateral Liens, and, to the
extent any of the Mortgaged Property shall consist of Fixtures, a first priority
security interest in the Fixtures, which first priority Lien and first priority
security interest are subject only to Permitted Collateral Liens.

 

11

 

SECTION 3.3  Condition of Mortgaged Property.  The Mortgagor represents and warrants that:

 

(i)                                     there
has been issued and there remains in full force and effect subject to no
revocation, suspension, forfeiture or modification, each and every Permit
necessary for the present use, operation and occupancy of the Premises by the
Mortgagor and its Tenants and the conduct of their respective businesses and
all required zoning, building code, land use, environmental and other similar
Permits, except where the failure to be so issued and to be in full force and
effect would not result in a Property Material Adverse Effect;

 

(ii)                                  the
Premises and the present and contemplated use and occupancy thereof comply with
all applicable zoning ordinances, building codes, land use laws, setback or
other development and/or use requirements of Governmental Authorities except
where such noncompliance would not result in a Property Material Adverse
Effect;

 

(iii)                               the
Premises are served by all utilities (including, without limitation, water and
sewer systems) necessary for the present use thereof, and all utility services
are provided by public or private utilities and the Premises have accepted or
are equipped to accept such utility services and the Mortgagor has not received
notice of termination of such utility service, except where the failure to be
so served would not result in a Property Material Adverse Effect;

 

(iv)                              the
Mortgagor has access to the Premises from roads sufficient to allow the
Mortgagor and its Tenants and invitees to conduct their respective businesses
at the Premises in accordance with sound commercial practices and the Mortgagor
has not received notice of termination of such access, except where the failure
to have such access would not result in a Property Material Adverse Effect;

 

(v)                                 the
Mortgagor has not received notice of any Taking or the commencement or pendency
of any action or proceeding therefor, other than such Takings as would not
result in a Property Material Adverse Effect;

 

(vi)                              there
has not occurred any Destruction of the Premises or any portion thereof as a result
of any fire or other casualty that, as of the date hereof, has not been
repaired in all material respects, other than such Destruction as would not
have a Property Material Adverse Effect;

 

(vii)                           there
are no disputes regarding boundary lines, location, encroachments or possession
of any portions of the Mortgaged Property and no state of facts exists which
could give rise to any such claim other than such disputes as would not result
in a Property Material Adverse Effect;

 

(viii)                        all
liquid and solid waste disposal, septic and sewer systems located on the
Premises are in a good and safe condition and repair and in compliance with all
Requirements of Law, except where the failure to so comply would not result in
a Property Material Adverse Effect;

 

(ix)                                no
portion of the Premises is located in an area identified by the Federal
Emergency Management Agency or any successor thereto as an area having special
flood hazards pursuant to

 

12

 

the Flood Insurance Acts or, if any portion of the
Premises is located within such area, the Mortgagor has obtained the insurance
prescribed in Article VIII hereof;

 

(x)                                   the
Premises are assessed for real estate tax purposes as one or more wholly independent
tax lot or lots, separate from any adjoining land or improvements not
constituting a portion of such lot or lots, and no other land or improvements
are assessed and taxed together with the Premises or any portion thereof, other
than such cases where the failure to be so assessed would not result in a
Property Material Adverse Effect; and

 

(xi)                                there
are no options or rights of first refusal to purchase or acquire all or any
portion of the Mortgaged Property, other than such options or rights of first
refusal as would not result in a Property Material Adverse Effect.

 

SECTION 3.4  Leases.  The Mortgagor represents and warrants that as
of the date hereof:

 

(i)                                     the
Leases identified in Schedule C attached hereto are the only Leases in
existence on the date hereof relating to the Premises;

 

(ii)                                  true
copies of such Leases have been previously delivered to the Mortgagee and there
are no agreements with any Tenant under such Leases other than those agreements
expressly set forth therein;

 

(iii)                               the
Mortgagor is the sole owner of all of the Mortgagor’s Interest in such Leases;

 

(iv)                              each
of such Leases is in full force and effect, constitutes a legal, valid and
binding obligation of the Mortgagor and the applicable Tenant thereunder, and
is enforceable against the Mortgagor and such Tenant in accordance with its
terms, except as enforceability may be limited by applicable bankruptcy,
insolvency or similar laws affecting the enforcement of creditors’ rights
generally or by equitable principles relating to enforceability;

 

(v)                                 there
is no default under any of such Leases and there is existing no condition which
with the giving of notice or passage of time or both would cause a default
thereunder;

 

(vi)                              all
Rents due under such Leases have been paid in full;

 

(vii)                           none
of the Rents reserved under such Leases have been assigned or otherwise pledged
or hypothecated except in favor of the Mortgagee pursuant to the provisions
hereof;

 

(viii)                        none
of the Rents (other than any security deposit collected in accordance with the
provisions of the applicable Lease) have been collected for more than one (1)
month in advance;

 

(ix)                                there
exist no offsets or defenses to the payment of any portion of the Rents and the
Mortgagor owes no monetary obligation to any Tenant under any such Lease;

 

(x)                                   the
Mortgagor has received no notice from any Tenant challenging the validity or
enforceability of any such Lease;

 

13

 

(xi)                                no
such Lease contains any option to purchase, right of first refusal to purchase,
right of first refusal to relet, or any other similar provision; and

 

(xii)                             each
such Lease is subordinate to this Mortgage either pursuant to its terms or pursuant
to a recordable Subordination Agreement.

 

SECTION 3.5  Insurance.  The Mortgagor represents and warrants that,
except where the failure of clauses (i), (ii) or (iii) hereof to be true would
not have a Property Material Adverse Effect, (i) the Premises and the use,
occupancy and operation thereof comply with all Insurance Requirements and
there exists no default under any Insurance Requirement, (ii) all premiums due
and payable with respect to the Insurance Policies have been paid,
(iii) all Insurance Policies are in full force and effect and the Mortgagor
has not received notice of violation or cancellation thereof and (iv) all
insurance certificates required pursuant to the Indenture have been delivered
to the Mortgagee.

 

SECTION 3.6  Charges.  The Mortgagor represents and warrants that
all Charges imposed upon or assessed against the Mortgaged Property have been
paid and discharged except to the extent such Charges constitute a Lien not yet
due and payable or to the extent such Charges are being contested in accordance
with Section 9.1 hereof.

 

SECTION 3.7  Environmental.  The Mortgagor represents and warrants that:

 

(i)                                     it
has obtained all Permits which are necessary with respect to the ownership and
operation of its business and the Mortgaged Property under any and all
applicable Environmental Laws and is in compliance with all terms and conditions
thereof, except where the failure so to obtain or to be in compliance would not
result in a Property Material Adverse Effect;

 

(ii)                                  it
is in compliance with any and all applicable Environmental Laws including,
without limitation, all other limitations, restrictions, conditions, standards,
prohibitions, requirements, obligations, schedules and timetables contained in
the Environmental Laws, except where the failure so to be in compliance would
not result in a Property Material Adverse Effect;

 

(iii)                               there
is no civil, criminal or administrative action, suit, demand, claim, hearing,
notice of violation, investigation, proceeding, notice of demand letter pending
or threatened against it or any Affiliate under the Environmental Laws which
would result in a fine, penalty or other cost or expense other than such
instances that would not result in a Property Material Adverse Effect; and

 

(iv)                              there
are no past or present events, conditions, circumstances, activities,
practices, incidents, actions or plans which may interfere with or prevent
compliance with the Environmental Laws, or which may give rise to any common
law or legal liability including, without limitation, liability under the
Comprehensive Environmental Response, Compensation and Liability Act of 1980,
as amended, or any other Environmental Law or related common law theory or
otherwise form the basis of any claim, action, demand, suit, proceeding,
hearing or notice of violation, study or investigation, based on or related to
the manufacture, processing, distribution, use, generation, treatment, storage,
disposal, transport or handling, or the emission, discharge, release or
threatened release into the environment, of any Hazardous Materials which would
result in a fine, penalty or

 

14

 

other cost or expense other than such instances that
would not result in a Property Material Adverse Effect .

 

SECTION 3.8  No Conflicts, Consents, etc.  Neither the execution and delivery hereof by
the Mortgagor nor the consummation of the transactions herein contemplated nor
the fulfillment of the terms hereof (i) violates the terms of any agreement,
indenture, mortgage, deed of trust, equipment lease, instrument or other
document to which the Mortgagor is a party, or by which it may be bound or to
which any of its properties or assets may be subject, (ii) conflicts with any
Requirement of Law applicable to the Mortgagor or its property or (iii) results
in or requires the creation or imposition of any Lien (other than the Lien
contemplated hereby) upon or with respect to any of the Mortgaged Property,
except where such violation, conflict, creation or imposition would not have a
Property Material Adverse Effect.  No
consent of any party (including, without limitation, equityholders or creditors
of the Mortgagor) and no consent, authorization, approval, license or other
action by, and no notice to or filing with, any Governmental Authority or
regulatory body or other Person (other than with respect to any required Permits)
is required for (i) the granting of a mortgage Lien on and security
interest in the Mortgaged Property by the Mortgagor granted by it pursuant to
this Mortgage or for the execution, delivery or performance hereof by the
Mortgagor except for the filing of this Mortgage and the other filings
contemplated hereby or (ii) the exercise by the Mortgagee of the remedies
in respect of the Mortgaged Property pursuant to this Mortgage other than those
required by law in connection with the exercise of the applicable remedy.

 

SECTION 3.9  Benefit to the Mortgagor.  The Mortgagor represents and warrants that it
will receive substantial benefit as a result of the execution, delivery, and
performance of the Indenture, the Notes and the Collateral Documents.

 

ARTICLE IV

 

CERTAIN
COVENANTS OF MORTGAGOR

 

SECTION 4.1  Preservation of Corporate Existence.  The Mortgagor shall:

 

(i)                                     preserve
and maintain in full force and effect its existence and good standing under the
laws of the jurisdiction of its organization;

 

(ii)                                  preserve
and maintain in full force and effect its qualification to transact business
and good standing in the state in which the Mortgaged Property is located; and

 

(iii)                               preserve
and maintain in full force and effect all consents, authorizations and approvals
necessary or required of any Governmental Authority or any other Person
relating to the execution, delivery and performance hereof, except where the
failure to do so would not result in a Property Material Adverse Effect.

 

SECTION 4.2  Title. 
The Mortgagor shall:

 

(i)                                     (A)
keep in effect all material rights and appurtenances to or that constitute a
part of the Mortgaged Property and (B) protect, preserve and defend its
interest in the Mortgaged Property

 

15

 

and title thereto, except against Permitted Collateral
Liens (other than the Lien created by this Mortgage);

 

(ii)                                  (A)
comply, in all material respects, with each of the terms, conditions and
provisions of any obligation of the Mortgagor which is secured by the Mortgaged
Property, except where the failure to so comply would not result in a Property
Material Adverse Effect, or the noncompliance with which may result in the
imposition of a Lien on the Mortgaged Property, (B) forever warrant and
defend to the Mortgagee the Lien and security interests created and evidenced
hereby and the validity and priority hereof in any action or proceeding against
the claims of any and all Persons whomsoever affecting or purporting to affect
the Mortgaged Property or any of the rights of the Mortgagee hereunder, except
against Permitted Collateral Liens (other than the Lien of this Mortgage), and
(C) maintain a valid and enforceable first priority Lien, except for Permitted
Collateral Liens (other than the Lien of this Mortgage) on the Mortgaged
Property and, to the extent any of the Mortgaged Property shall consist of
Fixtures, a first priority security interest in the Mortgaged Property, which
first priority Lien and security interest shall be subject only to Permitted Collateral
Liens; and

 

(iii)                               immediately
upon obtaining knowledge of the pendency of any proceedings for the eviction of
the Mortgagor from the Mortgaged Property or any part thereof by paramount
title or otherwise questioning the Mortgagor’s right, title and interest in, to
and under the Mortgaged Property as warranted in this Mortgage, or of any
condition that could give rise to any such proceedings, notify the Mortgagee
thereof.  The Mortgagee may participate
in such proceedings and the Mortgagor will deliver or cause to be delivered to
the Mortgagee all instruments requested by the Mortgagee to permit such
participation.  In any such proceedings,
the Mortgagee may be represented by counsel reasonably satisfactory to the
Mortgagee at the reasonable expense of the Mortgagor.  If, upon the resolution of such proceedings,
the Mortgagor shall suffer a loss of the Mortgaged Property or any part thereof
or interest therein and title insurance proceeds shall be payable in connection
therewith, such proceeds are hereby assigned to and shall be paid to the
Mortgagee for deposit into the Collateral Account and shall be applied in the
manner applicable to Net Loss Proceeds in accordance with the provisions of
Sections 4.16, 10.05(c) and 11.02 of the Indenture.

