Document:

Exhibit 10.1

AMENDMENT TO
CONSULTING AGREEMENT

This Amendment (the “Amendment”) to the Consulting
Agreement by and between Ikanos Communications, Inc. (the “Company”) and Texan Ventures (“Consultant”), effective as of March 30, 2006 (the “Consulting
Agreement”), is made effective as of November 17, 2006, by and between the Company and Consultant.  Unless otherwise defined herein, capitalized
terms used in this Amendment shall have the same meaning as in the Consulting
Agreement.

WHEREAS, Consultant and the Company entered into the
Consulting Agreement; and

WHEREAS, Consultant and the Company hereby desire to
amend the Consulting Agreement to provide for adjustments in the compensation
to be paid pursuant to the Consulting Agreement as a result of a change in the
types of Services to be provided to the Company and the additional amount of
time Consultant will spend providing such Services.

NOW, THEREFORE, in consideration of the foregoing recitals and the
respective covenants and agreements of the parties contained in this Amendment,
the Company and Consultant agree to amend the Consulting Agreement as follows:

1.             Compensation.  Section 3.A. of Exhibit A to the
Consulting Agreement is hereby revised to provide that the Company will
compensate Consultant at the rate of $18,000.00 per month retroactive to
October 24, as long as G. Venkatesh continues to provide Services on
behalf of the Consultant and serves as the Company’s Executive Chairman of the
Board of Directors.

In addition, G.
Venkatesh, in his person capacity, will be granted a stock option to purchase
125,000 shares of the Company’s Common Stock at an exercise price per share
equal to the fair market value per share of such Common Stock on the date of
grant with the Vesting
Commencement Date to being on October 24, 2006 (the “Option”).  1/9th of the
shares subject to the Option shall vest on the one (1) month anniversary of the
Vesting Commencement Date, and 1/9th of the shares subject to the options
shall vest each month thereafter on the anniversary of the Vesting Commencement
Date thereafter, subject to the optionee contiuning to be the Executive
Chairman of the Board throughout each such date.  The Option will have such other terms
and conditions as the Company may determine and will otherwise be subject to
the terms, definitions and provisions of the Company’s 2004 Equity Incentive
Plan and the stock option agreement by and between Mr. Venkatesh and the
Company, both of which documents are incorporated herein by reference.  Consultant hereby consents to the granting of
the Option directly to Mr. Venkatesh and agrees and acknowledges that the
Company nor any of its officers, managers, supervisors, agents, employees or
affiliates has any liability whatsoever to Consultant as a result of the
Company granting the Option to Mr. Venkatesh and is not entitled to any
compensation, payment or other rights other than as set forth in the Consulting
Agreement, as amended hereby.

2.             Consulting Agreement.  To the extent not expressly amended hereby,
the Consulting Agreement shall remain in full force and effect.

 

3.             Entire Agreement.  This Amendment, taken together with the
Consulting Agreement, represents the entire agreement of the parties and will
supersede any and all previous contracts, arrangements or understandings
between the parties with respect to subject matter herein.  This Amendment may be amended at any time
only by mutual written agreement of the parties hereto.

4.             Counterparts.  This Amendment may be executed in
counterparts, and each counterpart will have the same force and effect as an
original and will constitute an effective, binding agreement on the part of
each of the undersigned.  Execution and
delivery of this Amendment by exchange of facsimile copies bearing the
facsimile signature of a party will constitute a valid and binding execution
and delivery of the Amendment by such party. 
Such facsimile copies will constitute enforceable original documents.

5.             Headings.  All captions and section headings used in
this Second Amendment are for convenient reference only and do not form a part
of this Amendment.

6.             Governing Law.  This Amendment will be governed by the laws
of the State of California (with the exception of its conflict of laws
provisions).

IN WITNESS WHEREOF, this amendment has been entered into as of the date
first set forth above.

	
  IKANOS COMMUNICATIONS, INC.

  	
   

  	
  TEXAN VENTURES

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  By:

  	
  /s/ Daniel K. Atler

  	
   

  	
  By:

  	
  /s/ G. Venkatesh

  
	
  Name:

  	
  Daniel K. Atler

  	
   

  	
  Name:

  	
  G. Venkatesh

  
	
  Title:

  	
  Interim Chief Executive
  Officer

  	
   

  	
  Title:

  	
  Managing Member

  
	
   

  	
   

  	
   

  	
   

  	
   

  

 

 2Exhibit 10.23

 

 

[Published CUSIP Number:     ]

 

FIRST LIEN CREDIT AGREEMENT

 

Dated as of November 14, 2006

 

among

 

PA Meadows, LLC,

as the Borrower,

 

BANK OF AMERICA, N.A.,

as Administrative Agent, Collateral Agent and L/C Issuer,

 

and

 

The Other Lenders Party Hereto

 

BANC OF AMERICA SECURITIES LLC and

MERRILL LYNCH, PIERCE, FENNER & SMITH INCORPORATED,

as Joint Lead Arrangers and Joint Book
Managers

 

 

 

TABLE
OF CONTENTS

 

	
  Section

  	
   

  	
  Page

  
	
   

  	
   

  
	
   

  	
   

  
	
  ARTICLE I

  	
   

  
	
  DEFINITIONS AND ACCOUNTING TERMS

  	
   

  
	
   

  	
   

  
	
  1.01.

  	
  Defined Terms

  	
  1

  
	
  1.02.

  	
  Other Interpretive Provisions

  	
  32

  
	
  1.03.

  	
  Accounting Terms

  	
  33

  
	
  1.04.

  	
  Rounding

  	
  33

  
	
  1.05.

  	
  Times of Day

  	
  33

  
	
  1.06.

  	
  Letter of Credit Amounts

  	
  33

  
	
  1.07.

  	
  Currency Equivalents Generally

  	
  34

  
	
   

  	
   

  
	
  ARTICLE II

  	
   

  
	
  THE COMMITMENTS AND CREDIT EXTENSIONS

  	
   

  
	
   

  	
   

  	
   

  
	
  2.01.

  	
  The Loans

  	
  34

  
	
  2.02.

  	
  Borrowings, Conversions and Continuations of Loans

  	
  35

  
	
  2.03.

  	
  Letters of Credit

  	
  36

  
	
  2.04.

  	
  [Reserved]

  	
  45

  
	
  2.05.

  	
  Prepayments

  	
  45

  
	
  2.06.

  	
  Termination or Reduction of Commitments

  	
  47

  
	
  2.07.

  	
  Repayment of Loans

  	
  48

  
	
  2.08.

  	
  Interest

  	
  49

  
	
  2.09.

  	
  Fees

  	
  50

  
	
  2.10.

  	
  Computation of Interest and Fees

  	
  50

  
	
  2.11.

  	
  Evidence of Debt

  	
  50

  
	
  2.12.

  	
  Payments Generally; Administrative Agent’s Clawback

  	
  51

  
	
  2.13.

  	
  Sharing of Payments by Lenders

  	
  53

  
	
   

  	
   

  	
   

  
	
  ARTICLE III

  	
   

  
	
  TAXES, YIELD PROTECTION AND ILLEGALITY

  	
   

  
	
   

  	
   

  	
   

  
	
  3.01.

  	
  Taxes

  	
  54

  
	
  3.02.

  	
  Illegality

  	
  56

  
	
  3.03.

  	
  Inability to Determine Rates

  	
  56

  
	
  3.04.

  	
  Increased Costs; Reserves on Eurodollar Rate Loans.

  	
  57

  
	
  3.05.

  	
  Compensation for Losses

  	
  58

  
	
  3.06.

  	
  Mitigation Obligations; Replacement of Lenders

  	
  59

  
	
  3.07.

  	
  Survival

  	
  59

  
	
   

  	
   

  	
   

  
	
  ARTICLE IV

  	
   

  
	
  CONDITIONS PRECEDENT TO CREDIT EXTENSIONS

  	
   

  
	
   

  	
   

  	
   

  
	
  4.01.

  	
  Conditions of Initial Credit Extension

  	
  59

  

 

i

 

	
   

  	
   

  	
  Page

  
	
   

  	
   

  	
   

  
	
  4.02.

  	
  Conditions to All Credit Extensions

  	
  66

  
	
   

  	
   

  	
   

  
	
  ARTICLE V

  	
   

  
	
  REPRESENTATIONS AND WARRANTIES

  	
   

  
	
   

  	
   

  	
   

  
	
  5.01.

  	
  Existence, Qualification and Power

  	
  67

  
	
  5.02.

  	
  Authorization; No Contravention

  	
  67

  
	
  5.03.

  	
  Governmental Authorization; Other Consents

  	
  68

  
	
  5.04.

  	
  Binding Effect

  	
  68

  
	
  5.05.

  	
  Financial Statements; No Material Adverse Effect; No Internal Control
  Event

  	
  68

  
	
  5.06.

  	
  Litigation

  	
  69

  
	
  5.07.

  	
  No Default

  	
  69

  
	
  5.08.

  	
  Liens; Investments

  	
  69

  
	
  5.09.

  	
  Environmental Compliance

  	
  70

  
	
  5.10.

  	
  Insurance

  	
  71

  
	
  5.11.

  	
  Taxes

  	
  71

  
	
  5.12.

  	
  ERISA Compliance

  	
  72

  
	
  5.13.

  	
  Subsidiaries; Equity Interests; Loan Parties

  	
  72

  
	
  5.14.

  	
  Margin Regulations; Investment Company Act; Public Utility Holding
  Company Act

  	
  73

  
	
  5.15.

  	
  Disclosure

  	
  73

  
	
  5.16.

  	
  Compliance with Laws

  	
  73

  
	
  5.17.

  	
  Intellectual Property; Licenses, Etc.

  	
  73

  
	
  5.18.

  	
  Solvency

  	
  74

  
	
  5.19.

  	
  [Intentionally Omitted]

  	
  74

  
	
  5.20.

  	
  Labor Matters

  	
  74

  
	
  5.21.

  	
  Collateral Documents

  	
  74

  
	
  5.22.

  	
  Gaming Matters

  	
  74

  
	
  5.23.

  	
  Project; Construction Contracts

  	
  74

  
	
   

  	
   

  	
   

  
	
  ARTICLE VI

  	
   

  
	
  AFFIRMATIVE COVENANTS

  	
   

  
	
   

  	
   

  	
   

  
	
  6.01.

  	
  Financial Statements

  	
  74

  
	
  6.02.

  	
  Certificates; Other Information

  	
  76

  
	
  6.03.

  	
  Notices

  	
  78

  
	
  6.04.

  	
  Payment of Obligations

  	
  79

  
	
  6.05.

  	
  Preservation of Existence, Etc.

  	
  80

  
	
  6.06.

  	
  Maintenance of Properties

  	
  80

  
	
  6.07.

  	
  Maintenance of Insurance

  	
  80

  
	
  6.08.

  	
  Compliance with Laws

  	
  80

  
	
  6.09.

  	
  Books and Records

  	
  80

  
	
  6.10.

  	
  Inspection Rights

  	
  81

  
	
  6.11.

  	
  Use of Proceeds

  	
  81

  
	
  6.12.

  	
  Covenant to Guarantee Obligations and Give Security

  	
  81

  

 

ii

 

	
   

  	
   

  	
  Page

  
	
   

  	
   

  	
   

  
	
  6.13.

  	
  Environmental Covenant

  	
  84

  
	
  6.14.

  	
  Preparation of Environmental Reports

  	
  84

  
	
  6.15.

  	
  Further Assurances

  	
  85

  
	
  6.16.

  	
  Compliance with Terms of Leaseholds

  	
  85

  
	
  6.17.

  	
  Interest Rate Hedging

  	
  85

  
	
  6.18.

  	
  Lien Searches

  	
  85

  
	
  6.19.

  	
  Material Contracts

  	
  86

  
	
  6.20.

  	
  Gaming Licenses

  	
  86

  
	
  6.21.

  	
  Cash Collateral Accounts

  	
  86

  
	
  6.22.

  	
  Holdback Agreement

  	
  86

  
	
  6.23.

  	
  Compliance with the Temporary Casino Construction Plans; Operating

  	
  86

  
	
  6.24.

  	
  Construction Covenants.

  	
  86

  
	
   

  	
   

  	
   

  
	
  ARTICLE VII

  	
   

  
	
  NEGATIVE COVENANTS

  	
   

  
	
   

  	
   

  	
   

  
	
  7.01.

  	
  Liens

  	
  87

  
	
  7.02.

  	
  Indebtedness

  	
  89

  
	
  7.03.

  	
  Investments

  	
  90

  
	
  7.04.

  	
  Fundamental Changes

  	
  91

  
	
  7.05.

  	
  Dispositions

  	
  92

  
	
  7.06.

  	
  Restricted Payments

  	
  92

  
	
  7.07.

  	
  Change in Nature of Business

  	
  93

  
	
  7.08.

  	
  Transactions with Affiliates

  	
  93

  
	
  7.09.

  	
  Burdensome Agreements

  	
  93

  
	
  7.10.

  	
  Use of Proceeds

  	
  94

  
	
  7.11.

  	
  Financial Covenants

  	
  94

  
	
  7.12.

  	
  Capital Expenditures

  	
  95

  
	
  7.13.

  	
  Amendments of Organization Documents

  	
  96

  
	
  7.14.

  	
  Accounting Changes

  	
  96

  
	
  7.15.

  	
  Prepayments, Etc. of Indebtedness

  	
  96

  
	
  7.16.

  	
  Amendment, Etc. of Related Documents and Indebtedness

  	
  96

  
	
  7.17.

  	
  Construction of the Project

  	
  96

  
	
  7.18.

  	
  Seller Holdback Amount

  	
  97

  
	
   

  	
   

  	
   

  
	
  ARTICLE VIII

  	
   

  
	
  EVENTS OF DEFAULT AND REMEDIES

  	
   

  
	
   

  	
   

  	
   

  
	
  8.01.

  	
  Events of Default

  	
  97

  
	
  8.02.

  	
  Remedies upon Event of Default

  	
  100

  
	
  8.03.

  	
  Application of Funds

  	
  101

  
	
   

  	
   

  	
   

  
	
  ARTICLE IX

  	
   

  
	
  ADMINISTRATIVE AGENT

  	
   

  
	
   

  	
   

  	
   

  
	
  9.01.

  	
  Appointment and Authority

  	
  102

  

 

iii

 

	
   

  	
   

  	
  Page

  
	
   

  	
   

  	
   

  
	
  9.02.

  	
  Rights as a Lender

  	
  102

  
	
  9.03.

  	
  Exculpatory Provisions

  	
  102

  
	
  9.04.

  	
  Reliance by Administrative Agent

  	
  103

  
	
  9.05.

  	
  Delegation of Duties

  	
  104

  
	
  9.06.

  	
  Resignation of Administrative Agent

  	
  104

  
	
  9.07.

  	
  Non-Reliance on Administrative Agent and Other Lenders

  	
  105

  
	
  9.08.

  	
  No Other Duties, Etc.

  	
  105

  
	
  9.09.

  	
  Administrative Agent May File Proofs of Claim

  	
  105

  
	
  9.10.

  	
  Collateral and Guaranty Matters

  	
  106

  
	
   

  	
   

  	
   

  
	
  ARTICLE X

  	
   

  
	
  [RESERVED]

  	
   

  
	
   

  	
   

  
	
  ARTICLE XI

  	
   

  
	
  MISCELLANEOUS

  	
   

  
	
   

  	
   

  	
   

  
	
  11.01.

  	
  Amendments, Etc.

  	
  107

  
	
  11.02.

  	
  Notices; Effectiveness; Electronic Communications

  	
  108

  
	
  11.03.

  	
  No Waiver; Cumulative Remedies

  	
  110

  
	
  11.04.

  	
  Expenses; Indemnity; Damage Waiver

  	
  111

  
	
  11.05.

  	
  Payments Set Aside

  	
  112

  
	
  11.06.

  	
  Successors and Assigns

  	
  113

  
	
  11.07.

  	
  Treatment of Certain Information; Confidentiality

  	
  117

  
	
  11.08.

  	
  Right of Setoff

  	
  118

  
	
  11.09.

  	
  Interest Rate Limitation

  	
  118

  
	
  11.10.

  	
  Counterparts; Integration; Effectiveness

  	
  118

  
	
  11.11.

  	
  Survival of Representations and Warranties

  	
  119

  
	
  11.12.

  	
  Severability

  	
  119

  
	
  11.13.

  	
  Replacement of Lenders

  	
  119

  
	
  11.14.

  	
  Governing Law; Jurisdiction; Etc.

  	
  120

  
	
  11.15.

  	
  Waiver of Jury Trial

  	
  121

  
	
  11.16.

  	
  No Advisory or Fiduciary Responsibility

  	
  121

  
	
  11.17.

  	
  USA PATRIOT Act Notice

  	
  122

  
	
  11.18.

  	
  Gaming Authorities

  	
  122

  
	
  11.19.

  	
  Removal of a Lender

  	
  122

  
	
  11.20.

  	
  Time of the Essence

  	
  122

  
	
  11.21.

  	
  ENTIRE AGREEMENT

  	
  122

  
	
   

  	
   

  	
   

  
	
  SIGNATURES

  	
   

  	
  S-1

  

 

iv

 

	
   

  	
   

  
	
  SCHEDULES

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  1.01

  	
  Guarantors

  	
   

  
	
  2.01

  	
  Commitments and Applicable Percentages

  	
   

  
	
  4.01(a)(iv)

  	
  Mortgaged Properties

  	
   

  
	
  5.01

  	
  Governmental Licenses

  	
   

  
	
  5.03

  	
  Certain Authorizations

  	
   

  
	
  5.05

  	
  Supplement to Interim Financial Statements

  	
   

  
	
  5.08(c)

  	
  Existing Liens

  	
   

  
	
  5.08(d)

  	
  Owned Real Property

  	
   

  
	
  5.08(e)(i)

  	
  Leased Real Property (Lessee)

  	
   

  
	
  5.08(e)(ii)

  	
  Leased Real Property (Lessor)

  	
   

  
	
  5.08(f)

  	
  Existing Investments

  	
   

  
	
  5.09

  	
  Environmental Matters

  	
   

  
	
  5.11

  	
  Tax Assessments

  	
   

  
	
  5.12

  	
  Unfunded Pension Liability

  	
   

  
	
  5.13

  	
  Subsidiaries and Other Equity Investments; Loan Parties

  	
   

  
	
  5.17

  	
  Intellectual Property Matters

  	
   

  
	
  5.20

  	
  Labor Matters

  	
   

  
	
  5.22

  	
  Gaming Matters

  	
   

  
	
  5.23

  	
  Construction Contracts

  	
   

  
	
  7.02

  	
  Existing Indebtedness

  	
   

  
	
  7.08

  	
  Transactions with Affiliates

  	
   

  
	
  7.09

  	
  Burdensome Agreements

  	
   

  
	
  11.02

  	
  Administrative Agent’s Office, Certain Addresses for Notices

  	
   

  
	
  11.06

  	
  Processing and Recordation Fees

  	
   

  
	
   

  	
   

  	
   

  
	
  EXHIBITS

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  Form of

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  A

  	
  Committed Loan Notice

  	
   

  
	
  B

  	
  Cash Collateral and Disbursement Agreement

  	
   

  
	
  C-1

  	
  Term Note

  	
   

  
	
  C-2

  	
  Revolving Credit Note

  	
   

  
	
  D

  	
  Compliance Certificate

  	
   

  
	
  E

  	
  Assignment and Assumption

  	
   

  
	
  F

  	
  Guaranty

  	
   

  
	
  G

  	
  Security Agreement

  	
   

  
	
  H

  	
  Mortgage

  	
   

  
	
  J-1

  	
  Opinion Matters – Counsel to Loan Parties

  	
   

  
	
  J-2

  	
  Opinion Matters – Local Counsel to Loan Parties

  	
   

  
	
  K

  	
  Intercreditor Agreement

  	
   

  
	
  L

  	
  Equity Guarantee

  	
   

  
	
  M

  	
  Management Fee Subordination Agreement

  	
   

  

 

v

 

CREDIT AGREEMENT

 

This FIRST LIEN CREDIT AGREEMENT (“Agreement”) is entered into
as of November 14, 2006, among PA
MEADOWS, LLC, a Delaware limited liability company (the “Borrower”),
each lender from time to time party hereto (collectively, the “Lenders”
and individually, a “Lender”) and BANK OF AMERICA, N.A., as
Administrative Agent, Collateral Agent and L/C Issuer. MERRILL LYNCH, PIERCE,
FENNER & SMITH INCORPORATED will act as Syndication Agent (the “Syndication
Agent”) under the Agreement.

 

PRELIMINARY STATEMENTS:

 

The Borrower has requested that the Lenders provide a term B loan
facility and a revolving credit facility, and the Lenders have indicated their
willingness to lend and the L/C Issuer has indicated its willingness to issue
Letters of Credit, in each case, on the terms and subject to the conditions set
forth herein.

 

In consideration of the mutual covenants and agreements herein
contained, the parties hereto covenant and agree as follows:

 

ARTICLE I

DEFINITIONS AND ACCOUNTING TERMS

 

1.01.        Defined Terms. As used in this
Agreement, the following terms shall have the meanings set forth below:

 

“Acquired Companies” means MEC Pennsylvania Racing, Inc., a
Pennsylvania corporation, Mountain Laurel Racing, Inc., a Delaware corporation,
Washington Trotting Association, Inc., a Delaware corporation, MEC Pennsylvania
Food Service, Inc., a Pennsylvania corporation, and MEC Racing Management, a
Pennsylvania partnership.

 

“Administrative Agent” means Bank of America in its capacity as
administrative agent under any of the Loan Documents, or any successor
administrative agent; provided, however, that for purposes of Section 9.03
the term “Administrative Agent” shall include the Syndication Agent, as such
term is defined in the introductory paragraph hereto.

 

“Administrative Agent’s Office” means the Administrative Agent’s
address and, as appropriate, account as set forth on Schedule 11.02, or
such other address or account as the Administrative Agent may from time to time
notify to the Borrower and the Lenders.

 

“Administrative Questionnaire” means an Administrative
Questionnaire in a form supplied by the Administrative Agent.

 

“Administrative Fee Letter” means the letter agreement dated
July 20, 2006, among the Borrower, the Administrative Agent and Banc of America
Securities LLC.

 

“Affiliate” means, with respect to any Person, another Person
that directly, or indirectly through one or more intermediaries, Controls or is
Controlled by or is under common Control with the Person specified.

 

“Aggregate Commitments” means the Commitments of all the
Lenders.

 

 

“Aggregate Credit Exposures” means, at any time, in respect of
(a) the Term B Facility, the aggregate amount of the Term B Loans
outstanding at such time and (b) in respect of the Revolving Credit
Facility, the sum of (i) the unused portion of the aggregate Revolving Credit
Commitments at such time and (ii) the Total Revolving Credit Outstandings at
such time.

 

“Agreement” means this Credit Agreement.

 

“Applicable Commitment Fee Percentage” means, at any time, in
respect of the Revolving Credit Facility, 0.50% per annum.

 

“Applicable Percentage” means (a) in respect of the
Term B Facility, with respect to any Term B Lender at any time, the
percentage (carried out to the ninth decimal place) of the Term B Facility
represented by (i) on or prior to the Closing Date, such Term B
Lender’s Term B Commitment at such time and (ii) thereafter, the
principal amount of such Term B Lender’s Term B Loans at such time
and (b) in respect of the Revolving Credit Facility, with respect to any
Revolving Credit Lender at any time, the percentage (carried out to the ninth
decimal place) of the aggregate Revolving Credit Commitments represented by such
Revolving Credit Lender’s Revolving Credit Commitment at such time. If the
commitment of each Revolving Credit Lender to make Revolving Credit Loans and
the obligation of the L/C Issuer to make L/C Credit Extensions have been
terminated pursuant to Section 8.02, or if the Revolving Credit
Commitments have expired, then the Applicable Percentage of each Revolving
Credit Lender in respect of the Revolving Credit Facility shall be determined
based on the Applicable Percentage of such Revolving Credit Lender in respect
of the Revolving Credit Facility most recently in effect, giving effect to any
subsequent assignments. The initial Applicable Percentage of each Lender in
respect of each Facility is set forth opposite the name of such Lender on Schedule
2.01 or in the Assignment and Assumption pursuant to which such Lender
becomes a party hereto, as applicable.

 

“Applicable Rate” means (a) in respect of the Revolving
Credit Facility, 2.00% per annum for Base Rate Loans and 3.00% per annum for
Eurodollar Rate Loans and (b) in respect of the Term B Facility,
2.00% per annum for Base Rate Loans and 3.00% per annum for Eurodollar Rate
Loans.

 

“Applicable Revolving Credit Percentage” means with respect to
any Revolving Credit Lender at any time, such Revolving Credit Lender’s
Applicable Percentage in respect of the Revolving Credit Facility at such time.

 

“Appropriate Lender” means, at any time, (a) with respect
to any of the Term B Facility or the Revolving Credit Facility, a Lender
that has a Commitment with respect to such Facility or holds a Term B Loan or a
Revolving Credit Loan, respectively, at such time and (b) with respect to
the Letter of Credit Sublimit, (i) the L/C Issuer and (ii) if any
Letters of Credit have been issued pursuant to Section 2.03(a), the Revolving
Credit Lenders.

 

“Approved Fund” means (i) any Fund that is administered or
managed by (a) a Lender, (b) an Affiliate of a Lender or (c) an entity or an
Affiliate of an entity that administers or manages a Lender and (ii) any
swap, special purpose vehicles purchasing or acquiring security 

 

2

 

interests in collateralized loan obligations or any other vehicle
through which a Lender may leverage its investments from time to time.

 

“Arrangers” means Banc of America Securities LLC and Merrill
Lynch, Pierce Fenner & Smith Incorporated, in their capacities as joint
lead arrangers and joint book managers.

 

“Assignee Group” means two or more Eligible Assignees that are
Affiliates of one another or two or more Approved Funds managed by the same
investment advisor.

 

“Assignment and Assumption” means an assignment and assumption
entered into by a Lender and an Eligible Assignee (with the consent of any
party whose consent is required by Section 11.06(b)), and accepted by
the Administrative Agent, in substantially the form of Exhibit E or any
other form approved by the Administrative Agent.

 

“Attributable Indebtedness” means, on any date, (a) in respect
of any Capitalized Lease of any Person, the capitalized amount thereof that
would appear on a balance sheet of such Person prepared as of such date in
accordance with GAAP and, (b) in respect of any Synthetic Lease Obligation, the
capitalized amount of the remaining lease or similar payments under the
relevant lease or other applicable agreement or instrument that would appear on
a balance sheet of such Person prepared as of such date in accordance with GAAP
if such lease or other agreement or instrument were accounted for as a
Capitalized Lease.

 

“Audited Financial Statements” means the audited consolidated
balance sheet of the Acquired Companies for the fiscal year ended
December 31, 2005, and the related combined statements of income or
operations, shareholders’ equity and cash flows for such fiscal year of the Acquired
Companies, including the notes thereto.

 

“Auto-Reinstatement Letter of Credit” has the meaning specified
in Section 2.03(b)(iv).

 

“Availability Period” means in respect of the Revolving Credit
Facility, the period from and including the Closing Date to the earliest of (i)
the Maturity Date for the Revolving Credit Facility, (ii) the date of
termination of the Revolving Credit Commitments pursuant to Section 2.06,
and (iii) the date of termination of the commitment of each Revolving Credit
Lender to make Revolving Credit Loans and of the obligation of the L/C Issuer
to make L/C Credit Extensions pursuant to Section 8.02.

 

“Bank of America” means Bank of America, N.A. and its
successors.

 

“Base Rate” means for any day a fluctuating rate per annum equal
to the higher of (a) the Federal Funds Rate plus 1/2 of 1% and (b) the
rate of interest in effect for such day as publicly announced from time to time
by Bank of America as its “prime rate.” 
The “prime rate” is a rate set by Bank of America based upon various
factors including Bank of America’s costs and desired return, general economic
conditions and other factors, and is used as a reference point for pricing some
loans, which may be priced at, above, or below such announced rate. Any change
in such rate announced by Bank of America shall take effect at the opening of
business on the day specified in the public announcement of such change.

 

3

 

“Base Rate Loan” means a Revolving Credit Loan or a Term B Loan
that bears interest based on the Base Rate.

 

“Borrower” has the meaning specified in the introductory
paragraph hereto.

 

“Borrower Materials” has the meaning specified in Section
6.02.

 

“Borrowing” means a Revolving Credit Borrowing or a Term B
Borrowing, as the context may require.

 

“Budget” means the budget for the design and construction of the
Project as a whole from the commencement of construction thereof through the
Completion Date that is prepared by the Borrowers and approved by the
Construction Consultant.

 

“Business Day” means any day other than a Saturday, Sunday or
other day on which commercial banks are authorized to close under the Laws of,
or are in fact closed in, the Commonwealth of Pennsylvania or the state where
the Administrative Agent’s Office is located and, if such day relates to any
Eurodollar Rate Loan, means any such day on which dealings in Dollar deposits
are conducted by and between banks in the London interbank eurodollar market.

 

“Capital Expenditures” means, with respect to any Person for any
period, any expenditure in respect of the purchase or other acquisition of any
fixed or capital asset (excluding normal replacements and maintenance which are
properly charged to current operations). For purposes of this definition, the
purchase price of equipment that is purchased simultaneously with the trade-in
of existing equipment or with insurance proceeds shall be included in Capital
Expenditures only to the extent of the gross amount by which such purchase
price exceeds the credit granted by the seller of such equipment for the
equipment being traded in at such time or the amount of such insurance
proceeds, as the case may be.

 

“Capitalized Leases” means all leases that have been or should
be, in accordance with GAAP, recorded as capitalized leases.

 

“Cash Collateral Account” means a blocked, non-interest bearing
deposit account of one or more of the Loan Parties at Bank of America (or
another commercial bank selected by the Administrative Agent) in the name of
the Administrative Agent and under the sole dominion and control of the
Administrative Agent, established as provided in Section 6.21 and
otherwise established in a manner satisfactory to the Administrative Agent.

 

“Cash Collateral and Disbursement Agreement” means the Cash
Collateral and Disbursement Agreement between Borrower and the Control Agent in
the form attached hereto as Exhibit B.

 

“Cash Collateralize” has the meaning specified in Section
2.03(g).

 

“Cash Equivalents” means any of the following types of
Investments, to the extent owned by the Borrower or any of its Subsidiaries
free and clear of all Liens (other than Liens created under the Collateral
Documents):

 

4

 

(a)           readily
marketable obligations issued or directly and fully guaranteed or insured by
the United States of America or any agency or instrumentality thereof; provided
that the full faith and credit of the United States of America is pledged in
support thereof;

 

(b)           time
deposits with, or insured certificates of deposit or bankers’ acceptances of,
any commercial bank that (i) (A) is a Lender or (B) is organized under the laws
of the United States of America, any state thereof or the District of Columbia
or is the principal banking subsidiary of a bank holding company organized
under the laws of the United States of America, any state thereof or the
District of Columbia, and is a member of the Federal Reserve System, (ii)
issues (or the parent of which issues) commercial paper rated as described in
clause (c) of this definition and (iii) has combined capital and surplus
of at least $1,000,000,000, in each case with maturities of not more than 180
days from the date of acquisition thereof;

 

(c)           commercial
paper issued by any Person organized under the laws of any state of the United
States of America and rated at least “Prime-1” (or the then equivalent grade)
by Moody’s or at least “A-1” (or the then equivalent grade) by S&P, in each
case with maturities of not more than 180 days from the date of acquisition
thereof; and

 

(d)           Investments,
classified in accordance with GAAP as current assets of the Borrower or any of
its Subsidiaries, in money market investment programs registered under the
Investment Company Act of 1940, which are administered by financial
institutions that have the highest rating obtainable from either Moody’s or
S&P, and the portfolios of which are limited solely to Investments of the
character, quality and maturity described in clauses (a), (b) and
(c) of this definition.

 

“Cash Management Agreement” means any agreement to provide cash
management services, including treasury, depository, overdraft, credit or debit
card, electronic funds transfer and other cash management arrangements.

 

“Cash Management Bank” means any Person that, at the time it
enters into a Cash Management Agreement, is a Lender, an Affiliate of a Lender,
in its capacity as a party to such Cash Management Agreement or a financial
institution reasonably acceptable to the Administrative Agent; provided
that such financial institution enters into a control agreement with the
Control Agent on terms reasonably acceptable to the Collateral Agent.

 

“Casualty Event” means any involuntary loss of title, any
involuntary loss of, damage to or any destruction of, or any condemnation or
other taking (including by any Governmental Authority) of, the Meadows Property
and any other material property of the Loan Parties and any of their
Subsidiaries, taken as a whole. “Casualty Event” shall include but not be
limited to any taking of all or any part of any real property of any person or
any part thereof, in or by condemnation or other eminent domain proceedings
pursuant to any requirement of Law, or by reason of they temporary requisition
of the use or occupancy of all or any part or any real property of any person
or any part thereof by any Governmental Authority, civil or military, or any
settlement in lieu thereof.