 

SECTION 4.3  Maintenance and Use of Mortgaged Property;
Alterations.

 

(i)                                     Maintenance.  The Mortgagor shall cause the representations
and warranties set forth in Section 3.3 hereof to continue to be
true in each and every respect and shall pay or cause to be paid when due all
Charges, costs and expenses relating thereto, other than such Charges being
contested in accordance with Section 9.1 hereof.

 

(ii)                                  Maintenance
of Premises.  The Mortgagor shall not
commit or suffer any waste on the Premises. 
The Mortgagor shall, at all times, maintain the Premises in good working
order, condition and repair, reasonable wear and tear excepted, and shall use
commercially reasonable efforts to make or cause to be made all repairs,
structural or nonstructural, which are necessary or appropriate in the conduct
of the Mortgagor’s business.  The
Mortgagor shall not, except as permitted in Section 4.3(iii)
hereof, alter the occupancy or use of all or any portion of the Premises
without the prior written consent of the Mortgagee, which consent shall not be
unreasonably withheld.  Except to the
extent permitted pursuant to the provisions of Section 4.3(iii)
hereof, the Mortgagor shall not remove, demolish or alter the structural character

 

16

 

of any Improvement now or hereafter erected upon all
or any portion of the Premises, or permit any such removal, demolition or alteration,
without the prior written consent of the Mortgagee, which consent shall not be
unreasonably withheld.

 

(iii)                               Alterations.  The Mortgagor shall not, without the prior
written consent of the Mortgagee, which consent shall not be unreasonably
withheld, make any Alteration to the Premises except as permitted by Sections
10.04 and 10.06 of the Indenture. 
Whether or not the making of any Alteration shall require the consent of
the Mortgagee pursuant to the immediately preceding sentence, the Mortgagor
shall (A) complete each Alteration promptly, in a good and workmanlike
manner and in compliance, in all material respects, with all applicable local
laws, ordinances and requirements and (B) pay when due all claims for
labor performed and materials furnished in connection with such Alteration,
unless contested in accordance with the provisions of Article IX
hereof.

 

(iv)                              Permits.  The Mortgagor shall maintain, or cause to be
maintained, in full force and effect all Permits contemplated by and subject to
Section 3.3(i) hereof. 
Unless and to the extent contested by the Mortgagor in accordance with
the provisions of Article IX hereof, the Mortgagor shall comply, in
all material respects, with all requirements set forth in the Permits and all
Requirements of Law applicable to all or any portion of the Mortgaged Property
or the condition, use or occupancy of all or any portion thereof or any
recorded deed of restriction, declaration, covenant running with the land or
otherwise, now or hereafter in force, subject to the provisions of Section 3.3
hereof.

 

(v)                                 Zoning.  The Mortgagor shall not initiate, join in, or
consent to any change in the zoning or any other permitted use classification
of the Premises without the prior written consent of the Mortgagee, which
consent shall not be unreasonably withheld.

 

SECTION 4.4  Notices Regarding Certain Defaults.  The Mortgagor shall, promptly upon receipt of
any written notice regarding (i) any default by the Mortgagor relating to
the Mortgaged Property or any portion thereof or (ii) the failure to
discharge any of Mortgagor’s obligations with respect to the Mortgaged Property
or any portion thereof described herein, furnish a copy of such notice to the
Mortgagee.

 

SECTION 4.5  Access to Mortgaged Property, Books and
Records; Other Information.  Upon
request to the Mortgagor, the Mortgagee, its agents, accountants and attorneys
shall have full and free access to visit and inspect, as applicable, during
normal business hours and such other reasonable time as may be requested by the
Mortgagee, all of the Mortgaged Property including, without limitation, all of
the books, correspondence and records of the Mortgagor relating thereto.  The Mortgagee and its representatives may
examine the same, take extracts therefrom and make photocopies thereof.  The Mortgagor shall, at any and all times,
within a reasonable time after written request by the Mortgagee, furnish or
cause to be furnished to the Mortgagee, in such manner and in such detail as
may be reasonably requested by the Mortgagee, additional information with
respect to the Mortgaged Property.

 

SECTION 4.6  Limitation on Liens; Transfer Restrictions.  The Mortgagor may not, without the prior
written consent of the Mortgagee, further mortgage, encumber, hypothecate,
sell, convey or assign all or any part of the Mortgaged Property or suffer or
allow any of the foregoing to occur by operation of law or otherwise; provided,
however, that the Mortgagor shall have the right to (1) sell,
convey or assign all or any portion of the Mortgaged Property in accordance
with the provisions of the Indenture and

 

17

 

(2) suffer to exist the following Liens in
respect of the Mortgaged Property: (i) Prior Liens (but not extensions,
amendments, supplements or replacements of Prior Liens unless (A) extended,
amended, supplemented or replaced in a manner permitted by the Indenture or (B)
consented to by the Mortgagee which consent shall not be unreasonably
withheld), (ii) the Lien and security interest created by this Mortgage or
any other Collateral Document, (iii) Contested Liens, (iv) Liens described
in clause (9) of the definition of Permitted Liens (provided, however,
that such Liens shall not extend to or cover any Mortgaged Property other than
equipment subject to Capital Leases Obligations or Purchase Money Obligations
incurred in accordance with the provisions of the Indenture) or clause (4) of
the definition of Permitted Liens, and (v) Leases to the extent permitted
pursuant to the provisions of Article V hereof (the Liens described
in clauses (i) through (v) of this sentence, collectively, “Permitted
Collateral Liens”).

 

SECTION 4.7  Environmental.

 

(i)                                     Hazardous
Materials.  Except where the failure
to do so would not result in a Property Material Adverse Effect, the Mortgagor
shall (A) comply with any and all present and future Environmental Laws
applicable to the Mortgaged Property, (B) not release, store, treat,
handle, generate, discharge or dispose of any Hazardous Materials at, on, under
or from the Mortgaged Property in violation of or in a manner that could result
in any material liability under any present and future Environmental Law and
(C) take all necessary steps to initiate and expeditiously complete all
remedial, corrective and other action to eliminate any such effect.  In the event the Mortgagor fails to comply
with the covenants in the preceding sentence, the Mortgagee may, in addition to
any other remedies set forth herein, as agent for the Mortgagor and at the
Mortgagor’s sole cost and expense, cause any remediation, removal or response
action relating to Hazardous Materials required by applicable Environmental
Laws to be taken and the Mortgagor shall provide to the Mortgagee and its
agents and employees access to the Mortgaged Property for such purpose.  Any reasonable costs or expenses incurred by
the Mortgagee for such purpose shall be immediately due and payable by the
Mortgagor and shall bear interest at the Default Rate. The Mortgagee shall have
the right at any time when an Event of Default shall have occurred and be
continuing and at such other times when a potential violation of any present or
future Environmental Law exists which in the Mortgagee’s reasonable judgment
could result in any material liability or obligation under such Environmental
Law, at the sole cost and expense of the Mortgagor, to conduct an environmental
audit of the Mortgaged Property by such persons or firms appointed by the
Mortgagee, and the Mortgagor shall cooperate in all respects in the conduct of
such environmental audit, including, without limitation, by providing access to
the Mortgaged Property and to all records relating thereto.  To the extent that any such environmental
audit identifies conditions which in the Mortgagee’s reasonable judgment would
result in any material liability or obligation under any present or future
Environmental Law, the Mortgagor agrees to expeditiously correct any such
violation or respond to conditions giving rise to such liability or obligations
in a manner which complies in all material respects with the Environmental Laws
and mitigates associated health and environmental risks.  The Mortgagor shall indemnify and hold the
Mortgagee and each of the other Secured Parties harmless from and against all
loss, cost, damage or reasonable expense (including, without limitation,
reasonable attorneys’ and consultants’ fees and disbursements) that the
Mortgagee or any other Secured Party may sustain by reason of the assertion
against the Mortgagee or any Secured Party by any party of any claim relating
to such Hazardous Materials on, under or from the Mortgaged Property or actions
taken with respect thereto as authorized hereunder, except to the extent
arising from the gross negligence or willful misconduct of the Mortgagee or any
other Secured Party.  The foregoing
indemnification shall survive repayment of all Secured Obligations and any
release or assignment hereof; and

 

18

 

(ii)                                  Asbestos.
The Mortgagor shall not install nor permit to be installed in or removed from
the Mortgaged Property, asbestos or any asbestos-containing material
(collectively, “ACM”) except in compliance, in all material respects,
with all applicable Environmental Laws, and with respect to any ACM currently
present in the Mortgaged Property, the Mortgagor shall promptly either
(A) remove any ACM which such Environmental Laws require to be removed or
(B) otherwise comply, in all material respects, with such Environmental
Laws with respect to such ACM, all at the Mortgagor’s sole cost and
expense.  If the Mortgagor shall fail so
to remove any ACM or otherwise comply, in all material respects, with such laws
or regulations, the Mortgagee may, in addition to any other remedies set forth
herein, take reasonable or necessary steps to eliminate any ACM from the
Mortgaged Property or otherwise comply, in all material respects, with
applicable law, regulations or orders and the Mortgagor shall provide to the
Mortgagee and its agents and employees access to the Mortgaged Property for
such purpose.  Any reasonable costs or expenses
incurred by the Mortgagee for such purpose shall be immediately due and payable
by the Mortgagor and bear interest at the Default Rate.  The Mortgagor shall indemnify and hold the
Mortgagee and the other Secured Parties harmless from and against all loss,
cost, damage and expense (including, without limitation, reasonable attorneys’
and consultants’ fees and disbursements) that the Mortgagee or the other
Secured Parties may sustain, as a result of the presence of any ACM and any
removal thereof or compliance with all applicable Environmental Laws, except to
the extent arising from the gross negligence or willful misconduct of the
Mortgagee or any other Secured Party. 
The foregoing indemnification shall survive repayment of all Secured
Obligations and any release or assignment hereof.

 

SECTION 4.8  Estoppel Certificates.  The Mortgagor shall, from time to time, upon
thirty (30) days’ prior written reasonable request of the Mortgagee, execute,
acknowledge and deliver to the Mortgagee an Officers’ Certificate stating that
this Mortgage, the Indenture, the Notes and the Collateral Documents are
unmodified and in full force and effect (or, if there have been modifications,
that this Mortgage, the Indenture, the Notes and the Collateral Documents, as
applicable, is or are in full force and effect as modified and setting forth
such modifications) and stating the date to which principal and interest have
been paid on the Notes.

 

ARTICLE V

 

LEASES

 

SECTION 5.1  Mortgagor’s Affirmative Covenants with
Respect to Leases.  With respect to
each Lease, the Mortgagor shall:

 

(i)                                     observe
and perform, in all material respects, all the obligations imposed upon the
Landlord under such Lease;

 

(ii)                                  promptly
send copies to the Mortgagee of all notices of default which the Mortgagor
shall send or receive thereunder; and

 

(iii)                               enforce
all of the terms, covenants and conditions contained in such Lease upon the
part of the Tenant thereunder to be observed or performed to the extent it
would be commercially reasonable to do so.

 

19

 

SECTION 5.2  Mortgagor’s Negative Covenants with
Respect to Leases.  With respect to
each Lease, the Mortgagor shall not, without the prior written consent of the
Mortgagee, which consent shall not be unreasonably withheld:

 

(i)                                     receive
or collect, or permit the receipt or collection of, any Rent under such Lease
more than one (1) month in advance of the respective period in respect of which
such Rent is to accrue, except:

 

(A)                              in
connection with the execution and delivery of such Lease (or of any amendment
to such Lease), Rent thereunder may be collected and received in advance in an
amount not in excess of one (1) month’s Rent;

 

(B)                                the
amount held by Landlord as a reasonable security deposit thereunder; and

 

(C)                                any
amount received and collected for escalation and other charges in accordance
with the terms of such Lease;

 

(ii)                                  assign,
transfer or hypothecate (other than to the Mortgagee hereunder) any Rent under
such Lease whether then due or to accrue in the future or the interest of the
Mortgagor as Landlord under such Lease;

 

(iii)                               enter
into any amendment or modification of such Lease which would materially decrease
the unexpired term thereof or decrease the amount of the Rents payable
thereunder or materially impair the value or utility of the Mortgaged Property
or the security provided by this Mortgage;

 

(iv)                              terminate
(whether by exercising any contractual right of the Mortgagor to recapture
leased space or otherwise) or permit the termination of such Lease or accept
surrender of all or any portion of the space demised under such Lease prior to
the end of the term thereof or accept assignment of such Lease to the Mortgagor
unless:

 

(A)                              the
Tenant under such Lease has not paid the equivalent of two (2) months’ Rent and
the Mortgagor has made reasonable efforts to collect such Rent; and

 

(B)                                it
would be commercially reasonable to terminate such Lease; or

 

(v)                                 waive,
excuse, condone or in any manner discharge or release any Tenants of or from
the material obligations of such Tenants under their respective Leases or
guarantors of Tenants from any material obligations under any guarantees of the
Leases except as the same would be done by a Prudent Operator with due regard
for the security afforded the Mortgagee thereby.

 

SECTION 5.3  Additional Requirements with Respect to
New Leases.  In addition to the
requirements of Sections 5.1 and 5.2 hereof, the Mortgagor shall
not enter into any Lease after the date hereof unless the Tenant under such
Lease has entered into a Subordination Agreement and has otherwise complied
with the provisions of Section 10.06 of the Indenture.

 

20

 

ARTICLE VI

 

CONCERNING
ASSIGNMENT OF LEASES AND RENTS

 

SECTION 6.1  Present Assignment; License to the
Mortgagor.  Section 2.2 of this
Mortgage constitutes a present, absolute, effective, irrevocable and complete
assignment by the Mortgagor to the Mortgagee of the Leases and Rents and the
right, subject to applicable law, to collect all sums payable to the Mortgagor
thereunder and apply the same as the Mortgagee may, in its sole discretion,
determine to be appropriate (including the payment of reasonable costs and
expenses in connection with the maintenance, operation, improvement, insurance,
taxes and upkeep of the Mortgaged Property), which is not conditioned upon the
Mortgagee being in possession of the Premises. 
The Mortgagee hereby grants to the Mortgagor, however, a license to
collect and apply the Rents and to enforce the obligations of Tenants under the
Leases.  Immediately upon the occurrence
of and during the continuance of any Event of Default or a Default, the license
granted in the immediately preceding sentence shall cease and terminate, with
or without any notice, action or proceeding or the intervention of a receiver
appointed by a court.

 

SECTION 6.2  Collection of Rents by the Mortgagee.

 

(i)                                     From
and after the occurrence and during the continuance of an Event of Default or a
Default, any Rents receivable by the Mortgagee hereunder, after payment of all
proper costs and expenses as Mortgagee may, in its sole discretion, determine
to be appropriate (including the payment of reasonable costs and expenses in
connection with the maintenance, operation, improvement, insurance, taxes and
upkeep of the Mortgaged Property), shall be applied to the Secured Obligations
or, at the option of the Mortgagee, shall be held by the Mortgagee as
additional collateral to secure the performance by the Mortgagor of the Secured
Obligations.  The Mortgagee shall be
accountable to the Mortgagor only for Rents actually received by the
Mortgagee.  The collection of such Rents
and the application thereof shall not cure or waive any Event of Default or a
Default or waive, modify or affect notice of Event of Default or a Default or
invalidate any act done pursuant to such notice.

 

(ii)                                  The
Mortgagor hereby irrevocably authorizes and directs Tenant under each Lease to
rely upon and comply with any and all notices or demands from the Mortgagee for
payment of Rents to the Mortgagee and the Mortgagor shall have no claim against
Tenant for Rents paid by Tenant to the Mortgagee pursuant to such notice or
demand.

 

SECTION 6.3  No Release.  Neither this Mortgage nor any action or
inaction on the part of the Mortgagee shall release any Tenant under any Lease,
any guarantor of any Lease or the Mortgagor from any of their respective
obligations under such Leases or constitute an assumption of any such
obligation on the part of the Mortgagee. 
No action or failure to act on the part of the Mortgagor shall adversely
affect or limit the rights of the Mortgagee under this Mortgage or, through
this Mortgage, under such Leases. 
Nothing contained herein shall operate or be construed to
(i) obligate the Mortgagee to perform any of the terms, covenants or conditions
contained in any Lease or otherwise to impose any obligation upon the Mortgagee
with respect to such Lease (including, without limitation, any obligation
arising out of any covenant of quiet enjoyment contained in such Lease in the
event that Tenant under such Lease shall have been joined as a party defendant
in any action by which the estate of such Tenant shall be terminated) or
(ii) place upon the Mortgagee any obligation for the operation, control,
care, management or repair of the Premises.

 

21

 

SECTION 6.4  Irrevocable Interest.  All rights, powers and privileges of the
Mortgagee herein set forth are coupled with an interest and are irrevocable,
subject to the terms and conditions hereof, and the Mortgagor shall not take
any action under the Leases or otherwise which is inconsistent with this
Mortgage or any of the terms hereof and any such action inconsistent herewith
or therewith shall be void.

 

SECTION 6.5  Amendment to Leases.  Each Lease, including, without limitation,
all amendments, modifications, supplements, replacements, extensions and
renewals thereof, shall continue to be subject to the provisions hereof without
the necessity of any further act by any of the parties hereto.

 

ARTICLE VII

 

TAXES
AND CERTAIN STATUTORY LIENS

 

SECTION 7.1  Payment of Charges.  Unless and to the extent contested by the
Mortgagor in accordance with the provisions of Article IX hereof,
the Mortgagor shall pay and discharge, or cause to be paid and discharged, from
time to time when the same shall become due (or within any applicable grace
period) , all Charges subject to this Article VII.  The Mortgagor shall, upon the Mortgagee’s
request, deliver to the Mortgagee receipts evidencing the payment of all such
Charges.

 

SECTION 7.2  Escrow of Taxes.  From and after the occurrence and during the
continuance of an Event of Default or a Default, at the option and upon the
request of the Mortgagee, the Mortgagor shall deposit with the Mortgagee in an
account maintained by the Mortgagee (the “Tax Escrow Fund”), on the
first day of each month, an amount estimated by the Mortgagee to be equal to
one-twelfth of the annual real property taxes and other annual Charges required
to be discharged by the Mortgagor under Section 7.1 hereof.  Such amounts shall be held by the Mortgagee
without interest to the Mortgagor and applied to the payment of the obligations
in respect of which such amounts were deposited, in such priority as the
Mortgagee shall determine, on or before the respective dates on which such
obligations or any part thereof would become delinquent.  Nothing contained in this Article VII
shall (i) affect any right or remedy of the Mortgagee under any provision
hereof or of any statute or rule of law to pay any such amount as provided
above from its own funds and to add the amount so paid, together with interest
at the Default Rate during such time that any amount remains outstanding, to
the Secured Obligations or (ii) relieve the Mortgagor of its obligations
to make or provide for the payment of the annual real property taxes and other
annual Charges required to be discharged by the Mortgagor under Section 7.1
hereof.

 

SECTION 7.3  Certain Statutory Liens.  Unless and to the extent contested by the
Mortgagor in accordance with the provisions of Article IX hereof,
the Mortgagor shall timely pay, or cause to be paid, all lawful claims and
demands of mechanics, materialmen, laborers, government agencies administering
worker’s compensation insurance, old age pensions and social security benefits
and all other claims, judgments, demands or amounts of any nature which, if
unpaid, would result in, or permit the creation of, a Lien on the Mortgaged
Property or any part thereof, or which would result in forfeiture of all or any
part of the Mortgaged Property.

 

SECTION 7.4  Stamp and Other Taxes.  Unless and to the extent contested by the
Mortgagor in accordance with the provisions of Article IX hereof,
the Mortgagor shall pay any United States documentary stamp taxes, with
interest and fines and penalties, and any mortgage recording taxes, with

 

22

 

interest and fines and penalties, that may hereafter
be levied, imposed or assessed under or upon or by reason hereof or the Secured
Obligations or any instrument or transaction affecting or relating to either
thereof and in default thereof the Mortgagee may advance the same and the
amount so advanced shall be payable by the Mortgagor to the Mortgagee in
accordance with the provisions of Section 14.5 hereof.

 

SECTION 7.5  Certain Tax Law Changes.  In the event of the passage after the date
hereof of any law deducting from the value of real property, for the purpose of
taxation, amounts in respect of any Lien thereon or changing in any way the
laws for the taxation of mortgages or debts secured by mortgages for state or
local purposes or the manner of the collection of any Charges, and imposing any
Charges, either directly or indirectly, on this Mortgage, the Indenture or any
other Collateral Document, the Mortgagor shall promptly pay to the Mortgagee
such amount or amounts as may be necessary from time to time to pay any such
Charges.

 

SECTION 7.6  Proceeds of Tax Claim.  In the event that the proceeds of any tax
claim are paid after the Mortgagee has exercised its right to foreclose the
Lien hereof, such proceeds shall be paid to the Mortgagee to satisfy any
deficiency remaining after such foreclosure. 
The Mortgagee shall retain its interest in the proceeds of any tax claim
during any redemption period.  The amount
of any such proceeds in excess of any deficiency claim of the Mortgagee shall
in a prompt manner be released to the Mortgagor.

 

ARTICLE VIII

 

INSURANCE

 

SECTION 8.1  Required Insurance Policies and Coverages.  The Mortgagor shall maintain in respect of
the Premises the insurance policies and coverages required under
Section 4.19(b) of the Indenture.

 

SECTION 8.2  Delivery After Foreclosure.  In the event that the proceeds of any
insurance claim are paid after the Mortgagee has exercised its right to
foreclose the Lien hereof, such proceeds shall be paid to the Mortgagee to
satisfy any deficiency remaining after such foreclosure.  Mortgagee shall retain its interest in the
Insurance Policies required to be maintained pursuant to this Mortgage during
any redemption period. The amount of any such proceeds in excess of any
deficiency claim of the Mortgagee shall be released to the Mortgagor.

 

ARTICLE IX

 

CONTESTING
OF PAYMENTS

 

SECTION 9.1  Contesting of Taxes and Certain Statutory
Liens.  The Mortgagor may at its own
expense contest the validity, amount or applicability of any Charges as long as
the contest thereof shall be conducted in accordance with, and permitted
pursuant to the provisions of, the Indenture. 
Notwithstanding the foregoing provisions of this Section 9.1,
(i) no contest of any such obligations may be pursued by the Mortgagor (A)
if such contest would expose the Mortgagee or any Holder to any possible
criminal liability or (B) unless the Mortgagor shall have furnished a bond
or other security therefor reasonably

 

23

 

satisfactory to the Mortgagee or such Holder, as the
case may be, including for any additional civil liability for failure to comply
with such obligations and (ii) if at any time payment or performance of
any obligation contested by the Mortgagor pursuant to this Section 9.1
shall become necessary to prevent the imminent imposition of remedies because
of non-payment, the Mortgagor shall pay or perform the same in sufficient time
to prevent the imposition of remedies in respect of such default or prospective
default.

 

SECTION 9.2  Contesting of Insurance.  The Mortgagor shall not take any action that
would reasonably be expected to cause the termination, revocation or denial of
any insurance coverage required to be maintained under this Mortgage or that
would be the basis for a defense to any claim under any Insurance Policy
maintained in respect of the Premises and the Mortgagor shall otherwise comply
in all respects with all Insurance Requirements in respect of the Premises; provided,
however, that the Mortgagor may, at its own expense and after written
notice to the Mortgagee, (i) contest the applicability or enforceability
of any such Insurance Requirements by appropriate legal proceedings,
prosecution of which does not constitute a basis for cancellation or revocation
of any insurance coverage required under Article VIII hereof or
(ii) cause the Insurance Policy containing any such Insurance Requirement
to be replaced by a new policy complying with the provisions of Article VIII
hereof.

 

ARTICLE X

 

DESTRUCTION,
CONDEMNATION AND RESTORATION

 

SECTION 10.1  Destruction.  If there shall occur any Destruction,
individually or in the aggregate, in excess of $100,000, the Mortgagor shall
promptly send to the Mortgagee a written notice setting forth the nature and extent
of such Destruction.  The proceeds of any
insurance payable in respect of such Destruction are hereby assigned and shall
be paid to the Mortgagee.  The Net Loss
Proceeds arising out of such Destruction, shall be applied in accordance with
the provisions of Sections 4.16, 10.05(c) and 11.02 of the Indenture.

 

SECTION 10.2  Condemnation.  If there shall occur any Taking or the
commencement of any proceeding thereof, the Mortgagor shall immediately notify
the Mortgagee upon receiving notice of such Taking or commencement of
proceedings therefor.  The Mortgagee may,
at its option, participate in any proceedings or negotiations which might
result in any Taking, and the Mortgagor shall deliver or cause to be delivered
to the Mortgagee all instruments requested by it to permit such
participation.  The Mortgagee may be
represented by counsel reasonably satisfactory to it at the reasonable expense
of the Mortgagor in connection with any such participation.  The Mortgagor shall pay all reasonable fees,
costs and expenses incurred by the Mortgagee in connection with any Taking and
in seeking and obtaining any award or payment on account thereof.  Any proceeds, award or payment in respect of
any Taking are hereby assigned and shall be paid to the Mortgagee.  The Mortgagor shall take all steps necessary
to notify the condemning authority of such assignment.  The Net Loss Proceeds arising out of such
Taking shall be applied in accordance with the provisions of Sections 4.16, 10.05(c)
and 11.02 of the Indenture.