 

5

 

“CERCLA” means the Comprehensive Environmental Response,
Compensation and Liability Act of 1980.

 

“CERCLIS” means the Comprehensive Environmental Response,
Compensation and Liability Information System maintained by the U.S.
Environmental Protection Agency.

 

“Certificate of Occupancy” means a temporary or permanent
certificate of occupancy, in either case, for the Project issued by the
appropriate building department pursuant to applicable Laws which permanent or
temporary certificate of occupancy shall permit the Project to be used for its
intended purposes and shall be in full force and effect and, in the case of a
temporary certificate of occupancy, if such temporary certificate of occupancy
shall provide for an expiration date, any items which must be completed in
order for such temporary certificate of occupancy to be renewed or extended shall
be completed no later than 15 days prior to the applicable expiration date.

 

“CFC” means a Person that is a controlled foreign corporation
under Section 957 of the Code.

 

“Change in Law” means the occurrence, after the date of this
Agreement, of any of the following: (a) the adoption or taking effect of any
law, rule, regulation or treaty, (b) any change in any law, rule, regulation or
treaty or in the administration, interpretation or application thereof by any
Governmental Authority or (c) the making or issuance of any request, guideline
or directive (whether or not having the force of law) by any Governmental
Authority.

 

“Change of Control” means an event or series of events by which:

 

(a)           at
any time Cannery Casino Resorts, LLC (“CCR”) shall, directly or
indirectly, cease to hold 100% of the voting equity securities of the Borrower
(and taking into account all such securities that such person or group has the
right to acquire pursuant to any option right);

 

(b)           (i)
Mr. William Paulos and Mr. William Wortman collectively shall, directly or
indirectly, cease to hold 35% or more of the equity securities of CCR entitled
to vote for members of the board of directors or equivalent governing body of
CCR on a fully diluted basis (and taking into account all such securities that
such person or group has the right to acquire pursuant to any option right) or
(ii) OCM shall, directly or indirectly, cease to hold 33% or more of the equity
securities of CCR entitled to vote for members of the board of directors or equivalent
governing body of CCR on a fully diluted basis (and taking into account all
such securities that such person or group has the right to acquire pursuant to
any option right);

 

(c)           either
of Mr. William Paulos or Mr. William Wortman shall at any time cease to be a
member of the board of directors or other equivalent governing body of the
Borrower; provided that so long as Borrower is a sole member managed limited
liability company, no Change of Control shall be deemed to occur to the extent
that both Mr. William Paulos and Mr. William Wortman are members of the board
of directors or the equivalent governing body of CCR;

 

6

 

(d)           OCM
shall at any time cease to have at least two members of the board of directors
or other equivalent governing body of the Borrower; provided that so long as
Borrower is a sole member managed limited liability company, no Change of
Control shall be deemed to occur to the extent that OCM has at least two
members of the board of directors or the equivalent governing body of CCR;

 

(e)           Mr.
William Paulos, Mr. William Wortman and OCM shall at any time cease to hold the
power to appoint a majority of the members of the board of directors of the
Borrower; provided that so long as Borrower is a sole member managed limited
liability company, no Change of Control shall be deemed to occur to the extent
that Mr. William Paulos, Mr. William Wortman and OCM have the power to appoint
a majority of the board of directors or the equivalent governing body of CCR;
or

 

(f)            any
Person or two or more Persons acting in concert (other than Mr. William Paulos,
Mr. William Wortman, OCM and its Affiliates) shall have acquired by contract or
otherwise, or shall have entered into a contract or arrangement that, upon
consummation thereof, will result in its or their acquisition of the power to
exercise, directly or indirectly, a controlling influence over the management
or policies of CCR, or control over the equity securities of CCR entitled to
vote for members of the board of directors or equivalent governing body of CCR
on a fully diluted basis (and taking into account all such securities that such
Person or group has the right to acquire pursuant to any option right)
representing 15% or more of the combined voting power of such securities.

 

“Closing Date” means the first date all the conditions precedent
in Section 4.01 are satisfied or waived in accordance with Section
11.01.

 

“Code” means the Internal Revenue Code of 1986.

 

“Collateral” means all of the “Collateral”, “Mortgaged Property”
and “Trust Property” referred to in the Collateral Documents and all of the
other property that is or is intended under the terms of the Collateral
Documents to be subject to Liens in favor of the Administrative Agent for the benefit
of the Secured Parties. Notwithstanding any other provision hereof, no lien,
claim or encumbrance extends to, and “Collateral” does not include, (i) amounts
held in an account for the Commonwealth of Pennsylvania as specified by Chapter
14 of the Pennsylvania Race Horse Development and Gaming Act (Act 71) (4
Pa.C.S.A. § 1401, et seq.) and (ii)
Excluded Property.

 

“Collateral Agent” has the meaning specified in Section
9.01(b).

 

“Collateral Documents” means, collectively, the Security
Agreement, the Mortgages, each assignment of Construction Contracts, each of
the mortgages, collateral assignments, security agreements, pledge agreements
or other similar agreements delivered to the Administrative Agent pursuant to Sections
6.12 and 6.15, and each of the other agreements, instruments or
documents that creates or purports to create a Lien in favor of the
Administrative Agent for the benefit of the Secured Parties.

 

7

 

“Commitment” means a Term B Commitment or a Revolving
Credit Commitment, as the context may require.

 

“Committed Loan Notice” means a notice of (a) a Term Borrowing,
(b) a Revolving Credit Borrowing, (c) a conversion of Loans from one Type to
the other, or (d) a continuation of Eurodollar Rate Loans, pursuant to Section
2.02(a), which, if in writing, shall be substantially in the form of Exhibit
A.

 

“Completion Certificate” means a certificate executed by the
Borrower, the applicable Loan Party, General Contractor and Construction
Consultant stating that (i) the Project is completed and (ii) a Certificate of
Occupancy will be issued and the facility affected by the work is completely
operational.

 

“Completion Date” means the earlier of the date upon which the
Construction Contract contemplates completion of the Project, or the date a
Completion Certificate is issued for the Project executed by the Borrower, the
applicable Loan Party, General Contractor and Construction Consultant,
whichever shall first occur.

 

“Compliance Certificate” means a certificate substantially in
the form of Exhibit D.

 

“Consolidated Current Assets” means, with respect to any Person
at any date of determination, all assets of such Person and its Subsidiaries at
such date that should be classified as current assets on a consolidated balance
sheet of such Person, but excluding cash and Cash Equivalents.

 

“Consolidated Current Liabilities” means, with respect to any
Person at any date of determination, all liabilities of such Person and its
Subsidiaries at such date that should be classified as current liabilities on a
consolidated balance sheet of such Person, but excluding the sum of
(a) the principal amount of any current portion of long-term debt of such
Person and (b) (without duplication of clause (a) above) the then outstanding
principal amount of the Loans.

 

“Consolidated EBITDAM” means, at any date of determination, an
amount equal to Consolidated Net Income of the Borrower and its Subsidiaries on
a consolidated basis for the most recently completed Measurement Period plus
(a) the following to the extent deducted in calculating such Consolidated Net
Income:  (i) pre-opening expenses
relating to the Project , (ii) Consolidated Interest Charges, (iii)
depreciation and amortization expense, (iv) other expenses reducing such Consolidated
Net Income which do not represent a cash item in such period or any future
period, (v) the Management Compensation, (vi) the provision for Federal,
state, local and foreign income taxes payable, and (vii) other
extraordinary non-cash charges (paid or accruing) (in each case of or by the
Borrower and its Subsidiaries for such Measurement Period) and minus (b)
the following to the extent included in calculating such Consolidated Net
Income:  (i) all non-cash items
increasing Consolidated Net Income, (ii) interest income and (iii)
extraordinary gains (in each case of or by the Borrower and its Subsidiaries
for such Measurement Period).

 

“Consolidated Funded Indebtedness” means, as of any date of
determination, for the Borrower and its Subsidiaries on a consolidated basis,
the sum of (a) the outstanding principal 

 

8

 

amount of all obligations, whether current or long-term, for borrowed
money (including Obligations hereunder) and all obligations evidenced by bonds,
debentures, notes, loan agreements or other similar instruments, (b) all
purchase money Indebtedness, (c) all direct obligations arising under letters
of credit (including standby and commercial), bankers’ acceptances, bank
guaranties, surety bonds and similar instruments, (d) all obligations in
respect of the deferred purchase price of property or services (other than
trade accounts payable in the ordinary course of business and the Holdback
Amount), (e) all Attributable Indebtedness, (f) without duplication, all
Guarantees with respect to outstanding Indebtedness of the types specified in
clauses (a) through (e) above of Persons other than the Borrower or any
Subsidiary, and (g) all Indebtedness of the types referred to in clauses (a)
through (f) above of any partnership or joint venture (other than a joint
venture that is itself a corporation or limited liability company) in which the
Borrower or a Subsidiary is a general partner or joint venturer, unless such
Indebtedness is expressly made non-recourse to the Borrower or such Subsidiary.

 

“Consolidated Interest Charges” means, for any Measurement
Period, the sum of (a) all interest, premium payments, debt discount, fees,
charges and related expenses in connection with borrowed money (including capitalized
interest) or in connection with the deferred purchase price of assets, in each
case to the extent treated as interest in accordance with GAAP, (b) all
interest paid or payable with respect to discontinued operations and (c) the
portion of rent expense under Capitalized Leases that is treated as interest in
accordance with GAAP, in each case, of or by the Borrower and its Subsidiaries
on a consolidated basis for the most recently completed Measurement Period; provided
that Consolidated Interest Charges shall not include any Transaction fees or
expenses paid on the Closing Date regardless of the accounting treatment of
such fees or expenses.

 

“Consolidated Interest Coverage Ratio” means, as of any date of
determination, the ratio of (a) Consolidated EBITDAM to (b) Consolidated
Interest Charges, in each case, of or by the Borrower and its Subsidiaries on a
consolidated basis for the most recently completed Measurement Period; provided
that with respect to (i) the first Measurement Period after the Closing Date,
Consolidated EBITDAM and Consolidated Interest Charges for such Measurement
Period shall be multiplied by four (4), (ii) the second Measurement Period
after the Closing Date, Consolidated EBITDAM and Consolidated Interest Charges
for such Measurement Period shall be multiplied by two (2); (iii) the third
Measurement Period after the Closing Date, Consolidated EBITDAM and
Consolidated Interest Charges for such Measurement Period shall be multiplied
by one and one-third (11/3) and (iv) the Measurement
Period thereafter, Consolidated EBITDAM and Consolidated Interest Charges for
such Measurement Period shall be such amounts as otherwise set forth in
accordance with the definition of Measurement Period.

 

“Consolidated Leverage Ratio” means, as of any date of
determination, the ratio of (a) Consolidated Funded Indebtedness as of such
date to (b) Consolidated EBITDAM
of the Borrower and its Subsidiaries on a consolidated basis for the most
recently completed Measurement Period; provided that with respect to (i)
the first Measurement Period after the Closing Date, Consolidated Funded
Indebtedness and Consolidated EBITDAM for such Measurement Period shall be
multiplied by four (4), (ii) the second Measurement Period after the Closing
Date, Consolidated Funded Indebtedness and Consolidated EBITDAM for such
Measurement Period shall be multiplied by two (2), (iii) the third Measurement
Period after the Closing Date, Consolidated 

 

9

 

Funded Indebtedness and Consolidated EBITDAM for such Measurement
Period shall be multiplied by one and one-third (11/3)
and (iv) the Measurement Period thereafter, Consolidated Funded Indebtedness
and Consolidated EBITDAM for such Measurement Period shall be such amounts as
otherwise set forth in accordance with the definition of Measurement Period.

 

“Consolidated Net Income” means, at any date of determination,
the net income (or loss) of the Borrower and its Subsidiaries on a consolidated
basis for the most recently completed Measurement Period; provided that
Consolidated Net Income shall exclude (a) extraordinary gains and extraordinary
losses for such Measurement Period, (b) the net income of any Subsidiary during
such Measurement Period to the extent that the declaration or payment of
dividends or similar distributions by such Subsidiary of such income is not
permitted by operation of the terms of its Organization Documents or any
agreement, instrument or Law applicable to such Subsidiary during such
Measurement Period, except that the Borrower’s equity in any net loss of any
such Subsidiary for such Measurement Period shall be included in determining
Consolidated Net Income, and (c) any income (or loss) for such Period of any
Person if such Person is not a Subsidiary, except that the Borrower’s equity in
the net income of any such Person for such Measurement Period shall be included
in Consolidated Net Income up to the aggregate amount of cash actually
distributed by such Person during such Period to the Borrower or a Subsidiary
as a dividend or other distribution (and in the case of a dividend or other
distribution to a Subsidiary, such Subsidiary is not precluded from further
distributing such amount to the Borrower as described in clause (b) of this
proviso).

 

“Construction Consultant” means any Person designated from time
to time by the Administrative Agent to serve as the Construction Consultant
hereunder.

 

“Construction Contracts” means any and all contracts, written or
oral, between the Borrower, any applicable Loan Party and any Contractor and
any subcontractor and between any of the foregoing and any other person
(including, without limitation, any architect or engineer) relating in any way
to the construction of the Project, including the performing of labor or the
furnishing of standard or specially fabricated materials in connection
therewith or the preparation or furnishing of any drawings, renderings, plans,
design documents or other related items for the design, architecture or
construction of the Project.

 

“Construction Plans” has the meaning specified in Section
4.01(q).

 

“Contractor” means and includes any person or entity, including
any General Contractor, engaged to work on or furnish materials or supplies for
the Project.

 

“Contractual Obligation” means, as to any Person, any provision
of any security issued by such Person or of any agreement, instrument or other
undertaking to which such Person is a party or by which it or any of its
property is bound.

 

“Control” means the possession, directly or indirectly, of the power
to direct or cause the direction of the management or policies of a Person,
whether through the ability to exercise voting power, by contract or otherwise.
“Controlling” and “Controlled” have meanings correlative thereto.

 

10

 

“Control Agent” has the meaning specified in the Intercreditor
Agreement.

 

“Credit Extension” means each of the following:  (a) a Borrowing and (b) an L/C Credit
Extension.

 

“Debtor Relief Laws” means the Bankruptcy Code of the United
States, and all other liquidation, conservatorship, bankruptcy, assignment for
the benefit of creditors, moratorium, rearrangement, receivership, insolvency,
reorganization, or similar debtor relief Laws of the United States or other
applicable jurisdictions from time to time in effect and affecting the rights
of creditors generally.

 

“Default” means any event or condition that constitutes an Event
of Default or that, with the giving of any notice, the passage of time, or
both, would be an Event of Default.

 

“Default Rate” means (a) when used with respect to Obligations
other than Letter of Credit Fees, an interest rate equal to (i) the Base Rate plus
(ii) the Applicable Rate, if any, applicable to Base Rate Loans under the Term
B Facility plus (iii) 2% per annum; provided, however,
that with respect to a Eurodollar Rate Loan, the Default Rate shall be an
interest rate equal to the interest rate (including any Applicable Rate)
otherwise applicable to such Loan plus 2% per annum and (b) when used
with respect to Letter of Credit Fees, a rate equal to the Applicable Rate plus
2% per annum.

 

“Defaulting Lender” means any Lender that (a) has failed to fund
any portion of the Term B Loans, Revolving Credit Loans or participations in
L/C Obligations required to be funded by it hereunder within one Business Day
of the date required to be funded by it hereunder, (b) has otherwise failed to
pay over to the Administrative Agent or any other Lender any other amount
required to be paid by it hereunder within one Business Day of the date when
due, unless the subject of a good faith dispute, or (c) has been deemed
insolvent or become the subject of a bankruptcy or insolvency proceeding.

 

“Disposition” or “Dispose” means the sale, transfer,
license, lease or other disposition (including any sale and leaseback
transaction) of any property (exclusive of ordinary course gaming payout) by
any Person (or the granting of any option or other right to do any of the
foregoing), including any sale, assignment, transfer or other disposal, with or
without recourse, of any notes or accounts receivable or any rights and claims
associated therewith.

 

“Disqualification” means, with respect to any Lender:

 

(a)           the
failure of that Lender timely to file pursuant to applicable Gaming Laws (i) any
application requested of that Lender by any Gaming Authority in connection with
any licensing required of that Lender as a lender to the Loan Parties or (ii)
any required application or other papers in connection with determination of
the suitability of that Lender as a lender to the Loan Parties;

 

(b)           the
withdrawal of that Lender (except where requested or permitted by the
Gaming Board) of any such application or other required papers; or

 

11

 

(c)           any
final determination by a Gaming Authority pursuant to applicable Gaming Laws
(i) that such Lender is “unsuitable” as a lender to the Loan Parties, (ii) that
such Lender shall be “disqualified” as a lender to the Loan Parties or (iii)
denying the issuance to that Lender of any license required under applicable
Gaming Laws to be held by all lenders to the Loan Parties.

 

“Dollar” and “$” mean lawful money of the United States.

 

“Eligible Assignee” means any Person that meets the requirements
to be an assignee under Section 11.06(b)(iii), (v) and (vi)
(subject to such consents, if any, as may be required under Section 11.06(b)(iii)).

 

“Environmental Laws” means any and all Federal, state, local,
and foreign statutes, laws, regulations, ordinances, rules, judgments, orders,
decrees, permits, concessions, grants, franchises, licenses, agreements or
governmental restrictions relating to pollution and the protection of the
environment or the release of any materials into the environment, including
those related to hazardous substances or wastes, air emissions and discharges
to waste or public systems.

 

“Environmental Liability” means any liability, contingent or
otherwise (including any liability for damages, costs of environmental
remediation, fines, penalties or indemnities), of the Borrower, any other Loan
Party or any of their respective Subsidiaries directly or indirectly resulting
from or based upon (a) violation of any Environmental Law, (b) the generation,
use, handling, transportation, storage, treatment or disposal of any Hazardous
Materials, (c) exposure to any Hazardous Materials, (d) the release or
threatened release of any Hazardous Materials into the environment or (e) any
contract, agreement or other consensual arrangement pursuant to which liability
is assumed or imposed with respect to any of the foregoing.

 

“Environmental Permit” means any permit, approval,
identification number, license or other authorization required under any
Environmental Law.

 

“Equity Guarantee” means the Equity Guarantee to be dated the
Closing Date in the form attached hereto as Exhibit L.

 

“Equity Interests” means, with respect to any Person, all of the
shares of capital stock of (or other ownership or profit interests in) such
Person, all of the warrants, options or other rights for the purchase or
acquisition from such Person of shares of capital stock of (or other ownership
or profit interests in) such Person, all of the securities convertible into or
exchangeable for shares of capital stock of (or other ownership or profit interests
in) such Person or warrants, rights or options for the purchase or acquisition
from such Person of such shares (or such other interests), and all of the other
ownership or profit interests in such Person (including partnership, member or
trust interests therein), whether voting or nonvoting, and whether or not such
shares, warrants, options, rights or other interests are outstanding on any
date of determination.

 

“Equity Investors” means OCM, entities directly or indirectly
Controlled by OCM, entities directly or indirectly Controlled by Oaktree
Capital Management, LLC, 

 

12

 

Mr. William Paulos, Mr. William Wortman and entities directly or
indirectly Controlled by Mr. William Paulos and/or Mr. William Wortman.

 

“ERISA” means the Employee Retirement Income Security Act of
1974.

 

“ERISA Affiliate” means any trade or business (whether or not
incorporated) under common control with the Borrower within the meaning of
Section 414(b) or (c) of the Code (and Sections 414(m) and (o) of the Code for
purposes of provisions relating to Section 412 of the Code).

 

“ERISA Event” means (a) a Reportable Event with respect to a
Pension Plan; (b) a withdrawal by the Borrower or any ERISA Affiliate from a
Pension Plan subject to Section 4063 of ERISA during a plan year in which
it was a substantial employer (as defined in Section 4001(a)(2) of ERISA)
or a cessation of operations that is treated as such a withdrawal under Section
4062(e) of ERISA; (c) a complete or partial withdrawal by the Borrower or any
ERISA Affiliate from a Multiemployer Plan or notification that a Multiemployer
Plan is in reorganization; (d) the filing of a notice of intent to terminate,
the treatment of a Plan amendment as a termination under Section 4041 or 4041A
of ERISA, or the commencement of proceedings by the PBGC to terminate a Pension
Plan or Multiemployer Plan; (e) an event or condition which constitutes grounds
under Section 4042 of ERISA for the termination of, or the appointment of a
trustee to administer, any Pension Plan or Multiemployer Plan; or (f) the
imposition of any liability under Title IV of ERISA, other than for PBGC
premiums due but not delinquent under Section 4007 of ERISA, upon the Borrower
or any ERISA Affiliate.

 

“Eurodollar Rate” means, for any Interest Period with respect to
a Eurodollar Rate Loan, the rate per annum equal to the British Bankers
Association LIBOR Rate (“BBA LIBOR”), as published by Reuters (or other
commercially available source providing quotations of BBA LIBOR as designated
by the Administrative Agent from time to time) at approximately 11:00 a.m.,
London time, two Business Days prior to the commencement of such Interest
Period, for Dollar deposits (for delivery on the first day of such Interest
Period) with a term equivalent to such Interest Period. If such rate is not
available at such time for any reason, then the “Eurodollar Rate” for such
Interest Period shall be the rate per annum determined by the Administrative
Agent to be the rate at which deposits in Dollars for delivery on the first day
of such Interest Period in same day funds in the approximate amount of the
Eurodollar Rate Loan being made, continued or converted by Bank of America and
with a term equivalent to such Interest Period would be offered by Bank of
America’s London Branch to major banks in the London interbank eurodollar
market at their request at approximately 11:00 a.m. (London time) two Business
Days prior to the commencement of such Interest Period.

 

“Eurodollar Rate Loan” means a Revolving Credit Loan or a
Term B Loan that bears interest at a rate based on the Eurodollar Rate.

 

“Event of Default” has the meaning specified in Section 8.01.

 

“Excess Cash Flow” means, for any fiscal year of the Borrower,
the excess (if any) of (a) the sum (for such fiscal year) of (i) Consolidated
EBITDAM and (ii) the excess, if any, of the Working Capital of the Borrower at
the beginning of such fiscal year over the Working 

 

13

 

Capital of the Borrower at the end of such fiscal year over (b) the sum
(for such fiscal year) of (i) Consolidated Interest Charges actually paid in
cash by the Borrower and its Subsidiaries (less interest income and any prepaid
interest expense), (ii) scheduled principal repayments, to the extent actually
made, of (x) Term B Loans pursuant to Section 2.07(b) and (y) Indebtedness to
the extent incurred pursuant to the FF&E Financing, (iii) all income taxes
actually paid in cash by the Borrower and its Subsidiaries, (iv) Restricted Payments
made in accordance with Section 7.06(d), (v) Capital Expenditures (which
includes Maintenance Capital Expenditures and Expansion Capital Expenditures)
actually made by the Borrower and its Subsidiaries, (vi) the Management
Compensation paid by the Borrower and its Subsidiaries and (vii) the excess, if
any, of the Working Capital of the Borrower at the end of such fiscal year over
the Working Capital of the Borrower at the beginning of such fiscal year.

 

“Excluded Issuance” by the Borrower means an issuance and sale
of an Equity Interest in the Borrower to its sole member or the Equity
Investors, a capital contribution to the Borrower from its sole member or its
Equity Investors or an issuance of shares of capital stock of (or other
ownership or profit interests in) the Borrower upon the exercise of warrants,
options or other rights for the purchase of such capital stock (or other
ownership or profit interest).

 

“Excluded Property” has the meaning specified in Section 1.1(a)
of the Security Agreement.

 

“Excluded Taxes” means, with respect to the Administrative
Agent, any Lender, the L/C Issuer or any other recipient of any payment to be
made by or on account of any obligation of the Borrower hereunder, (a) taxes
imposed on or measured by its overall net income (however denominated), and
franchise taxes imposed on it (in lieu of net income taxes), by the
jurisdiction (or any political subdivision thereof) under the laws of which
such recipient is organized or in which its principal office is located or, in
the case of any Lender, in which its applicable Lending Office is located, (b)
any branch profits taxes imposed by the United States or any similar tax
imposed by any other jurisdiction in which the Borrower is located and (c) in
the case of a Foreign Lender (other than an assignee pursuant to a request by
the Borrower under Section 11.13), any U.S. federal withholding tax that
is imposed on amounts payable to such Foreign Lender at the time such Foreign
Lender becomes a party hereto (or designates a new Lending Office) or is
attributable to such Foreign Lender’s failure or inability (other than as a
result of a Change in Law) to comply with Section 3.01(e), except to the
extent that such Foreign Lender (or its assignor, if any) was entitled, at the
time of designation of a new Lending Office (or assignment), to receive
additional amounts from the Borrower with respect to such withholding tax
pursuant to Section 3.01.

 

“Expansion Capital Expenditure” means any Capital Expenditure by
the Borrower or any of its Restricted Subsidiaries that is not properly
characterized as a Maintenance Capital Expenditure, including, without
limitation, expenditures with respect to the buy-out of real property leases.

 

“Extraordinary Receipt” means any cash received by or paid to or
for the account of any Person not in the ordinary course of business, including
tax refunds, pension plan reversions, proceeds of insurance (other than
proceeds of business interruption insurance to the extent such proceeds
constitute compensation for lost earnings) and condemnation awards (and
payments 

 

14

 

in lieu thereof); provided, however, that an
Extraordinary Receipt shall not include cash receipts from proceeds of
insurance or condemnation awards (or payments in lieu thereof) to the extent
that such proceeds, awards or payments are applied (or in respect of which
expenditures were previously incurred) to replace or repair property in respect
of which such proceeds were received and shall not include indemnity payments
and purchase price adjustments from Seller.

 

“Facility” means the Term B Facility or the Revolving
Credit Facility, as the context may require.

 

“Federal Funds Rate” means, for any day, the rate per annum
equal to the weighted average of the rates on overnight Federal funds
transactions with members of the Federal Reserve System arranged by Federal
funds brokers on such day, as published by the Federal Reserve Bank of New York
on the Business Day next succeeding such day; provided that (a) if such
day is not a Business Day, the Federal Funds Rate for such day shall be such
rate on such transactions on the next preceding Business Day as so published on
the next succeeding Business Day, and (b) if no such rate is so published on
such next succeeding Business Day, the Federal Funds Rate for such day shall be
the average rate (rounded upward, if necessary, to a whole multiple of 1/100 of
1%) charged to Bank of America on such day on such transactions as determined
by the Administrative Agent.

 

“Fee Letter” means the letter agreement, dated July 20, 2006,
among the Borrower, the Administrative Agent, Merrill Lynch Capital Corporation
and the Arrangers.

 

“FF&E” means furniture, furnishings or equipment used in the
ordinary course of the business of the Borrower or a Guarantor.

 

“FF&E Financing” means Indebtedness the proceeds of which
are used solely to finance the acquisition by the Borrower or a Guarantor of,
or the entry into a Capitalized Lease by the Borrower or a Guarantor with
respect to, FF&E, in each case as amended, restated, modified, renewed,
refunded, replaced (whether upon or after termination or otherwise) or
refinanced in whole or in part from time to time.

 

“FIRREA” means the Financial Institutions Reform, Recovery and
Enforcement Act of 1989, as amended.

 

“Foreign Lender” means any Lender that is organized under the
laws of a jurisdiction other than that in which the Borrower is resident for
tax purposes. For purposes of this definition, the United States, each State
thereof and the District of Columbia shall be deemed to constitute a single
jurisdiction.

 

“FRB” means the Board of Governors of the Federal Reserve System
of the United States.

 

“Fund” means any Person (other than a natural person) that is
(or will be) engaged in making, purchasing, holding or otherwise investing in
commercial loans and similar extensions of credit in the ordinary course.

 

15

 

“GAAP” means generally accepted accounting principles in the
United States set forth in the opinions and pronouncements of the Accounting
Principles Board and the American Institute of Certified Public Accountants and
statements and pronouncements of the Financial Accounting Standards Board or
such other principles as may be approved by a significant segment of the
accounting profession in the United States, that are applicable to the
circumstances as of the date of determination, consistently applied.

 

“Gaming Authority” means any agency, authority, board, bureau,
commission, department, office or instrumentality of any nature whatsoever of
the federal government or any state, city or other political subdivision,
whether now or hereafter in existence, or any officer or official thereof, but
only to the extent that such agency, authority, board, bureau, commission,
department, office or instrumentality possesses authority to regulate any
gaming operation owned, managed or operated, or proposed to be owned, managed
or operated, by the Borrower or any of its Subsidiaries.

 

“Gaming Laws” means all applicable federal, state and local
laws, rules and regulations pursuant to which Gaming Authorities possess
regulatory, licensing or permit authority over the ownership or operation of
gaming facilities.

 

“Gaming License” means any finding of suitability, registration,
license, franchise or other approval or authorization issued by or from any
Gaming Authority under Gaming Laws that is required to own, lease, operate or
otherwise conduct or manage the gaming activities of the Borrower and its Subsidiaries
in any state or jurisdiction in which any Borrower or any of its Subsidiaries
conduct business.

 

“General Contractor” means (i) Borrower with respect to the
Project or (ii) any other Person who contracts for the construction of the
entire Project, rather than for a portion of the work relating thereto and
otherwise has the obligation to retain and pay subcontractors and coordinates
the work to be performed.

 

“Governmental Authority” means the government of the United
States or any other nation, or of any political subdivision thereof, whether
state or local, and any agency, authority, instrumentality, regulatory body,
court, central bank or other entity exercising executive, legislative,
judicial, taxing, regulatory or administrative powers or functions of or
pertaining to government (including any supra-national bodies such as the
European Union or the European Central Bank).

 

“Governmental Real Property Disclosure Requirements” means any
requirement of Law of any Governmental Authority requiring notification of the
buyer, lessee, mortgagee, assignee or other transferee of any real property,
facility, establishment or business, or notification, registration or filing to
or with any Governmental Authority, in connection with the sale, lease,
mortgage, assignment or other transfer (including any transfer or control) of
any real property, facility, establishment or business, of the actual or
threatened presence or release in or into the Environment, or the use, disposal
or handling of Hazardous Material on, at, under or near the real property,
facility, establishment or business to be sold, leased, mortgaged, assigned or
transferred.

 

16

 

“Guarantee” means, as to any Person, any (a) any obligation,
contingent or otherwise, of such Person guaranteeing or having the economic
effect of guaranteeing any Indebtedness or other obligation payable or
performable by another Person (the “primary obligor”) in any manner,
whether directly or indirectly, and including any obligation of such Person,
direct or indirect, (i) to purchase or pay (or advance or supply funds for the
purchase or payment of) such Indebtedness or other financial obligation, (ii)
to purchase or lease property, securities or services for the purpose of assuring
the obligee in respect of such Indebtedness or other obligation of the payment
or performance of such Indebtedness or other obligation, (iii) to maintain
working capital, equity capital or any other financial statement condition or
liquidity or level of income or cash flow of the primary obligor so as to
enable the primary obligor to pay such Indebtedness or other obligation, or
(iv) entered into for the purpose of assuring in any other manner the obligee
in respect of such Indebtedness or other obligation of the payment or financial
performance thereof or to protect such obligee against loss in respect thereof
(in whole or in part), or (b) any Lien on any assets of such Person securing
any Indebtedness or other obligation of any other Person, whether or not such
Indebtedness or other obligation is assumed by such Person (or any right,
contingent or otherwise, of any holder of such Indebtedness to obtain any such
Lien). The amount of any Guarantee shall be deemed to be an amount equal to the
stated or determinable amount of the related primary obligation, or portion
thereof, in respect of which such Guarantee is made or, if not stated or
determinable, the maximum reasonably anticipated liability in respect thereof
as determined by the guaranteeing Person in good faith. The term “Guarantee”
as a verb has a corresponding meaning.

 

“Guarantors” means, collectively, the Subsidiaries of the
Borrower listed on Schedule 1.01 and each other Subsidiary of the
Borrower that shall be required to execute and deliver a guaranty or guaranty
supplement pursuant to Section 6.12.

 

“Guaranty” means, collectively, the Guaranty made by the
Guarantors in favor of the Secured Parties, substantially in the form of Exhibit
F, together with each other guaranty and guaranty supplement delivered
pursuant to Section 6.12.

 

“Hazardous Materials” means all explosive or radioactive
substances or wastes and all hazardous or toxic substances, wastes or other
pollutants, including petroleum or petroleum distillates, asbestos or asbestos-containing
materials, polychlorinated biphenyls, radon gas, infectious or medical wastes
and all other substances or wastes of any nature regulated pursuant to any
Environmental Law.

 

“Hedge Bank” means any Person that, at the time it enters into a
Secured Hedge Agreement, is a Lender or an Affiliate of a Lender, in its
capacity as a party to such Secured Hedge Agreement.