 

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ARTICLE XI

 

EVENTS
OF DEFAULT AND REMEDIES

 

SECTION 11.1  Events of Default.  It shall be an Event of Default hereunder if
there shall have occurred and be continuing an Event of Default under the
Indenture.

 

SECTION 11.2  Remedies in Case of an Event of Default.  If any Event of Default shall have occurred
and be continuing, the Mortgagee may at its option, in addition to any other
action permitted under this Mortgage or the Indenture or by law, statute or in
equity, take one or more of the following actions to the greatest extent
permitted by local law:

 

(i)                                     by
written notice to the Issuer and the Mortgagor, declare the entire unpaid
amount of the Secured Obligations to be due and payable immediately;

 

(ii)                                  personally,
or by its agents or attorneys, (A) enter into and upon and take possession
of all or any part of the Premises together with the books, records and
accounts of the Mortgagor relating thereto and, exclude the Mortgagor, its
agents and servants wholly therefrom, (B) use, operate, manage and control
the Premises and conduct the business thereof, (C) maintain and restore
the Premises, (D) make all necessary or proper repairs, renewals and
replacements and such useful Alterations thereto and thereon as the Mortgagee
may deem advisable, (E) manage, lease and operate the Premises and carry
on the business thereof and exercise all rights and powers of the Mortgagor
with respect thereto either in the name of the Mortgagor or otherwise or
(F) collect and receive all Rents. 
The Mortgagee shall be under no liability for or by reason of any such
taking of possession, entry, removal or holding, operation or management except
that any amounts so received by the Mortgagee shall be applied in accordance
with the provisions of the Indenture;

 

(iii)                               with
or without entry, personally or by its agents or attorneys, (A) sell the
Mortgaged Property and all estate, right, title and interest, claim and demand
therein at one or more sales in one or more parcels, in accordance with the
provisions of Section 11.3 or (B) institute and prosecute
proceedings for the complete or partial foreclosure of the Lien and security
interests created and evidenced hereby; or

 

(iv)                              take
such steps to protect and enforce its rights whether by action, suit or
proceeding at law or in equity for the specific performance of any covenant,
condition or agreement in the Indenture, the Notes and the Collateral
Documents, or in aid of the execution of any power granted in this Mortgage, or
for any foreclosure hereunder, or for the enforcement of any other appropriate
legal or equitable remedy or otherwise as the Mortgagee shall elect.

 

SECTION 11.3  Sale of Mortgaged Property if Event of
Default Occurs; Proceeds of Sale.

 

(i)                                     If
any Event of Default shall have occurred and be continuing, the Mortgagee may
institute an action to foreclose this Mortgage or take such other action as may
be permitted and available to the Mortgagee at law or in equity for the
enforcement of the Indenture and the Notes and realization on the Mortgaged
Property and proceeds thereon through power of sale or to final judgment and
execution thereof for the Secured Obligations, and in furtherance thereof the
Mortgagee may sell the Mortgaged Property at

 

25

 

one or more sales, as an entirety or in parcels, at
such time and place, upon such terms and after such notice thereof as may be
required or permitted by law or statute or in equity.  The Mortgagee may execute and deliver to the
purchaser at such sale a conveyance of the Mortgaged Property in fee simple and
an assignment or conveyance of all the Mortgagor’s Interest in the Leases and
the Mortgaged Property, each of which conveyances and assignments shall contain
recitals as to the Event of Default upon which the execution of the power of
sale herein granted depends, and the Mortgagor hereby constitutes and appoints
the Mortgagee the true and lawful attorney in fact of the Mortgagor to make any
such recitals, sale, assignment and conveyance, and all of the acts of the
Mortgagee as such attorney in fact are hereby ratified and confirmed.  The Mortgagor agrees that such recitals shall
be binding and conclusive upon the Mortgagor and that any assignment or
conveyance to be made by the Mortgagee shall divest the Mortgagor of all right,
title, interest, equity and right of redemption, including any statutory
redemption, in and to the Mortgaged Property. 
The power and agency hereby granted are coupled with an interest and are
irrevocable by death or dissolution, or otherwise, and are in addition to any
and all other remedies which the Mortgagee may have hereunder, at law or in
equity.  So long as the Secured
Obligations, or any part thereof, remain unpaid, the Mortgagor agrees that
possession of the Mortgaged Property by the Mortgagor, or any person claiming
under the Mortgagor, shall be as tenant, and, in case of a sale under power or
upon foreclosure as provided in this Mortgage, the Mortgagor and any person in
possession under the Mortgagor, as to whose interest such sale was not made
subject, shall, at the option of the purchaser at such sale, then become and be
tenants holding over, and shall forthwith deliver possession to such purchaser,
or be summarily dispossessed in accordance with the laws applicable to tenants
holding over.  In case of any sale under
this Mortgage by virtue of the exercise of the powers herein granted, or
pursuant to any order in any judicial proceeding or otherwise, the Mortgaged
Property may be sold as an entirety or in separate parcels in such manner or
order as the Mortgagee in its sole discretion may elect.  One or more exercises of powers herein
granted shall not extinguish or exhaust such powers, until the entire Mortgaged
Property is sold or all amounts secured hereby are paid in full.

 

(ii)                                  In
the event of any sale made under or by virtue of this Article XI,
the entire principal of, and interest in respect of the Secured Obligations, if
not previously due and payable, shall, at the option of the Mortgagee, immediately
become due and payable, anything in this Mortgage to the contrary
notwithstanding.

 

(iii)                               The
proceeds of any sale made under or by virtue of this Article XI,
together with any other sums which then may be held by the Mortgagee under this
Mortgage, whether under the provisions of this Article XI or
otherwise, shall be applied in accordance with the provisions of the Indenture;

 

(iv)                              The
Mortgagee may bid for and acquire the Mortgaged Property or any part thereof at
any sale made under or by virtue of this Article XI and, in lieu of
paying cash therefor, may make settlement for the purchase price by crediting
against the purchase price the unpaid amounts (whether or not then due and
owing) in respect of the Secured Obligations, after deducting from the sales
price the expense of the sale and the reasonable costs of the action or
proceedings and any other sums that the Mortgagee is authorized to deduct under
this Mortgage.

 

(v)                                 The
Mortgagee may adjourn from time to time any sale by it to be made under or by
virtue hereof by announcement at the time and place appointed for such sale or
for such adjourned sale or sales, and, the Mortgagee, without further notice or
publication, may make such sale at the time and place to which the same shall
be so adjourned.

 

26

 

(vi)                              If
the Premises is comprised of more than one parcel of land, the Mortgagee may
take any of the actions authorized by this Section 11.3 in respect
of any or a number of individual parcels.

 

SECTION 11.4  Additional Remedies in Case of an Event of
Default.

 

(i)                                     The
Mortgagee shall be entitled to recover judgment as aforesaid either before,
after or during the pendency of any proceedings for the enforcement of the
provisions hereof, and the right of the Mortgagee to recover such judgment
shall not be affected by any entry or sale hereunder, or by the exercise of any
other right, power or remedy for the enforcement of the provisions hereof, or
the foreclosure of, or absolute conveyance pursuant to, this Mortgage.  In case of proceedings against the Mortgagor
in insolvency or bankruptcy or any proceedings for its reorganization or
involving the liquidation of its assets, the Mortgagee shall be entitled to
prove the whole amount of principal and interest and other payments, charges
and costs due in respect of the Secured Obligations to the full amount thereof
without deducting therefrom any proceeds obtained from the sale of the whole or
any part of the Mortgaged Property; provided, however, that in no
case shall the Mortgagee receive a greater amount than the aggregate of such
principal, interest and such other payments, charges and costs (with interest
at the Default Rate) from the proceeds of the sale of the Mortgaged Property
and the distribution from the estate of the Mortgagor.

 

(ii)                                  Any
recovery of any judgment by the Mortgagee and any levy of any execution under
any judgment upon the Mortgaged Property shall not affect in any manner or to
any extent the Lien and security interests created and evidenced hereby upon
the Mortgaged Property or any part thereof, or any conveyances, powers, rights
and remedies of the Mortgagee hereunder, but such conveyances, powers, rights
and remedies shall continue unimpaired as before.

 

(iii)                               Any
monies collected by the Mortgagee under this Section 11.4 shall be
applied in accordance with the provisions of Section 11.3(iii).

 

SECTION 11.5  Legal Proceedings After an Event of
Default.

 

(i)                                     After
the occurrence and during the continuance of any Event of Default and immediately
upon the commencement of any action, suit or legal proceedings to obtain
judgment for the Secured Obligations or any part thereof, or of any proceedings
to foreclose the Lien and security interest created and evidenced hereby or
otherwise enforce the provisions hereof or of any other proceedings in aid of
the enforcement hereof, the Mortgagor shall enter its voluntary appearance in
such action, suit or proceeding.

 

(ii)                                  Upon
the occurrence and during the continuance of an Event of Default, the Mortgagee
shall be entitled forthwith as a matter of right, concurrently or independently
of any other right or remedy hereunder either before or after declaring the
Secured Obligations or any part thereof to be due and payable, to the
appointment of a receiver without giving notice to any party and without regard
to the adequacy or inadequacy of any security for the Secured Obligations or
the solvency or insolvency of any person or entity then legally or equitably
liable for the Secured Obligations or any portion thereof.  The Mortgagor hereby consents to the
appointment of such receiver. 
Notwithstanding the appointment of any receiver, the Mortgagee shall be
entitled as pledgee to the possession and control of any cash, deposits or
instruments at the time held by or payable or deliverable under the terms of
the Indenture to the Mortgagee.

 

27

 

(iii)                               The
Mortgagor shall not (A) at any time insist upon, or plead, or in any
manner whatsoever claim or take any benefit or advantage of any stay or
extension or moratorium law, any exemption from execution or sale of the
Mortgaged Property or any part thereof, wherever enacted, now or at any time
hereafter in force, which may affect the covenants and terms of performance hereof,
(B) claim, take or insist on any benefit or advantage of any law now or
hereafter in force providing for the valuation or appraisal of the Mortgaged
Property, or any part thereof, prior to any sale or sales of the Mortgaged
Property which may be made pursuant to this Mortgage, or pursuant to any
decree, judgment or order of any court of competent jurisdiction or
(C) after any such sale or sales, claim or exercise any right under any
statute heretofore or hereafter enacted to redeem the property so sold or any
part thereof.  To the extent permitted by
applicable law, the Mortgagor hereby expressly (A) waives all benefit or
advantage of any such law or laws, including, without limitation, any statute
of limitations applicable to this Mortgage, (B) waives all rights to have the
Mortgaged Property marshalled on any foreclosure of this Mortgage, (C) waives
any and all rights to trial by jury in any action or proceeding related to the
enforcement hereof, (D) waives any objection which it may now or hereafter
have to the laying of venue of any action, suit or proceeding brought in
connection with this Mortgage and further waives and agrees not to plead that
any such action, suit or proceeding brought in any such court has been brought
in an inconvenient forum and (E) covenants not to hinder, delay or impede the
execution of any power granted or delegated to the Mortgagee by this Mortgage
but to suffer and permit the execution of every such power as though no such
law or laws had been made or enacted. 
The Mortgagee shall not be liable for any incorrect or improper payment
made pursuant to this Article XI in the absence of gross negligence
or willful misconduct.

 

SECTION 11.6  Remedies Not Exclusive.  No remedy conferred upon or reserved to the
Mortgagee by this Mortgage is intended to be exclusive of any other remedy or
remedies, and each and every such remedy shall be cumulative and shall be in
addition to every other remedy given under this Mortgage or now or hereafter
existing at law or in equity.  Any delay
or omission of the Mortgagee to exercise any right or power accruing on any
Event of Default shall not impair any such right or power and shall not be
construed to be a waiver of or acquiescence in any such Event of Default.  Every power and remedy given by this Mortgage
may be exercised from time to time concurrently or independently, when and as
often as may be deemed expedient by the Mortgagee in such order and manner as
the Mortgagee, in its sole discretion, may elect.  If the Mortgagee accepts any monies required
to be paid by the Mortgagor under this Mortgage after the same become due, such
acceptance shall not constitute a waiver of the right either to require prompt
payment, when due, of all other sums secured by this Mortgage or to declare an
Event of Default with regard to subsequent defaults.  If the Mortgagee accepts any monies required
to be paid by the Mortgagor under this Mortgage in an amount less than the sum
then due, such acceptance shall be deemed an acceptance on account only and on
the condition that it shall not constitute a waiver of the obligation of the
Mortgagor to pay the entire sum then due, and the Mortgagor’s failure to pay
the entire sum then due shall be and continue to be a default hereunder
notwithstanding acceptance of such amount on account.

 

SECTION 11.7  Special Louisiana Provisions.

 

(i)                                     Without
limiting the generality of the foregoing, should one or more Events of Default
occur or exist and be continuing under this Mortgage, as provided above, the
Mortgagee, at its option, may exercise any one or more of the following rights
and remedies, in addition to any other rights and remedies provided by law and
under this Mortgage to the greatest extent permitted by applicable Louisiana
law.  Nothing contained herein shall be
construed as constituting the Mortgagee as mortgagee in possession in absence
of the actual taking of possession of the Premises by the Mortgagee.

 

28

 

(ii)                                  The
Mortgagee shall have the right, at its sole option, to accelerate the maturity
and demand immediate payment in full of any and all of the Secured
Obligations.  The Mortgagee shall then
have the right to commence appropriate foreclosure proceedings against the
Mortgaged Property and against the Mortgagor’s rights as provided in this
Mortgage.

 

(iii)                               In
the event that the Mortgagee elects to commence appropriate Louisiana
foreclosure proceedings under this Mortgage, the Mortgagee may cause the
Mortgaged Property, or any part or parts thereof, to be immediately seized and
sold, whether in term of court or in vacation, under ordinary or executory
process, in accordance with applicable Louisiana law, to the highest bidder for
cash, with or without appraisement, and without the necessity of making
additional demand upon or notifying the Mortgagor or placing the Mortgagor in
default, all of which are expressly waived.

 

(iv)                              For
purposes of foreclosure under Louisiana executory process procedures, the
Mortgagor confesses judgment and acknowledges to be indebted to the Mortgagee,
up to the full amount of the indebtedness in principal, interest, costs,
expenses, reasonable attorney’s fees and other fees and charges and amounts
contemplated hereunder.  The Mortgagor
further confesses judgment and acknowledges to be indebted unto and in favor of
the Mortgagee in the amount of all future advances that the Mortgagee may make
on the Mortgagor’s behalf pursuant to this Mortgage, together with interest
thereon.  To the extent permitted under
applicable Louisiana law, the Mortgagor additionally waives:  (1) the benefit of appraisal as provided in
Articles 2332, 2336, 2723, and 2724 of the Louisiana Code of Civil Procedure,
and all other laws with regard to appraisal upon judicial sale; (2) the demand
and three (3) days’ delay provided under Articles 22639 and 2721 of the
Louisiana Code of Civil Procedure; (3) the notice of seizure as provided under
Articles 2293 and 2721 of the Louisiana Code of Civil Procedure; (4) the three
(3) days’ delay provided under Articles 2331, 2722 and 2723 of the Louisiana
Code of Civil Procedure and all other Articles not specifically mentioned
above.  The Mortgagor further agrees that
any declaration of fact made by authentic act before a Notary Public and two
witnesses, by a Person declaring that such facts are within his or her
knowledge, shall constitute authentic evidence of such facts for purposes of
foreclosure under applicable Louisiana law and for purposes of La. R.S.
9:3504(D)(6) and La. R.S. 10:9-508, to the extent applicable.

 

(v)                                 Should
any or all of the Mortgaged Property be seized as an incident to an action for
the recognition or enforcement of this Mortgage, by executory process,
sequestration, attachment, writ of fieri facias or otherwise, the Mortgagor
hereby agrees that the court issuing any such order shall, if requested by the
Mortgagee, appoint the Mortgagee, or any agent designated by the Mortgagee or
any Person named by the Mortgagee at the time such seizure is requested, or any
time thereafter, as Keeper of the Mortgaged Property as provided under La. R.S.
9:5136, et seq.  Such a Keeper shall be
entitled to reasonable compensation.  The
Mortgagor agrees to pay the reasonable fees of such Keeper which compensation
to the Keeper shall also be secured by this Mortgage in the form of any future
advances as provided in this Mortgage.

 

(vi)                              Should
it become necessary for the Mortgagee to foreclose under this Mortgage, all
declarations of fact, which are made under an authentic act before a Notary
Public in the presence of two witnesses, by a person declaring such facts to
lie within his or her knowledge, shall constitute authentic evidence for
purposes of executory process and also for purposes of La. R.S. 9:3509.1, La.
R.S. 9:3504(D)(6) and La. R.S. 10:9-508, where applicable.

 

29

 

(vii)                           Should
one or more Events of Default occur or exist under this Mortgage, the Mortgagee
shall have the additional right, at its sole option, to separately sell the
aforesaid rights, or any part of parts thereof, at private or public
compensation, or on credit, or for future delivery, without the assumption of
any credit risk.  The sale of the
aforesaid rights may be without appraisement, the benefit of which is also
expressly waived by the Mortgagor.  The
Mortgagee may exercise any other remedies with regard to the Mortgagor’s rights
as may be authorized under the Louisiana Commercial Laws (La. R.S. 10:9-101, et
seq.).

 

(viii)                        To
the extent provided by law, and in the event of foreclosure under this
Mortgage, or other transfer of title or assignment of the Mortgaged Property,
or any part or parts thereof, in lieu of payment of the Secured Obligations,
whether in whole or in part, all policies of insurance and other rights
applicable to the foreclosed Mortgaged Property upon transfer of the Mortgaged
Property shall automatically inure to the benefit of and shall pass to the
purchaser(s) or transferee(s) thereof, subject to the rights of the
purchaser(s) or transferee(s) to reject such insurance coverage and/or rights
at its or their sole option and election.

 

(ix)                                The
Mortgagee may, in addition to or in lieu of the foregoing remedies, in the
Mortgagee’s sole discretion, commence an appropriate action against the
Mortgagor seeking specific performance of any covenant contained in this
Mortgage or in aid of the execution or enforcement of any power in this
Mortgage granted.

 

(x)                                   Except
as may be prohibited by applicable law, all of the Mortgagee’s rights and
remedies, whether evidenced by this Mortgage or by any other writing, shall be
cumulative and may be exercised singularly or concurrently.  Election by the Mortgagee to pursue any
remedy shall not exclude pursuit of any other remedy, and an election to make
expenditures or to take action to perform an obligation of the Mortgagor under
this Mortgage, after the Mortgagor’s failure to perform shall not affect the
Mortgagee’s right to declare a default and exercise its remedies.  Nothing under this Mortgage or otherwise
shall be construed so as to limit or restrict the rights and remedies available
to the Mortgagee following an Event of Default, or in any way to limit or
restrict the rights and abilities of the Mortgagee to proceed directly against
Mortgagor and/or against any other co-maker, guarantor, surety or endorser of
the Secured Obligations, and/or to proceed against any other collateral
directly or indirectly securing the Secured Obligations.

 

ARTICLE XII

 

SECURITY
AGREEMENT AND FIXTURE FILING

 

SECTION 12.1  Security Agreement.

 

(i) This Mortgage shall constitute a Security Agreement as defined in
the Louisiana Commercial Laws, La. R.S. § 10:101 et seg., and shall create
and evidence a security interest in all the equipment and in all the other
items of Mortgaged Property in which a security interest may be granted
pursuant to the Louisiana Commercial Laws (collectively, “Personal Property”).

 

(ii) The remedies for any violation of the covenants, terms and
conditions of the agreements herein contained shall be as prescribed herein or
by general Louisiana law or, as to such part of the

 

30

 

security which is also reflected in any financing
statement filed to perfect the security interest herein created, by the
specific statutory provisions now or hereinafter enacted and specified in the
Louisiana Commercial Laws, all at Mortgagee’s sole election.  The mention in any financing statement of (1)
the rights in or the proceeds of any fire or hazard insurance policy, or (2)
any award in eminent domain proceedings for a taking or for loss of value, or
(3) Mortgagor’s interest as lessor in any present or future lease or rights to
income growing out of the use or occupancy of the Mortgaged Property whether
pursuant to lease or otherwise, shall never be construed as in any way altering
any of the rights of Mortgagee under this Mortgage or impugning the priority of
the Mortgagee’s lien granted hereby or by any other recorded document.  Rather, such mention in the financing
statement is declared to be for the protection of the Mortgagee in the event
any court or judge shall at any time hold with respect to (1), (2) and (3)
above, that notice of Mortgagee’s priority of interest to be effective against
a particular class of persons, including, but not limited to, the Federal
Government and any subdivisions or entity of the Federal Government, must be
filed with the clerk of court of any parish (or St. Landry Parish Recorder of
Mortgages) pursuant to Section 9-401 of the Louisiana Commercial Laws.

 

SECTION 12.2  Fixture Filing.  From the date of its recording, this Mortgage
shall be effective as a fixture financing statement with respect to all goods
constituting part of the Mortgaged Property which are to become fixtures
related to the Land.  For this purpose,
the following information is set forth:

 

(a) Name and
Address of Debtor:

 

Jalou
Eunice, LLC

3747 Highway 190

Eunice, Louisiana 70535

 

and

 

(b) Name and Address of Secured Party:

 

Wells
Fargo Bank, National Association

Corporate Trust Services 

213 Court Street, Suite 703

Middletown, Connecticut 06457

 

(c) This
document covers goods which are to become fixtures.  All items that are fixtures on the date of
this Mortgage shall be subject to the mortgage Lien granted hereunder.

 

ARTICLE XIII

 

FURTHER
ASSURANCES

 

SECTION 13.1  Recording Documentation To Assure Security.  The Mortgagor shall, forthwith after the
execution and delivery hereof and thereafter, from time to time, cause this
Mortgage and any financing statement, continuation statement or similar
instrument relating to any thereof or to any property

 

31

 

intended to be subject to the Lien hereof to be filed,
registered and recorded in such manner and in such places as may be required by
any present or future law in order to publish notice of and fully to protect
the validity and priority thereof or the Lien hereof purported to be created
upon the Mortgaged Property and the interest and rights of the Mortgagee
therein.  The Mortgagor shall pay or
cause to be paid all taxes and fees incident to such filing, registration and
recording, and all reasonable expenses incident to the preparation, execution
and acknowledgment thereof, and of any instrument of further assurance, and all
Federal or state stamp taxes or other taxes, duties and charges arising out of
or in connection with the execution and delivery of such instruments.

 

SECTION 13.2  Further Acts.  The Mortgagor shall, at the sole cost and
expense of the Mortgagor, do, execute, acknowledge and deliver all and every
such further acts, deeds, conveyances, mortgages, assignments, notices of
assignment, transfers, financing statements, continuation statements,
instruments and assurances as the Mortgagee shall from time to time reasonably
request, which may be necessary in the judgment of the Mortgagee from time to
time to assure, perfect, convey, assign, mortgage, transfer and confirm unto
the Mortgagee, the property and rights hereby conveyed or assigned or which the
Mortgagor may be or may hereafter become bound to convey or assign to the Mortgagee
or for carrying out the intention or facilitating the performance of the terms
hereof or the filing, registering or recording hereof.  Without limiting the generality of the
foregoing, in the event that the Mortgagee desires to exercise any remedies,
consensual rights or attorney-in-fact powers set forth in this Mortgage and
determines it necessary to obtain any approvals or consents of any Governmental
Authority or any other Person therefor, then, upon the reasonable request of
the Mortgagee, the Mortgagor agrees to use its reasonable efforts to assist and
aid the Mortgagee to obtain as soon as practicable any necessary approvals or
consents for the exercise of any such remedies, rights and powers.  In the event the Mortgagor shall fail
(i) within ten (10) Business Days after demand, to execute or take any
action required to be executed or taken by the Mortgagor under this Section 13.2
to the extent same is necessary to maintain perfection of the Lien granted to
Mortgagee hereunder or (ii) such failure shall constitute an Event of Default,
to execute or take any action required to be executed or taken by the Mortgagor
under this Section 13.2 (other than the type described in clause
(i) of this sentence) then, in each of the cases described in clauses (i) and
(ii) of this sentence, the Mortgagee may execute or take the same as the
attorney-in-fact for the Mortgagor, such power of attorney being coupled with
an interest and is irrevocable.

 

SECTION 13.3  Additional Security.  Without notice to or consent of the Mortgagor
and without impairment of the Lien and rights created by this Mortgage, the
Mortgagee may accept (but the Mortgagor shall not be obligated to furnish) from
the Mortgagor or from any other Person, additional security for the Secured Obligations.  Neither the giving hereof nor the acceptance
of any such additional security shall prevent the Mortgagee from resorting,
first, to such additional security, and, second, to the security created by
this Mortgage without affecting the Mortgagee’s Lien and rights under this
Mortgage.