 

“Holdback Agreement” means the Holdback Agreement by and between
Seller and the Borrower dated November 14, 2006.

 

“Holdback Amount” has the meaning specified in the Holdback
Agreement.

 

17

 

“Indebtedness” means, as to any Person at a particular time,
without duplication, all of the following, whether or not included as
indebtedness or liabilities in accordance with GAAP:

 

(a)           all
obligations of such Person for borrowed money and all obligations of such
Person evidenced by bonds, debentures, notes, loan agreements or other similar
instruments;

 

(b)           the
maximum amount of all direct or contingent obligations of such Person arising
under letters of credit (including standby and commercial), bankers’
acceptances, bank guaranties, surety bonds and similar instruments;

 

(c)           net
obligations of such Person under any Swap Contract;

 

(d)           all
obligations of such Person to pay the deferred purchase price of property or
services (other than trade accounts payable in the ordinary course of business
and the Holdback Amount);

 

(e)           indebtedness
(excluding prepaid interest thereon) secured by a Lien on property owned or
being purchased by such Person (including indebtedness arising under
conditional sales or other title retention agreements), whether or not such
indebtedness shall have been assumed by such Person or is limited in recourse;

 

(f)            all
Attributable Indebtedness in respect of Capitalized Leases and Synthetic Lease
Obligations of such Person;

 

(g)           all
obligations of such Person to purchase, redeem, retire, defease or otherwise
make any payment in respect of any Equity Interest in such Person or to purchase
or exercise any warrant, right or option to acquire such Equity Interest,
valued, in the case of a redeemable preferred interest, at the greater of its
voluntary or involuntary liquidation preference plus
accrued and unpaid dividends; and

 

(h)           all
Guarantees of such Person in respect of any of the foregoing.

 

For all purposes hereof, the Indebtedness of any Person shall include
the Indebtedness of any partnership or joint venture (other than a joint
venture that is itself a corporation or limited liability company) in which
such Person is a general partner or a joint venturer, unless such Indebtedness
is expressly made non-recourse to such Person. The amount of any net obligation
under any Swap Contract on any date shall be deemed to be the Swap Termination
Value thereof as of such date.

 

“Indemnified Taxes” means Taxes other than Excluded Taxes.

 

“Indemnitees” has the meaning specified in Section 11.04(b).

 

“Information” has the meaning specified in Section 11.07.

 

18

 

“Intercreditor Agreement” means the Intercreditor Agreement to
be dated the Closing Date in the form attached hereto as Exhibit K.

 

“Interest Payment Date” means, (a) as to any Eurodollar Rate
Loan, the last day of each Interest Period applicable to such Loan and the
Maturity Date of the Facility under which such Loan was made; provided, however,
that if any Interest Period for a Eurodollar Rate Loan exceeds three months,
the respective dates that fall every three months after the beginning of such
Interest Period shall also be Interest Payment Dates; and (b) as to any Base
Rate Loan, the last Business Day of each March, June, September and December
and the Maturity Date of the Facility under which such Loan was made.

 

“Interest Period” means, as to each Eurodollar Rate Loan, the
period commencing on the date such Eurodollar Rate Loan is disbursed or
converted to or continued as a Eurodollar Rate Loan and ending on the date one,
two, three or six months thereafter, as selected by the Borrower in its
Committed Loan Notice; provided that:

 

(a)           any
Interest Period that would otherwise end on a day that is not a Business Day
shall be extended to the next succeeding Business Day unless such Business Day
falls in another calendar month, in which case such Interest Period shall end
on the next preceding Business Day;

 

(b)           any
Interest Period that begins on the last Business Day of a calendar month (or on
a day for which there is no numerically corresponding day in the calendar month
at the end of such Interest Period) shall end on the last Business Day of the
calendar month at the end of such Interest Period; and

 

(c)           no
Interest Period shall extend beyond the Maturity Date of the Facility under
which such Loan was made.

 

“Internal Control Event” means a material weakness in, or fraud
that involves management or other employees who have a significant role in, the
Borrower’s internal controls over financial reporting, in each case as
described in the Securities Laws.

 

“Investment” means, as to any Person, any direct or indirect
acquisition or investment by such Person, whether by means of (a) the purchase
or other acquisition of Equity Interests of another Person, (b) a loan, advance
or capital contribution to, Guarantee or assumption of debt of, or purchase or
other acquisition of any other debt or interest in, another Person, or (c) the
purchase or other acquisition (in one transaction or a series of transactions)
of assets of another Person that constitute a business unit or all or a
substantial part of the business of, such Person. For purposes of covenant
compliance, the amount of any Investment shall be the amount actually invested,
without adjustment for subsequent increases or decreases in the value of such
Investment.

 

“IP Rights” has the meaning specified in Section 5.17.

 

“IRS” means the United States Internal Revenue Service.

 

19

 

“ISP” means, with respect to any Letter of Credit, the “International
Standby Practices 1998” published by the Institute of International Banking Law
& Practice (or such later version thereof as may be in effect at the time
of issuance).

 

“Issuer Documents” means with respect to any Letter of Credit,
the Letter of Credit Application, and any other document, agreement and instrument
entered into by the L/C Issuer and the Borrower (or any Subsidiary) or in favor
the L/C Issuer and relating to such Letter of Credit.

 

“Laws” means, collectively, all international, foreign, Federal,
state and local statutes, treaties, rules, guidelines, regulations, ordinances,
codes and administrative or judicial precedents or authorities, including the
interpretation or administration thereof by any Governmental Authority charged
with the enforcement, interpretation or administration thereof, and all
applicable administrative orders, directed duties, requests, licenses,
authorizations and permits of, and agreements with, any Governmental Authority,
in each case whether or not having the force of law.

 

“L/C Advance” means, with respect to each Revolving Credit
Lender, such Lender’s funding of its participation in any L/C Borrowing in
accordance with its Applicable Revolving Credit Percentage.

 

“L/C Borrowing” means an extension of credit resulting from a
drawing under any Letter of Credit which has not been reimbursed on the date
when made or refinanced as a Revolving Credit Borrowing.

 

“L/C Credit Extension” means, with respect to any Letter of
Credit, the issuance thereof or extension of the expiry date thereof, or the
increase of the amount thereof.

 

“L/C Issuer” means Bank of America in its capacity as issuer of
Letters of Credit hereunder, or any successor issuer of Letters of Credit
hereunder.

 

“L/C Obligations” means, as at any date of determination, the
aggregate amount available to be drawn under all outstanding Letters of Credit plus
the aggregate of all Unreimbursed Amounts, including all L/C Borrowings. For
purposes of computing the amount available to be drawn under any Letter of
Credit, the amount of such Letter of Credit shall be determined in accordance
with Section 1.06. For all purposes of this Agreement, if on any date of
determination a Letter of Credit has expired by its terms but any amount may
still be drawn thereunder by reason of the operation of Rule 3.14 of the ISP,
such Letter of Credit shall be deemed to be “outstanding” in the amount so
remaining available to be drawn.

 

“Leases” means any and all leases, subleases, tenancies,
options, concession agreements, rental agreements, occupancy agreements,
franchise agreements, access agreements and any other agreements (including all
amendments, extensions, replacements, renewals, modifications and/or guarantees
thereof), whether or not of record and whether now in existence or hereafter
entered into, affecting the use or occupancy of all or any portion of any Real
Property.

 

“Lender” has the meaning specified in the introductory paragraph
hereto.

 

20

 

“Lending Office” means, as to any Lender, the office or offices
of such Lender described as such in such Lender’s Administrative Questionnaire,
or such other office or offices as a Lender may from time to time notify the
Borrower and the Administrative Agent.

 

“Letter of Credit” means any standby letter of credit issued
hereunder.

 

“Letter of Credit Application” means an application and
agreement for the issuance or amendment of a Letter of Credit in the form from
time to time in use by the L/C Issuer.

 

“Letter of Credit Expiration Date” means the day that is seven
days prior to the Maturity Date then in effect for the Revolving Credit
Facility (or, if such day is not a Business Day, the next preceding Business
Day).

 

“Letter of Credit Fee” has the meaning specified in Section
2.03(i).

 

“Letter of Credit Sublimit” means an amount equal to $5,000,000.
The Letter of Credit Sublimit is part of, and not in addition to, the Revolving
Credit Facility.

 

“Licensing Fee L/C” means the $50.0 million letter of credit
dated December 19, 2005, delivered to the PGBC on behalf of Washington Trotting
Association, Inc. in support of the licensing fee for the Pennsylvania Gaming
License.

 

“Lien” means any mortgage, pledge, hypothecation, assignment,
deposit arrangement, encumbrance, lien (statutory or other), charge, or
preference, priority or other security interest or preferential arrangement in
the nature of a security interest of any kind or nature whatsoever (including
any conditional sale or other title retention agreement, any easement, right of
way or other encumbrance on title to real property, and any financing lease
having substantially the same economic effect as any of the foregoing).

 

“Loan” means an extension of credit by a Lender to the Borrower
under Article II in the form of a Term B Loan or a Revolving Credit
Loan.

 

“Loan Documents” means, collectively, (a) this Agreement,
(b) the Notes, (c) the Guaranty, (d) the Collateral Documents, (e) the Fee
Letter, (f) each Issuer Document, (g) each Secured Hedge Agreement, (h)
each Secured Cash Management Agreement, (i) the Cash Collateral and Disbursement
Agreement, and (j) the Intercreditor Agreement; provided that for
purposes of the definition of “Material Adverse Effect” and Articles IV
through IX, “Loan Documents” shall not include Secured Hedge Agreements
or Secured Cash Management Agreements.

 

“Loan Parties” means, collectively, the Borrower and each
Guarantor.

 

“Maintenance Capital Expenditures” means any Capital
Expenditures by the Borrower or any of its Restricted Subsidiaries that are
made to maintain, restore, refurbish or replace in the ordinary course of
business the condition or usefulness of property of the Borrower or any of its
Restricted Subsidiaries, or otherwise to support the continuation of such
person’s day-to-day operations as then conducted, but that are not properly
chargeable to repairs and maintenance in accordance with GAAP.

 

21

 

“Management Compensation” means any and all fees, expenses and
other monies due and payable, from time to time, by the Borrower to Millennium,
which shall not, in the aggregate, exceed 4% of Consolidated EBITDAM per fiscal
year.

 

“Managers” means collectively William Wortman and William
Paulos.

 

“Material Adverse Effect” means (a) a material adverse change
in, or a material adverse effect upon, the operations, business, properties,
liabilities (actual or contingent) or condition (financial or otherwise) of the
Borrower and its Subsidiaries taken as a whole; (b) a material impairment of
the rights and remedies of the Administrative Agent or any Lender under any Loan
Document, or of the ability of any Loan Party to perform its obligations under
any Loan Document to which it is a party; or (c) a material adverse effect upon
the legality, validity, binding effect or enforceability against any Loan Party
of any Loan Document to which it is a party.

 

“Material Contract” means, with respect to any Person, each
contract to which such Person is a party involving aggregate consideration
payable to or by such Person of $4.0 million or more in any year or otherwise
material to the business, condition (financial or otherwise), operations,
performance, properties or prospects of such Person.

 

“Maturity Date” means (a) with respect to the Revolving Credit
Facility, November 14, 2011 and (b) with respect to the Term B Facility, November
14, 2011; provided, however, that, in each case, if such date is
not a Business Day, the Maturity Date shall be the next preceding Business Day.

 

“Meadows Property” means the Meadows Racetrack located on
Racetrack Road in North Strabane Township, Washington County, Pennsylvania,
which comprises approximately 153.03 acres.

 

“Measurement Period” means, at any date of determination, the
most recently completed four fiscal quarters of the Borrower or, if fewer than
four consecutive fiscal quarters of the Borrower have been completed since the
Closing Date, the fiscal quarters of the Borrower that have been completed
since the Closing Date.

 

“Millennium” means Millennium Gaming, Inc. or an affiliate
thereof.

 

“Moody’s” means Moody’s Investors Service, Inc. and any
successor thereto.

 

“Mortgage” has the meaning specified in Section 4.01(a)(iv).

 

“Mortgage Policy” has the meaning specified in Section 4.01(a)(iv)(B).

 

“Mortgaged Property” shall mean (a) each Real Property
identified as a Mortgaged Property on Schedule 4.01(a)(iv) and
(b) each Real Property, if any, which shall be subject to a Mortgage
delivered after the Closing Date pursuant to Section 6.12

 

“Multiemployer Plan” means any employee benefit plan of the type
described in Section 4001(a)(3) of ERISA, to which the Borrower or any
ERISA Affiliate makes or is obligated 

 

22

 

to make contributions, or during the preceding five plan years, has
made or been obligated to make contributions.

 

“Net Cash Proceeds” means:

 

(a)           with
respect to any Disposition by the Borrower or any of its Subsidiaries, or any
Extraordinary Receipt received or paid to the account of the Borrower or any of
its Subsidiaries, the excess, if any, of (i) the sum of cash and Cash Equivalents
received in connection with such transaction (including any cash or Cash
Equivalents received by way of deferred payment pursuant to, or by monetization
of, a note receivable or otherwise, but only as and when so received) over (ii)
the sum of (A) the principal amount of any Indebtedness that is secured by the
applicable asset and that is required to be repaid in connection with such
transaction (other than Indebtedness under the Loan Documents), (B) the
reasonable and customary out-of-pocket expenses incurred by the Borrower or
such Subsidiary in connection with such transaction and (C) income taxes
reasonably estimated to be actually payable within two years of the date of the
relevant transaction as a result of any gain recognized in connection therewith;
and

 

(b)           with
respect to the sale or issuance of any Equity Interest by the Borrower or any
of its Subsidiaries, or the incurrence or issuance of any Indebtedness by the
Borrower or any of its Subsidiaries, the excess of (i) the sum of the cash and
Cash Equivalents received in connection with such transaction over (ii) the
underwriting discounts and commissions, and other reasonable and customary
out-of-pocket expenses, incurred by the Borrower or such Subsidiary in
connection therewith.

 

“Non-Reinstatement Deadline” has the meaning specified in Section
2.03(b)(iv).

 

“Note” means a Term B Note or a Revolving Credit Note, as
the context may require.

 

“NPL” means the National Priorities List under CERCLA.

 

“Obligations” means all advances to, and debts, liabilities,
obligations, covenants and duties of, any Loan Party arising under any Loan
Document or otherwise with respect to any Loan or Letter of Credit, whether
direct or indirect (including those acquired by assumption), absolute or
contingent, due or to become due, now existing or hereafter arising and
including interest and fees that accrue after the commencement by or against
any Loan Party or any Affiliate thereof of any proceeding under any Debtor
Relief Laws naming such Person as the debtor in such proceeding, regardless of
whether such interest and fees are allowed claims in such proceeding.

 

“OCM” means OCM Acquisition Co., LLC, a limited liability
company organized under the laws of Nevada.

 

23

 

“Operating” means that:

 

(1)           the
Pennsylvania Gaming Licenses shall have been granted and not been revoked or
suspended; and

 

(2)           the
Temporary Casino is open to the general public and operating in accordance with
applicable law in all material respects.

 

“Organization Documents” means, (a) with respect to any
corporation, the certificate or articles of incorporation and the bylaws (or
equivalent or comparable constitutive documents with respect to any non-U.S.
jurisdiction); (b) with respect to any limited liability company, the
certificate or articles of formation or organization and operating agreement;
and (c) with respect to any partnership, joint venture, trust or other form of
business entity, the partnership, joint venture or other applicable agreement
of formation or organization and any agreement, instrument, filing or notice
with respect thereto filed in connection with its formation or organization
with the applicable Governmental Authority in the jurisdiction of its formation
or organization and, if applicable, any certificate or articles of formation or
organization of such entity.

 

“Other Taxes” means all present or future stamp or documentary
taxes or any other excise or property taxes, charges or similar levies arising
from any payment made hereunder or under any other Loan Document or from the
execution, delivery or enforcement of, or otherwise with respect to, this
Agreement or any other Loan Document.

 

“Outstanding Amount” means (a) with respect to Term Loans and
Revolving Credit Loans on any date, the aggregate outstanding principal amount
thereof after giving effect to any borrowings and prepayments or repayments of
Term Loans and Revolving Credit Loans, as the case may be, occurring on such
date; and (b) with respect to any L/C Obligations on any date, the amount of
such L/C Obligations on such date after giving effect to any L/C Credit
Extension occurring on such date and any other changes in the aggregate amount
of the L/C Obligations as of such date, including as a result of any reimbursements
by the Borrower of Unreimbursed Amounts.

 

“Participant” has the meaning specified in Section 11.06(d).

 

“PBGC” means the Pension Benefit Guaranty Corporation.

 

“PCAOB” means the Public Company Accounting Oversight Board.

 

“Pennsylvania Gaming License” means a Conditional Category 1
license (a “Conditional Gaming License”) or a Category 1 license (a “Category
1 Gaming License”) in Pennsylvania for the operation of a slot machine
facility at the Meadows Property.

 

“Pension Plan” means any “employee pension benefit plan” (as
such term is defined in Section 3(2) of ERISA), other than a Multiemployer
Plan, that is subject to Title IV of ERISA and is sponsored or maintained by
the Borrower or any ERISA Affiliate or to which the Borrower or any ERISA
Affiliate contributes or has an obligation to contribute, or in the case of 

 

24

 

a multiple employer or other plan described in Section 4064(a) of
ERISA, has made contributions at any time during the immediately preceding five
plan years.

 

“Permitted Encumbrances” has the meaning specified in the
Mortgages.

 

“Person” means any natural person, corporation, limited
liability company, trust, joint venture, association, company, partnership,
Governmental Authority or other entity.

 

“Plan” means any “employee benefit plan” (as such term is
defined in Section 3(3) of ERISA) established by the Borrower or, with
respect to any such plan that is subject to Section 412 of the Code or Title IV
of ERISA, any ERISA Affiliate.

 

“Plans and Specifications” means all specifications, designs,
documents, schematic drawings and related items for the design, architecture
and construction of the Project, that are prepared by the Borrowers’ architect
, and approved by the Construction Consultant, and, in each case, all
amendments and modifications thereof approved by the Administrative Agent.

 

“Platform” has the meaning specified in Section 6.02.

 

“Pledged Debt” means “Intercompany Debt” as defined in the
Security Agreement.

 

“Pledged Equity” means “Pledged Securities” as defined in the
Security Agreement.

 

“Post-Closing Agreement” means the Post-Closing and Note
Issuance Agreement dated as of July 26, 2006, by and among the Borrower,
Seller and other parties thereto and any amendments thereto as of the date
hereof.

 

“Project” means the construction of the Temporary Casino.

 

“Racing Services Agreement” means the Racing Services Agreement
dated as of July 26, 2006, by and among Racing Services Operator and the
Guarantors.

 

“Racing Services Operator” means MEC Pennsylvania Racing
Services, Inc. in such capacity pursuant to the Racing Services Agreement.

 

“Real Property” means, collectively, all right, title and
interest (including any leasehold, mineral or other estate) in and to any and
all parcels of or interests in real property owned, leased or operated by any
Person, whether by lease, license or other means, together with, in each case,
all easements, hereditaments and appurtenances relating thereto, all
improvements and appurtenant fixtures and equipment, all general intangibles
and contract rights and other property and rights incidental to the ownership,
lease or operation thereof.

 

“Reduction Amount” has the meaning set forth in Section
2.05(b)(ix).

 

“Register” has the meaning specified in Section 11.06(c).

 

25

 

“Registered Public Accounting Firm” has the meaning specified by
the Securities Laws and shall be independent of the Borrower as prescribed by
the Securities Laws.

 

“Related Documents” means the Racing Services Agreement, the
Post-Closing Agreement and the First Amendment dated July 26, 2006 to the
Stock Purchase Agreement dated November 8, 2005, between Magna
Entertainment Corp. and the Borrower, and each other agreement contemplated thereby.

 

“Related Parties” means, with respect to any Person, such Person’s
Affiliates and the partners, directors, officers, employees, agents, trustees
and advisors of such Person and of such Person’s Affiliates.

 

“Reportable Event” means any of the events set forth in Section
4043(c) of ERISA, other than events for which the 30 day notice period has been
waived.

 

“Request for Credit Extension” means (a) with respect to a
Borrowing, conversion or continuation of Term B Loans or Revolving Credit
Loans, a Committed Loan Notice and (b) with respect to an L/C Credit Extension,
a Letter of Credit Application.

 

“Required Lenders” means, as of any date of determination,
Lenders holding more than 50% of the sum of the (a) Total Outstandings (with
the aggregate amount of each Revolving Credit Lender’s risk participation and
funded participation in L/C Obligations being deemed “held” by such Revolving
Credit Lender for purposes of this definition) and (b) aggregate unused
Revolving Credit Commitments; provided that the unused Revolving Credit
Commitment of, and the portion of the Total Outstandings held or deemed held
by, any Defaulting Lender shall be excluded for purposes of making a
determination of Required Lenders.

 

“Required Revolving Lenders” means, as of any date of
determination, Revolving Credit Lenders holding more than 50% of the sum of the
(a) Total Revolving Credit Outstandings (with the aggregate amount of each
Revolving Credit Lender’s risk participation and funded participation in L/C
Obligations being deemed “held” by such Revolving Credit Lender for purposes of
this definition) and (b) aggregate unused Revolving Credit Commitments; provided
that the unused Revolving Credit Commitment of, and the portion of the Total
Revolving Credit Outstandings held or deemed held by, any Defaulting Lender
shall be excluded for purposes of making a determination of Required Revolving
Lenders.

 

“Required Term B Lenders” means, as of any date of
determination, Term B Lenders holding more than 50% of the Term B Loans on such
date; provided that the portion of the Term B Loans held by any
Defaulting Lender shall be excluded for purposes of making a determination of
Required Term B Lenders.

 

“Responsible Officer” means the chief executive officer,
president, chief financial officer, treasurer, assistant treasurer, controller,
manager or managing member of a Loan Party and any other officer of the
applicable Loan Party so designated by any of the foregoing officers in a
notice to the Administrative Agent. Any document delivered hereunder that is
signed by a Responsible Officer of a Loan Party shall be conclusively presumed
to have been authorized by 

 

26

 

all necessary corporate, partnership and/or other action on the part of
such Loan Party and such Responsible Officer shall be conclusively presumed to
have acted on behalf of such Loan Party.

 

“Restricted Payment” means any dividend or other distribution
(whether in cash, securities or other property) with respect to any capital stock
or other Equity Interest of any Person or any of its Subsidiaries, or any
payment (whether in cash, securities or other property), including any sinking
fund or similar deposit, on account of the purchase, redemption, retirement,
defeasance, acquisition, cancellation or termination of any such capital stock
or other Equity Interest, or on account of any return of capital to any Person’s
stockholders, partners or members (or the equivalent of any thereof).

 

“Revolving Credit Borrowing” means a borrowing consisting of
simultaneous Revolving Credit Loans of the same Type and, in the case of
Eurodollar Rate Loans, having the same Interest Period made by each of the
Revolving Credit Lenders pursuant to Section 2.01(b).

 

“Revolving Credit Commitment” means, as to each Revolving Credit
Lender, its obligation to (a) make Revolving Credit Loans to the Borrower
pursuant to Section 2.01(b) and (b) purchase participations in L/C
Obligations, in an aggregate principal amount at any one time outstanding not
to exceed the amount set forth opposite such Lender’s name on Schedule 2.01
under the caption “Revolving Credit Commitment” or opposite such caption in the
Assignment and Assumption pursuant to which such Lender becomes a party hereto,
as applicable, as such amount may be adjusted from time to time in accordance
with this Agreement.

 

“Revolving Credit Facility” means the revolving credit facility
established hereunder pursuant to Section 2.01(c)..

 

“Revolving Credit Lender” means, at any time, any Lender that
has a Revolving Credit Commitment at such time.

 

“Revolving Credit Loan” has the meaning specified in Section
2.01(c).

 

“Revolving Credit Note” means a promissory note made, at the
request of a Revolving Credit Lender, by the Borrower in favor of such
Revolving Credit Lender evidencing Revolving Credit Loans made by such
Revolving Credit Lender, substantially in the form of Exhibit C-2.

 

“S&P” means Standard & Poor’s Ratings Services, a
division of The McGraw-Hill Companies, Inc., and any successor thereto.

 

“Sarbanes-Oxley” means the Sarbanes-Oxley Act of 2002.

 

“SEC” means the Securities and Exchange Commission, or any
Governmental Authority succeeding to any of its principal functions.

 

“Second Lien Administrative Agent” means Bank of America, N.A.,
in its capacity as administrative agent under the Second Lien Credit Agreement,
and its successors and assigns.

 

27

 

“Second Lien Collateral Agent” means Bank of America, N.A., in
its capacity as collateral agent under any of the Second Lien Loan Documents,
and its successors and assigns.

 

“Second Lien Credit Agreement” means (i) that certain credit
agreement dated as of the date hereof among Borrower, the lenders party thereto
and Bank of America, N.A., as administrative agent and collateral agent for the
Second Lien Secured Parties, as amended, restated, supplemented or modified
from time to time to the extent permitted by this Agreement and the
Intercreditor Agreement, and (ii) any other credit agreement, loan agreement,
note agreement, promissory note, indenture or other agreement or instrument
evidencing or governing the terms of any indebtedness or other financial
accommodation that has been incurred to extend (subject to the limitations set
forth herein and in the Intercreditor Agreement) or refinance in whole or in
part the indebtedness and other obligations outstanding under the
(x) credit agreement referred to in clause (i) or (y) any subsequent
Second Lien Credit Agreement, unless such agreement or instrument expressly
provides that it is not intended to be and is not a Second Lien Credit
Agreement hereunder. Any reference to the Second Lien Credit Agreement
hereunder shall be deemed a reference to any Second Lien Credit Agreement then
in existence.

 

“Second Lien Loan Documents” means the Second Lien Credit
Agreement and the other Loan Documents as defined in the Second Lien Credit
Agreement, including each mortgage and other security documents, guaranties and
the notes issued thereunder.

 

“Second Lien Loans” means the loan extended under the Second
Lien Credit Agreement.

 

“Second Lien Secured Parties” means the Second Lien
Administrative Agent, the Second Lien Collateral Agent and each Person that is
a lender under the Second Lien Credit Agreement.

 

“Secured Cash Management Agreement” means any Cash Management
Agreement that is entered into by and between the Borrower and any Cash
Management Bank.

 

“Secured Hedge Agreement” means any interest rate Swap Contract
required or permitted under Article VI or VII that is entered
into by and between the Borrower and any Hedge Bank.

 

“Secured Parties” means, collectively, the Administrative Agent,
the Collateral Agent, the Control Agent, the Lenders, the L/C Issuer, the Hedge
Banks, the Cash Management Banks, each co-agent or sub-agent appointed by the
Administrative Agent from time to time pursuant to Section 9.05,
and the other Persons the Obligations owing to which are or are purported to be
secured by the Collateral under the terms of the Collateral Documents.

 

“Securities Laws” means the Securities Act of 1933, the
Securities Exchange Act of 1934, Sarbanes-Oxley, and the applicable accounting
and auditing principles, rules, standards and practices promulgated, approved
or incorporated by the SEC or the PCAOB.

 

“Security Agreement” has the meaning specified in Section 4.01(a)(iii).

 

28

 

“Seller” means Magna Entertainment Corp.

 

“Solvent” and “Solvency” mean, with respect to any Person
on any date of determination, that on such date (a) the fair value of the
property of such Person is greater than the total amount of liabilities,
including contingent liabilities, of such Person, (b) the present fair
salable value of the assets of such Person is not less than the amount that
will be required to pay the probable liability of such Person on its debts as
they become absolute and matured, (c) such Person does not intend to, and
does not believe that it will, incur debts or liabilities beyond such Person’s
ability to pay such debts and liabilities as they mature, (d) such Person
is not engaged in business or a transaction, and is not about to engage in
business or a transaction, for which such Person’s property would constitute an
unreasonably small capital, and (e) such Person is able to pay its debts and
liabilities, contingent obligations and other commitments as they mature in the
ordinary course of business. The amount of contingent liabilities at any time
shall be computed as the amount that, in the light of all the facts and
circumstances existing at such time, represents the amount that can reasonably
be expected to become an actual or matured liability.

 

“Stock Purchase Agreement” means the Stock Purchase Agreement
dated November 8, 2005, between Seller and the Borrower, as amended by the
First Amendment to the Stock Purchase Agreement dated July 26, 2006.

 

“Subsidiary” of a Person means a corporation, partnership, joint
venture, limited liability company or other business entity of which a majority
of the shares of securities or other interests having ordinary voting power for
the election of directors or other governing body (other than securities or
interests having such power only by reason of the happening of a contingency)
are at the time beneficially owned by such Person. Unless otherwise specified,
all references herein to a “Subsidiary” or to “Subsidiaries” shall refer to a
Subsidiary or Subsidiaries of the Borrower.

 

“Swap Contract” means (a) any and all rate swap transactions,
basis swaps, credit derivative transactions, forward rate transactions,
commodity swaps, commodity options, forward commodity contracts, equity or
equity index swaps or options, bond or bond price or bond index swaps or
options or forward bond or forward bond price or forward bond index
transactions, interest rate options, forward foreign exchange transactions, cap
transactions, floor transactions, collar transactions, currency swap
transactions, cross-currency rate swap transactions, currency options, spot
contracts, or any other similar transactions or any combination of any of the
foregoing (including any options to enter into any of the foregoing), whether or
not any such transaction is governed by or subject to any master agreement, and
(b) any and all transactions of any kind, and the related confirmations, which
are subject to the terms and conditions of, or governed by, any form of master
agreement published by the International Swaps and Derivatives Association,
Inc., any International Foreign Exchange Master Agreement, or any other master
agreement (any such master agreement, together with any related schedules, a “Master
Agreement”), including any such obligations or liabilities under any Master
Agreement.

 

“Swap Termination Value” means, in respect of any one or more
Swap Contracts, after taking into account the effect of any legally enforceable
netting agreement relating to such Swap Contracts, (a) for any date on or after
the date such Swap Contracts have been closed out and termination value(s)
determined in accordance therewith, such termination value(s), and (b) 

 

29

 

for any date prior to the date referenced in clause (a), the amount(s)
determined as the mark-to-market value(s) for such Swap Contracts, as
determined based upon one or more mid-market or other readily available
quotations provided by any recognized dealer in such Swap Contracts (which may
include a Lender or any Affiliate of a Lender).

 

“Synthetic Lease Obligation” means the monetary obligation of a
Person under (a) a so-called synthetic, off-balance sheet or tax retention
lease, or (b) an agreement for the use or possession of property (including
sale and leaseback transactions), in each case, creating obligations that do
not appear on the balance sheet of such Person but which, upon the application
of any Debtor Relief Laws to such Person, would be characterized as the
indebtedness of such Person (without regard to accounting treatment).

 

“Tax Amount” means (a) with respect to any period ending prior
to the Closing Date, an amount equal to the estimated federal income taxes
attributable to the Tax Recipients’ indirect distributive share of the Borrower’s
taxable income (taking into account both items separately stated under Code
§702(a)(1) through (7) and non-separately stated items under Code §702(a)(8))
applying a forty percent (40%) marginal tax rate, and (b) relative to any
period ending on or after the Closing Date, an amount equal to (i) the lowest
aggregate amount of distributions to the Tax Recipients (based on pro rata
distributions to such Tax Recipients in proportion to their percentage
interests under the CCR operating agreement) such that each Tax Recipient
receives an amount sufficient to equal (x) the amount of taxable income of the
Borrower directly or indirectly allocated to and reported by such Tax Recipient
in respect of such period (taking into account any Code §704(c) items and
annualizing the estimated taxable income (excluding extraordinary items, which
shall be taken into account separately) for distributions with respect to
periods of less than a fiscal year), multiplied by (y) the highest maximum
combined marginal federal, state and local income tax rates to which any Tax
Recipient may be subject (taking into account the deductibility of state income
tax for federal income tax purposes), plus (ii) an additional amount
(distributed to the Tax Recipients pro rata in the proportion to their
percentage interests under the CCR operating agreement) such that, after giving
effect to distributions of such additional amount, each Tax Recipient will
satisfy the safe harbor for estimated tax payments based on prior year tax liability
under Code §§6654 or 6655 (and analogous state or local provisions) assuming
that each Tax Recipient’s only income was from the Borrower.

 

“Taxes” means all present or future taxes, levies, imposts,
duties, deductions, withholdings, assessments, fees or other charges imposed by
any Governmental Authority, including any interest, additions to tax or
penalties applicable thereto.

 

“Tax Recipient” means each direct or indirect equityholder of
the Borrower that is required to report and pay federal income taxes with
respect to taxable income of the Borrower that is directly or indirectly
allocated to such Person, and each of his or her or its successors and assigns.

 

“Temporary Casino” means the casino constructed in accordance
with the Construction Plans on the Meadows Property, which shall include at
least 1,800 slot machines.

 

30

 

“Term B Borrowing” means a borrowing consisting of simultaneous
Term B Loans of the same Type and, in the case of Eurodollar Rate Loans, having
the same Interest Period made by each of the Term B Lenders pursuant to Section
2.01(b).

 

“Term B Commitment” means, as to each Term B Lender, its obligation to make Term
B Loans to the Borrower pursuant to Section 2.01(b) in an aggregate
principal amount at any one time outstanding not to exceed the amount set forth
opposite such Lender’s name on Schedule 2.01 under the caption “Term B
Commitment” or opposite such caption in the Assignment and Assumption pursuant
to which such Term B Lender becomes a party hereto, as applicable, as such
amount may be adjusted from time to time in accordance with this Agreement.

 

“Term B Facility” means, at any time, the term loan facility
established hereunder pursuant to Section 2.01(b).

 

“Term B Lender” means at any time, (a) on or prior to the
Closing Date, any Lender that has a Term B Commitment at such time and (b) at
any time after the Closing Date, any Lender that holds Term B Loans at such
time.

 

“Term B Loan” means an advance made by any Term B Lender
under the Term B Facility.

 

“Term B Note” means a promissory note made, at the request of a
Term B Lender, by the Borrower in favor of such Term B Lender, evidencing
Term B Loans made by such Term B Lender, substantially in the form of
Exhibit C-1.

 

“Threshold Amount” means $4.0 million.

 

“Timetable” means the schedule for construction and completion
of the Project which has been prepared by the Borrowers and approved by the
Construction Consultant.

 

“Title Company” shall mean First American Title Company or any
other title insurance company as shall be retained by the Borrower and
reasonably acceptable to the Administrative Agent.

 

“Total Outstandings” means the aggregate Outstanding Amount of
all Loans and all L/C Obligations.

 

“Total Revolving Credit Outstandings” means the aggregate
Outstanding Amount of all Revolving Credit Loans and L/C Obligations.

 

“Transaction” means, collectively, (a) the entering into by the
Loan Parties and their applicable Subsidiaries of the Loan Documents and the
Related Documents to which they are or are intended to be a party, (b) the
repayment of the Tranche A Junior Note (as defined in the Post-Closing
Agreement), (c) the consummation of the transactions contemplated by the Loan
Documents and the Related Documents and (d) the payment of the fees and
expenses incurred in connection with the consummation of the foregoing.

 

31

 

“Type” means, with respect to a Loan, its character as a Base
Rate Loan or a Eurodollar Rate Loan.

 

“UCC” means the Uniform Commercial Code as in effect in the
State of New York; provided that, if perfection or the effect of
perfection or non-perfection or the priority of any security interest in any
Collateral is governed by the Uniform Commercial Code as in effect in a
jurisdiction other than the State of New York, “UCC” means the Uniform
Commercial Code as in effect from time to time in such other jurisdiction for
purposes of the provisions hereof relating to such perfection, effect of
perfection or non-perfection or priority.

 

“Unfunded Pension Liability” means the excess of a Pension Plan’s
benefit liabilities under Section 4001(a)(16) of ERISA, over the current
value of that Pension Plan’s assets, determined in accordance with the
assumptions used for funding the Pension Plan pursuant to Section 412 of
the Code for the applicable plan year.

 

“United States” and “U.S.” mean the United States of
America.

 

“Unreimbursed Amount” has the meaning specified in Section
2.03(c)(i).

 

“U.S. Loan Party” means any Loan Party that is organized under
the laws of one of the states of the United States of America and that is not a
CFC.

 

“Working Capital” means for any Person, at any date of
determination, the amount, if any, by which the Consolidated Current Assets of such
Person at such date of determination exceeds the Consolidated Current
Liabilities of such Person at such date.

 

1.02.        Other
Interpretive Provisions. With reference to this Agreement and each other
Loan Document, unless otherwise specified herein or in such other Loan
Document:

 

(a)           The
definitions of terms herein shall apply equally to the singular and plural
forms of the terms defined. Whenever the context may require, any pronoun shall
include the corresponding masculine, feminine and neuter forms. The words “include,”
“includes” and “including” shall be deemed to be followed by the
phrase “without limitation.”  The word “will”
shall be construed to have the same meaning and effect as the word “shall.”  Unless the context requires otherwise, (i)
any definition of or reference to any agreement, instrument or other document
(including any Organization Document) shall be construed as referring to such
agreement, instrument or other document as from time to time amended,
supplemented or otherwise modified (subject to any restrictions on such
amendments, supplements or modifications set forth herein or in any other Loan
Document), (ii) any reference herein to any Person shall be construed to
include such Person’s successors and assigns, (iii) the words “herein,” “hereof”
and “hereunder,” and words of similar import when used in any Loan
Document, shall be construed to refer to such Loan Document in its entirety and
not to any particular provision thereof, (iv) all references in a Loan Document
to Articles, Sections, Preliminary Statements, Exhibits and Schedules shall be
construed to refer to Articles and Sections of, and Preliminary Statements,
Exhibits and Schedules to, the Loan Document in which such references appear,
(v) any reference to any law shall include all statutory and regulatory
provisions consolidating, amending, replacing or interpreting such law and any
reference to any law or regulation shall, unless otherwise specified, 

 

32

 

refer to such law or regulation as amended, modified or supplemented
from time to time, and (vi) the words “asset” and “property”
shall be construed to have the same meaning and effect and to refer to any and
all tangible and intangible assets and properties, including cash, securities,
accounts and contract rights.

 

(b)           In
the computation of periods of time from a specified date to a later specified
date, the word “from” means “from and including”; the words “to”
and “until” each mean “to but excluding”; and the word “through”
means “to and including.”

 

(c)           Section
headings herein and in the other Loan Documents are included for convenience of
reference only and shall not affect the interpretation of this Agreement or any
other Loan Document.

 

1.03.        Accounting
Terms.

 

(a)           Generally.
All accounting terms not specifically or completely defined herein shall be
construed in conformity with, and all financial data (including financial
ratios and other financial calculations) required to be submitted pursuant to
this Agreement shall be prepared in conformity with, GAAP applied on a
consistent basis, as in effect from time to time, applied in a manner
consistent with and customary for gaming operations substantially similar to
the Project, except as otherwise specifically prescribed herein.

 

(b)           Changes
in GAAP. If at any time any change in GAAP would affect the computation of
any financial ratio or requirement set forth in any Loan Document, and either
the Borrower or the Required Lenders shall so request, the Administrative
Agent, the Lenders and the Borrower shall negotiate in good faith to amend such
ratio or requirement to preserve the original intent thereof in light of such
change in GAAP (subject to the approval of the Required Lenders); provided
that, until so amended, (i) such ratio or requirement shall continue to be
computed in accordance with GAAP prior to such change therein and (ii) the
Borrower shall provide to the Administrative Agent and the Lenders financial
statements and other documents required under this Agreement or as reasonably
requested hereunder setting forth a reconciliation between calculations of such
ratio or requirement made before and after giving effect to such change in
GAAP.

 

1.04.        Rounding.
Any financial ratios required to be maintained by the Borrower pursuant to this
Agreement shall be calculated by dividing the appropriate component by the
other component, carrying the result to one place more than the number of
places by which such ratio is expressed herein and rounding the result up or
down to the nearest number (with a rounding-up if there is no nearest number).

 

1.05.        Times
of Day. Unless otherwise specified, all references herein to times of day
shall be references to Eastern time (daylight or standard, as applicable).

 

1.06.        Letter
of Credit Amounts. Unless otherwise specified herein, the amount of a
Letter of Credit at any time shall be deemed to be the stated amount of such
Letter of Credit in effect at such time; provided, however, that
with respect to any Letter of Credit that, by its terms or the terms of any
Issuer Document related thereto, provides for one or more automatic 

 

33

 

increases in
the stated amount thereof, the amount of such Letter of Credit shall be deemed
to be the maximum stated amount of such Letter of Credit after giving effect to
all such increases, whether or not such maximum stated amount is in effect at
such time.

 

1.07.        Currency
Equivalents Generally. Any amount specified in this Agreement (other than
in Articles II, IX and X) or any of the other Loan
Documents to be in Dollars shall also include the equivalent of such amount in
any currency other than Dollars, such equivalent amount thereof in the
applicable currency to be determined by the Administrative Agent at such time
on the basis of the Spot Rate (as defined below) for the purchase of such
currency with Dollars. For purposes of this Section 1.07, the “Spot
Rate” for a currency means the rate determined by the Administrative Agent
to be the rate quoted by the Person acting in such capacity as the spot rate
for the purchase by such Person of such currency with another currency through
its principal foreign exchange trading office at approximately 11:00 a.m. on
the date two Business Days prior to the date of such determination; provided
that the Administrative Agent may obtain such spot rate from another financial
institution designated by the Administrative Agent if the Person acting in such
capacity does not have as of the date of determination a spot buying rate for any
such currency.

 

ARTICLE II

THE COMMITMENTS AND CREDIT EXTENSIONS

 

2.01.        The
Loans.

 

(a)           [Reserved].

 

(b)           The
Term B Borrowing. Subject to the terms and conditions set forth
herein, each Term B Lender severally agrees to make a single loan to the
Borrower on the Closing Date in an amount not to exceed such Term B Lender’s
Term B Commitment. The Term B Borrowing shall consist of Term B
Loans made simultaneously by the Term B Lenders in accordance with their
respective Term B Commitments. Amounts borrowed under this Section 2.01(b)
and repaid or prepaid may not be reborrowed. Term B Loans may be Base Rate
Loans or Eurodollar Rate Loans as further provided herein.

 

(c)           The
Revolving Credit Borrowings. Subject to the terms and conditions set forth
herein, each Revolving Credit Lender severally agrees to make loans (each such
loan, a “Revolving Credit Loan”) to the Borrower from time to time, on
any Business Day during the Availability Period, in an aggregate amount not to
exceed at any time outstanding the amount of such Lender’s Revolving Credit
Commitment; provided, however, that after giving effect to any
Revolving Credit Borrowing, (i) the Total Revolving Credit Outstandings shall
not exceed the aggregate amount of the Revolving Credit Lenders’ Revolving Credit
Commitments, and (ii) the aggregate Outstanding Amount of the Revolving
Credit Loans of any Lender, plus such Revolving Credit Lender’s
Applicable Revolving Credit Percentage of the Outstanding Amount of all L/C
Obligations, shall not exceed such Revolving Credit Lender’s Revolving Credit
Commitment. Within the limits of each Revolving Credit Lender’s Revolving
Credit Commitment, and subject to the other terms and conditions hereof, the
Borrower may borrow under this Section 2.01(c), prepay under Section
2.05, and reborrow under this Section 2.01(c). Revolving Credit
Loans may be Base Rate Loans or Eurodollar Rate Loans, as further provided
herein.

 

34

 

2.02.        Borrowings, Conversions and Continuations of
Loans.

 

(a)           Each
Term B Borrowing, each Revolving Credit Borrowing, each conversion of Term B
Loans or Revolving Credit Loans from one Type to the other, and each
continuation of Eurodollar Rate Loans shall be made upon the Borrower’s
irrevocable notice to the Administrative Agent, which may be given by telephone.
Each such notice must be received by the Administrative Agent not later than
11:00 a.m. (i) three Business Days prior to the requested date of any Borrowing
of, conversion to or continuation of Eurodollar Rate Loans or of any conversion
of Eurodollar Rate Loans to Base Rate Loans, and (ii) on the requested date of
any Borrowing of Base Rate Loans. Each telephonic notice by the Borrower
pursuant to this Section 2.02(a) must be confirmed promptly by delivery
to the Administrative Agent of a written Committed Loan Notice, appropriately
completed and signed by a Responsible Officer of the Borrower. Each Borrowing
of, conversion to or continuation of Eurodollar Rate Loans shall be in a
principal amount of $2,000,000 or a whole multiple of $1,000,000 in excess
thereof. Except as provided in Sections 2.03(c) and 2.04(c), each
Borrowing of or conversion to Base Rate Loans shall be in a principal amount of
$500,000 or a whole multiple of $100,000 in excess thereof. Each Committed Loan
Notice  (whether telephonic or written)
shall specify (i) whether the Borrower is requesting a Term B Borrowing, a
Revolving Credit Borrowing, a conversion of Term Loans or Revolving Credit Loans
from one Type to the other, or a continuation of Eurodollar Rate Loans, (ii)
the requested date of the Borrowing, conversion or continuation, as the case
may be (which shall be a Business Day), (iii) the principal amount of Loans to
be borrowed, converted or continued, (iv) the Type of Loans to be borrowed or
to which existing Term B Loans or Revolving Credit Loans are to be converted,
and (v) if applicable, the duration of the Interest Period with respect thereto.
If the Borrower fails to specify a Type of Loan in a Committed Loan Notice or
if the Borrower fails to give a timely notice requesting a conversion or
continuation, then new borrowings of the applicable Term B Loans or Revolving
Credit Loans shall be made as, Base Rate Loans and previously outstanding Term
B Loans or Revolving Credit Loans will continue as the same Type with an
Interest Period of one month unless notice otherwise is given timely to the
Administrative Agent. If the Borrower requests a Borrowing of, conversion to,
or continuation of Eurodollar Rate Loans in any such Committed Loan Notice, but
fails to specify an Interest Period, it will be deemed to have specified an
Interest Period of one month.

 

(b)           Following
receipt of a Committed Loan Notice, the Administrative Agent shall promptly
notify each Lender of the amount of its Applicable Percentage under the
applicable Facility of the applicable Term B Loans or Revolving Credit
Loans, and if no timely notice of a conversion or continuation is provided by
the Borrower, the Administrative Agent shall notify each Lender of the details
of any automatic conversion to Base Rate Loans described in Section 2.02(a).
In the case of a Term B Borrowing or a Revolving Credit Borrowing, each
Appropriate Lender shall make the amount of its Loan available to the
Administrative Agent in immediately available funds at the Administrative Agent’s
Office not later than 1:00 p.m. on the Business Day specified in the applicable
Committed Loan Notice. Upon satisfaction of the applicable conditions set forth
in Section 4.02 (and, if such Borrowing is the initial Credit Extension,
Section 4.01), the Administrative Agent shall make all funds so received
available to the Borrower in like funds as received by the Administrative Agent
either by (i) crediting the account of the Borrower on the books of the
Administrative Agent with the amount of such funds or (ii) wire transfer
of such funds, in each case in accordance with instructions provided to (and
reasonably 

 

35

 

acceptable to) the Administrative Agent by the Borrower; provided,
however, that if, on the date a Committed Loan Notice with respect to a
Revolving Credit Borrowing is given by the Borrower, there are L/C Borrowings
outstanding, then the proceeds of such Revolving Credit Borrowing, first,
shall be applied to the payment in full of any such L/C Borrowings, and second,
shall be made available to the Borrower as provided above.

 

(c)           Except
as otherwise provided herein, a Eurodollar Rate Loan may be continued or
converted only on the last day of an Interest Period for such Eurodollar Rate
Loan. During the existence of a Default, no Loans may be requested as,
converted to or continued as Eurodollar Rate Loans without the consent of the
Required Term B Lenders, and no Revolving Loans may be requested as, converted
to or continued as Eurodollar Rate Loans without the consent of the Required
Revolving Lenders.

 

(d)           The
Administrative Agent shall promptly notify the Borrower and the Lenders funding
such Loans of the interest rate applicable to any Interest Period for
Eurodollar Rate Loans upon determination of such interest rate. At any time
that Base Rate Loans are outstanding, the Administrative Agent shall notify the
Borrower and the Lenders of any change in Bank of America’s prime rate used in
determining the Base Rate promptly following the public announcement of such
change.

 

(e)           After
giving effect to all Term B Borrowings, all conversions of Term B
Loans from one Type to the other, and all continuations of Term B Loans as
the same Type, there shall not be more than 5 Interest Periods in effect in
respect of the Term B Facility. After giving effect to all Revolving
Credit Borrowings, all conversions of Revolving Credit Loans from one Type to
the other, and all continuations of Revolving Credit Loans as the same Type,
there shall not be more than 10 Interest Periods in effect in respect of the
Revolving Credit Facility.

 

2.03.        Letters
of Credit.

 

(a)           The
Letter of Credit Commitment. (i) 
Subject to the terms and conditions set forth herein, (A) the L/C Issuer
agrees, in reliance upon the agreements of the Revolving Credit Lenders set
forth in this Section 2.03, (1) from time to time on any Business Day
during the period from the Closing Date until the Letter of Credit Expiration
Date, to issue Letters of Credit for the account of the Borrower or its
Subsidiaries, and to amend or extend Letters of Credit previously issued by it,
in accordance with Section 2.03(b), and (2) to honor drawings under the
Letters of Credit; and (B) the Revolving Credit Lenders severally agree to
participate in Letters of Credit issued for the account of the Borrower or its
Subsidiaries and any drawings thereunder; provided that after giving
effect to any L/C Credit Extension with respect to any Letter of Credit, (x)
the Total Revolving Credit Outstandings shall not exceed the aggregate amount
of the Revolving Credit Lenders’ Revolving Credit Commitments, (y) the
aggregate Outstanding Amount of the Revolving Credit Loans of any Revolving
Credit Lender, plus such Lender’s Applicable Revolving Credit Percentage
of the Outstanding Amount of all L/C Obligations shall not exceed such Lender’s
Revolving Credit Commitment, and (z) the Outstanding Amount of the L/C
Obligations shall not exceed the Letter of Credit Sublimit. Each request by the
Borrower for the issuance or amendment of a Letter of Credit shall be deemed to
be a representation by the Borrower that the L/C Credit Extension so requested
complies with the conditions set forth in the 

 

36

 

proviso to the preceding sentence. Within the foregoing limits, and
subject to the terms and conditions hereof, the Borrower’s ability to obtain
Letters of Credit shall be fully revolving, and accordingly the Borrower may,
during the foregoing period, obtain Letters of Credit to replace Letters of
Credit that have expired or that have been drawn upon and reimbursed.

 

(ii)           The L/C Issuer shall not issue any Letter of
Credit if:

 

(A)          subject to Section 2.03(b)(iii), the
expiry date of such requested Letter of Credit would occur more than twelve
months after the date of issuance or last extension, unless the Required
Revolving Lenders have approved such expiry date; or

 

(B)           the expiry date of such requested Letter of
Credit would occur after the Letter of Credit Expiration Date, unless all the
Revolving Credit Lenders have approved such expiry date.

 

(iii)          The L/C Issuer shall not be under any
obligation to issue any Letter of Credit if:

 

(A)          any order, judgment or decree of any
Governmental Authority or arbitrator shall by its terms purport to enjoin or
restrain the L/C Issuer from issuing such Letter of Credit, or any Law
applicable to the L/C Issuer or any request or directive (whether or not having
the force of law) from any Governmental Authority with jurisdiction over the
L/C Issuer shall prohibit, or request that the L/C Issuer refrain from, the
issuance of letters of credit generally or such Letter of Credit in particular
or shall impose upon the L/C Issuer with respect to such Letter of Credit any restriction,
reserve or capital requirement (for which the L/C Issuer is not otherwise
compensated hereunder) not in effect on the Closing Date, or shall impose upon
the L/C Issuer any unreimbursed loss, cost or expense which was not applicable
on the Closing Date and which the L/C Issuer in good faith deems material to
it;

 

(B)           the issuance of such Letter of Credit would
violate one or more policies of the L/C Issuer applicable to letters of credit
generally;

 

(C)           except as otherwise agreed by the Administrative
Agent and the L/C Issuer, such Letter of Credit is in an initial stated amount
less than $500,000;

 

(D)          such Letter of Credit is to be denominated in
a currency other than Dollars;

 

(E)           such Letter of Credit contains any
provisions for automatic reinstatement of the stated amount after any drawing
thereunder; or

 

(F)           a default of any Lender’s obligations to
fund under Section 2.03(c) exists or any Lender is at such time a
Defaulting Lender hereunder, unless the L/C Issuer has entered into satisfactory
arrangements with the Borrower or such Lender to eliminate the L/C Issuer’s
risk with respect to such Lender.

 

37

 

(iv)          The
L/C Issuer shall not amend any Letter of Credit if the L/C Issuer would not be
permitted at such time to issue such Letter of Credit in its amended form under
the terms hereof.

 

(v)           The
L/C Issuer shall be under no obligation to amend any Letter of Credit if (A)
the L/C Issuer would have no obligation at such time to issue such Letter of
Credit in its amended form under the terms hereof, or (B) the beneficiary of
such Letter of Credit does not accept the proposed amendment to such Letter of
Credit.

 

(vi)          The
L/C Issuer shall act on behalf of the Revolving Credit Lenders with respect to
any Letters of Credit issued by it and the documents associated therewith, and
the L/C Issuer shall have all of the benefits and immunities (A) provided
to the Administrative Agent in Article IX with respect to any acts taken
or omissions suffered by the L/C Issuer in connection with Letters of Credit
issued by it or proposed to be issued by it and Issuer Documents pertaining to
such Letters of Credit as fully as if the term “Administrative Agent” as used
in Article IX included the L/C Issuer with respect to such acts or
omissions, and (B) as additionally provided herein with respect to the L/C
Issuer.

 

(b)           Procedures
for Issuance and Amendment of Letters of Credit; Auto-Extension Letters of
Credit. (i)  Each Letter of Credit
shall be issued or amended, as the case may be, upon the request of the
Borrower delivered to the L/C Issuer (with a copy to the Administrative Agent)
in the form of a Letter of Credit Application, appropriately completed and
signed by a Responsible Officer of the Borrower. Such Letter of Credit
Application must be received by the L/C Issuer and the Administrative Agent not
later than 11:00 a.m. at least two Business Days (or such later date and time
as the Administrative Agent and the L/C Issuer may agree in a particular
instance in their sole discretion) prior to the proposed issuance date or date
of amendment, as the case may be. In the case of a request for an initial
issuance of a Letter of Credit, such Letter of Credit Application shall specify
in form and detail satisfactory to the L/C Issuer:  (A) the proposed issuance date of the
requested Letter of Credit (which shall be a Business Day); (B) the amount
thereof; (C) the expiry date thereof; (D) the name and address of the
beneficiary thereof; (E) the documents to be presented by such beneficiary in
case of any drawing thereunder; (F) the full text of any certificate to be
presented by such beneficiary in case of any drawing thereunder; and (G) such
other matters as the L/C Issuer may require. In the case of a request for an
amendment of any outstanding Letter of Credit, such Letter of Credit
Application shall specify in form and detail satisfactory to the L/C Issuer (1)
the Letter of Credit to be amended; (2) the proposed date of amendment thereof
(which shall be a Business Day); (3) the nature of the proposed amendment; and
(4) such other matters as the L/C Issuer may require. Additionally, the
Borrower shall furnish to the L/C Issuer and the Administrative Agent such
other documents and information pertaining to such requested Letter of Credit
issuance or amendment, including any Issuer Documents, as the L/C Issuer or the
Administrative Agent may require.

 

(ii)           Promptly
after receipt of any Letter of Credit Application, the L/C Issuer will confirm
with the Administrative Agent (by telephone or in writing) that the
Administrative Agent has received a copy of such Letter of Credit Application
from the Borrower and, if not, the L/C Issuer will provide the Administrative
Agent with a copy thereof. Unless the L/C Issuer has received written notice
from any Revolving Credit Lender, the Administrative Agent or any 

 

38

 

Loan Party, at least one Business Day prior to the requested date of
issuance or amendment of the applicable Letter of Credit, that one or more
applicable conditions contained in Article IV shall not then be
satisfied, then, subject to the terms and conditions hereof, the L/C Issuer
shall, on the requested date, issue a Letter of Credit for the account of the
Borrower (or the applicable Subsidiary) or enter into the applicable amendment,
as the case may be, in each case in accordance with the L/C Issuer’s usual and
customary business practices. Immediately upon the issuance of each Letter of
Credit, each Revolving Credit Lender shall be deemed to, and hereby irrevocably
and unconditionally agrees to, purchase from the L/C Issuer a risk
participation in such Letter of Credit in an amount equal to the product of
such Revolving Credit Lender’s Applicable Revolving Credit Percentage times
the amount of such Letter of Credit.

 

(iii)          If
the Borrower so requests in any applicable Letter of Credit Application, the
L/C Issuer may, in its sole and absolute discretion, agree to issue a Letter of
Credit that has automatic extension provisions (each, an “Auto-Extension
Letter of Credit”); provided that any such Auto-Extension Letter of
Credit must permit the L/C Issuer to prevent any such extension at least once
in each twelve-month period (commencing with the date of issuance of such
Letter of Credit) by giving prior notice to the beneficiary thereof not later
than a day (the “Non-Extension Notice Date”) in each such twelve-month
period to be agreed upon at the time such Letter of Credit is issued. Unless
otherwise directed by the L/C Issuer, the Borrower shall not be required to
make a specific request to the L/C Issuer for any such extension. Once an
Auto-Extension Letter of Credit has been issued, the Revolving Credit Lenders
shall be deemed to have authorized (but may not require) the L/C Issuer to
permit the extension of such Letter of Credit at any time to an expiry date not
later than the Letter of Credit Expiration Date; provided, however,
that the L/C Issuer shall not permit any such extension if (A) the L/C Issuer
has determined that it would not be permitted, or would have no obligation at
such time to issue such Letter of Credit in its revised form (as extended)
under the terms hereof (by reason of the provisions of clause (ii) or (iii) of Section
2.03(a) or otherwise), or (B) it has received notice (which may be by
telephone or in writing) on or before the day that is five Business Days before
the Non-Extension Notice Date (1) from the Administrative Agent that the
Required Revolving Lenders have elected not to permit such extension or (2)
from the Administrative Agent, any Revolving Credit Lender or the Borrower that
one or more of the applicable conditions specified in Section 4.02 is
not then satisfied, and in each such case directing the L/C Issuer not to
permit such extension.

 

(iv)          If
the Borrower so requests in any applicable Letter of Credit Application, the
L/C Issuer may, in its sole and absolute discretion, agree to issue a Letter of
Credit that permits the automatic reinstatement of all or a portion of the
stated amount thereof after any drawing thereunder (each, an “Auto-Reinstatement
Letter of Credit”). Unless otherwise directed by the L/C Issuer, the
Borrower shall not be required to make a specific request to the L/C Issuer to
permit such reinstatement. Once an Auto-Reinstatement Letter of Credit has been
issued, except as provided in the following sentence, the Revolving Credit
Lenders shall be deemed to have authorized (but may not require) the L/C Issuer
to reinstate all or a portion of the stated amount thereof in accordance with
the provisions of such Letter of Credit. Notwithstanding the foregoing, if such
Auto-Reinstatement Letter of Credit permits the L/C Issuer to decline to
reinstate all or any portion of the stated amount thereof after a drawing
thereunder by giving notice of such non-reinstatement within a specified number
of days after such drawing (the “Non-Reinstatement Deadline”), the L/C
Issuer shall not permit such reinstatement if it has received a 

 

39

 

notice (which may be by telephone or in writing) on or before the day
that is five Business Days before the Non-Reinstatement Deadline (A) from the
Administrative Agent that the Required Revolving Lenders have elected not to
permit such reinstatement or (B) from the Administrative Agent, any Lender or
the Borrower that one or more of the applicable conditions specified in Section
4.02 is not then satisfied (treating such reinstatement as an L/C Credit
Extension for purposes of this clause) and, in each case, directing the L/C
Issuer not to permit such reinstatement.

 

(v)           Promptly
after its delivery of any Letter of Credit or any amendment to a Letter of
Credit to an advising bank with respect thereto or to the beneficiary thereof,
the L/C Issuer will also deliver to the Borrower and the Administrative Agent a
true and complete copy of such Letter of Credit or amendment.

 

(c)           Drawings
and Reimbursements; Funding of Participations. (i)  Upon receipt from the beneficiary of any
Letter of Credit of any notice of a drawing under such Letter of Credit, the
L/C Issuer shall notify the Borrower and the Administrative Agent thereof. Not
later than 11:00 a.m. on the date of any payment by the L/C Issuer under a
Letter of Credit (each such date, an “Honor Date”), the Borrower shall
reimburse the L/C Issuer through the Administrative Agent in an amount equal to
the amount of such drawing. If the Borrower fails to so reimburse the L/C
Issuer by such time, the Administrative Agent shall promptly notify each
Revolving Credit Lender of the Honor Date, the amount of the unreimbursed
drawing (the “Unreimbursed Amount”), and the amount of such Revolving
Credit Lender’s Applicable Revolving Credit Percentage thereof. In such event,
the Borrower shall be deemed to have requested a Revolving Credit Borrowing of
Base Rate Loans to be disbursed on the Honor Date in an amount equal to the
Unreimbursed Amount, without regard to the minimum and multiples specified in Section
2.02 for the principal amount of Base Rate Loans, but subject to the amount
of the unutilized portion of the Revolving Credit Commitments and the
conditions set forth in Section 4.02 (other than the delivery of a
Committed Loan Notice). Any notice given by the L/C Issuer or the
Administrative Agent pursuant to this Section 2.03(c)(i) may be given by
telephone if immediately confirmed in writing; provided that the lack of
such an immediate confirmation shall not affect the conclusiveness or binding
effect of such notice.

 

(ii)           Each
Revolving Credit Lender shall upon any notice pursuant to Section 2.03(c)(i)
make funds available to the Administrative Agent for the account of the L/C
Issuer at the Administrative Agent’s Office in an amount equal to its
Applicable Revolving Credit Percentage of the Unreimbursed Amount not later
than 1:00 p.m. on the Business Day specified in such notice by the
Administrative Agent, whereupon, subject to the provisions of Section
2.03(c)(iii), each Revolving Credit Lender that so makes funds available
shall be deemed to have made a Base Rate Loan to the Borrower in such amount. The
Administrative Agent shall remit the funds so received to the L/C Issuer.

 

(iii)          With
respect to any Unreimbursed Amount that is not fully refinanced by a Revolving
Credit Borrowing of Base Rate Loans because the conditions set forth in Section 4.02
cannot be satisfied or for any other reason, the Borrower shall be deemed to
have incurred from the L/C Issuer an L/C Borrowing in the amount of the
Unreimbursed Amount that is not so refinanced, which L/C Borrowing shall be due
and payable on demand (together with interest) and shall bear interest at the
Default Rate. In such event, each Revolving Credit Lender’s 

 

40

 

payment to the Administrative Agent for the account of the L/C Issuer
pursuant to Section 2.03(c)(ii) shall be deemed payment in respect of
its participation in such L/C Borrowing and shall constitute an L/C Advance
from such Lender in satisfaction of its participation obligation under this Section
2.03.

 

(iv)          Until
each Revolving Credit Lender funds its Revolving Credit Loan or L/C Advance
pursuant to this Section 2.03(c) to reimburse the L/C Issuer for any
amount drawn under any Letter of Credit, interest in respect of such Lender’s
Applicable Revolving Credit Percentage of such amount shall be solely for the
account of the L/C Issuer.

 

(v)           Each
Revolving Credit Lender’s obligation to make Revolving Credit Loans or L/C
Advances to reimburse the L/C Issuer for amounts drawn under Letters of Credit,
as contemplated by this Section 2.03(c), shall be absolute and
unconditional and shall not be affected by any circumstance, including (A) any
setoff, counterclaim, recoupment, defense or other right which such Lender may
have against the L/C Issuer, the Borrower or any other Person for any reason
whatsoever; (B) the occurrence or continuance of a Default, or (C) any other
occurrence, event or condition, whether or not similar to any of the foregoing;
provided, however, that each Revolving Credit Lender’s obligation
to make Revolving Credit Loans pursuant to this Section 2.03(c) is
subject to the conditions set forth in Section 4.02 (other than delivery
by the Borrower of a Committed Loan Notice ). No such making of an L/C Advance
shall relieve or otherwise impair the obligation of the Borrower to reimburse
the L/C Issuer for the amount of any payment made by the L/C Issuer under any
Letter of Credit, together with interest as provided herein.

 

(vi)          If
any Revolving Credit Lender fails to make available to the Administrative Agent
for the account of the L/C Issuer any amount required to be paid by such Lender
pursuant to the foregoing provisions of this Section 2.03(c) by the time
specified in Section 2.03(c)(ii), the L/C Issuer shall be entitled to
recover from such Lender (acting through the Administrative Agent), on demand,
such amount with interest thereon for the period from the date such payment is
required to the date on which such payment is immediately available to the L/C
Issuer at a rate per annum equal to the greater of the Federal Funds Rate and a
rate determined by the L/C Issuer in accordance with banking industry rules on
interbank compensation, plus any administrative, processing or similar fees
customarily charged by the L/C Issuer in connection with the foregoing. If such
Lender pays such amount (with interest and fees as aforesaid), the amount so
paid (but not such interest and fees, which shall be for the account of the L/C
Issuer) shall constitute such Lender’s Loan included in the relevant Borrowing
or L/C Advance in respect of the relevant L/C Borrowing, as the case may be. A
certificate of the L/C Issuer submitted to any Revolving Credit Lender (through
the Administrative Agent) with respect to any amounts owing under this Section 2.03(c)(vi)
shall be conclusive absent manifest error.