 

ARTICLE XIV

 

MISCELLANEOUS

 

SECTION 14.1  Covenants To Run with the Land.  All of the grants, covenants, terms,
provisions and conditions in this Mortgage shall run with the Land and shall
apply to, and bind the successors

 

32

 

and assigns of, the Mortgagor.  If there shall be more than one mortgagor
with respect to the Mortgaged Property, the covenants and warranties hereof
shall be joint and several.

 

SECTION 14.2  No Merger.  The rights and estate created by this
Mortgage shall not, under any circumstances, be held to have merged into any
other estate or interest now owned or hereafter acquired by the Mortgagee
unless the Mortgagee shall have consented to such merger in writing, such
consent not to be unreasonably withheld.

 

SECTION 14.3  Concerning Mortgagee.

 

(i)                                     The
Mortgagee has been appointed as trustee pursuant to the Indenture.  The actions of the Mortgagee hereunder are
subject to the provisions of the Indenture. 
The Mortgagee shall have the right hereunder to make demands, to give
notices, to exercise or refrain from exercising any rights, and to take or
refrain from taking action (including, without limitation, the release or
substitution of the Mortgaged Property), in accordance with this Mortgage and
the Indenture.  The Mortgagee may employ
agents and attorneys-in-fact in connection herewith and shall not be liable for
the negligence or misconduct of any such agents or attorneys-in-fact selected
by it in good faith.  The Mortgagee may
resign and a successor Mortgagee may be appointed in the manner provided in the
Indenture.  Upon the acceptance of any
appointment as the Mortgagee by a successor Mortgagee, that successor Mortgagee
shall thereupon succeed to and become vested with all the rights, powers,
privileges and duties of the retiring Mortgagee under this Mortgage, and the
retiring Mortgagee shall thereupon be discharged from its duties and
obligations under this Mortgage.  After
any retiring Mortgagee’s resignation, the provisions hereof shall inure to its
benefit as to any actions taken or omitted to be taken by it under this
Mortgage while it was the Mortgagee.

 

(ii)                                  The
Mortgagee shall be deemed to have exercised reasonable care in the custody and
preservation of the Mortgaged Property in its possession if such Mortgaged
Property is accorded treatment substantially equivalent to that which the
Mortgagee, in its individual capacity, accords its own property consisting of
similar instruments or interests, it being understood that neither the
Mortgagee nor any of the Secured Parties shall have responsibility for taking
any necessary steps to preserve rights against any Person with respect to any
Mortgaged Property.

 

(iii)                               The
Mortgagee shall be entitled to rely upon any written notice, statement,
certificate, order or other document or any telephone message believed by it to
be genuine and correct and to have been signed, sent or made by the proper
person, and, with respect to all matters pertaining to this Mortgage and its
duties hereunder, upon advice of counsel selected by it.

 

(iv)                              If
any portion of the Mortgaged Property also constitutes collateral granted to
the Mortgagee under any other deed of trust, mortgage, security agreement,
pledge or instrument of any type, in the event of any conflict between the
provisions hereof and the provisions of such other deed of trust, mortgage,
security agreement, pledge or instrument of any type in respect of such
collateral, the Mortgagee, in its sole discretion, shall select which provision
or provisions shall control.

 

SECTION 14.4  Mortgagee May Perform; Mortgagee Appointed
Attorney-in-Fact.  If the Mortgagor
shall fail to perform any covenants contained in this Mortgage, subject to any
applicable grace periods or contest rights permitted pursuant to Article IX
hereof or as otherwise permitted by any Collateral Document (including, without
limitation, the Mortgagor’s covenants to (i) pay the premiums in respect of

 

33

 

all required insurance policies hereunder, (ii) pay
Charges, (iii) make repairs, (iv) discharge Liens or (v) pay or perform any
obligations of the Mortgagor under any Mortgaged Property) or if any warranty
on the part of the Mortgagor contained herein shall be breached, the Mortgagee
may (but shall not be obligated to) do the same or cause it to be done or
remedy any such breach, and may expend funds for such purpose; provided,
however, that the Mortgagee shall in no event be bound to inquire into
the validity of any tax, Lien, imposition or other obligation which the
Mortgagor fails to pay or perform as and when required hereby and which the
Mortgagor does not contest in accordance with the provisions of Article IX
hereof.  Any and all amounts reasonably
so expended by the Mortgagee shall be paid by the Mortgagor in accordance with
the provisions of Section 14.5 hereof.  Neither the provisions of this Section 14.4
nor any action taken by the Mortgagee pursuant to the provisions of this Section 14.4
shall prevent any such failure to observe any covenant contained in this
Mortgage nor any breach of warranty from constituting an Event of Default.  Upon the occurrence and during the
continuance of an Event of Default the Mortgagor hereby appoints the Mortgagee
its attorney-in-fact, with full authority in the place and stead of the
Mortgagor and in the name of the Mortgagor to take any action and to execute
any instrument consistent with the terms hereof and the other Collateral
Documents which the Mortgagee may deem necessary or advisable to accomplish the
purposes hereof.  The foregoing grant of
authority is a power of attorney coupled with an interest and such appointment
shall be irrevocable for the term hereof. 
The Mortgagor hereby ratifies all that such attorney shall lawfully do
or cause to be done by virtue hereof.

 

SECTION 14.5  Expenses  The Mortgagor will upon demand pay to the
Mortgagee the amount of any and all reasonable costs and expenses, including
the reasonable fees and expenses of its counsel and the reasonable fees and
expenses of any experts and agents which the Mortgagee may incur in connection
with (i) any action, suit or other proceeding affecting the Mortgaged Property
or any part thereof commenced, in which action, suit or proceeding the Mortgagee
is made a party or participates or in which the right to use the Mortgaged
Property or any part thereof is threatened, or in which it becomes necessary in
the judgment of the Mortgagee to defend or uphold the Lien hereof (including,
without limitation, any action, suit or proceeding to establish or uphold the
compliance of the Mortgaged Property with any Requirements of Law),
(ii) the collection of the Secured Obligations, (iii) the enforcement
and administration hereof, (iv) the custody or preservation of, or the sale of,
collection from, or other realization upon, any of the Mortgaged Property, (v)
the exercise or enforcement of any of the rights of the Mortgagee or any
Secured Party hereunder or (vi) the failure by the Mortgagor to perform or
observe any of the provisions hereof. 
All amounts expended by the Mortgagee and payable by the Mortgagor under
this Section 14.5 shall be due upon demand therefor (together with
interest thereon accruing at the Default Rate during the period from and
including the date on which such funds were so expended to the date of
repayment) and shall be part of the Secured Obligations.  The Mortgagor’s obligations under this Section 14.5
shall survive the termination hereof and the discharge of the Mortgagor’s other
obligations under this Mortgage.

 

SECTION 14.6  Indemnity.

 

(i)                                     The
Mortgagor agrees to indemnify, pay and hold harmless the Mortgagee and each of
the other Secured Parties and the officers, directors, employees, agents and
Affiliates of the Mortgagee and each of the other Secured Parties
(collectively, the “Indemnitees”) from and against any and all other
liabilities, obligations, losses, damages, penalties, actions, judgments,
suits, claims, costs (including, without limitation, settlement costs),
expenses or disbursements of any kind or nature whatsoever (including, without
limitation, the reasonable fees and disbursements of counsel for such
Indemnitees in connection with any investigative, administrative or judicial
proceeding, commenced or threatened, whether or not

 

34

 

such Indemnitee shall be designated a party thereto),
which may be imposed on, incurred by or asserted against that Indemnitee, in
any manner relating to or arising out hereof, the Indenture, the Notes, any
other Collateral Document or any other document evidencing the Secured
Obligations (including, without limitation, any misrepresentation by the
Mortgagor in this Mortgage, the Indenture, the Notes, any other Collateral
Document or any other document evidencing the Secured Obligations (the “Indemnified
Liabilities”); provided, however, that the Mortgagor shall
have no obligation to an Indemnitee hereunder with respect to Indemnified
Liabilities to the extent it has been determined by a final decision (after all
appeals and the expiration of time to appeal) by a court of competent
jurisdiction that such Indemnified Liabilities arose from the gross negligence
or willful misconduct of that Indemnitee. 
To the extent that the undertaking to indemnify, pay and hold harmless
set forth in the preceding sentence may be unenforceable because it is
violative of any law or public policy, the Mortgagor shall contribute the
maximum portion which it is permitted to pay and satisfy under applicable law,
to the payment and satisfaction of all Indemnified Liabilities incurred by the
Indemnitees or any of them.

 

(ii)                                  Survival.  The obligations of the Mortgagor contained in
this Section 14.6 shall survive the termination hereof and the
discharge of the Mortgagor’s other obligations under this Mortgage, the
Indenture and the other Collateral Documents.

 

(iii)                               Reimbursement.  Any amount paid by any Indemnitee as to which
such Indemnitee has the right to reimbursement shall constitute Secured
Obligations secured by the Mortgaged Property.

 

SECTION 14.7  Continuing Security Interest; Assignment.  This Mortgage shall create a continuing Lien
on and security interest in the Mortgaged Property and shall (i) be
binding upon the Mortgagor, its respective successors and assigns and
(ii) inure, together with the rights and remedies of the Mortgagee
hereunder, to the benefit of the Mortgagee and the other Secured Parties and
each of their respective successors, transferees and assigns.  No other Persons (including, without
limitation, any other creditor of Mortgagor) shall have any interest herein or
any right or benefit with respect hereto. 
Without limiting the generality of the foregoing clause (ii), any
Holder of the Notes may assign or otherwise transfer any indebtedness held by
it that is secured by this Mortgage to any other Person, and such other Person
shall thereupon become vested with all the benefits in respect thereof granted
to such Holder, herein or otherwise, subject however, to the provisions of the
Indenture.

 

SECTION 14.8  Termination; Release.  The Mortgaged Property shall be released from
the Lien of this Mortgage in accordance with the provisions of Article 10
of the Indenture.

 

SECTION 14.9  Modification in Writing.  No amendment, modification, supplement,
termination or waiver of or to any provision hereof, nor consent to any
departure by the Mortgagor therefrom, shall be effective unless the same shall
be done in accordance with the terms of the Indenture and unless in writing and
signed by the Mortgagee and Mortgagor. 
Any amendment, modification or supplement of or to any provision hereof,
any waiver of any provision hereof and any consent to any departure by the
Mortgagor from the terms of any provision hereof shall be effective only in the
specific instance and for the specific purpose for which made or given.  Except where notice is specifically required
by this Mortgage or any other Collateral Document, no notice to or demand on
the Mortgagor in any case shall entitle the Mortgagor to any other or further
notice or demand in similar or other circumstances.

 

35

 

SECTION 14.10  Notices.  Unless otherwise provided herein or in the
Indenture, any notice or other communication herein required or permitted to be
given shall be given in the manner and become effective as set forth in the
Indenture, if to the Mortgagor, addressed to it at the address of the Issuer
set forth in the Indenture, and as to the Mortgagee, addressed to it at its
address set forth in the Indenture, or in each case at such other address as
shall be designated by such party in a written notice to the other party
complying as to delivery with the terms of this Section 14.10.

 

SECTION 14.11  GOVERNING LAW; SERVICE OF PROCESS; WAIVER
OF JURY TRIAL.  THIS MORTGAGE SHALL
BE GOVERNED BY, AND SHALL BE CONSTRUED AND ENFORCED IN ACCORDANCE WITH, THE
LAWS OF THE STATE IN WHICH THE PREMISES ARE LOCATED, WITHOUT REGARD TO
PRINCIPLES OF CONFLICTS OF LAWS, EXCEPT TO THE EXTENT THAT THE VALIDITY OR
PERFECTION OF THE SECURITY INTEREST HEREUNDER, OR REMEDIES HEREUNDER, IN
RESPECT OF ANY PARTICULAR ITEM OR TYPE OF MORTGAGED PROPERTY ARE GOVERNED BY
THE LAWS OF A JURISDICTION OTHER THAN SUCH STATE.  THE MORTGAGOR AGREES THAT SERVICE OF PROCESS
IN ANY PROCEEDING MAY BE EFFECTED BY MAILING A COPY THEREOF BY REGISTERED OR
CERTIFIED MAIL (OR ANY SUBSTANTIALLY SIMILAR FORM OF MAIL), POSTAGE PREPAID, TO
THE ISSUER AT ITS ADDRESS SET FORTH IN THE INDENTURE OR AT SUCH OTHER ADDRESS
OF WHICH THE MORTGAGEE SHALL HAVE BEEN NOTIFIED PURSUANT THERETO.  IF ANY AGENT APPOINTED BY THE MORTGAGOR
REFUSES TO ACCEPT SERVICE, THE MORTGAGOR HEREBY AGREES THAT SERVICE UPON IT BY
MAIL SHALL CONSTITUTE SUFFICIENT NOTICE. 
NOTHING HEREIN SHALL AFFECT THE RIGHT TO SERVE PROCESS IN ANY OTHER
MANNER PERMITTED BY LAW OR SHALL LIMIT THE RIGHT OF THE MORTGAGEE TO BRING
PROCEEDINGS AGAINST THE MORTGAGOR IN THE COURTS OF ANY OTHER JURISDICTION.  THE MORTGAGOR HEREBY IRREVOCABLY WAIVES ALL
RIGHT TO A TRIAL BY JURY IN ANY ACTION, PROCEEDING OR COUNTERCLAIM ARISING OUT
OF OR RELATING TO THIS AGREEMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY.