 

(d)           Repayment
of Participations. (i)  At any time
after the L/C Issuer has made a payment under any Letter of Credit and has
received from any Revolving Credit Lender such Lender’s L/C Advance in respect
of such payment in accordance with Section 2.03(c), if the
Administrative Agent receives for the account of the L/C Issuer any payment in
respect of the related Unreimbursed Amount or interest thereon (whether
directly from the Borrower or otherwise, including proceeds of Cash Collateral
applied thereto by the Administrative Agent), the 

 

41

 

Administrative Agent will distribute to such Lender its Applicable
Revolving Credit Percentage thereof in the same funds as those received by the
Administrative Agent.

 

(ii)           If
any payment received by the Administrative Agent for the account of the L/C
Issuer pursuant to Section 2.03(c)(i) is required to be returned under
any of the circumstances described in Section 11.05 (including pursuant
to any settlement entered into by the L/C Issuer in its discretion), each
Revolving Credit Lender shall pay to the Administrative Agent for the account
of the L/C Issuer its Applicable Revolving Credit Percentage thereof on demand
of the Administrative Agent, plus interest thereon from the date of such
demand to the date such amount is returned by such Lender, at a rate per annum
equal to the Federal Funds Rate from time to time in effect. The obligations of
the Lenders under this clause shall survive the payment in full of the
Obligations and the termination of this Agreement.

 

(e)           Obligations
Absolute. The obligation of the Borrower to reimburse the L/C Issuer for
each drawing under each Letter of Credit and to repay each L/C Borrowing shall
be absolute, unconditional and irrevocable, and shall be paid strictly in
accordance with the terms of this Agreement under all circumstances, including
the following (without prejudice to any rights the Borrower may have against
such L/C Issuer for the same, but subject to the limitations hereafter set
forth):

 

(i)            any lack of validity or enforceability of
such Letter of Credit, this Agreement, or any other Loan Document;

 

(ii)           the existence of any claim, counterclaim,
setoff, defense or other right that the Borrower or any Subsidiary may have at
any time against any beneficiary or any transferee of such Letter of Credit (or
any Person for whom any such beneficiary or any such transferee may be acting),
the L/C Issuer or any other Person, whether in connection with this Agreement,
the transactions contemplated hereby or by such Letter of Credit or any
agreement or instrument relating thereto, or any unrelated transaction;

 

(iii)          any draft, demand, certificate or other
document presented under such Letter of Credit proving to be forged,
fraudulent, invalid or insufficient in any respect or any statement therein
being untrue or inaccurate in any respect; or any loss or delay in the
transmission or otherwise of any document required in order to make a drawing
under such Letter of Credit;

 

(iv)          any payment by the L/C Issuer under such
Letter of Credit against presentation of a draft or certificate that does not
strictly comply with the terms of such Letter of Credit; or any payment made by
the L/C Issuer under such Letter of Credit to any Person purporting to be a
trustee in bankruptcy, debtor-in-possession, assignee for the benefit of
creditors, liquidator, receiver or other representative of or successor to any
beneficiary or any transferee of such Letter of Credit, including any arising
in connection with any proceeding under any Debtor Relief Law; or

 

(v)           any other circumstance or happening
whatsoever, whether or not similar to any of the foregoing, including any other
circumstance that might otherwise constitute a defense available to, or a
discharge of, the Borrower or any of its Subsidiaries.

 

42

 

The Borrower shall promptly examine a copy of each Letter of Credit and
each amendment thereto that is delivered to it and, in the event of any claim
of noncompliance with the Borrower’s instructions or other irregularity, the
Borrower will immediately notify the L/C Issuer. The Borrower shall be
conclusively deemed to have waived any such claim against the L/C Issuer and
its correspondents unless such notice is given as aforesaid.

 

(f)            Role
of L/C Issuer. Each Lender and the Borrower agree that, in paying any
drawing under a Letter of Credit, the L/C Issuer shall not have any
responsibility to obtain any document (other than any sight draft, certificates
and documents expressly required by the Letter of Credit) or to ascertain or
inquire as to the validity or accuracy of any such document or the authority of
the Person executing or delivering any such document. None of the L/C Issuer,
the Administrative Agent, any of their respective Related Parties nor any
correspondent, participant or assignee of the L/C Issuer shall be liable to any
Lender for (i) any action taken or omitted in connection herewith at the
request or with the approval of the Revolving Credit Lenders or the Required
Revolving Lenders, as applicable; (ii) any action taken or omitted in the
absence of gross negligence or willful misconduct; or (iii) the due execution,
effectiveness, validity or enforceability of any document or instrument related
to any Letter of Credit or Issuer Document. The Borrower hereby assumes all
risks of the acts or omissions of any beneficiary or transferee with respect to
its use of any Letter of Credit; provided, however, that this
assumption is not intended to, and shall not, preclude the Borrower’s pursuing
such rights and remedies as it may have against the beneficiary or transferee
at law or under any other agreement. None of the L/C Issuer, the Administrative
Agent, any of their respective Related Parties nor any correspondent,
participant or assignee of the L/C Issuer shall be liable or responsible for
any of the matters described in clauses (i) through (v) of Section 2.03(e);
provided, however, that anything in such clauses to the contrary
notwithstanding, the Borrower may have a claim against the L/C Issuer, and the
L/C Issuer may be liable to the Borrower, to the extent, but only to the
extent, of any direct, as opposed to consequential or exemplary, damages
suffered by the Borrower which the Borrower proves were caused by the L/C
Issuer’s willful misconduct or gross negligence or the L/C Issuer’s willful
failure to pay under any Letter of Credit after the presentation to it by the
beneficiary of a sight draft and certificate(s) strictly complying with the
terms and conditions of a Letter of Credit. In furtherance and not in
limitation of the foregoing, the L/C Issuer may accept documents that appear on
their face to be in order, without responsibility for further investigation,
regardless of any notice or information to the contrary, and the L/C Issuer
shall not be responsible for the validity or sufficiency of any instrument
transferring or assigning or purporting to transfer or assign a Letter of
Credit or the rights or benefits thereunder or proceeds thereof, in whole or in
part, which may prove to be invalid or ineffective for any reason.

 

(g)           Cash
Collateral. Upon the request of the Administrative Agent, (i) if the L/C
Issuer has honored any full or partial drawing request under any Letter of Credit
and such drawing has resulted in an L/C Borrowing, or (ii) if, as of the Letter
of Credit Expiration Date, any L/C Obligation for any reason remains
outstanding, the Borrower shall, in each case, immediately Cash Collateralize
the then Outstanding Amount of all L/C Obligations. Sections 2.05 and 8.02(c)
set forth certain additional requirements to deliver Cash Collateral
hereunder. For purposes of this Section 2.03, Section 2.05 and Section
8.02(c), “Cash Collateralize” means to pledge and deposit with or
deliver to the Administrative Agent, for the benefit of the L/C Issuer and the
Revolving Lenders, as collateral for the L/C Obligations, cash or deposit
account 

 

43

 

balances pursuant to documentation in form and substance satisfactory
to the Administrative Agent and the L/C Issuer (which documents are hereby
consented to by the Lenders). Derivatives of such term have corresponding
meanings. The Borrower hereby grants to the Administrative Agent, for the benefit
of the L/C Issuer and the Lenders, a security interest in all such cash,
deposit accounts and all balances therein and all proceeds of the foregoing. Cash
Collateral shall be maintained in blocked, non-interest bearing deposit
accounts at the Administrative Agent. If at any time the Administrative Agent
determines that any funds held as Cash Collateral pursuant to this Section
2.03(g) are subject to any right or claim of any Person other than the
Administrative Agent or that the total amount of such funds is less than the
aggregate Outstanding Amount of all L/C Obligations, the Borrower will,
forthwith upon demand by the Administrative Agent, pay to the Administrative
Agent, as additional funds to be deposited as Cash Collateral, an amount equal
to the excess of (x) such aggregate Outstanding Amount over (y) the
total amount of funds, if any, then held as Cash Collateral that the
Administrative Agent determines to be free and clear of any such right and
claim. Upon the drawing of any Letter of Credit for which funds are on deposit
as Cash Collateral, such funds shall be applied, to the extent permitted under
applicable Laws, to reimburse the L/C Issuer.

 

(h)           Applicability
of ISP and UCP. Unless otherwise expressly agreed by the L/C Issuer and the
Borrower when a Letter of Credit is issued, (i) the rules of the ISP shall
apply to each standby Letter of Credit, and (ii) the rules of the Uniform
Customs and Practice for Documentary Credits, as most recently published by the
International Chamber of Commerce at the time of issuance shall apply to each
commercial Letter of Credit.

 

(i)            Letter
of Credit Fees. The Borrower shall pay to the Administrative Agent for the
account of each Revolving Credit Lender in accordance with its Applicable
Revolving Credit Percentage a Letter of Credit fee (the “Letter of Credit
Fee”) for each Letter of Credit equal to the Eurodollar Rate times
the daily amount available to be drawn under such Letter of Credit. For
purposes of computing the daily amount available to be drawn under any Letter
of Credit, the amount of such Letter of Credit shall be determined in
accordance with Section 1.06. Letter of Credit Fees shall be (i) due and
payable on the first Business Day after the end of each March, June, September
and December, commencing with the first such date to occur after the issuance
of such Letter of Credit, on the Letter of Credit Expiration Date and
thereafter on demand and (ii) computed on a quarterly basis in arrears. If
there is any change in the Applicable Rate during any quarter, the daily amount
available to be drawn under each Letter of Credit shall be computed and
multiplied by the Applicable Rate separately for each period during such
quarter that such Applicable Rate was in effect. Notwithstanding anything to
the contrary contained herein, upon the request of the Required Revolving
Lenders, while any Event of Default exists, all Letter of Credit Fees shall
accrue at the Default Rate.

 

(j)            Fronting
Fee and Documentary and Processing Charges Payable to L/C Issuer. The Borrower
shall pay directly to the L/C Issuer for its own account a fronting fee with
respect to each Letter of Credit, at the rate per annum specified in the
Administrative Fee Letter, computed on the daily amount available to be drawn
under such Letter of Credit on a quarterly basis in arrears. Such fronting fee
shall be due and payable on the tenth Business Day after the end of each March,
June, September and December in respect of the most recently-ended quarterly
period (or portion thereof, in the case of the first payment), commencing with
the first such

 

44

 

date to occur after the issuance of such Letter of Credit, on the
Letter of Credit Expiration Date and thereafter on demand. For purposes of
computing the daily amount available to be drawn under any Letter of Credit,
the amount of such Letter of Credit shall be determined in accordance with Section
1.06. In addition, the Borrower shall pay directly to the L/C Issuer for
its own account the customary issuance, presentation, amendment and other
processing fees, and other standard costs and charges, of the L/C Issuer
relating to letters of credit as from time to time in effect. Such customary
fees and standard costs and charges are due and payable on demand and are
nonrefundable.

 

(k)           Conflict
with Issuer Documents. In the event of any conflict between the terms
hereof and the terms of any Issuer Document, the terms hereof shall control.

 

(l)            Letters
of Credit Issued for Subsidiaries. Notwithstanding that a Letter of Credit
issued or outstanding hereunder is in support of any obligations of, or is for
the account of, a Subsidiary, the Borrower shall be obligated to reimburse the
L/C Issuer hereunder for any and all drawings under such Letter of Credit. The
Borrower hereby acknowledges that the issuance of Letters of Credit for the
account of Subsidiaries inures to the benefit of the Borrower, and that the
Borrower’s business derives substantial benefits from the businesses of such
Subsidiaries.

 

2.04.        [Reserved].

 

2.05.        Prepayments.

 

(a)           Optional.
The Borrower may, upon notice to the Administrative Agent, at any time or from
time to time voluntarily prepay Term Loans and Revolving Credit Loans in whole
or in part without premium or penalty; provided that (A) such notice
must be received by the Administrative Agent not later than 11:00 a.m. (1)
three Business Days prior to any date of prepayment of Eurodollar Rate Loans
and (2) on the date of prepayment of Base Rate Loans; (B) any prepayment
of Eurodollar Rate Loans shall be in a principal amount of $1,000,000 or a
whole multiple of $1,000,000 in excess thereof; and (C) any prepayment of Base
Rate Loans shall be in a principal amount of $500,000 or a whole multiple of
$100,000 in excess thereof or, in each case, if less, the entire principal
amount thereof then outstanding. Each such notice shall specify the date and
amount of such prepayment and the Type(s) of Loans to be prepaid and, if
Eurodollar Rate Loans are to be prepaid, the Interest Period(s) of such Loans. The
Administrative Agent will promptly notify each Lender of its receipt of each
such notice, and of the amount of such Lender’s ratable portion of such
prepayment (based on such Lender’s Applicable Percentage in respect of the
relevant Facility). If such notice is given by the Borrower, the Borrower shall
make such prepayment and the payment amount specified in such notice shall be
due and payable on the date specified therein. Any prepayment of a Eurodollar
Rate Loan shall be accompanied by all accrued interest on the amount prepaid,
together with any additional amounts required pursuant to Section 3.05. Each
prepayment of the outstanding Term Loans pursuant to this Section 2.05(a)
shall be applied to the principal repayment installments thereof on a pro rata
basis, and each such prepayment shall be paid to the Lenders in accordance with
their respective Applicable Percentages in respect of each of the relevant
Facilities.

 

45

 

(b)           Mandatory.
(i)  Within five Business Days after
financial statements have been delivered pursuant to Section 6.01(a) and
the related Compliance Certificate has been delivered pursuant to Section
6.02(b), the Borrower shall prepay an aggregate principal amount of Loans
equal to the excess (if any) of (A) 50% of Excess Cash Flow for the fiscal year
covered by such financial statements over (B) the aggregate principal
amount of Term Loans prepaid pursuant to Section 2.05(a) (such mandatory
prepayments to be applied as set forth in clauses (vi) and (ix) below).

 

(ii)           If
the Borrower or any of its Subsidiaries Disposes of any property (other than
any Disposition of any property permitted by Sections 7.05(a) - (f))
which results in the realization by such Person of Net Cash Proceeds, the
Borrower shall prepay an aggregate principal amount of Loans equal to 100% of
such Net Cash Proceeds immediately upon receipt thereof by such Person (such
prepayments to be applied as set forth in clauses (vi) and (ix) below).

 

(iii)          Upon
the sale or issuance by the Borrower or any of its Subsidiaries of any of its
Equity Interests (other than Excluded Issuances and any sales or issuances of
Equity Interests to another Loan Party), the Borrower shall prepay an aggregate
principal amount of Loans equal to 100% of all Net Cash Proceeds received
therefrom immediately upon receipt thereof by the Borrower or such Subsidiary
(such prepayments to be applied as set forth in clauses (vi) and (ix) below).

 

(iv)          Upon
the incurrence or issuance by the Borrower or any of its Subsidiaries of any
Indebtedness (other than Indebtedness permitted to be incurred or issued
pursuant to Section 7.02), the Borrower shall prepay an aggregate
principal amount of Loans equal to 100% of all Net Cash Proceeds received
therefrom immediately upon receipt thereof by the Borrower or such Subsidiary
(such prepayments to be applied as set forth in clauses (vi) and (ix) below).

 

(v)           Upon
any Extraordinary Receipt received by or paid to or for the account of the
Borrower or any of its Subsidiaries, and not otherwise included in clause (ii),
(iii) or (iv) of this Section 2.05(b), the Borrower shall prepay an
aggregate principal amount of Loans equal to 100% of all Net Cash Proceeds
received therefrom immediately upon receipt thereof by the Borrower or such
Subsidiary (such prepayments to be applied as set forth in clauses (vi) and
(ix) below).

 

(vi)          Each
prepayment of Loans pursuant to the foregoing provisions of this Section
2.05(b) shall be applied, first, to the Term B Facility and to the
principal repayment installments thereof on a pro rata basis and, second,
to the Revolving Credit Facility in the manner set forth in clause (ix) of this
Section 2.05(b).

 

(vii)         Notwithstanding
any of the other provisions of clause (ii), (iii), (iv) or (v) of this
Section 2.05(b), so long as no Default shall have occurred and be
continuing, if, on any date on which a prepayment would otherwise be required
to be made pursuant to clause (ii), (iii), (iv) or (v) of this Section 2.05(b),
the aggregate amount of Net Cash Proceeds required by such clause to be applied
to prepay Loans on such date is less than or equal to $2,000,000, the Borrower
may defer such prepayment until the first date on which the aggregate amount of
Net Cash Proceeds or other amounts otherwise required under clause (ii), (iii),
(iv) or (v) of this Section 2.05(b) to be applied to prepay Loans
exceeds $1,000,000. During such deferral period the Borrower 

 

46

 

may apply all or any part of such aggregate amount to prepay Revolving
Credit Loans and may, subject to the fulfillment of the applicable conditions
set forth in Article IV, reborrow such amounts (which amounts, to the
extent originally constituting Net Cash Proceeds, shall be deemed to retain their
original character as Net Cash Proceeds when so reborrowed) for application as
required by this Section 2.05(b). Upon the occurrence of a Default
during any such deferral period, the Borrower shall immediately prepay the
Loans in the amount of all Net Cash Proceeds received by the Borrower and other
amounts, as applicable, that are required to be applied to prepay Loans under
this Section 2.05(b) (without giving effect to the first and second
sentences of this clause (vii)) but which have not previously been so
applied.

 

(viii)        If
for any reason the Total Revolving Credit Outstandings at any time exceed the
aggregate amount of the Revolving Credit Lenders’ Revolving Credit Commitments
at such time, the Borrower shall immediately prepay Revolving Credit Loans and
L/C Borrowings and/or Cash Collateralize the L/C Obligations (other than the
L/C Borrowings) in an aggregate amount equal to such excess.

 

(ix)           Prepayments
of the Revolving Credit Facility made pursuant to this Section 2.05(b), first,
shall be applied ratably to the L/C Borrowings, second, shall be applied
ratably to the outstanding Revolving Credit Loans, and, third, shall be
used to Cash Collateralize the remaining L/C Obligations (provided that such
prepayment shall not reduce the Revolving Credit Commitments); and, in the case
of prepayments of the Revolving Credit Facility required pursuant to clause
(i), (ii), (iii), (iv) or (v) of this Section 2.05(b), the amount
remaining, if any, after the prepayment in full of all L/C Borrowings and Revolving
Credit Loans outstanding at such time and the Cash Collateralization of the
remaining L/C Obligations in full (the sum of such prepayment amounts, cash
collateralization amounts and remaining amount being, collectively, the “Reduction
Amount”) may be retained by the Borrower for use in the ordinary course of
its business. Upon the drawing of any Letter of Credit that has been Cash
Collateralized, the funds held as Cash Collateral shall be applied (without any
further action by or notice to or from the Borrower or any other Loan Party) to
reimburse the L/C Issuer or the Revolving Credit Lenders, as applicable.

 

2.06.        Termination
or Reduction of Commitments.

 

(a)           Optional.
The Borrower may, upon notice to the Administrative Agent, terminate the
Revolving Credit Facility or the Letter of Credit Sublimit or from time to time
permanently reduce the Revolving Credit Commitments or the Letter of Credit
Sublimit; provided that (i) any such notice shall be received by the
Administrative Agent not later than 11:00 a.m. five Business Days prior to the
date of termination or reduction, (ii) any such partial reduction shall be in
an aggregate amount of $5,000,000 or any whole multiple of $1,000,000 in excess
thereof and (iii) the Borrower shall not terminate or reduce (A) the Revolving
Credit Commitments if, after giving effect thereto and to any concurrent
prepayments hereunder, the Total Revolving Credit Outstandings would exceed the
aggregate Revolving Credit Commitments or (B) the Letter of Credit
Sublimit if, after giving effect thereto, the Outstanding Amount of L/C
Obligations not fully Cash Collateralized hereunder would exceed the Letter of
Credit Sublimit.

 

(b)           Mandatory.
(i)  [Reserved].

 

47

 

(ii)           The
aggregate Term B Commitments shall be automatically and permanently
reduced to zero on the date of the Term B Borrowing.

 

(iii)          [Reserved].

 

(iv)          If
after giving effect to any reduction or termination of Revolving Credit
Commitments under this Section 2.06, or the Letter of Credit Sublimit
exceeds the aggregate Revolving Credit Commitments at such time, the Letter of
Credit Sublimit shall be automatically reduced by the amount of such excess.

 

(c)           Application
of Commitment Reductions; Payment of Fees. The Administrative Agent will
promptly notify the Lenders of any termination or reduction of the Letter of
Credit Sublimit, or the Revolving Credit Commitment under this Section 2.06.
Upon any reduction of the Revolving Credit Commitments, the Revolving Credit
Commitment of each Revolving Credit Lender shall be reduced by such Lender’s
Applicable Revolving Credit Percentage of such reduction amount. All fees in
respect of the Revolving Credit Facility accrued until the effective date of
any termination of the Revolving Credit Facility shall be paid on the effective
date of such termination.

 

2.07.        Repayment
of Loans.

 

(a)           [Reserved].

 

(b)           Term
B Loans. The Borrower shall repay to the Term B Lenders the aggregate
principal amount of all Term B Loans outstanding on the following dates in
the respective amounts set forth opposite such dates (which amounts shall be
reduced as a result of the application of prepayments in accordance with the
order of priority set forth in Section 2.05(a) and (b)(vi)):

 

	
  Date

  	
   

  	
  Amount

  	
   

  
	
  June 30, 2007

  	
   

  	
  $

  	
  450,000

  	
   

  
	
  September
  30, 2007

  	
   

  	
  $

  	
  450,000

  	
   

  
	
  December 31,
  2007

  	
   

  	
  $

  	
  450,000

  	
   

  
	
  March 31,
  2008

  	
   

  	
  $

  	
  450,000

  	
   

  
	
  June 30,
  2008

  	
   

  	
  $

  	
  450,000

  	
   

  
	
  September
  30, 2008

  	
   

  	
  $

  	
  450,000

  	
   

  
	
  December 31,
  2008

  	
   

  	
  $

  	
  450,000

  	
   

  
	
  March 31,
  2009

  	
   

  	
  $

  	
  450,000

  	
   

  
	
  June 30,
  2009

  	
   

  	
  $

  	
  450,000

  	
   

  
	
  September
  30, 2009

  	
   

  	
  $

  	
  450,000

  	
   

  
	
  December 31,
  2009

  	
   

  	
  $

  	
  450,000

  	
   

  
	
  March 31,
  2010

  	
   

  	
  $

  	
  450,000

  	
   

  
	
  June 30,
  2010

  	
   

  	
  $

  	
  450,000

  	
   

  
	
  September
  30, 2010

  	
   

  	
  $

  	
  450,000

  	
   

  
	
  December 31,
  2010

  	
   

  	
  $

  	
  450,000

  	
   

  

 

48

 

	
  Date

  	
   

  	
  Amount

  	
   

  
	
  March 31,
  2011

  	
   

  	
  $

  	
  450,000

  	
   

  
	
  June 30,
  2011

  	
   

  	
  $

  	
  450,000

  	
   

  
	
  Term Loan
  Maturity Date

  	
   

  	
  $

  	
  172,350,000

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  Total

  	
   

  	
  $

  	
  180,000,000

  	
   

  

 

provided, however, that the final
principal repayment installment of the Term B Loans shall be repaid on the
Maturity Date for the Term B Facility and in any event shall be in an
amount equal to the aggregate principal amount of all Term B Loans
outstanding on such date.

 

(c)           Revolving
Credit Loans. The Borrower shall repay to the Revolving Credit Lenders on
the Maturity Date for the Revolving Credit Facility the aggregate principal
amount of all Revolving Credit Loans outstanding on such date.

 

2.08.        Interest.

 

(a)           Subject
to the provisions of Section 2.08(b), (i) each Eurodollar Rate Loan
under a Facility shall bear interest on the outstanding principal amount
thereof for each Interest Period at a rate per annum equal to the Eurodollar
Rate for such Interest Period plus the Applicable Rate for such
Facility; and (ii) each Base Rate Loan under a Facility shall bear interest on
the outstanding principal amount thereof from the applicable borrowing date at
a rate per annum equal to the Base Rate plus the Applicable Rate for
such Facility.

 

(b)           (i)  If any amount of principal of any Loan is not
paid when due, whether at stated maturity, by acceleration or otherwise, such
amount shall thereafter bear interest at a fluctuating interest rate per annum
at all times equal to the Default Rate to the fullest extent permitted by
applicable Laws.

 

(ii)           If
any amount (other than principal of any Loan) payable by the Borrower under any
Loan Document is not paid when due, whether at stated maturity, by acceleration
or otherwise, then upon the request of the Required Lenders such amount shall
thereafter bear interest at a fluctuating interest rate per annum at all times
equal to the Default Rate to the fullest extent permitted by applicable Laws.

 

(iii)          Upon
the request of the Required Lenders, while any Event of Default exists, the
Borrower shall pay interest on the principal amount of all outstanding
Obligations hereunder at a fluctuating interest rate per annum at all times
equal to the Default Rate to the fullest extent permitted by applicable Laws.

 

(iv)          Accrued
and unpaid interest on past due amounts (including interest on past due
interest) shall be due and payable upon demand.

 

(c)           Interest
on each Loan shall be due and payable in arrears on each Interest Payment Date
applicable thereto and at such other times as may be specified herein. Interest

 

49

 

hereunder shall be due and payable in accordance with the terms hereof
before and after judgment, and before and after the commencement of any
proceeding under any Debtor Relief Law.

 

2.09.        Fees.
In addition to certain fees described in Sections 2.03(i) and (j):

 

(a)           Commitment
Fee. The Borrower shall pay to the Administrative Agent for the account of
each Revolving Credit Lender in accordance with its Applicable Revolving Credit
Percentage, a commitment fee equal to the Applicable Commitment Fee Percentage times
the actual daily amount by which the aggregate Revolving Credit Commitments
exceed the sum of (i) the Outstanding Amount of Revolving Credit Loans and (ii)
the Outstanding Amount of L/C Obligations. The commitment fee shall accrue at
all times during the Availability Period, including at any time during which
one or more of the conditions in Article IV is not met, and shall be due
and payable quarterly in arrears on the last Business Day of each March, June,
September and December, commencing with the first such date to occur after the
Closing Date, and on the last day of the Availability Period for the Revolving
Credit Facility. The commitment fee shall be calculated quarterly in arrears,
and if there is any change in the Applicable Rate during any quarter, the
actual daily amount shall be computed and multiplied by the Applicable Rate
separately for each period during such quarter that such Applicable Rate was in
effect.

 

(b)           Other
Fees. (i)  The Borrower shall pay the
amounts required to be paid under the Fee Letter in the amounts and at the
times specified therein. Such fees shall be fully earned when paid and shall
not be refundable for any reason whatsoever.

 

(ii)           The Borrower shall pay to the Lenders such
fees as shall have been separately agreed upon in writing in the amounts and at
the times so specified. Such fees shall be fully earned when paid and shall not
be refundable for any reason whatsoever.

 

2.10.        Computation
of Interest and Fees. All computations of interest for Base Rate Loans when
the Base Rate is determined by Bank of America’s “prime rate” shall be made on
the basis of a year of 365 or 366 days, as the case may be, and actual days
elapsed. All other computations of fees and interest shall be made on the basis
of a 360-day year and actual days elapsed (which results in more fees or
interest, as applicable, being paid than if computed on the basis of a 365-day
year). Interest shall accrue on each Loan for the day on which the Loan is
made, and shall not accrue on a Loan, or any portion thereof, for the day on
which the Loan or such portion is paid, provided that any Loan that is
repaid on the same day on which it is made shall, subject to Section 2.12(a),
bear interest for one day. Each determination by the Administrative Agent of an
interest rate or fee hereunder shall be conclusive and binding for all
purposes, absent manifest error.

 

2.11.        Evidence
of Debt.

 

(a)           The
Credit Extensions made by each Lender shall be evidenced by one or more
accounts or records maintained by such Lender and by the Administrative Agent
in the ordinary course of business. The accounts or records maintained by the
Administrative Agent and each Lender shall be conclusive absent manifest error
of the amount of the Credit Extensions made by the Lenders to the Borrower and
the interest and payments thereon. Any failure to so 

 

50

 

record or any error in doing so shall not, however, limit or otherwise
affect the obligation of the Borrower hereunder to pay any amount owing with
respect to the Obligations. In the event of any conflict between the accounts
and records maintained by any Lender and the accounts and records of the
Administrative Agent in respect of such matters, the accounts and records of
the Administrative Agent shall control in the absence of manifest error. Upon
the request of any Lender made through the Administrative Agent, the Borrower
shall execute and deliver to such Lender (through the Administrative Agent) a
Note, which shall evidence such Lender’s Loans in addition to such accounts or
records. Each Lender may attach schedules to its Note and endorse thereon the
date, Type (if applicable), amount and maturity of its Loans and payments with
respect thereto.

 

(b)           In
addition to the accounts and records referred to in Section 2.11(a),
each Lender and the Administrative Agent shall maintain in accordance with its
usual practice accounts or records evidencing the purchases and sales by such
Lender of participations in Letters of Credit. In the event of any conflict
between the accounts and records maintained by the Administrative Agent and the
accounts and records of any Lender in respect of such matters, the accounts and
records of the Administrative Agent shall control in the absence of manifest
error.

 

2.12.        Payments
Generally; Administrative Agent’s Clawback.

 

(a)           General.
All payments to be made by the Borrower shall be made without condition or
deduction for any counterclaim, defense, recoupment or setoff. Except as
otherwise expressly provided herein, all payments by the Borrower hereunder
shall be made to the Administrative Agent, for the account of the respective
Lenders to which such payment is owed, at the Administrative Agent’s Office in
Dollars and in immediately available funds not later than 2:00 p.m. on the date
specified herein. The Administrative Agent will promptly distribute to each
Lender its Applicable Percentage in respect of the relevant Facility (or other
applicable share as provided herein) of such payment in like funds as received
by wire transfer to such Lender’s Lending Office. All payments received by the
Administrative Agent after 2:00 p.m. shall be deemed received on the next
succeeding Business Day and any applicable interest or fee shall continue to
accrue. If any payment to be made by the Borrower shall come due on a day other
than a Business Day, payment shall be made on the next following Business Day,
and such extension of time shall be reflected on computing interest or fees, as
the case may be.

 

(b)           (i)  Funding by Lenders; Presumption by
Administrative Agent. Unless the Administrative Agent shall have received
notice from a Lender prior to the proposed date of any Borrowing of Eurodollar
Rate Loans (or, in the case of any Borrowing of Base Rate Loans, prior to 12:00
noon on the date of such Borrowing) that such Lender will not make available to
the Administrative Agent such Lender’s share of such Borrowing, the
Administrative Agent may assume that such Lender has made such share available
on such date in accordance with Section 2.02 (or, in the case of a
Borrowing of Base Rate Loans, that such Lender has made such share available in
accordance with and at the time required by Section 2.02) and may, in
reliance upon such assumption, make available to the Borrower a corresponding
amount. In such event, if a Lender has not in fact made its share of the
applicable Borrowing available to the Administrative Agent, then the applicable
Lender and the Borrower severally agree to pay to the Administrative Agent
forthwith on demand such corresponding amount in immediately available funds
with 

 

51

 

interest thereon, for each day from and including the date such amount
is made available to the Borrower to but excluding the date of payment to the
Administrative Agent, at (A) in the case of a payment to be made by such
Lender, the greater of the Federal Funds Rate and a rate determined by the
Administrative Agent in accordance with banking industry rules on interbank
compensation, plus any administrative, processing or similar fees customarily
charged by the Administrative Agent in connection with the foregoing, and (B)
in the case of a payment to be made by the Borrower, the interest rate
applicable to Base Rate Loans. If the Borrower and such Lender shall pay such
interest to the Administrative Agent for the same or an overlapping period, the
Administrative Agent shall promptly remit to the Borrower the amount of such
interest paid by the Borrower for such period. If such Lender pays its share of
the applicable Borrowing to the Administrative Agent, then the amount so paid
shall constitute such Lender’s Loan included in such Borrowing. Any payment by
the Borrower shall be without prejudice to any claim the Borrower may have
against a Lender that shall have failed to make such payment to the
Administrative Agent.

 

(ii)           Payments
by Borrower; Presumptions by Administrative Agent. Unless the
Administrative Agent shall have received notice from the Borrower prior to the
time at which any payment is due to the Administrative Agent for the account of
the Lenders or the L/C Issuer hereunder that the Borrower will not make such
payment, the Administrative Agent may assume that the Borrower has made such
payment on such date in accordance herewith and may, in reliance upon such
assumption, distribute to the Appropriate Lenders or the L/C Issuer, as the
case may be, the amount due. In such event, if the Borrower has not in fact
made such payment, then each of the Appropriate Lenders or the L/C Issuer, as
the case may be, severally agrees to repay to the Administrative Agent
forthwith on demand the amount so distributed to such Lender or the L/C Issuer,
in immediately available funds with interest thereon, for each day from and
including the date such amount is distributed to it to but excluding the date
of payment to the Administrative Agent, at the greater of the Federal Funds
Rate and a rate determined by the Administrative Agent in accordance with
banking industry rules on interbank compensation.

 

A notice of the Administrative Agent to any Lender or the Borrower with
respect to any amount owing under this subsection (b) shall be conclusive,
absent manifest error.

 

(c)           Failure
to Satisfy Conditions Precedent. If any Lender makes available to the Administrative
Agent funds for any Loan to be made by such Lender as provided in the foregoing
provisions of this Article II, and such funds are not made available to
the Borrower by the Administrative Agent because the conditions to the
applicable Credit Extension set forth in Article IV are not satisfied or
waived in accordance with the terms hereof, the Administrative Agent shall
return such funds (in like funds as received from such Lender) to such Lender,
without interest.

 

(d)           Obligations
of Lenders Several. The obligations of the Lenders hereunder to make Term
Loans and Revolving Credit Loans and to fund participations in Letters of
Credit and to make payments pursuant to Section 11.04(c) are several and
not joint. The failure of any Lender to make any Loan, to fund any such
participation or to make any payment under Section 11.04(c) on any date
required hereunder shall not relieve any other Lender of its corresponding
obligation to do so on such date, and no Lender shall be responsible for the
failure of any other 

 

52

 

Lender to so make its Loan, to purchase its participation or to make
its payment under Section 11.04(c).

 

(e)           Funding
Source. Nothing herein shall be deemed to obligate any Lender to obtain the
funds for any Loan in any particular place or manner or to constitute a
representation by any Lender that it has obtained or will obtain the funds for
any Loan in any particular place or manner.

 

(f)            Insufficient
Funds. If at any time insufficient funds are received by and available to
the Administrative Agent to pay fully all amounts of principal, L/C Borrowings,
interest and fees then due hereunder, such funds shall be applied (i) first,
toward payment of interest and fees then due hereunder, ratably among the
parties entitled thereto in accordance with the amounts of interest and fees
then due to such parties, and (ii) second, toward payment of principal
and L/C Borrowings then due hereunder, ratably among the parties entitled
thereto in accordance with the amounts of principal and L/C Borrowings then due
to such parties.

 

2.13.        Sharing
of Payments by Lenders. If any Lender shall, by exercising any right of
setoff or counterclaim or otherwise, obtain payment in respect of (a)
Obligations in respect of any the Facilities due and payable to such Lender
hereunder and under the other Loan Documents at such time in excess of its
ratable share (according to the proportion of (i) the amount of such
Obligations due and payable to such Lender at such time to (ii) the aggregate
amount of the Obligations in respect of the Facilities due and payable to all
Lenders hereunder and under the other Loan Documents at such time) of payments
on account of the Obligations in respect of the Facilities due and payable to
all Lenders hereunder and under the other Loan Documents at such time obtained
by all the Lenders at such time or (b) Obligations in respect of any of the
Facilities owing (but not due and payable) to such Lender hereunder and under
the other Loan Documents at such time in excess of its ratable share (according
to the proportion of (i) the amount of such Obligations owing (but not due and
payable) to such Lender at such time to (ii) the aggregate amount of the
Obligations in respect of the Facilities owing (but not due and payable) to all
Lenders hereunder and under the other Loan Parties at such time) of payment on
account of the Obligations in respect of the Facilities owing (but not due and
payable) to all Lenders hereunder and under the other Loan Documents at such
time obtained by all of the Lenders at such time then the Lender receiving such
greater proportion shall (a) notify the Administrative Agent of such fact, and
(b) purchase (for cash at face value) participations in the Loans and
subparticipations in L/C Obligations of the other Lenders, or make such other
adjustments as shall be equitable, so that the benefit of all such payments
shall be shared by the Lenders ratably in accordance with the aggregate amount
of Obligations in respect of the Facilities then due and payable to the Lenders
or owing (but not due and payable) to the Lenders, as the case may be, provided
that:

 

(i)            if any such participations or
subparticipations are purchased and all or any portion of the payment giving
rise thereto is recovered, such participations or subparticipations shall be
rescinded and the purchase price restored to the extent of such recovery,
without interest; and

 

(ii)           the provisions of this Section shall not be
construed to apply to (A) any payment made by the Borrower pursuant to and in
accordance with the express terms of 

 

53

 

this Agreement or (B) any payment obtained by a Lender as consideration
for the assignment of or sale of a participation in any of its Loans or
subparticipations in L/C Obligations to any assignee or participant, other than
to the Borrower or any Subsidiary thereof (as to which the provisions of this
Section shall apply).

 

The Borrower consents to the foregoing and agrees, to the extent it may
effectively do so under applicable law, that any Lender acquiring a
participation pursuant to the foregoing arrangements may exercise against the
Borrower rights of setoff and counterclaim with respect to such participation
as fully as if such Lender were a direct creditor of the Borrower in the amount
of such participation.

 

ARTICLE III

TAXES, YIELD PROTECTION AND ILLEGALITY

 

3.01.        Taxes.

 

(a)           Payments
Free of Taxes. Any and all payments by or on account of any obligation of a
Loan Party hereunder or under any other Loan Document shall be made free and
clear of and without reduction or withholding for any Indemnified Taxes or
Other Taxes, provided that if the Borrower shall be required by
applicable law to deduct any Indemnified Taxes (including any Other Taxes) from
such payments, then (i) the sum payable shall be increased as necessary so that
after making all required deductions (including deductions applicable to
additional sums payable under this Section) the Administrative Agent, any
Lender or the L/C Issuer, as the case may be, receives an amount equal to the
sum it would have received had no such deductions been made, (ii) the
applicable Loan Party shall make such deductions and (iii) the applicable Loan
Party shall timely pay the full amount deducted to the relevant Governmental
Authority in accordance with applicable law.

 

(b)           Payment
of Other Taxes by the Borrower. Without limiting the provisions of
subsection (a) above, the Borrower shall timely pay any Other Taxes to the
relevant Governmental Authority in accordance with applicable law.

 

(c)           Indemnification
by the Borrower. The Loan Parties shall indemnify the Administrative Agent,
each Lender and the L/C Issuer, within 30 days after demand therefor, for the
full amount of any Indemnified Taxes or Other Taxes (including Indemnified
Taxes or Other Taxes imposed or asserted on or attributable to amounts payable
under this Section) paid by the Administrative Agent, such Lender or the L/C
Issuer, as the case may be, and any penalties, interest and reasonable expenses
arising therefrom or with respect thereto, whether or not such Indemnified
Taxes or Other Taxes were correctly or legally imposed or asserted by the
relevant Governmental Authority; provided, however, that the Loan
Parties shall have no liability hereunder in respect of penalties, interest and
other liabilities attributable to any Indemnified Taxes or Other Taxes if such
penalties, interest or other liabilities are attributable to the gross
negligence or willful misconduct of an Administrative Agent, Lender or L/C
Issuer. A certificate as to the amount of such payment or liability delivered
to the Borrower (or applicable Loan Party) by a Lender or the L/C Issuer (with
a copy to the Administrative Agent), or by the Administrative Agent on its own
behalf or on behalf of a Lender or the L/C Issuer, shall be conclusive absent
manifest error.

 

54

 

(d)           Evidence
of Payments. As soon as practicable after any payment of Indemnified Taxes
or Other Taxes by a Loan Party to a Governmental Authority, the Loan Party
shall deliver to the Administrative Agent the original or a certified copy of a
receipt issued by such Governmental Authority evidencing such payment, a copy
of the return reporting such payment or other evidence of such payment
reasonably satisfactory to the Administrative Agent.

 

(e)           Status
of Lenders. Any Foreign Lender that is entitled to an exemption from or
reduction of withholding tax under the law of the jurisdiction in which the
Borrower is resident for tax purposes, or any treaty to which such jurisdiction
is a party, with respect to payments hereunder or under any other Loan Document
shall deliver to the Borrower (with a copy to the Administrative Agent), at the
time or times prescribed by applicable law or reasonably requested by the
Borrower or the Administrative Agent, such properly completed and executed
documentation prescribed by applicable law as will permit such payments to be
made without withholding or at a reduced rate of withholding. In addition, any
Lender, if requested by the Borrower or the Administrative Agent, shall deliver
such other documentation prescribed by applicable law or reasonably requested
by the Borrower or the Administrative Agent as will enable the Borrower or the
Administrative Agent to determine whether or not such Lender is subject to
backup withholding or information reporting requirements.

 

Without limiting the generality of the foregoing, if the Borrower is
resident for tax purposes in the United States, any Foreign Lender shall
deliver to the Borrower and the Administrative Agent (in such number of copies
as shall be requested by the recipient) on or prior to the date on which such
Foreign Lender becomes a Lender under this Agreement (and from time to time thereafter
upon the request of the Borrower or the Administrative Agent, but only if such
Foreign Lender is legally entitled to do so), whichever of the following is
applicable:

 

(i)            duly completed copies of Internal Revenue
Service Form W-8BEN claiming eligibility for benefits of an income tax treaty
to which the United States is a party,

 

(ii)           duly completed copies of Internal Revenue
Service Form W-8ECI,

 

(iii)          in the case of a Foreign Lender claiming the
benefits of the exemption for portfolio interest under section 881(c) of the
Code, (A) a certificate to the effect that such Foreign Lender is not (1) a “bank”
within the meaning of section 881(c)(3)(A) of the Code, (2) a “10 percent
shareholder” of the Borrower within the meaning of section 881(c)(3)(B) of the
Code, or (3) a “controlled foreign corporation” described in section
881(c)(3)(C) of the Code and (B) duly completed copies of  Internal Revenue Service Form W-8BEN, or

 

(iv)          any other form prescribed by applicable law
as a basis for claiming exemption from or a reduction in United States Federal
withholding tax duly completed together with such supplementary documentation
as may be prescribed by applicable law to permit the Borrower to determine the
withholding or deduction required to be made.

 

(f)            Treatment
of Certain Refunds. If the Administrative Agent, any Lender or the L/C
Issuer determines, in its sole discretion, that it has received a refund of any
Indemnified Taxes or Other Taxes as to which it has been indemnified by a Loan
Party or with respect to 

 

55

 

which a Loan Party has paid additional amounts pursuant to this
Section, it shall pay to the Loan Party an amount equal to such refund (but
only to the extent of indemnity payments made, or additional amounts paid, by
the Loan Party under this Section with respect to the Indemnified Taxes or
Other Taxes giving rise to such refund), net of all out-of-pocket expenses of
the Administrative Agent, such Lender or the L/C Issuer, as the case may be, and
without interest (other than any interest paid by the relevant Governmental
Authority with respect to such refund), provided that the Loan Party,
upon the request of the Administrative Agent, such Lender or the L/C Issuer,
agrees to repay the amount paid over to the Loan Party (plus any
penalties, interest or other charges imposed by the relevant Governmental
Authority) to the Administrative Agent, such Lender or the L/C Issuer if the
Administrative Agent, such Lender or the L/C Issuer is required to repay such
refund to such Governmental Authority. This subsection shall not be construed
to require the Administrative Agent, any Lender or the L/C Issuer to make
available its tax returns (or any other information relating to its taxes that
it deems confidential) to the Loan Parties or any other Person.

 

3.02.        Illegality.
If any Lender determines that any Law has made it unlawful, or that any
Governmental Authority has asserted that it is unlawful, for any Lender or its
applicable Lending Office to make, maintain or fund Eurodollar Rate Loans, or
to determine or charge interest rates based upon the Eurodollar Rate, or any
Governmental Authority has imposed material restrictions on the authority of
such Lender to purchase or sell, or to take deposits of, Dollars in the London
interbank market, then, on notice thereof by such Lender to the Borrower
through the Administrative Agent, any obligation of such Lender to make or
continue Eurodollar Rate Loans or to convert Base Rate Loans to Eurodollar Rate
Loans shall be suspended until such Lender notifies the Administrative Agent
and the Borrower that the circumstances giving rise to such determination no
longer exist. Upon receipt of such notice, the Borrower shall, upon demand from
such Lender (with a copy to the Administrative Agent), prepay or, if
applicable, convert all Eurodollar Rate Loans of such Lender to Base Rate
Loans, either on the last day of the Interest Period therefor, if such Lender
may lawfully continue to maintain such Eurodollar Rate Loans to such day, or
immediately, if such Lender may not lawfully continue to maintain such
Eurodollar Rate Loans. Upon any such prepayment or conversion, the Borrower
shall also pay accrued interest on the amount so prepaid or converted.

 

3.03.        Inability
to Determine Rates. If the Required Lenders determine that for any reason
in connection with any request for a Eurodollar Rate Loan or a conversion to or
continuation thereof that (a) Dollar deposits are not being offered to banks in
the London interbank eurodollar market for the applicable amount and Interest
Period of such Eurodollar Rate Loan, (b) adequate and reasonable means do not
exist for determining the Eurodollar Rate for any requested Interest Period
with respect to a proposed Eurodollar Rate Loan, or (c) the Eurodollar Rate for
any requested Interest Period with respect to a proposed Eurodollar Rate Loan
does not adequately and fairly reflect the cost to such Lenders of funding such
Loan, the Administrative Agent will promptly so notify the Borrower and each
Lender. Thereafter, the obligation of the Lenders to make or maintain
Eurodollar Rate Loans shall be suspended until the Administrative Agent (upon
the instruction of the Required Lenders) revokes such notice. Upon receipt of
such notice, the Borrower may revoke any pending request for a Borrowing of,
conversion to or continuation of Eurodollar Rate Loans or, failing that, will
be deemed to have converted such 

 

56

 

request into a
request for a Committed Borrowing of Base Rate Loans in the amount specified
therein.

 

3.04.        Increased
Costs; Reserves on Eurodollar Rate Loans.

 

(a)           Increased
Costs Generally. If any Change in Law shall:

 

(i)            impose, modify or deem applicable any
reserve, special deposit, compulsory loan, insurance charge or similar
requirement against assets of, deposits with or for the account of, or credit
extended or participated in by, any Lender (except any reserve requirement
contemplated by Section 3.04(e)) or the L/C Issuer;

 

(ii)           subject any Lender or the L/C Issuer to any
tax of any kind whatsoever with respect to this Agreement, any Letter of
Credit, any participation in a Letter of Credit or any Loan made by it
hereunder, or change the basis of taxation of payments to such Lender or the L/C
Issuer in respect thereof (except for Indemnified Taxes or Other Taxes covered
by Section 3.01 and the imposition of, or any change in the rate of, any
Excluded Tax payable by such Lender or the L/C Issuer); or

 

(iii)          impose on any Lender or the L/C Issuer or the
London interbank market any other condition, cost or expense affecting this
Agreement or Eurodollar Rate Loans made hereunder by such Lender or any Letter
of Credit or participation therein;

 

and the result of any of the foregoing shall be to increase the cost to
such Lender of making or maintaining any Loan (or of maintaining its obligation
to make any such Loan), or to increase the cost to such Lender or the L/C
Issuer of participating in, issuing or maintaining any Letter of Credit (or of
maintaining its obligation to participate in or to issue any Letter of Credit),
or to reduce the amount of any sum received or receivable by such Lender or the
L/C Issuer hereunder (whether of principal, interest or any other amount) then,
upon written request of such Lender or the L/C Issuer, the Borrower will pay to
such Lender or the L/C Issuer, as the case may be, such additional amount or
amounts as will compensate such Lender or the L/C Issuer, as the case may be,
for such additional costs incurred or reduction suffered following the receipt
of such request.

 

(b)           Capital
Requirements. If any Lender or the L/C Issuer determines that any Change in
Law affecting such Lender or the L/C Issuer or any Lending Office of such
Lender or such Lender’s or the L/C Issuer’s holding company, if any, regarding
capital requirements has or would have the effect of reducing the rate of
return on such Lender’s or the L/C Issuer’s capital or on the capital of such
Lender’s or the L/C Issuer’s holding company, if any, as a consequence of this
Agreement, the Commitments of such Lender or the Loans made by, or
participations in Letters of Credit held by, such Lender, or the Letters of
Credit issued by the L/C Issuer, to a level below that which such Lender or the
L/C Issuer or such Lender’s or the L/C Issuer’s holding company could have
achieved but for such Change in Law (taking into consideration such Lender’s or
the L/C Issuer’s policies and the policies of such Lender’s or the L/C Issuer’s
holding company with respect to capital adequacy), then from time to time the
Borrower will pay to such Lender or the L/C Issuer, as the case may be, upon
the written request of such Lender, such additional amount or amounts as will
compensate such Lender or the L/C Issuer or such Lender’s or the L/C Issuer’s
holding company for any such reduction suffered.

 

57

 

(c)           Certificates
for Reimbursement. A certificate of a Lender or the L/C Issuer setting
forth the amount or amounts necessary to compensate such Lender or the L/C
Issuer or its holding company, as the case may be, as specified in subsection
(a) or (b) of this Section and delivered to the Borrower shall be conclusive
absent manifest error. The Borrower shall pay such Lender or the L/C Issuer, as
the case may be, the amount shown as due on any such certificate within 10 days
after receipt thereof.

 

(d)           Delay
in Requests. Failure or delay on the part of any Lender or the L/C Issuer
to demand compensation pursuant to the foregoing provisions of this Section
shall not constitute a waiver of such Lender’s or the L/C Issuer’s right to
demand such compensation, provided that the Borrower shall not be
required to compensate a Lender or the L/C Issuer pursuant to the foregoing
provisions of this Section for any increased costs incurred or reductions
suffered more than six months prior to the date that such Lender or the L/C
Issuer, as the case may be, notifies the Borrower of the Change in Law giving
rise to such increased costs or reductions and of such Lender’s or the L/C
Issuer’s intention to claim compensation therefor (except that, if the Change
in Law giving rise to such increased costs or reductions is retroactive, then
the six-month period referred to above shall be extended to include the period
of retroactive effect thereof).

 

(e)           Reserves
on Eurodollar Rate Loans. The Borrower shall pay to each Lender, as long as
such Lender shall be required to maintain reserves with respect to liabilities
or assets consisting of or including Eurocurrency funds or deposits (currently
known as “Eurocurrency liabilities”), additional interest on the unpaid
principal amount of each Eurodollar Rate Loan equal to the actual costs of such
reserves allocated to such Loan by such Lender (as determined by such Lender in
good faith, which determination shall be conclusive), which shall be due and
payable on each date on which interest is payable on such Loan, provided
the Borrower shall have received at least 10 days’ prior notice (with a copy to
the Administrative Agent) of such additional interest from such Lender. If a
Lender fails to give notice 10 days prior to the relevant Interest Payment
Date, such additional interest shall be due and payable 10 days from receipt of
such notice.

 

3.05.        Compensation
for Losses. Upon demand of any Lender (with a copy to the Administrative
Agent) from time to time, the Borrower shall promptly compensate such Lender
for and hold such Lender harmless from any loss, cost or expense incurred by it
as a result of:

 

(a)           any
continuation, conversion, payment or prepayment of any Loan other than a Base
Rate Loan on a day other than the last day of the Interest Period for such Loan
(whether voluntary, mandatory, automatic, by reason of acceleration, or
otherwise);

 

(b)           any
failure by the Borrower (for a reason other than the failure of such Lender to
make a Loan) to prepay, borrow, continue or convert any Loan other than a Base
Rate Loan on the date or in the amount notified by the Borrower; or

 

(c)           any
assignment of a Eurodollar Rate Loan on a day other than the last day of the
Interest Period therefor as a result of a request by the Borrower pursuant to Section
11.13;

 

58

 

including any loss of anticipated profits and any loss or expense
arising directly, in each case, from the liquidation or reemployment of funds
obtained by it to maintain such Loan or from fees payable to terminate the
deposits from which such funds were obtained. The Borrower shall also pay any
customary administrative fees charged by such Lender in connection with the
foregoing.

 

For purposes of calculating amounts payable by the Borrower to the
Lenders under this Section 3.05, each Lender shall be deemed to
have funded each Eurodollar Rate Loan made by it at the Eurodollar Rate for
such Loan by a matching deposit or other borrowing in the London interbank
eurodollar market for a comparable amount and for a comparable period, whether
or not such Eurodollar Rate Loan was in fact so funded.

 

3.06.        Mitigation
Obligations; Replacement of Lenders.

 

(a)           Designation
of a Different Lending Office. If any Lender requests compensation under Section
3.04, or the Borrower is required to pay any additional amount to any
Lender or any Governmental Authority for the account of any Lender pursuant to Section 3.01,
or if any Lender gives a notice pursuant to Section 3.02, then such
Lender shall use reasonable efforts to designate a different Lending Office for
funding or booking its Loans hereunder or to assign its rights and obligations
hereunder to another of its offices, branches or affiliates, if, in the
judgment of such Lender, such designation or assignment (i) would eliminate or
reduce amounts payable pursuant to Section 3.01 or 3.04, as the
case may be, in the future, or eliminate the need for the notice pursuant to Section
3.02, as applicable, and (ii) in each case, would not subject such Lender
to any unreimbursed cost or expense and would not otherwise be disadvantageous
to such Lender. The Borrower hereby agrees to pay all reasonable costs and
expenses incurred by any Lender in connection with any such designation or
assignment.

 

(b)           Replacement
of Lenders. If any Lender requests compensation under Section 3.04,
if the Borrower is required to pay any additional amount to any Lender or any Governmental
Authority for the account of any Lender pursuant to Section 3.01 or if
any Lender ceases to make available Eurodollar Rate Loans pursuant to Section
3.02, the Borrower may replace such Lender in accordance with Section
11.13.

 

3.07.        Survival.
All of the Borrower’s obligations under this Article III shall survive
termination of the Aggregate Commitments and repayment of all other Obligations
hereunder.

 

ARTICLE IV

CONDITIONS PRECEDENT TO CREDIT EXTENSIONS

 

4.01.        Conditions
of Initial Credit Extension. The obligation of the L/C Issuer and each
Lender to make its initial Credit Extension hereunder is subject to
satisfaction of the following conditions precedent:

 

(a)           The
Administrative Agent’s receipt of the following, each of which shall be originals
or telecopies (followed promptly by originals) unless otherwise specified, each
properly executed by a Responsible Officer of the signing Loan Party, each
dated the Closing Date (or, in the case of certificates of governmental
officials, a recent date 

 

59

 

before the Closing Date) and each in form and substance satisfactory to
the Administrative Agent and each of the Lenders:

 

(i)            executed counterparts of this Agreement and
each Guaranty, sufficient in number for distribution to the Administrative
Agent, each Lender and the Borrower;

 

(ii)           a Note executed by the Borrower in favor of
each Lender requesting a Note;

 

(iii)          a pledge and security agreement, in
substantially the form of Exhibit G (together with each other
pledge and security agreement delivered pursuant to Sections 6.12
and 6.15, in each case as amended, the “Security Agreement”),
duly executed by each Loan Party, together with:

 

(A)          certificates representing the Pledged Equity
referred to therein accompanied by undated stock powers executed in blank and
instruments evidencing the Pledged Debt indorsed in blank,

 

(B)           proper Financing Statements in form
appropriate for filing under the Uniform Commercial Code of all jurisdictions
that the Administrative Agent may deem necessary or desirable in order to
perfect the Liens created under the Security Agreement, covering the Collateral
described in the Security Agreement,

 

(C)           completed requests for information, dated on
or before the date of the initial Credit Extension, listing all effective
financing statements and other evidence of liens filed in the jurisdictions
referred to in clause (B) above and in each other jurisdiction requested
by the Administrative Agent that name any Loan Party as debtor, together with
copies of such other financing statements,

 

(D)          evidence of the completion of all other
actions, recordings and filings of or with respect to the Security Agreement
that the Administrative Agent may deem necessary or desirable in order to
perfect the Liens created thereby,

 

(E)           the Account Control Agreements and the
Securities Account Control Agreement, in each case as referred to in the
Security Agreement and duly executed by the appropriate parties,

 

(F)           evidence that all other action that the Administrative
Agent may deem necessary or desirable in order to perfect the Liens created
under the Security Agreement has been taken (including receipt of duly executed
payoff letters, UCC-3 termination statements and landlords’ and bailees’ waiver
and consent agreements);

 

60

 

(iv)          deeds of trust, trust deeds, deeds to secure
debt, mortgages, or any other document, creating and evidencing a Lien on any
Mortgaged Property (as defined in the Collateral Documents), in substantially
the form of Exhibit H (with such changes as may be satisfactory to
the Administrative Agent and its counsel to account for local law matters) and
covering the properties listed on Schedule 4.01(a)(iv) (together with
the Assignments of Leases and Rents referred to therein and each other mortgage
delivered pursuant to Section 6.12 or Section 6.15, in each case
as amended, the “Mortgages”), duly executed by the appropriate Loan
Party, together with:

 

(A)          evidence that counterparts of the Mortgages
have been duly executed, acknowledged and delivered and are in form suitable
for filing or recording in all filing or recording offices that the
Administrative Agent may deem necessary or desirable in order to create a valid
first and subsisting Lien on the property described therein in favor of the
Administrative Agent for the benefit of the Secured Parties and that all
filing, documentary, stamp, intangible and recording taxes and fees have been
paid,

 

(B)           fully paid American Land Title Association
Lender’s Extended Coverage title insurance policies (the “Mortgage Policies”)
in form and substance, with endorsements and in amounts not less than $6.5
million, issued, coinsured and reinsured by a Title Company acceptable to the
Administrative Agent, insuring the Mortgages to be valid first and subsisting
Liens on the property and described therein, free and clear of all defects
(including, but not limited to, mechanics’ and materialmen’s Liens) and
encumbrances, excepting only Permitted Encumbrances and other Liens permitted
under the Loan Documents, and providing for such other affirmative insurance
(including endorsements for future advances under the Loan Documents, for
mechanics’ and materialmen’s Liens and for zoning of the applicable property) and
on matters relating to first loss dollar, contiguity, revolving credit,
non-imputation, public road access, survey, variable rate, environmental lien,
mortgage recording tax, separate tax lot, so-called comprehensive coverage over
covenants and restrictions, and a “tie-in” or “cluster” endorsement, if
available under applicable Law (i.e. policies which insure against losses
regardless of location on allocated value of the insured property up to a
stated maximum coverage amount) and such coinsurance and direct access
reinsurance as the Administrative Agent may deem necessary or desirable,

 

(C)           American Land Title Association form
surveys, for which all necessary fees (where applicable) have been paid, and
dated as of a date acceptable to the Administrative Agent, certified to the
Administrative Agent and the issuer of the Mortgage Policies in a manner
satisfactory to the Administrative Agent by a land surveyor duly registered and
licensed in the State in which the property described in such surveys is located
and acceptable to the Administrative Agent, showing all buildings 

 

61

 

and other improvements, any off-site improvements, the location of any
easements, parking spaces, rights of way, building set-back lines and other
dimensional regulations and the absence of encroachments, either by such
improvements or on to such property, and other defects, other than
encroachments and other defects acceptable to the Administrative Agent,

 

(D)          [Reserved],

 

(E)           with respect to each property to be subject
to a Mortgage, such affidavits, certificates, information (including financial
data) and instruments of identification (including a so-called “gap”
indemnification) as shall be required to induce the Title Company to issue the
title insurance policy/ies and endorsements contemplated above,

 

(F)           evidence reasonably acceptable to the
Administrative Agent of payment by Borrower of all required title insurance
policy premiums, search and examination charges, escrow charges and related
charges, mortgage recording taxes, fees, charges, costs and expenses required
for the recording of the Mortgages and issuance of title insurance policies
referred to above,

 

(G)           with respect to the Real Property, copies of
all Leases or other agreements relating to possessory interests, if any. To the
extent any of the foregoing affect any property to be subject to a Mortgage
with respect to which the Borrower or any Subsidiary holds the lessor’s
interest, such agreement shall be subordinate to the Lien of the Mortgage to be
recorded against such property, either expressly by its terms or pursuant to a
subordination, non-disturbance and attornment agreement, and shall otherwise be
acceptable to the Administrative Agent,

 

(H)          with respect to each property to be subject
to a Mortgage, each Loan Party and each of their Subsidiaries shall have made
all notifications, registrations and filings, to the extent required by, and in
accordance with, all Governmental Real Property Disclosure Requirements applicable
to such property,

 

(I)            evidence that the insurance required to be
maintained pursuant to the Loan Documents has been obtained and is in effect,

 

(J)            evidence that all other action that the
Administrative Agent may deem necessary or desirable in order to create valid
first and subsisting Liens on the property described in the Mortgages has been
taken,

 

(K)          a competed Federal Emergency Management
Agency Standard Flood Hazard Determination with respect to each property to be
subject to a Mortgage, and

 

62

 

(L)           with respect to each Real Property subject
to a Mortgage, appraisals that satisfy the applicable requirements of the Real
Estate Appraisal Reform Amendments of FIRREA and are otherwise in form and substance
satisfactory to the Administrative Agent,

 

(v)           such certificates of resolutions or other
action, incumbency certificates and/or other certificates of Responsible
Officers of each Loan Party as the Administrative Agent may require evidencing
the identity, authority and capacity of each Responsible Officer thereof
authorized to act as a Responsible Officer in connection with this Agreement
and the other Loan Documents to which such Loan Party is a party or is to be a
party;

 

(vi)          such documents and certifications as the
Administrative Agent may reasonably require to evidence that each Loan Party is
duly organized or formed, and that the Borrower and Guarantors is validly
existing, in good standing and qualified to engage in business in each
jurisdiction where its ownership, lease or operation of properties or the
conduct of its business requires such qualification, except to the extent that
failure to do so could not reasonably be expected to have a Material Adverse
Effect;

 

(vii)         a favorable opinion of Munger, Tolles &
Olson LLP, counsel to the Loan Parties, addressed to the Administrative Agent
and each Lender, as to the matters set forth in Exhibit J-1 and such
other matters concerning the Loan Parties and the Loan Documents as the
Required Lenders may reasonably request;

 

(viii)        a favorable opinion of Fox Rothschild LLP,
local counsel to the Loan Parties in Pennsylvania, addressed to the
Administrative Agent and each Lender, as to the matters set forth in Exhibit
J-2 and such other matters concerning the Loan Parties and the Loan
Documents as the Required Lenders may reasonably request;

 

(ix)           a certificate signed by a Responsible
Officer of the Borrower certifying (A) that the conditions specified in Sections
4.02(a) and (b) have been satisfied and (B) that there has been no
event or circumstance since December 31, 2004 that has had or could be
reasonably expected to have, either individually or in the aggregate, a
Material Adverse Effect;

 

(x)            certificates attesting to the Solvency of
each Loan Party before and after giving effect to the Transaction, from its
chief financial officer;

 

(xi)           an environmental assessment report, in form
and substance satisfactory to the Lenders from an environmental consulting firm
acceptable to the Lenders, which report shall identify existing and potential
environmental concerns and shall quantify related costs and liabilities,
associated with any facilities of the Borrower, the Company or any of their
respective Subsidiaries, and the Lenders shall be satisfied with the nature and
amount of any such matters and with the Borrower’s plans with respect thereto;

 

63

 

(xii)        certified copies of each employment agreement
and other compensation arrangement with each executive officer of any Loan
Party or any of its Subsidiaries as the Administrative Agent shall request;

 

(xiii)       evidence that all insurance required to be maintained
pursuant to the Loan Documents has been obtained and is in effect, together
with the certificates of insurance, naming the Collateral Agent, on behalf of
the Secured Parties, as an additional insured or loss payee, as the case may
be, under all insurance policies maintained with respect to the assets and
properties of the Loan Parties that constitutes Collateral;

 

(xiv)       certified copies of the Related Documents
(including, without limitation, the Holdback Agreement), duly executed by the
parties thereto and in form and substance satisfactory to the Lenders, together
with all agreements, instruments and other documents delivered in connection
therewith as the Administrative Agent shall request;

 

(xv)        such other assurances, certificates, documents,
consents or opinions as the Administrative Agent, the L/C Issuer or any Lender
reasonably may require;

 

(xvi)       the Intercreditor Agreement, duly executed by
the parties thereto; and

 

(xvii)      a management fee subordination agreement, duly
executed by Millennium, in substantially the form of Exhibit M.

 

(b)           (i)
All fees required to be paid to the Administrative Agent and the Arrangers on
or before the Closing Date shall have been paid and (ii) all fees required to
be paid to the Lenders on or before the Closing Date shall have been paid.

 

(c)           Unless
waived by the Administrative Agent, the Borrower shall have paid all fees,
charges and disbursements of counsel to the Administrative Agent (directly to
such counsel if requested by the Administrative Agent) to the extent invoiced
prior to or on the Closing Date, plus such additional amounts of such fees,
charges and disbursements as shall constitute its reasonable estimate of such
fees, charges and disbursements incurred or to be incurred by it through the
closing proceedings (provided that such estimate shall not thereafter
preclude a final settling of accounts between the Borrower and the
Administrative Agent).