 

SECTION 14.12  Severability of Provisions.  Any provision hereof which is prohibited or
unenforceable in any jurisdiction shall, as to such jurisdiction, be
ineffective to the extent of such prohibition or unenforceability without
invalidating the remaining provisions hereof or affecting the validity or
enforceability of such provision in any other jurisdiction.

 

SECTION 14.13  Limitation on Interest Payable.  It is the intention of the parties to conform
strictly to the usury laws, whether state or Federal, that are applicable to
the transaction of which this Mortgage is a part.  All agreements between the Mortgagor and the
Mortgagee, whether now existing or hereafter arising and whether oral or
written, are hereby expressly limited so that in no contingency or event
whatsoever shall the amount paid or agreed to be paid by the Mortgagor for the
use, forbearance or detention of the money to be loaned or advanced under the Indenture
or any related document or for the payment or performance of any covenant or
obligation contained herein or in the Indenture or any related document exceed
the maximum amount permissible under applicable Federal or state usury laws.  If under any circumstances whatsoever fulfillment
of any such provision, at the time performance of such provision shall be due,
shall involve exceeding the limit of validity prescribed by law, then the
obligation to be fulfilled shall be reduced to the limit of such validity.  If under any circumstances the Mortgagor
shall have paid an amount deemed interest by applicable law, which would exceed
the highest lawful rate, such

 

36

 

amount that would be excessive interest under
applicable usury laws shall be applied to the reduction of the principal amount
owing in respect of the Secured Obligations and not to the payment of interest,
or if such excessive interest exceeds the unpaid balance of principal and any
other amounts due hereunder, the excess shall be refunded to the
Mortgagor.  All sums paid or agreed to be
paid for the use, forbearance or detention of the principal under any extension
of credit by the Mortgagee shall, to the extent permitted by applicable law,
and to the extent necessary to preclude exceeding the limit of validity
prescribed by law, be amortized, prorated, allocated and spread from the date
hereof until payment in full of the Secured Obligations so that the actual rate
of interest on account of such principal amounts is uniform throughout the term
hereof.

 

SECTION 14.14  Business Days.  In the event any time period or any date
provided in this Mortgage ends or falls on a day other than a Business Day,
then such time period shall be deemed to end and such date shall be deemed to
fall on the next succeeding Business Day, and performance herein may be made on
such Business Day, with the same force and effect as if made on such other day.

 

SECTION 14.15  Relationship.  The relationship of the Mortgagee to the
Mortgagor hereunder is strictly and solely that of lender and borrower and
mortgagor and mortgagee and nothing contained in the Indenture, the Notes, this
Mortgage or any other document or instrument now existing and delivered in
connection therewith or otherwise in connection with the Secured Obligations is
intended to create, or shall in any event or under any circumstance be
construed as creating a partnership, joint venture, tenancy-in-common, joint
tenancy or other relationship of any nature whatsoever between the Mortgagee
and the Mortgagor other than as lender and borrower and mortgagor and
mortgagee.

 

SECTION 14.16  Waiver of Stay.

 

(i)                                     The
Mortgagor agrees that in the event that the Mortgagor or any property or assets
of the Mortgagor shall hereafter become the subject of a voluntary or
involuntary proceeding under the Bankruptcy Code or the Mortgagor shall
otherwise be a party to any Federal or state bankruptcy, insolvency, moratorium
or similar proceeding to which the provisions relating to the automatic stay
under Section 362 of the Bankruptcy Code or any similar provision in any
such law is applicable, then, in any such case, whether or not the Mortgagee
has commenced foreclosure proceedings under this Mortgage, the Mortgagee shall
be entitled to relief from any such automatic stay as it relates to the
exercise of any of the rights and remedies (including, without limitation, any
foreclosure proceedings) available to the Mortgagee as provided in this
Mortgage, in any other Collateral Document or any other document evidencing the
Secured Obligations.

 

(ii)                                  The
Mortgagee shall have the right to petition or move any court having
jurisdiction over any proceeding described in Section 14.16(i)
hereof for the purposes provided therein, and the Mortgagor agrees (i) not to
oppose any such petition or motion and (ii) at the Mortgagor’s sole cost and
expense, to assist and cooperate with the Mortgagee, as may be requested by the
Mortgagee from time to time, in obtaining any relief requested by the
Mortgagee, including, without limitation, by filing any such petitions,
supplemental petitions, requests for relief, documents, instruments or other
items from time to time requested by the Mortgagee or any such court.

 

SECTION 14.17  No Credit for Payment of Taxes or
Impositions.  The Mortgagor shall not
be entitled to any credit against the principal, premium, if any, or interest
payable under the Indenture

 

37

 

or the Notes, and the Mortgagor shall not be entitled
to any credit against any other sums which may become payable under the terms
thereof or hereof, by reason of the payment of any Charge on the Mortgaged
Property or any part thereof.

 

SECTION 14.18  No Claims Against the Mortgagee.  Nothing contained in this Mortgage shall
constitute any consent or request by the Mortgagee, express or implied, for the
performance of any labor or services or the furnishing of any materials or
other property in respect of the Premises or any part thereof, nor as giving
the Mortgagor any right, power or authority to contract for or permit the
performance of any labor or services or the furnishing of any materials or
other property in such fashion as would permit the making of any claim against
the Mortgagee in respect thereof or any claim that any Lien based on the
performance of such labor or services or the furnishing of any such materials
or other property is prior to the Lien hereof.

 

SECTION 14.19  Obligations Absolute.  All obligations of the Mortgagor hereunder
shall be absolute and unconditional irrespective of:

 

(i)                                     any
bankruptcy, insolvency, reorganization, arrangement, readjustment, composition,
liquidation or the like of the Mortgagor, the Issuer or any other Guarantor;

 

(ii)                                  any
lack of validity or enforceability of the Indenture, the Notes or any other
agreement or instrument relating thereto;

 

(iii)                               any
change in the time, manner or place of payment of, or in any other term of, all
or any of the Secured Obligations, or any other amendment or waiver of or any
consent to any departure from the Indenture, the Notes or any other agreement
or instrument relating thereto;

 

(iv)                              any
exchange, release or non-perfection of any other collateral, or any release or
amendment or waiver of or consent to any departure from any guarantee, for all
or any of the Secured Obligations;

 

(v)                                 any
exercise or non-exercise, or any waiver of any right, remedy, power or
privilege under or in respect hereof, the Indenture, the Notes or any agreement
or instrument relating thereto except as specifically set forth in a waiver
granted pursuant to the provisions of Section 14.9 hereof; or

 

(vi)                              any
other circumstances which might otherwise constitute a defense available to, or
a discharge of, the Mortgagor.

 

SECTION 14.20  Last Dollars Secured.  This Mortgage secures only a portion of the
Indebtedness owing or which may become owing by the Mortgagor.  The parties agree that any payments or
repayments of such Indebtedness by the Mortgagor shall be and be deemed to be
applied first to the portion of the Indebtedness that is not secured hereby, it
being the parties’ intent that the portion of the Indebtedness last remaining
unpaid shall be secured hereby.

 

[REMAINDER OF THIS PAGE INTENTIONALLY LEFT BLANK]

 

38

 

THUS
DONE AND PASSED, on the day, month and year first written above, effective as
of the Effective Date, in the State and Parish aforesaid, by the undersigned
Mortgagor in the presence of the undersigned Notary and the undersigned
competent witnesses, who hereunto sign their names with Mortgagor after reading
of the whole.

 

 

	
  WITNESSES:

  	
   

  	
  MORTGAGOR:

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  JALOU EUNICE,
  LLC

  a Louisiana limited liability company

  
	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  /s/ Thomas E.
  Hamilton

  	
   

  	
   

  	
  By:

  	
  /s/ Ian M.
  Stewart

  	
   

  
	
  Printed Name:
  Thomas E. Hamilton

  	
   

  	
   

  	
  Ian M. Stewart

  
	
   

  	
   

  	
   

  	
  Authorized
  Officer

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  /s/ Sterling W.
  Dale, Jr.

  	
   

  	
   

  	
   

  
	
  Printed Name:
  Sterling W. Dale, Jr.

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  /s/ Perryann P.
  Whitehurst

  	
   

  
	
  Notary
  Public

  
									

 

 

Schedule A

 

Legal Description

 

A CERTAIN LOT OR PARCEL
OF GROUND, situated in Section 28, Township 6 South, Range 1 East, St.
Landry Parish, Louisiana, being designated as LOT “B” on a map of subdivision
of the remaining portion of the Joseph Y. Nagata Property, a copy of which map
is of record in the official records of St. Landry Parish, Louisiana, said lot
being more particularly described as follows:

 

COMMENCING AT THE SOUTHWEST CORNER OF SECTION 28,
T6S-R1E THENCE RUN NORTH ALONG THE WEST LINE OF SECTION 28 A DISTANCE OF
129.00’ TO THE INTERSECTION OF THE NORTHERLY RIGHT OF WAY LINE OF US
HIGHWAY 190 AND THE WESTERLY RIGHT OF WAY LINE OF INDUSTRIAL PARK LANE; THENCE
ALONG THE NORTHERLY RIGHT-OF-WAY LINE OF US HIGHWAY 190 SOUTH 89°51’18” EAST A
DISTANCE OF 60.30’ TO THE POINT OF BEGINNING ON THE EASTERLY RIGHT-OF-WAY LINE
OF INDUSTRIAL PARK LANE; THENCE ALONG THE SAID EASTERLY RIGHT-OF-WAY LINE NORTH
00°05’02” EAST A DISTANCE OF 478.58’ TO A POINT AND TURN; THENCE NORTH 89°58’42”
EAST A DISTANCE OF 530.21’ TO A POINT AND TURN; THENCE SOUTH 27°14’14” EAST A
DISTANCE OF 115.24’ TO A POINT AND TURN; THENCE NORTH 62°43’40” EAST A DISTANCE
56.70’ TO A POINT AND TURN; THENCE SOUTH 25°44’02” EAST A DISTANCE OF 70.00’ TO
A POINT AND TURN; THENCE SOUTH A DISTANCE OF 340.93’ TO A POINT AND TURN ON THE
NORTHERLY RIGHT-OF-WAY LINE OF US HIGHWAY 190; THENCE ALONG SAID NORTHERLY
RIGHT-OF-WAY LINE NORTH 89°15’18” WEST A DISTANCE OF 664.45’ BACK TO THE POINT
OF BEGINNING, CONTAINING WITHIN SAID BOUNDS 7.070 ACRES OR 307,969 SQ. FT. MORE
OR LESS.

 

 

Schedule B

 

Prior Liens

 

1.               Each
of the liens and other encumbrances excepted as being prior to the Lien hereof
as set forth in Schedule B to the marked title insurance commitment issued
by Lawyers Title Insurance Corporation, dated as of the date hereof and
delivered to the Trustee on the date hereof, bearing Lawyers Title Insurance
Corporation reference number 40888/ dd relating to the real property described
in Schedule A attached hereto.

 

 

2.               Zoning
and building ordinances and regulations, to the extent they constitute
Permitted Liens of the type described in clause (4) of the definition thereof.

 

41

 

Schedule C

 

Leases Affecting the
Mortgaged Property

 

None

 

 

Exhibit 1

 

FORM OF SUBORDINATION,
NON-DISTURBANCE

AND ATTORNMENT AGREEMENT

 

THIS SUBORDINATION, NON-DISTURBANCE AND ATTORNMENT
AGREEMENT (the “Agreement”) is made and entered into as of the       
day of          ,                       by
and between                                             ,
as trustee, having an office at                                    
(in such capacity, “Trustee”), and                                       ,
having an office at                                        
(“Tenant”).

 

R  E
C  I  T  A  L  S:

 

A.  Tenant is
the tenant under a certain lease dated                   ,
            
between                                            ,
as landlord (“Landlord”), and Tenant, as tenant (as amended through the date
hereof, the “Lease”), pursuant to which Tenant leased a portion (the “Leased
Premises”) of the property known as                                          ,
located at                                              ,
as more particularly described in Schedule A attached hereto (the “Property”).