 

(d)           The
Closing Date shall have occurred on or before December 31, 2006.

 

(e)           All
of the information made available to the Administrative Agent prior to July 20,
2006 shall be complete and correct in all material respects; and no changes or
developments shall have occurred, and no new or additional information shall
have been received or discovered by the Administrative Agent or the Lenders
regarding the Borrower, the Acquired Companies or the Transaction after
July 20, 2006 that either individually 

 

64

 

or in the aggregate could reasonably be expected to have a “Material
Adverse Effect” (as defined in the Related Documents).

 

(f)            Each
of the Holdback Agreement (as defined in the Post-Closing Agreement) and the
Equity Guarantee shall be in full force and effect.

 

(g)           The
“Second Closing” under the Post-Closing Agreement shall have been consummated
(or shall be concurrently consummated) strictly in accordance with the terms
thereof, without any waiver or amendment not consented to by the Lenders of any
term, provision or condition set forth therein, and in compliance with all
applicable requirements of Law.

 

(h)           From
November 1, 2006 to the Closing Date, the Borrower shall have received not less
than $50.0 million in cash proceeds from capital contributions to its equity
from funds invested by OCM in CCR and contributed to Borrower.

 

(i)            The
Lenders shall be satisfied as to all intercompany indebtedness and all
indebtedness and other liabilities of the Acquired Companies to third parties
that are to remain outstanding following the Closing Date.

 

(j)            The
expiration or termination of the requisite waiting period under the
Hart-Scott-Rodino Antitrust Improvements Act of 1976 shall have occurred and no
Governmental Authority (as defined in the Related Documents) shall have
enacted, promulgated, enforced or entered any Governmental Order (as defined in
the Related Documents) which is in effect and has the effect of making the
transactions contemplated by the Related Documents illegal, otherwise
restraining or prohibiting consummation of such transactions or causing any of
such transactions to be rescinded following completion, thereof. Borrower shall
have received final approval (excluding any appeal period, if applicable) from
the “Commission” (as defined in the Stock Purchase Agreement) of (x) the
purchase of the Acquired Companies by Borrower and (y) the management of the
racing operations of the “Meadows Facility” (as defined in the Stock Purchase
Agreement) under the Racing Services Agreement. Either (i) the “Gaming Board”
(as defined in the Stock Purchase Agreement) shall have issued a Pennsylvania
Gaming License to any of the Acquired Companies or (ii) the Gaming Board
shall have approved the issuance of a Pennsylvania Gaming License to any of the
Acquired Companies, and the Arrangers shall be reasonably satisfied with the
conditions contained in such approval. Since July 20, 2006, there shall not
have been any gaming law, rule or regulation enacted, or any interpretation of
an existing gaming law, rule or regulation announced, that restricts in any
material respect (or requires a license with respect to) the ability of a
lender to assign or participate in interest in the Term Facility.

 

(k)           The
Lenders shall have received: (A) an audited combined balance sheet of the
Acquired Companies and their subsidiaries (excluding the “Excluded Subsidiaries”
as defined in the Stock Purchase Agreement) as of December 31, 2005 and
audited statements of income, cash flows and equity for the year then ended at
least 15 days prior to the Closing Date; and (B) an unaudited combined balance
sheet of the Acquired Companies and their subsidiaries (excluding the “Excluded
Subsidiaries” as defined in the 

 

65

 

Stock Purchase Agreement) as of each quarter ending at least 45 days
prior to the Closing Date, together with the related unaudited statements of
income, cash flows and equity; and (C) and pro forma combined financial
statements of the Borrower and its Subsidiaries after giving Effect to the
Transaction as of the dates, and for the periods, set forth in clause (B)
above; and (D) forecasts prepared by management of the Borrower, each in form
satisfactory to the Lenders, of balance sheets, income statements and cash flow
statements for (i) each fiscal quarter for the first year following the Closing
Date and (ii) for each year thereafter.

 

(l)            Each
of the Facilities shall have received ratings from Moody’s Investors Service,
Inc. and Standard & Poor’s, a division of The McGraw-Hill Companies, Inc.,
at least 20 days prior to the Closing Date.

 

(m)          The
Borrower shall have deposited $50.0 million in a cash collateral account for
the purpose of cash collateralizing the Licensing Fee L/C.

 

(n)           The
Borrower shall have received not less than $70.0 million cash proceeds from the
advance of the Second Lien Loans.

 

(o)           A
complete information memorandum shall have been provided for use in syndicating
the Facilities at least 30 days prior to the Closing Date.

 

(p)           All
contracts, subcontracts and lease agreements related to (x) road improvement
cost related to the Temporary Casino and (y) a “sprung structure” to house the
Temporary Casino (the “Construction Contracts”), shall not collectively
exceed an aggregate amount of $39.6 million, and in each case shall be on terms
reasonably satisfactory to the Arrangers and the Administrative Agent.

 

(q)           The
terms of the construction reserve, the Budget, the Timetable and the Plans and
Specifications (the collectively, “Construction Plans”) with respect to
the Temporary Casino and related road improvements shall be reasonably
satisfactory to the Construction Consultant, the Arrangers and the
Administrative Agent.

 

Without limiting the generality of the provisions of Section 9.04,
for purposes of determining compliance with the conditions specified in this Section
4.01, each Lender that has signed this Agreement shall be deemed to have
consented to, approved or accepted or to be satisfied with, each document or
other matter required thereunder to be consented to or approved by or
acceptable or satisfactory to a Lender unless the Administrative Agent shall
have received notice from such Lender prior to the proposed Closing Date
specifying its objection thereto.

 

4.02.        Conditions
to All Credit Extensions. The obligation of each Lender to honor any
Request for Credit Extension (other than a Committed Loan Notice requesting
only a conversion of Loans to the other Type, or a continuation of Eurodollar
Rate Loans) is subject to the following conditions precedent:

 

(a)           The
representations and warranties of the Borrower contained in Article V or
any other Loan Document, or which are contained in any document furnished at
any 

 

66

 

time under or in connection herewith or therewith, shall be true and
correct on and as of the date of such Credit Extension, except to the extent
that such representations and warranties specifically refer to an earlier date,
in which case they shall be true and correct as of such earlier date, and
except that for purposes of this Section 4.02, the representations and
warranties contained in Sections 5.05(a) and (b) shall be deemed
to refer to the most recent statements furnished pursuant to Sections
6.01(a) and (b), respectively.

 

(b)           No
Default shall exist, or would result from such proposed Credit Extension or
from the application of the proceeds thereof.

 

(c)           The
Administrative Agent and, if applicable or the L/C Issuer shall have received a
Request for Credit Extension in accordance with the requirements hereof.

 

(d)           The
Administrative Agent shall have received such other approvals, opinions or
documents as any Lender through the Administrative Agent may reasonably
request.

 

Each Request for Credit Extension (other than a Committed Loan Notice
requesting only a conversion of Loans to the other Type or a continuation of
Eurodollar Rate Loans) submitted by the Borrower shall be deemed to be a
representation and warranty that the conditions specified in Sections
4.02(a) and (b) have been satisfied on and as of the date of the
applicable Credit Extension.

 

ARTICLE V

REPRESENTATIONS AND WARRANTIES

 

The Borrower represents and warrants to the Administrative Agent and
the Lenders that:

 

5.01.        Existence,
Qualification and Power. Each Loan Party and each of its Subsidiaries (a)
is duly organized or formed, validly existing and, as applicable, in good
standing under the Laws of the jurisdiction of its incorporation or
organization, (b) has all requisite power and authority and all requisite
governmental licenses, authorizations, consents and approvals to (i) own or lease
its assets and carry on its business and (ii) execute, deliver and perform its
obligations under the Loan Documents and Related Documents to which it is a
party and consummate the Transaction, and (c) is duly qualified and is licensed
and, as applicable, in good standing under the Laws of each jurisdiction where
its ownership, lease or operation of properties or the conduct of its business
requires such qualification or license; except as set forth on Schedule 5.01
or in each case referred to in clause (b)(i) or (c), to the extent that failure
to do so could not reasonably be expected to have a Material Adverse Effect.

 

5.02.        Authorization;
No Contravention. The execution, delivery and performance by each Loan
Party of each Loan Document and Related Document to which such Person is or is
to be a party have been duly authorized by all necessary corporate or other
organizational action, and do not and will not (a) contravene the terms of any
of such Person’s Organization Documents; (b) conflict with or result in any
breach or contravention of, or the creation of any Lien under, or require any
payment to be made under (i) any Contractual Obligation to which 

 

67

 

such Person is a party or affecting such Person or the properties of
such Person or any of its Subsidiaries or (ii) any order, injunction, writ or
decree of any Governmental Authority or any arbitral award to which such Person
or its property is subject; or (c) violate any Law.

 

5.03.        Governmental
Authorization; Other Consents. No approval, consent, exemption,
authorization, or other action by, or notice to, or filing with, any
Governmental Authority or any other Person is necessary or required in
connection with (a) the execution, delivery or performance by, or enforcement
against, any Loan Party of this Agreement or any other Loan Document or Related
Document, or for the consummation of the Transaction, (b) the grant by any
Loan Party of the Liens granted by it pursuant to the Collateral Documents, (c) the
perfection or maintenance of the Liens created under the Collateral Documents
(including the first priority nature thereof) or (d) the exercise by the
Administrative Agent or any Lender of its rights under the Loan Documents or
the remedies in respect of the Collateral pursuant to the Collateral Documents,
except for the authorizations, approvals, actions, notices and filings listed
on Schedule 5.03, all of which have been duly obtained, taken,
given or made and are in full force and effect except as provided thereon. Except
as set forth on Schedule 5.03, all applicable waiting periods in
connection with the Transaction have expired without any action having been
taken by any Governmental Authority restraining, preventing or imposing
materially adverse conditions upon the Transaction or the rights of the Loan
Parties or their Subsidiaries freely to transfer or otherwise dispose of, or to
create any Lien on, any properties now owned or hereafter acquired by any of
them.

 

5.04.        Binding
Effect. This Agreement has been, and each other Loan Document, when
delivered hereunder, will have been, duly executed and delivered by each Loan
Party that is party thereto. This Agreement constitutes, and each other Loan
Document when so delivered will constitute, a legal, valid and binding
obligation of such Loan Party, enforceable against each Loan Party that is
party thereto in accordance with its terms.

 

5.05.        Financial
Statements; No Material Adverse Effect; No Internal Control Event.

 

(a)           To
the knowledge of the Borrower, the Audited Financial Statements (i) were
prepared in accordance with GAAP consistently applied throughout the period
covered thereby, except as otherwise expressly noted therein and (ii) fairly
present the financial condition of the Acquired Companies as of the date
thereof and their results of operations for the period covered thereby in
accordance with GAAP consistently applied throughout the period covered
thereby, except as otherwise expressly noted therein.

 

(b)           To
the knowledge of the Borrower, the unaudited combined balance sheet of the
Acquired Companies dated September 30, 2006, and the related combined
statements of income or operations, shareholders’ equity and cash flows for the
fiscal quarter ended on that date as set forth on Schedule 5.05(b) (i)
were prepared in accordance with GAAP consistently applied throughout the
period covered thereby, except as otherwise expressly noted therein, and (ii)
fairly present the financial condition of the Acquired Companies as of the date
thereof and their results of operations for the period covered thereby,
subject, in the case of clauses (i) and (ii), to the absence of footnotes and
to normal year-end audit adjustments.

 

68

 

(c)           Since
the date of the Audited Financial Statements, there has been no event or
circumstance, either individually or in the aggregate, that has had or could
reasonably be expected to have a Material Adverse Effect.

 

(d)           To
the best knowledge of the Borrower, no Internal Control Event exists or has
occurred since the date of the Audited Financial Statements that has resulted
in or could reasonably be expected to result in a misstatement in any material
respect, in any financial information delivered or to be delivered to the
Administrative Agent or the Lenders, of (i) covenant compliance calculations
provided hereunder or (ii) the assets, liabilities, financial condition or
results of operations of the Borrower and its Subsidiaries on a consolidated
basis.

 

(e)           The
consolidated pro forma balance sheet of the Borrower and its Subsidiaries as at
September 30, 2006, and the related consolidated pro forma statements
of income and cash flows of the Borrower and its Subsidiaries for the twelve
months then ended as set forth on Schedule 5.05(e), certified by the
chief financial officer or treasurer of the Borrower, copies of which have been
furnished to each Lender, fairly present the consolidated pro forma
financial condition of the Borrower and its Subsidiaries as at such date and
the consolidated pro forma results of operations of the Borrower and its
Subsidiaries for the period ended on such date, in each case giving effect to
the Transaction, all in accordance with GAAP.

 

(f)            The
consolidated forecasted balance sheets, statements of income and cash flows of
the Borrower and its Subsidiaries delivered pursuant to Section 4.01
or Section 6.01(d) were prepared in good faith on the basis of the
assumptions stated therein, which assumptions were fair in light of the
conditions existing at the time of delivery of such forecasts, and represented,
at the time of delivery, the Borrower’s best estimate of its future financial
condition and performance.

 

5.06.        Litigation.
There are no actions, suits, proceedings, claims or disputes pending or, to the
knowledge of the Borrower, threatened, at law, in equity, in arbitration or
before any Governmental Authority, by or against the Borrower or any of its
Subsidiaries or against any of their properties or revenues that (a) purport to
affect or pertain to this Agreement, any other Loan Document, any Related
Document or the consummation of the Transaction, or (b) either individually or
in the aggregate, if determined adversely, could reasonably be expected to have
a Material Adverse Effect.

 

5.07.        No
Default. Neither any Loan Party nor any Subsidiary thereof is in default
under or with respect to any Contractual Obligation that could, either
individually or in the aggregate, reasonably be expected to have a Material
Adverse Effect. No Default has occurred and is continuing or would result from
the consummation of the transactions contemplated by this Agreement or any
other Loan Document.

 

5.08.        Liens;
Investments.

 

(a)           Each
Loan Party and each of its Subsidiaries has good record and marketable title in
fee simple to, or valid leasehold interests in, all Real Property necessary or
used in the ordinary conduct of its business, except for such defects in title
as could not, individually or in the aggregate, reasonably be expected to have
a Material Adverse Effect.

 

69

 

(b)           Neither
the businesses nor the properties of any Loan Party or any of its Subsidiaries
are affected by any Casualty Event. No Loan Party or any of its Subsidiaries
has received any notice of, not has any knowledge of, the occurrence or
pendency or contemplation of any Casualty Event affecting all or any portion of
its property. No Mortgage encumbers improved Real Property that is located in
an area that has been identified by the Secretary of Housing and Urban Developments
as an area having special flood hazards within the meaning of the National
Flood Insurance Act of 1968 unless flood insurance available under such Act has
been obtained in accordance with Section 6.07.

 

(c)           Schedule 5.08(c)
sets forth a complete and accurate list of all Liens on the property or assets
of each Loan Party and each of its Subsidiaries, showing as of the date hereof
the lienholder thereof and the property or assets of such Loan Party or such
Subsidiary subject thereto. The property of each Loan Party and each of its
Subsidiaries is subject to no Liens, other than Liens set forth on Schedule 5.08(c),
and as otherwise permitted by Section 7.01.

 

(d)           Schedule 5.08(d)
sets forth a complete and accurate list of all Real Property owned by each Loan
Party and each of its Subsidiaries, showing as of the date hereof the street
address, county or other relevant jurisdiction, state, record owner and book
value thereof. Each Loan Party and each of its Subsidiaries has good,
marketable and insurable fee simple title to the Real Property owned by such
Loan Party or such Subsidiary, free and clear of all Liens, other than Liens
created or permitted by the Loan Documents.

 

(e)           (i)  Schedule 5.08(e)(i) sets forth a
complete and accurate list of all leases of Real Property under which any Loan
Party or any Subsidiary of a Loan Party is the Lessee or guarantee, showing as
of the date hereof the street address, county or other relevant jurisdiction,
state, lessor, lessee, expiration date and annual rental cost thereof. Each
such lease is the legal, valid and binding obligation of the lessor thereof,
enforceable in accordance with its terms, except where the failure thereof
could not reasonably be expected to have a Material Adverse Effect.

 

(ii)           Schedule
5.08(e)(ii) sets forth a complete and accurate list of all Leases of Real
Property under which any Loan Party or any Subsidiary of a Loan Party is the
lessor or guarantor, showing as of the date hereof the street address, county
or other relevant jurisdiction, state, lessor, lessee, expiration date and
annual rental cost thereof. Each such lease is the legal, valid and binding
obligation of the lessee or guarantee thereof, enforceable in accordance with
its terms, except where the failure thereof could not reasonably be expected to
have a Material Adverse Effect.

 

(f)            Schedule 5.08(f)
sets forth a complete and accurate list of all Investments held by any Loan
Party or any Subsidiary of a Loan Party on the date hereof, showing as of the
date hereof the amount, obligor or issuer and maturity, if any, thereof.

 

5.09.        Environmental
Compliance.

 

(a)           Based
upon a review of the effect of existing Environmental Laws and claims alleging
potential liability or responsibility for violation of any Environmental Law on
the businesses, operations and properties of the Loan Parties and their
respective Subsidiaries, the 

 

70

 

Borrower has reasonably concluded that,
except as specifically disclosed in Schedule 5.09, such
Environmental Laws and claims could not, individually or in the aggregate,
reasonably be expected to have a Material Adverse Effect.

 

(b)           Except
as otherwise set forth in Schedule 5.09, to the best knowledge of
the Borrower (i) none of the properties currently or formerly owned or operated
by any Loan Party or any of its Subsidiaries is listed or proposed for listing
on the NPL or on the CERCLIS or any analogous foreign, state or local list or
is adjacent to any such property; (ii) there are no and never have been any
underground or above-ground storage tanks or any surface impoundments, septic
tanks, pits, sumps or lagoons in which Hazardous Materials are being or have
been treated, stored or disposed on any property currently owned or operated by
any Loan Party or any of its Subsidiaries or, to the best of the knowledge of
the Loan Parties, on any property formerly owned or operated by any Loan Party
or any of its Subsidiaries; (iii) there is no asbestos or asbestos-containing
material on any property currently owned or operated by any Loan Party or any
of its Subsidiaries; and (iv) Hazardous Materials have not been released,
discharged or disposed of on any property currently or formerly owned or
operated by any Loan Party or any of its Subsidiaries.

 

(c)           Except
as otherwise set forth on Schedule 5.09, to the best knowledge of
the Borrower (i) neither any Loan Party nor any of its Subsidiaries is
undertaking, and has not completed, either individually or together with other
potentially responsible parties, any investigation or assessment or remedial or
response action relating to any actual or threatened release, discharge or
disposal of Hazardous Materials at any site, location or operation, either
voluntarily or pursuant to the order of any Governmental Authority or the
requirements of any Environmental Law; and (ii) all Hazardous Materials
generated, used, treated, handled or stored at, or transported to or from, any
property currently or formerly owned or operated by any Loan Party or any of
its Subsidiaries have been disposed of in a manner not reasonably expected to
result in material liability to any Loan Party or any of its Subsidiaries.

 

5.10.        Insurance.
The properties of the Borrower and its Subsidiaries are insured with
financially sound and reputable insurance companies not Affiliates of the
Borrower, in such amounts (after giving effect to any self-insurance compatible
with the following standards), with such deductibles and covering such risks as
are customarily carried by companies engaged in similar businesses and owning
similar properties in localities where the Borrower or the applicable
Subsidiary operates.

 

5.11.        Taxes.
Except as set forth on Schedule 5.11, the Borrower and its Subsidiaries
have filed all Federal, state and other tax returns and reports required to be
filed, and have paid all Federal, state and other taxes, assessments, fees and
other governmental charges levied or imposed upon them or their properties,
income or assets or otherwise due and payable, except those which are being
contested in good faith by appropriate actions diligently conducted and for
which adequate reserves have been provided in accordance with GAAP and except
those which would not have a Material Adverse Effect. There is no proposed tax
assessment against the Borrower or any Subsidiary that would, if made, have a
Material Adverse Effect. Neither any Loan Party nor any Subsidiary thereof is
party to any tax sharing agreement pursuant to which it would be required to
make any payments.

 

71

 

5.12.        ERISA
Compliance.

 

(a)           Each
Plan is in compliance in all material respects with the applicable provisions
of ERISA, the Code and other Federal or state Laws. Each Plan that is intended
to qualify under Section 401(a) of the Code has received a favorable
determination letter from the IRS or an application for such a letter is
currently being processed by the IRS with respect thereto and, to the best
knowledge of the Borrower, nothing has occurred which would prevent, or cause
the loss of, such qualification. Except as set forth on Schedule 5.12,
the Borrower and each ERISA Affiliate have made all required contributions to
each Plan subject to Section 412 of the Code, and no application for a funding
waiver or an extension of any amortization period pursuant to Section 412 of
the Code has been made with respect to any Plan.

 

(b)           There
are no pending or, to the best knowledge of the Borrower, threatened claims,
actions or lawsuits, or action by any Governmental Authority, with respect to
any Plan that could reasonably be expected to have a Material Adverse Effect. There
has been no prohibited transaction or violation of the fiduciary responsibility
rules with respect to any Plan that has resulted or could reasonably be
expected to result in a Material Adverse Effect.

 

(c)           Except
as set forth on Schedule 5.12, (i) no ERISA Event has occurred or is
reasonably expected to occur; (ii) no Pension Plan has any Unfunded
Pension Liability; (iii) neither the Borrower nor any ERISA Affiliate has incurred,
or reasonably expects to incur, any liability under Title IV of ERISA with
respect to any Pension Plan (other than premiums due and not delinquent under
Section 4007 of ERISA); (iv) neither the Borrower nor any ERISA Affiliate has
incurred, or reasonably expects to incur, any liability (and no event has
occurred which, with the giving of notice under Section 4219 of ERISA, would
result in such liability) under Section 4201 or 4243 of ERISA with respect to a
Multiemployer Plan; and (v) neither the Borrower nor any ERISA Affiliate has
engaged in a transaction that could be subject to Section 4069 or 4212(c) of
ERISA.

 

5.13.        Subsidiaries;
Equity Interests; Loan Parties. As of the Closing Date, the Borrower has no
Subsidiaries other than those specifically disclosed in Part (a) of Schedule
5.13, and all of the outstanding Equity Interests in such Subsidiaries have
been validly issued, are fully paid and non-assessable and are owned by a Loan
Party in the amounts specified on Part (a) of Schedule 5.13 free and
clear of all Liens except those created under the Collateral Documents. The
Borrower has no equity investments in any other corporation or entity other
than those specifically disclosed in Part (b) of Schedule 5.13. All of
the outstanding Equity Interests in the Borrower have been validly issued, are
fully paid and non-assessable and are owned by PA MezzCo, LLC in the amounts
specified on Part (c) of Schedule 5.13 free and clear of all Liens
except those created under the Collateral Documents. Set forth on Part (d) of Schedule
5.13 is a complete and accurate list of all Loan Parties, showing as of the
Closing Date (as to each Loan Party) the jurisdiction of its incorporation, the
address of its principal place of business and its U.S. taxpayer identification
number or, in the case of any non-U.S. Loan Party that does not have a U.S.
taxpayer identification number, its unique identification number issued to it
by the jurisdiction of its incorporation. The copy of the charter of each Loan
Party and each amendment thereto provided pursuant to Section 4.01(a)(vii)
is a true and correct copy of each such document, each of which is valid and in
full force and effect.

 

72

 

5.14.        Margin
Regulations; Investment Company Act; Public Utility Holding Company Act.

 

(a)           The
Borrower is not engaged and will not engage, principally or as one of its
important activities, in the business of purchasing or carrying margin stock
(within the meaning of Regulation U issued by the FRB), or extending credit for
the purpose of purchasing or carrying margin stock.

 

(b)           None
of the Borrower, any Person Controlling the Borrower, or any Subsidiary (i) is
a “holding company,” or a “subsidiary company” of a “holding company,” or an “affiliate”
of a “holding company” or of a “subsidiary company” of a “holding company,”
within the meaning of the Public Utility Holding Company Act of 1935, or (ii)
is or is required to be registered as an “investment company” under the
Investment Company Act of 1940.

 

5.15.        Disclosure.
The Borrower has disclosed to the Administrative Agent and the Lenders all
agreements, instruments and corporate or other restrictions to which it or any
of its Subsidiaries is subject, and all other matters known to it, that,
individually or in the aggregate, could reasonably be expected to result in a
Material Adverse Effect. No report, financial statement, certificate or other
information furnished (whether in writing or orally) by or on behalf of any
Loan Party to the Administrative Agent or any Lender in connection with the
transactions contemplated hereby and the negotiation of this Agreement or
delivered hereunder or under any other Loan Document (in each case as modified
or supplemented by other information so furnished) contains any material
misstatement of fact or omits to state any material fact necessary to make the
statements therein, in the light of the circumstances under which they were
made, not misleading; provided that, with respect to projected financial
information, the Borrower represents only that such information was prepared in
good faith based upon assumptions believed to be reasonable at the time.

 

5.16.        Compliance
with Laws. Each Loan Party and each Subsidiary thereof is in compliance in
all material respects with the requirements of all Laws and all orders, writs,
injunctions and decrees applicable to it or to its properties, except in such
instances in which (a) such requirement of Law or order, writ, injunction or
decree is being contested in good faith by appropriate proceedings diligently
conducted or (b) the failure to comply therewith, either individually or in the
aggregate, could not reasonably be expected to have a Material Adverse Effect.

 

5.17.        Intellectual
Property; Licenses, Etc. The Borrower and each of its Subsidiaries own, or
possess the right to use, all of the trademarks, service marks, trade names,
copyrights, patents, patent rights, franchises, licenses and other intellectual
property rights (collectively, “IP Rights”) that are reasonably necessary
for the operation of their respective businesses, without conflict with the
rights of any other Person, and Schedule 5.17 sets forth a complete and
accurate list of all such IP Rights owned or used by the Borrower and each of
its Subsidiaries. To the best knowledge of the Borrower, no slogan or other
advertising device, product, process, method, substance, part or other material
now employed, or now contemplated to be employed, by the Borrower or any of its
Subsidiaries infringes upon any rights held by any other Person. Except as
specifically disclosed in Schedule 5.17, no claim or litigation
regarding any of the foregoing is pending or, to the best knowledge of the
Borrower, threatened, which, either individually or in the aggregate, could
reasonably be expected to have a Material Adverse Effect.

 

73

 

5.18.        Solvency.
Each Loan Party is, individually and together with its Subsidiaries on a
consolidated basis, Solvent.

 

5.19.        [Intentionally
Omitted]

 

5.20.        Labor
Matters. Except as set forth on Schedule 5.20 there are no
collective bargaining agreements or Multiemployer Plans covering the employees
of the Borrower or any of its Subsidiaries as of the Closing Date and neither
the Borrower nor any Subsidiary has suffered any strikes, walkouts, work
stoppages or other material labor difficulty within the last five years.

 

5.21.        Collateral
Documents. The provisions of the Collateral Documents are effective to
create in favor of the Administrative Agent for the benefit of the Secured
Parties a legal, valid and enforceable first priority Lien (subject to Liens
permitted by clauses (a) through (m) of Section 7.01) on all right,
title and interest of the respective Loan Parties in the Collateral described
therein. Except for filings completed prior to the Closing Date and as
contemplated hereby and by the Collateral Documents, no filing or other action
will be necessary to perfect or protect such Liens.

 

5.22.        Gaming
Matters. Except as set forth on Schedule 5.22, each Borrower, and
their Subsidiaries, have obtained (i) approval for  all Gaming Licenses necessary or appropriate
to conduct their businesses and operations conducted or as contemplated to be
conducted, and (ii) as of the Closing Date, all required approvals from Gaming
Authorities of the transactions contemplated hereby and by the other Loan
Documents, subject to the provisions of such approvals or conditions in respect
of the Gaming License as are satisfactory to the Administrative Agent.

 

5.23.        Project;
Construction Contracts. As of the date hereof, except as set forth on Schedule
5.23, (i) no Construction Contracts have been entered into or
otherwise exist and (ii) no demolition or construction has commenced
relating to the Project.

 

ARTICLE VI

AFFIRMATIVE COVENANTS

 

So long as any Lender shall have any Commitment hereunder, any Loan or
other Obligation hereunder shall remain unpaid or unsatisfied, or any Letter of
Credit shall remain outstanding, the Borrower shall, and shall (except in the
case of the covenants set forth in Sections 6.01, 6.02, 6.03
and 6.11) cause each Subsidiary to:

 

6.01.        Financial
Statements. Deliver to the Administrative Agent and each Lender, in form
and detail satisfactory to the Administrative Agent and the Required Lenders:

 

(a)           as
soon as available, but in any event within 120 days after the end of each
fiscal year of the Borrower (commencing
with the fiscal year ended December 31, 2006), a consolidated balance sheet of
the Borrower and its Subsidiaries as at the end of such fiscal year, and the
related consolidated statements of income or operations, shareholders’ equity
and cash flows for such fiscal year, setting forth in each case in comparative
form 

 

74

 

the figures for the previous fiscal year, all in reasonable detail and
prepared in accordance with GAAP, audited and accompanied by (i) a report and
opinion of Piercy Bowler Taylor & Kern or another nationally recognized
Registered Public Accounting Firm reasonably acceptable to the Required
Lenders, which report and opinion shall be prepared in accordance with
standards established by the Public Company Accounting Oversight Board (United
States) and shall not be subject to any “going concern” or like qualification
or exception or any qualification or exception as to the scope of such audit or
with respect to the absence of any material misstatement and (ii) an opinion of
such Registered Public Accounting Firm independently assessing the Borrower’s
internal controls over financial reporting in accordance with Item 308 of SEC
Regulation S-K, PCAOB Auditing Standard No. 2, and Section 404 of
Sarbanes-Oxley expressing a conclusion that contains no statement that there is
a material weakness in such internal controls, except for such material
weaknesses as to which the Required Lenders do not object;

 

(b)           as
soon as available, but in any event within 60 days after the end of each of the
first three fiscal quarters of each fiscal year of the Borrower (commencing
with the fiscal quarter ended March 31, 2007), a consolidated balance
sheet of the Borrower and its Subsidiaries as at the end of such fiscal
quarter, and the related consolidated statements of income or operations,
shareholders’ equity and cash flows for such fiscal quarter and for the portion
of the Borrower’s fiscal year then ended, setting forth in each case in
comparative form the figures for the corresponding fiscal quarter of the
previous fiscal year and the corresponding portion of the previous fiscal year,
all in reasonable detail, certified by the chief executive officer, chief
financial officer, treasurer or controller of the Borrower as fairly presenting
the financial condition, results of operations, shareholders’ equity and cash
flows of the Borrower and its Subsidiaries in accordance with GAAP, subject
only to normal year-end audit adjustments and the absence of footnotes;

 

(c)           as
soon as available, but in any event within 30 days after the end of the first
18 months commencing with the month ended March 31, 2007, monthly operating
statements in form satisfactory to the Administrative Agent; and

 

(d)           as
soon as available, but in any event at least 30 days after the end of each
fiscal year of the Borrower, an annual business plan and budget of the Borrower
and its Subsidiaries on a consolidated basis, including forecasts prepared by
management of the Borrower, in form satisfactory to the Administrative Agent
and the Required Lenders, of consolidated balance sheets and statements of
income or operations and cash flows of the Borrower and its Subsidiaries on a
quarterly basis for the immediately following fiscal year and annually for each
fiscal year thereafter (including the fiscal year in which the Maturity Date
for the Term B Facility occurs).

 

As to any information contained in materials furnished pursuant to Section
6.02(d), the Borrower shall not be separately required to furnish such
information under Section 6.01(a) or (b) above, but the foregoing
shall not be in derogation of the obligation of the Borrower to furnish the
information and materials described in Sections 6.01(a) and (b)
above at the times specified therein.