 

B.  Landlord has
or will grant a mortgage lien on and security interest in the Property to
Trustee (for its benefit and for the benefit of the holders of certain senior
secured notes and notes issued in exchange therefor pursuant to that certain
indenture dated as of [                               ,
2002]) pursuant to one or more mortgages, deeds of trust, deeds to secure debt
or similar security instruments (collectively, the “Security Instruments”).

 

C.  Tenant has
agreed to subordinate the Lease to the Security Instruments and to the lien
thereof and Trustee has agreed not to disturb Tenant’s possessory rights in the
Leased Premises under the Lease on the terms and conditions hereinafter set
forth.

 

A  G  R  E  E
M  E  N  T:

 

NOW, THEREFORE, the parties hereto mutually agree as
follows:

 

1.  Subordination.  Notwithstanding anything to the contrary set
forth in the Lease, the Lease and the leasehold estate created thereby and all
of Tenant’s rights thereunder are and shall at all times be subject and
subordinate in all respects to the Security Instruments and the lien thereof,
and to all rights of Trustee thereunder, and to any and all advances to be made
thereunder, and to all renewals, modifications, consolidations, replacements
and extensions thereof.

 

2.  Nondisturbance.  So long as Tenant complies with the
provisions of this Agreement, pays all rents and other charges as specified in
the Lease and is not otherwise in default (beyond applicable notice and cure
periods) of any of its obligations and covenants pursuant to the Lease, Trustee
agrees for itself and its successors in interest and for any other person
acquiring title to the Property through a foreclosure (an “Acquiring Party”),
that Tenant’s possession of the Leased Premises as described in the Lease will
not be disturbed during the term of the Lease by reason of a foreclosure.  For purposes of this Agreement, a

 

 

“foreclosure” shall include (but not be limited to) a
sheriff’s or trustee’s sale under the power of sale contained in the Security
Instruments, the termination of any superior lease of the Property and any
other transfer of the Landlord’s interest in the Property under peril of
foreclosure, including, without limitation to the generality of the foregoing,
an assignment or sale in lieu of foreclosure.

 

3.  Attornment.  Tenant agrees to attorn to, accept and
recognize any Acquiring Party as the landlord under the Lease pursuant to the
provisions expressly set forth therein for the then remaining balance of the
term of the Lease, and any extensions thereof as made pursuant to the
Lease.  The foregoing provision shall be
self-operative and shall not require the execution of any further instrument or
agreement by Tenant as a condition to its effectiveness.

 

4.  No Liability.
Notwithstanding anything to the contrary contained herein or in the Lease, it
is specifically understood and agreed that neither the Trustee, any receiver
nor any Acquiring Party shall be:

 

(a)  liable for any act,
omission, negligence or default of any prior landlord (including Landlord); or

 

(b)  liable for any failure of
any prior landlord (including Landlord) to construct any improvements or bound
by any covenant to construct any improvement either at the commencement of the
term of the Lease or upon any renewal or extension thereof or upon the addition
of additional space pursuant to any expansion right contained in the Lease; or

 

(c)  subject to any offsets,
credits, claims or defenses which Tenant might have against any prior landlord
(including Landlord); or

 

(d)  bound by any rent or
additional rent which is payable on a monthly basis and which Tenant might have
paid for more than one (1) month in advance to any prior landlord (including
Landlord) or by any security deposit or other prepaid charge which Tenant might
have paid in advance to any prior landlord (including Landlord); or

 

(e)  liable to Tenant hereunder
or under the terms of the Lease beyond its interest in the Property; or

 

(f)  bound by any assignment,
subletting, renewal, extension or any other agreement or modification of the
Lease made without the written consent of Trustee; or

 

(g)  bound by any consensual or
negotiated surrender, cancellation or termination of the Lease, in whole or in
part, agreed upon between Landlord and Tenant unless effected unilaterally by
Tenant pursuant to the express terms of the Lease.

 

Notwithstanding the foregoing, Tenant reserves its
right to any and all claims or causes of action (i) against such prior
landlord for prior losses or damages and (ii) against the successor
landlord for all losses or damages arising from and after the date that such
successor landlord takes title to the Property.

 

2

 

5.  Certain Acknowledgments
and Agreements by Tenant. 
(a) Tenant has notice that the Lease and the rents and all other
sums due thereunder have been assigned to Trustee as security for the notes
secured by the Security Instruments.  In
the event Trustee notifies Tenant of the occurrence of a default under the
Security Instruments and demands that Tenant pay its rents and all other sums
due or to become due under the Lease directly to Trustee, Tenant shall honor
such demand and pay its rent and all other sums due under the Lease directly to
Trustee or as otherwise authorized in writing by Trustee.  Landlord irrevocably authorizes Tenant to
make the foregoing payments to Trustee upon such notice and demand.

 

(b)  Tenant
shall send a copy of any and all notices or statements under the Lease to
Trustee at the same time such notices or statements are sent to Landlord.

 

(c)  This
Agreement satisfies any and all conditions or requirements in the Lease
relating to the granting of a non-disturbance agreement.

 

6.  Trustee to Receive Default
Notices.  Tenant shall notify Trustee
of any default by Landlord under the Lease which would entitle Tenant to cancel
the Lease, and agrees that, notwithstanding any provisions of the Lease to the
contrary, no notice of cancellation thereof shall be effective unless Trustee
shall have received notice of default giving rise to such cancellation and
shall have failed within sixty (60) days after receipt of such notice to cure
such default or, if such default cannot be cured within sixty (60) days, shall
have failed within sixty (60) days after receipt of such notice to commence and
thereafter diligently pursue any action necessary to cure such default.

 

7.  Estoppel.  Tenant hereby certifies and represents to
Trustee that as of the date of this Agreement:

 

(a)  the Lease is in full force
and effect;

 

(b)  all requirements for the
commencement and validity of the Lease have been satisfied and there are no
unfulfilled conditions to Tenant’s obligations under the Lease;

 

(c)  Tenant is not in default
under the Lease and has not received any uncured notice of any default by
Tenant under the Lease; to the best of Tenant’s knowledge, Landlord is not in
default under the Lease; no act, event or condition has occurred which with
notice or the lapse of time, or both, would constitute a default by Tenant or
Landlord under the Lease; no claim by Tenant of any nature exists against
Landlord under the Lease; and all obligations of Landlord have been fully
performed;

 

(d)  there are no defenses,
counterclaims or setoffs against rents or charges due or which may become due
under the Lease;

 

(e)  none of the rent which
Tenant is required to pay under the Lease has been prepaid, or will in the
future be prepaid, more than one (1) month in advance;

 

(f)  Tenant has no right or
option contained in the Lease or in any other document to purchase all or any
portion of the Leased Premises;

 

3

 

(g)  the Lease has not been
modified or amended and constitutes the entire agreement between Landlord and
Tenant relating to the Leased Premises;

 

(h)  Tenant has not assigned,
mortgaged, sublet, encumbered, conveyed or otherwise transferred any or all of
its interest under the Lease; and

 

(i)  Tenant has full authority to
enter into this Agreement, which has been duly authorized by all necessary
action.

 

8.  Notices.  All notices or other written communications
hereunder shall be deemed to have been properly given (i) upon delivery, if
delivered in person with receipt acknowledged by the recipient thereof, (ii)
one (1) Business Day (hereinafter defined) after having been deposited for
overnight delivery with any reputable overnight courier service, or (iii) three
(3) Business Days after having been deposited in any post office or mail
depository regularly maintained by the United States Postal Service and sent by
registered or certified mail, postage prepaid, return receipt requested,
addressed to the receiving party at its address set forth above or addressed as
such party may from time to time designate by written notice to the other
parties.  For purposes of this Section 8,
the term “Business Day” shall mean any day other than Saturday, Sunday or any
other day on which banks are required or authorized to close in New York, New
York.  Either party by notice to the
other may designate additional or different addresses for subsequent notices or
communications.

 

9.  Successors.  The obligations and rights of the parties
pursuant to this Agreement shall bind and inure to the benefit of the
successors, assigns, heirs and legal representatives of the respective parties;
provided, however, that in the event of the assignment or
transfer of the interest of Trustee, all obligations and liabilities of Trustee
under this Agreement shall terminate, and thereupon all such obligations and
liabilities shall be the responsibility of the party to whom Trustee’s interest
is assigned or transferred; and provided, further, that the
interest of Tenant under this Agreement may not be assigned or transferred
without the prior written consent of Trustee. 
In addition, Tenant acknowledges that all references herein to Landlord
shall mean the owner of the landlord’s interest in the Lease, even if said
owner shall be different from the Landlord named in the Recitals.

 

10.  Duplicate Original;
Counterparts.  This Agreement may be
executed in any number of duplicate originals and each duplicate original shall
be deemed to be an original.  This
Agreement may be executed in several counterparts, each of which counterparts
shall be deemed an original instrument and all of which together shall
constitute a single Agreement.

 

11.  Limitation of Trustee’s
Liability.  (a)  Trustee
shall have no obligations nor incur any liability with respect to any
warranties of any nature whatsoever, whether pursuant to the Lease or otherwise,
including, without limitation, any warranties respecting use, compliance with
zoning, Landlord’s title, Landlord’s authority, habitability, fitness for
purpose or possession.

 

(b)  In the
event that Trustee shall acquire title to the Leased Premises or the Property,
Trustee shall have no obligation, nor incur any liability, beyond Trustee’s
then equity interest, if any, in the Leased Premises, and Tenant shall look
exclusively to such equity interest of Trustee, if any, in the Leased Premises
for the payment and discharge of any obligations imposed upon Trustee hereunder
or under the Lease, and Trustee is hereby released and relieved of any other
obligations hereunder and under the Lease.

 

4

 

12.  Modification in Writing.  This Agreement may not be modified except by
an agreement in writing signed by the parties hereto or their respective
successors in interest.

 

13.  Lien of Security
Instruments.  Nothing contained in
this Agreement shall in any way impair or affect the lien created by the
Security Instruments or the provisions thereof.

 

14.  Compliance with Lease.  Tenant agrees that in the event there is any
inconsistency between the terms and provisions hereof and the terms and
provisions of the Lease, the terms and provisions hereof shall be controlling.

 

15.  Governing Law;
Severability.  This Agreement shall
be governed by the laws of the State of
[            ].  If any term of this Agreement or the
application thereof to any person or circumstances shall to any extent be
invalid or unenforceable, the remainder of this Agreement or the application of
such terms to any person or circumstances other than those as to which it is
invalid or unenforceable shall not be affected thereby, and each term of this
Agreement shall be valid and enforceable to the fullest extent permitted by
law.

 

16.  Further Actions.  Tenant agrees at its own expense to execute
and deliver, at any time and from time to time upon the request of Trustee or
any Acquiring Party, such documents and instruments (in recordable form, if
requested) as may be necessary or appropriate, in the opinion of Trustee or any
Acquiring Party, to fully implement or to further evidence the understandings
and agreements contained in this Agreement. 
Moreover, Tenant hereby irrevocably appoints and constitutes Trustee or
any Acquiring Party as its true and lawful attorney-in-fact to execute and
deliver any such documents or instruments which may be necessary or
appropriate, in the opinion of Trustee or any Acquiring Party, to implement or
further evidence such understandings and agreements and which Tenant, after
thirty (30) days’ notice from Trustee or any Acquiring Party, has failed to
execute and deliver.

 

5

 

IN WITNESS WHEREOF, Trustee and Tenant have duly
executed this Agreement as of the date first above written.

 

 

	
   

  	
   

  	
   

  	
  ,

  
	
   

  	
   

  	
  as Trustee

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
   

  	
  Title:

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  ,

  
	
   

  	
   

  	
  as Tenant

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
   

  	
  Title:

  

 

The undersigned, as the Landlord named in the
Recitals, having duly executed this Agreement as of the date first written above,
and as mortgagor, pledgor, assignor or debtor under the Security Instruments,
hereby accepts and agrees for itself and its successors and assigns,
(i) to be bound by the provisions of Section 5 hereof, (ii) that
nothing contained in the foregoing Agreement (x) shall in any way be
deemed to constitute a waiver by Trustee of any of its rights or remedies under
the Security Instruments or (y) shall in any way be deemed to release
Landlord from its obligations to comply with the terms, provisions, conditions,
covenants and agreements set forth in the Security Instruments and
(iii) that the provisions of the Security Instruments remain in full force
and effect and must be complied with by Landlord.

 

	
   

  	
   

  	
   

  	
  , a

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
   

  	
  Title:

  
						

 

 

ACKNOWLEDGMENT

 

	
  State of

  	
  )

  
	
  ) ss.:

  	
   

  
	
  County of

  	
  )

  

 

[Local counsel to provide appropriate acknowledgment]

 

 

SCHEDULE A to EXHIBIT 1

 

Description of Real Property

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