 

75

 

6.02.        Certificates;
Other Information. Deliver to the Administrative Agent and each Lender, in
form and detail satisfactory to the Administrative Agent and the Required
Lenders:

 

(a)           concurrently
with the delivery of the financial statements referred to in Section 6.01(a),
a letter from the Borrower’s Registered Public Accounting Firm indicating that
during the performance of the financial statement audit, no knowledge was
obtained of any Default under the financial covenants set forth in Section
7.11 or, if any such Default shall be known to exist, stating the nature
and status of such event;

 

(b)           (i) concurrently
with the delivery of the financial statements referred to in Sections 6.01(a)
and (b) (commencing with the delivery of the financial statements for
the earlier of (x) the first “full” three-month fiscal quarter during
which the Temporary Casino is Operating and (y) the fiscal quarter ended
September 30, 2007), a duly completed Compliance Certificate signed by the
chief executive officer, chief financial officer, treasurer or controller of
the Borrower and in the event of any change in generally accepted accounting
principles used in the preparation of such financial statements, the Borrower
shall also provide, if necessary for the determination of compliance with Section
7.11, a statement of reconciliation conforming such financial statements to
GAAP and (ii) concurrently with the delivery of the financial statements
referred to in Section 6.01(a), a copy of management’s discussion
and analysis with respect to such financial statements;

 

(c)           promptly
after any request by the Administrative Agent or any Lender, copies of any
detailed audit reports, management letters or recommendations submitted to the
board of directors (or the audit committee of the board of directors) of any
Loan Party by independent accountants in connection with the accounts or books
of any Loan Party or any of its Subsidiaries, or any audit of any of them;

 

(d)           promptly
after the same are available, copies of each annual report, proxy or financial
statement or other report or communication sent to the stockholders of the
Borrower, and copies of all annual, regular, periodic and special reports and
registration statements which the Borrower may file or be required to file with
the SEC under Section 13 or 15(d) of the Securities Exchange Act of 1934,
or with any national securities exchange, and in any case not otherwise
required to be delivered to the Administrative Agent pursuant hereto;

 

(e)           as
soon as available, but in any event within 30 days after the end of each fiscal
year of the Borrower, a report summarizing the insurance coverage (specifying
type, amount and carrier) in effect for each Loan Party and its Subsidiaries
and containing such additional information as the Administrative Agent, or any
Lender through the Administrative Agent, may reasonably specify;

 

(f)            not
later than five Business Days after receipt thereof by any Loan Party or any
Subsidiary thereof, copies of all notices, requests and other documents
(including amendments, waivers and other modifications) so received under or
pursuant to any Related Document or instrument, indenture, loan or credit or
similar agreement regarding or 

 

76

 

related to any breach or default by any party thereto or any other
event that could materially impair the value of the interests or the rights of
any Loan Party or otherwise have a Material Adverse Effect and, from time to
time upon request by the Administrative Agent, such information and reports
regarding the Related Documents and such instruments, indentures and loan and
credit and similar agreements as the Administrative Agent may reasonably
request;

 

(g)           promptly
after the assertion or occurrence thereof, notice of any action or proceeding
against or of any noncompliance by any Loan Party or any of its Subsidiaries
with any Environmental Law or Environmental Permit that could
(i) reasonably be expected to have a Material Adverse Effect or
(ii) cause any property described in the Mortgages to be subject to any
restrictions on ownership, occupancy, use or transferability under any
Environmental Law;

 

(h)           as
soon as available, but in any event within 30 days after the end of each fiscal
year of the Borrower, (i) a report supplementing Schedules 5.08(d),
5.08(e)(i) and 5.08(e)(ii), including an identification of all
owned and leased real property disposed of by the Borrower or any Subsidiary
thereof during such fiscal year, a list and description (including the street
address, county or other relevant jurisdiction, state, record owner, book value
thereof and, in the case of leases of property, lessor, lessee, expiration date
and annual rental cost thereof) of all real property acquired or leased during
such fiscal year and a description of such other changes in the information
included in such Schedules as may be necessary for such Schedules to be
accurate and complete; (ii) a
report supplementing Schedule 5.17, setting forth (A) a list of
registration numbers for all patents, trademarks, service marks, trade names
and copyrights awarded to the Borrower or any Subsidiary thereof during such
fiscal year and (B) a list of all patent applications, trademark applications,
service mark applications, trade name applications and copyright applications
submitted by the Borrower or any Subsidiary thereof during such fiscal year and
the status of each such application; and (iii) a report supplementing Schedules
5.08(f) and 5.13 containing a description of all changes in the
information included in such Schedules as may be necessary for such Schedules
to be accurate and complete, each such report to be signed by a Responsible
Officer of the Borrower and to be in a form reasonably satisfactory to the
Administrative Agent;

 

(i)            promptly,
such additional information regarding the business, financial, legal or
corporate affairs of any Loan Party or any Subsidiary thereof, or compliance
with the terms of the Loan Documents, as the Administrative Agent or any Lender
may from time to time reasonably request; and

 

(j)            promptly
following the Completion Date, the Borrower shall or shall cause the applicable
Loan Party to deliver notice to the Administrative Agent of the occurrence of
the Completion Date, together with a copy of a Completion Certificate, if any,
relating thereto.

 

Documents required to be delivered pursuant to Section 6.01(a)
or (b) or Section 6.02(d) (to the extent any such documents
are included in materials otherwise filed with the SEC) may be delivered
electronically and if so delivered, shall be deemed to have been delivered

 

77

 

on the date (i) on which the
Borrower posts such documents, or provides a link thereto on the Borrower’s
website on the Internet at the website address listed on Schedule 11.02;
or (ii) on which such documents are posted on the Borrower’s behalf on an
Internet or intranet website, if any, to which each Lender and the
Administrative Agent have access (whether a commercial, third-party website or
whether sponsored by the Administrative Agent); provided that:  (i) the Borrower shall deliver paper copies
of such documents to the Administrative Agent or any Lender that requests the
Borrower to deliver such paper copies until a written request to cease
delivering paper copies is given by the Administrative Agent or such Lender and
(ii) the Borrower shall notify the Administrative Agent and each Lender (by
telecopier or electronic mail) of the posting of any such documents and provide
to the Administrative Agent by electronic mail electronic versions (i.e.,
soft copies) of such documents. Notwithstanding anything contained herein, in
every instance the Borrower shall be required to provide paper copies of the
Compliance Certificates required by Section 6.02(b) to the
Administrative Agent. Except for such Compliance Certificates, the
Administrative Agent shall have no obligation to request the delivery or to
maintain copies of the documents referred to above, and in any event shall have
no responsibility to monitor compliance by the Borrower with any such request
for delivery, and each Lender shall be solely responsible for requesting
delivery to it or maintaining its copies of such documents.

 

The Borrower hereby acknowledges that (a) the Administrative Agent
and/or the Arrangers will make available to the Lenders and the L/C Issuer
materials and/or information provided by or on behalf of the Borrower hereunder
(collectively, “Borrower Materials”) by posting the Borrower Materials
on IntraLinks or another similar electronic system (the “Platform”) and
(b) certain of the Lenders may be “public-side” Lenders (i.e., Lenders
that do not wish to receive material non-public information with respect to the
Borrower or its securities) (each, a “Public Lender”). The Borrower
hereby agrees that (w) all Borrower Materials that are to be made
available to the Public Lenders shall be clearly and conspicuously marked “PUBLIC,”
which, at a minimum, shall mean that the word “PUBLIC” shall appear prominently
on the first page thereof; (x) by marking Borrower Materials “PUBLIC,” the
Borrower shall be deemed to have authorized the Administrative Agent, the
Arrangers, the L/C Issuer and the Lenders to treat such Borrower Materials as
not containing any material non-public information (although it may be
sensitive and proprietary) with respect to the Borrower or its securities for
purposes of United States Federal and state securities laws (provided, however,
that to the extent such Borrower Materials constitute Information, they shall
be treated as set forth in Section 11.07); (y) all Borrower Materials
marked “PUBLIC” are permitted to be made available through a portion of the
Platform designated “Public Investor”; and (z) the Administrative Agent and the
Arrangers shall be entitled to treat any Borrower Materials that are not marked
“PUBLIC” as being suitable only for posting on a portion of the Platform not
designated “Public Investor.” 
Notwithstanding the foregoing, the Borrower shall be under no obligation
to mark any Borrower Materials “PUBLIC.”

 

6.03.        Notices.
Promptly notify the Administrative Agent and each Lender as soon as becoming
aware of the same:

 

(a)           of
the occurrence of any Default;

 

78

 

(b)           of
any matter that has resulted or could reasonably be expected to result in a
Material Adverse Effect, including (i) breach or non-performance of, or any default
under, a Contractual Obligation of any Loan Party or any Subsidiary thereof;
(ii) any dispute, litigation, investigation, proceeding or suspension between
any Loan Party or any Subsidiary thereof and any Governmental Authority; or
(iii) the commencement of, or any material development in, any litigation or
proceeding affecting any Loan Party or any Subsidiary thereof, including
pursuant to any applicable Environmental Laws;

 

(c)           of
the occurrence of any ERISA Event;

 

(d)           of
any material change in accounting policies or financial reporting practices by
any Loan Party or any Subsidiary thereof;

 

(e)           of
the determination by the Registered Public Accounting Firm providing the
opinion required under Section 6.01(a)(ii) (in connection with its
preparation of such opinion) or the Borrower’s determination at any time of the
occurrence or existence of any Internal Control Event;

 

(f)            of
the (i) occurrence of any Disposition of property or assets for which the
Borrower is required to make a mandatory prepayment pursuant to Section 2.05(b)(ii),
(ii) occurrence of any sale of capital stock or other Equity Interests for
which the Borrower is required to make a mandatory prepayment pursuant to Section 2.05(b)(iii),
(iii) incurrence or issuance of any Indebtedness for which the Borrower is
required to make a mandatory prepayment pursuant to Section 2.05(b)(iv),
and (iv) receipt of any Extraordinary Receipt for which the Borrower is
required to make a mandatory prepayment pursuant to Section 2.0(b)(v);
and

 

(g)           of
any announcement by Moody’s or S&P of any change or possible change in a
Debt Rating.

 

Each notice pursuant to Section 6.03 (other than Section
6.03(f) or (g)) shall be accompanied by a statement of a Responsible
Officer of the Borrower setting forth details of the occurrence referred to
therein and stating what action the Borrower has taken and proposes to take
with respect thereto. Each notice pursuant to Section 6.03(a) shall
describe with particularity any and all provisions of this Agreement and any
other Loan Document that have been breached.

 

6.04.        Payment
of Obligations. Pay and discharge as the same shall become due and payable,
all its obligations and liabilities, including (a) all tax liabilities,
assessments and governmental charges or levies upon it or its properties or
assets, unless the same are being contested in good faith by appropriate
actions diligently conducted and adequate reserves in accordance with GAAP are
being maintained by the Borrower or such Subsidiary; (b) all lawful claims
which, if unpaid, would by law become a Lien upon its property; and (c) all
Indebtedness, as and when due and payable, but subject to any subordination
provisions contained in any instrument or agreement evidencing such
Indebtedness.

 

79

 

6.05.        Preservation
of Existence, Etc. (a) Preserve, renew and maintain in full force and
effect its legal existence and good standing under the Laws of the jurisdiction
of its organization except in a transaction permitted by Section 7.04 or
7.05; provided, however, that the Borrower and its
Subsidiaries may consummate any other merger or consolidation permitted under Section 7.04;
(b) take all reasonable action to maintain all rights, privileges, permits,
licenses and franchises necessary or desirable in the normal conduct of its
business, except to the extent that failure to do so could not reasonably be
expected to have a Material Adverse Effect; and (c) preserve or renew all of
its registered patents, trademarks, trade names and service marks, the
non-preservation of which could reasonably be expected to have a Material
Adverse Effect.

 

6.06.        Maintenance
of Properties. (a) Maintain, preserve and protect (and cause the Racing
Service Operator to maintain, preserve and protect) all of its material
properties and equipment necessary in the operation of its business in good
working order and condition, ordinary wear and tear excepted; and (b) make all
necessary repairs thereto and renewals and replacements thereof except, in the
case of (a) and (b), where the failure to do so could not reasonably be
expected to have a Material Adverse Effect.

 

6.07.        Maintenance
of Insurance. Maintain with financially sound and reputable insurance
companies not Affiliates of the Borrower, insurance with respect to its
properties and business against loss or damage of the kinds customarily insured
against by Persons engaged in the same or similar business, of such types and
in such amounts as are customarily carried under similar circumstances by such
other Persons. With respect to each of the properties to be subject to a
Mortgage, obtain flood insurance in such total amount as the Administrative
Agent or the Required Lenders may from time to time require, if at any time the
areas in which any improvements located on any property to be subject to a “flood
hazard area” in any Flood Insurance Rate Map published by the Federal Emergency
Management Agency (or any successor agency), and otherwise comply with the
National Flood Insurance Program as set forth in the Flood Disaster Protection
Act of 1973, as amended from time to time. The Collateral Agent shall be named
as additional insured and as loss payee under any insurance policies maintained
from time to time by any Loan Party.

 

6.08.        Compliance
with Laws. Comply in all material respects with the requirements of all
Laws and all orders, writs, injunctions and decrees applicable to it or to its
business or property, except in such instances in which (a) such requirement of
Law or order, writ, injunction or decree is being contested in good faith by
appropriate actions diligently conducted; or (b) the failure to comply
therewith could not reasonably be expected to have a Material Adverse Effect.

 

6.09.        Books
and Records. (a) Maintain proper books of record and account, in which
full, true and correct entries in conformity with GAAP consistently applied
shall be made of all financial transactions and matters involving the assets
and business of the Borrower or such Subsidiary, as the case may be; and (b) maintain such books of record and
account in material conformity with all applicable requirements of any
Governmental Authority having regulatory jurisdiction over the Borrower or such
Subsidiary, as the case may be.

 

80

 

6.10.        Inspection
Rights. Permit representatives and independent contractors of the
Administrative Agent and each Lender to visit and inspect any of its
properties, to examine its corporate, financial and operating records, and make
copies thereof or abstracts therefrom, and to discuss its affairs, finances and
accounts with its directors, officers, and independent public accountants, all
at the expense of the Borrower and at such reasonable times during normal
business hours and as often as may be reasonably desired, upon reasonable
advance notice to the Borrower; provided, however, that when an
Event of Default exists the Administrative Agent or any Lender (or any of their
respective representatives or independent contractors) may do any of the
foregoing at the expense of the Borrower at any time during normal business
hours and without advance notice.

 

6.11.        Use
of Proceeds. Use the proceeds of the initial Credit Extension (along with
the proceeds from the Second Lien Facility and cash on hand) to finance, in
part, the Transactions (including, without limitation, on the Closing Date
(i) refinancing the Tranche A Junior Note (as defined in the Post-Closing
Agreement), (ii) depositing $50.0 million into a cash collateral account with
the issuing bank under the License Fee L/C as cash collateral for the Licensing
Fee L/C, (iii) depositing $18.5 million into a cash collateral account
with the Disbursement Agent as contemplated by the Cash Collateral and
Disbursement Agreement to fund interest payments on the Loans through the
Interest Periods ending immediately after nine months after the Closing Date,
(iv) depositing $39.6 million into a cash collateral account with the
Disbursement Agent as contemplated by the Cash Collateral and Disbursement
Agreement, (v) depositing $5.0 million into a government restricted cash
account and (vi) paying related fees and expenses. Use the other proceeds
of the Credit Extensions for general corporate purposes not in contravention of
any Law or of any Loan Document.

 

6.12.        Covenant
to Guarantee Obligations and Give Security.

 

(a)           Upon
the formation or acquisition of any new direct or indirect Subsidiary (other
than any CFC or a Subsidiary that is held directly or indirectly by a CFC) by
any Loan Party, then the Borrower shall, at the Borrower’s expense:

 

(i)            within 10 Business Days after such
formation or acquisition, cause such Subsidiary, and cause each direct and
indirect parent of such Subsidiary (if it has not already done so), to duly
execute and deliver to the Administrative Agent a guaranty or guaranty
supplement, in form and substance satisfactory to the Administrative Agent,
guaranteeing the other Loan Parties’ obligations under the Loan Documents,

 

(ii)           within 10 Business Days after such formation
or acquisition, furnish to the Administrative Agent a description of the real
and personal properties of such Subsidiary, in detail satisfactory to the
Administrative Agent,

 

(iii)          within 15 Business Days after such formation
or acquisition, cause such Subsidiary and each direct and indirect parent of
such Subsidiary (if it has not already done so) to duly execute and deliver to
the Administrative Agent deeds of trust, trust deeds, deeds to secure debt,
mortgages and other security and pledge agreements, as specified by and in form
and substance satisfactory to the Administrative Agent (including delivery of
all Pledged Interests in and of such Subsidiary, and other instruments of 

 

81

 

the type specified in Section 4.01(a)(iii)), securing payment of
all the Obligations of such Subsidiary or such parent, as the case may be,
under the Loan Documents and constituting Liens on all such real and personal
properties,

 

(iv)          within 30 days after such formation or
acquisition, cause such Subsidiary and each direct and indirect parent of such
Subsidiary (if it has not already done so) to take whatever action (including
the recording of mortgages, the filing of Uniform Commercial Code financing
statements, the giving of notices and the endorsement of notices on title
documents) may be necessary or advisable in the opinion of the Administrative
Agent to vest in the Administrative Agent (or in any representative of the
Administrative Agent designated by it) valid and subsisting Liens on the properties
purported to be subject to the deeds of trust, trust deeds, deeds to secure
debt, mortgages and security and pledge agreements delivered pursuant to this Section 6.12,
enforceable against all third parties in accordance with their terms,

 

(v)           within 60 days after such formation or
acquisition, deliver to the Administrative Agent, upon the request of the
Administrative Agent in its sole discretion, a signed copy of a favorable
opinion, addressed to the Administrative Agent and the other Secured Parties, of
counsel for the Loan Parties acceptable to the Administrative Agent as to the
matters contained in clauses (i), (iii) and (iv) above, and as to such
other matters as the Administrative Agent may reasonably request, and

 

(vi)          as promptly as practicable after such
formation or acquisition, deliver, upon the request of the Administrative Agent
in its sole discretion, to the Administrative Agent with respect to each parcel
of real property owned or held by the entity that is the subject of such
formation or acquisition title reports, surveys and engineering, soils and
other reports, and environmental assessment reports, each in scope, form and
substance satisfactory to the Administrative Agent, provided, however, that to the extent that any Loan Party
or any of its Subsidiaries shall have otherwise received any of the foregoing
items with respect to such real property, such items shall, promptly after the
receipt thereof, be delivered to the Administrative Agent.

 

(b)           Upon
the acquisition of any property by any Loan Party, if such property, in the
judgment of the Administrative Agent, shall not already be subject to a
perfected first priority security interest in favor of the Administrative Agent
for the benefit of the Secured Parties, then the Borrower shall, at the
Borrower’s expense:

 

(i)            within 10 Business Days after such
acquisition, furnish to the Administrative Agent a description of the property
so acquired in detail satisfactory to the Administrative Agent,

 

(ii)           within 15 Business Days after such acquisition,
cause the applicable Loan Party to duly execute and deliver to the
Administrative Agent deeds of trust, trust deeds, deeds to secure debt,
mortgages and other security and pledge agreements, as specified by and in form
and substance satisfactory to the Administrative Agent, securing payment of all
the Obligations of the applicable Loan Party under the Loan Documents and
constituting Liens on all such properties,

 

82

 

(iii)          within 30 days after such acquisition, cause
the applicable Loan Party to take whatever action (including the recording of
mortgages, the filing of Uniform Commercial Code financing statements, the
giving of notices and the endorsement of notices on title documents) may be
necessary or advisable in the opinion of the Administrative Agent to vest in
the Administrative Agent (or in any representative of the Administrative Agent
designated by it) valid and subsisting Liens on such property, enforceable
against all third parties,

 

(iv)          within 60 days after such acquisition,
deliver to the Administrative Agent, upon the request of the Administrative
Agent in its sole discretion, a signed copy of a favorable opinion, addressed
to the Administrative Agent and the other Secured Parties, of counsel for the
Loan Parties acceptable to the Administrative Agent as to the matters contained
in clauses (ii) and (iii) above and as to such other matters as the
Administrative Agent may reasonably request,

 

(v)           as promptly as practicable after any
acquisition of a real property, deliver, upon the request of the Administrative
Agent in its sole discretion, to the Administrative Agent with respect to such
real property title reports, surveys and engineering, soils and other reports,
and environmental assessment reports, each in scope, form and substance
satisfactory to the Administrative Agent, provided, however, that
to the extent that any Loan Party or any of its Subsidiaries shall have
otherwise received any of the foregoing items with respect to such real property,
such items shall, promptly after the receipt thereof, be delivered to the
Administrative Agent, and

 

(vi)          use commercially reasonable efforts,
excluding litigation or eviction of the tenant thereunder, to cause the
applicable Loan Parties to deliver subordination, non-disturbance and
attornment agreements with respect to all leases affecting such mortgaged
property.

 

(c)           Upon
the request of the Administrative Agent following the occurrence and during the
continuance of a Default, the Borrower shall, at the Borrower’s expense:

 

(i)            within 10 Business Days after such request,
furnish to the Administrative Agent a description of the real and personal
properties of the Loan Parties and their respective Subsidiaries in detail
satisfactory to the Administrative Agent,

 

(ii)           within 15 Business Days after such request,
duly execute and deliver, and cause each Subsidiary (other than any CFC or a
Subsidiary that is held directly or indirectly by a CFC) of the Borrower (if it
has not already done so) to duly execute and deliver, to the Administrative
Agent deeds of trust, trust deeds, deeds to secure debt, mortgages and other
security and pledge agreements, as specified by and in form and substance
satisfactory to the Administrative Agent (including delivery of all Pledged
Equity and Pledged Debt in and of such Subsidiary, and other instruments of the
type specified in Section 4.01(a)(iii)), securing payment of all the
Obligations of under the Loan Documents and constituting Liens on all such
properties,

 

83

 

(iii)          within 30 days after such request, take, and
cause each Subsidiary (other than any CFC or a Subsidiary that is held directly
or indirectly by a CFC) of the Borrower to take, whatever action (including the
recording of mortgages, the filing of Uniform Commercial Code financing
statements, the giving of notices and the endorsement of notices on title
documents) may be necessary or advisable in the opinion of the Administrative
Agent to vest in the Administrative Agent (or in any representative of the
Administrative Agent designated by it) valid and subsisting Liens on the
properties purported to be subject to the deeds of trust, trust deeds, deeds to
secure debt, mortgages and security and pledge agreements delivered pursuant to
this Section 6.12, enforceable against all third parties in
accordance with their terms,

 

(iv)          within 60 days after such request, deliver to
the Administrative Agent, upon the request of the Administrative Agent in its
sole discretion, a signed copy of a favorable opinion, addressed to the
Administrative Agent and the other Secured Parties, of counsel for the Loan
Parties acceptable to the Administrative Agent as to the matters contained in
clauses (ii) and (iii) above, and as to such other matters as the
Administrative Agent may reasonably request, and

 

(v)           as promptly as practicable after such
request, deliver, upon the request of the Administrative Agent in its sole
discretion, to the Administrative Agent with respect to each parcel of real
property owned or held by the Borrower and its Subsidiaries, title reports,
surveys and engineering, soils and other reports, and environmental assessment
reports, each in scope, form and substance satisfactory to the Administrative
Agent, provided, however,
that to the extent that any Loan Party or any of its Subsidiaries shall have
otherwise received any of the foregoing items with respect to such real
property, such items shall, promptly after the receipt thereof, be delivered to
the Administrative Agent.

 

6.13.        Environmental
Covenant. Use and operate all of its facilities and properties in material
compliance with all applicable Environmental Laws, keep all material permits,
approvals, certificates, licenses and other authorizations required pursuant to
applicable Environmental Laws in effect and remain in material compliance
therewith, and handle all Hazardous Materials in material compliance with all
applicable Environmental Laws; promptly notify the Administrative Agent and
provide copies upon receipt of all written claims, complaints, notices or
inquiries relating to the condition of its facilities and properties under, or
compliance of its facilities and properties with, applicable Environmental
Laws, and shall promptly commence and diligently proceed to cure, to the
reasonable satisfaction of the Administrative Agent any actions and proceedings
relating to violations of compliance with applicable Environmental Laws; and
provide such information and certifications which the Administrative Agent may
reasonably request from time to time.

 

6.14.        Preparation
of Environmental Reports. At the request of the Required Lenders from time
to time, provide to the Lenders within 60 days after such request, at the
expense of the Borrower, an environmental site assessment report for any of its
properties described in such request, prepared by an environmental consulting
firm acceptable to the Administrative Agent, indicating the presence or absence
of Hazardous Materials and the estimated cost of any compliance, removal or
remedial action in connection with any Hazardous Materials on 

 

84

 

such properties; without
limiting the generality of the foregoing, if the Administrative Agent
determines at any time that a material risk exists that any such report will
not be provided within the time referred to above, the Administrative Agent may
retain an environmental consulting firm to prepare such report at the expense
of the Borrower, and the Borrower hereby grants and agrees to cause any
Subsidiary that owns any property described in such request to grant at the
time of such request to the Administrative Agent, the Lenders, such firm and
any agents or representatives thereof an irrevocable non-exclusive license,
subject to the rights of tenants, to enter onto their respective properties to
undertake such an assessment.

 

6.15.        Further
Assurances. Promptly upon request by the Administrative Agent, or any
Lender through the Administrative Agent, (a) correct any material defect or
error that may be discovered in any Loan Document or in the execution,
acknowledgment, filing or recordation thereof, and (b) do, execute,
acknowledge, deliver, record, re-record, file, re-file, register and
re-register any and all such further acts, deeds, certificates, assurances and
other instruments as the Administrative Agent, or any Lender through the
Administrative Agent, may reasonably require from time to time in order to (i)
carry out more effectively the purposes of the Loan Documents, (ii) to the
fullest extent permitted by applicable law, subject any Loan Party’s or any of
its Subsidiaries’ properties, assets, rights or interests to the Liens now or
hereafter intended to be covered by any of the Collateral Documents, (iii)
perfect and maintain the validity, effectiveness and priority of any of the
Collateral Documents and any of the Liens intended to be created thereunder and
(iv) assure, convey, grant, assign, transfer, preserve, protect and confirm
more effectively unto the Secured Parties the rights granted or now or
hereafter intended to be granted to the Secured Parties under any Loan Document
or under any other instrument executed in connection with any Loan Document to
which any Loan Party or any of its Subsidiaries is or is to be a party, and
cause each of its Subsidiaries to do so.

 

6.16.        Compliance
with Terms of Leaseholds. Make all payments and otherwise perform all
obligations in respect of all Leases of Real Property to which the Borrower or
any of its Subsidiaries is a party, keep such Leases in full force and effect
and not allow such Leases to lapse or be terminated or any rights to renew such
leases to be forfeited or cancelled, notify the Administrative Agent of any
default by any party with respect to such leases and cooperate with the
Administrative Agent in all respects to cure any such default, and cause each
of its Subsidiaries to do so, except, in any case, where the failure to do so,
either individually or in the aggregate, could not be reasonably likely to have
a Material Adverse Effect.

 

6.17.        Interest
Rate Hedging. Enter into prior to December 31, 2006, and maintain at all
times thereafter, interest rate Swap Contracts with Persons acceptable to the
Administrative Agent, covering a notional amount of not less than 50% of the
aggregate outstanding Term B Loans and Second Lien Loans and providing for such
other terms reasonably acceptable to the Administrative Agent.

 

6.18.        Lien
Searches. Promptly following receipt of the acknowledgment copy of any
financing statements filed under the Uniform Commercial Code in any
jurisdiction by or on behalf of the Secured Parties, deliver to the
Administrative Agent completed requests for information listing such financing
statement and all other effective financing statements filed in 

 

85

 

such jurisdiction that name any
Loan Party as debtor, together with copies of such other financing statements.

 

6.19.        Material
Contracts. Perform and observe all the terms and provisions of each
Material Contract to be performed or observed by it, maintain each such
Material Contract in full force and effect, enforce each such Material Contract
in accordance with its terms, take all such action to such end as may be from
time to time requested by the Administrative Agent and, upon request of the
Administrative Agent, make to each other party to each such Material Contract
such demands and requests for information and reports or for action as any Loan
Party or any of its Subsidiaries is entitled to make under such Material
Contract, and cause each of its Subsidiaries to do so, except, in any case,
where the failure to do so, either individually or in the aggregate, could not
reasonably be expected to have a Material Adverse Effect.

 

6.20.        Gaming
Licenses. (a)  Ensure that all
necessary Gaming Licenses from any Gaming Authority for the ownership, use, or
operation of the businesses or properties owned or operated by each Borrower
and its Subsidiaries are in full force and effect, and (b) comply, in all
material respects, with all of the provisions thereof applicable to them.

 

6.21.        Cash
Collateral Accounts. Maintain, and cause each of the other Loan Parties to
maintain, all Cash Collateral Accounts with the Administrative Agent or another
commercial bank located in the United States which has accepted the assignment
of such accounts to the Administrative Agent for the benefit of the Secured
Parties pursuant to the terms of the Security Agreement.

 

6.22.        Holdback
Agreement. Comply in all material respects with the terms of the Holdback
Agreement, which shall not be waived or amended in manner materially less
favorable to the Lenders without such Lenders’ prior consent.

 

6.23.        Compliance
with the Temporary Casino Construction Plans; Operating. Ensure that the
Temporary Casino is

 

(i)            built in all material respects in
accordance with the Construction Plans, and

 

(ii)           Operating as soon as practicable and in any
event not later than the first anniversary of the Closing Date.

 

6.24.        Construction
Covenants. Prior to the commencement of development and construction of the
Project (either by way of construction of the Project or the commencement of
substantial demolition activities in respect of the existing Real Property):

 

(i)            the Borrowers shall agree to reimburse the
Administrative Agent for the reasonable costs of the Construction Consultant,
who shall be allowed full access to the Project site (and all plans, budgets,
timetables, permits, licenses, approvals and other all other documents relating
to the Project) and prepare a monthly construction progress report;

 

86

 

(ii)           the Construction Consultant shall have
reviewed the Construction Plans (and any geotechnical and other reports and
assessments as they reasonably shall require) and shall have concurred that the
Construction Plans are reasonable and feasible; and

 

(iii)          collateral assignments of the each
Construction Contract for the Project in each case in form and substance
acceptable to the Administrative Agent shall have been made by the Borrower or
the applicable Loan Party to the Administrative Agent.

 

6.25.        FF&E
Financing. Promptly after the Closing Date and in any event no later than
December 31, 2006, the Borrower shall have consummated the FF&E Financing
on terms reasonably acceptable to the Administrative Agent.

 

ARTICLE VII

NEGATIVE COVENANTS

 

So long as any Lender shall have any Commitment hereunder, any Loan or
other Obligation hereunder shall remain unpaid or unsatisfied, or any Letter of
Credit shall remain outstanding, the Borrower shall not, nor shall it permit
any Subsidiary to, directly or indirectly:

 

7.01.        Liens.
Create, incur, assume or suffer to exist any Lien upon any of its property,
assets or revenues, whether now owned or hereafter acquired, or sign or file or
suffer to exist under the Uniform Commercial Code of any jurisdiction a
financing statement that names the Borrower or any of its Subsidiaries as
debtor, or assign any accounts or other right to receive income, other than the
following:

 

(a)           Liens
pursuant to any Loan Document;

 

(b)           Liens
existing on the date hereof and listed on Schedule 5.08(c) and any
renewals or extensions thereof, provided that (i) the property covered
thereby is not changed, (ii) the amount secured or benefited thereby is not
increased except as contemplated by Section 7.02(g), (iii) the direct or
any contingent obligor with respect thereto is not changed, and (iv) any
renewal or extension of the obligations secured or benefited thereby is
permitted by Section 7.02(g);

 

(c)           Liens
for taxes, assessments or other governmental charges or levies not yet
delinquent or thereafter payable without penalty or which are being contested
in good faith and by appropriate actions, if adequate reserves with respect
thereto are maintained on the books of the applicable Person in accordance
with, and to the extent required by, GAAP;

 

(d)           carriers’,
warehousemen’s, mechanics’, materialmen’s, repairmen’s or other like Liens
arising in the ordinary course of business which are not overdue for a period
of more than 60 days or which are being contested in good faith and by
appropriate actions diligently conducted, if adequate reserves with respect
thereto are maintained on the books of the applicable Person to the extent
required by GAAP;

 

87

 

(e)           pledges
or deposits in the ordinary course of business in connection with workers’
compensation, unemployment insurance and other social security legislation,
other than any Lien imposed by ERISA;

 

(f)            deposits
to secure the performance of bids, trade contracts and leases (other than
Indebtedness), statutory obligations, surety and appeal bonds, performance
bonds and other obligations of a like nature incurred in the ordinary course of
business;

 

(g)           easements,
rights-of-way, restrictions and other similar encumbrances affecting real
property which, in the aggregate, are not substantial in amount, and which do
not in any case materially detract from the value of the property subject
thereto or materially interfere with the ordinary conduct of the business of
the applicable Person;

 

(h)           Liens
securing writs of attachment or similar instruments or judgments for the
payment of money not constituting an Event of Default under Section 8.01(h);

 

(i)            present
or future zoning laws and ordinances or other laws and ordinances restricting
the occupancy, use or enjoyment of real property;

 

(j)            Liens
securing Indebtedness permitted under Section 7.02(i); provided
that (i) such Liens do not at any time encumber any property other than the
property financed by such Indebtedness and (ii) the Indebtedness secured
thereby does not exceed the cost or fair market value, whichever is lower, of
the property being acquired on the date of acquisition;

 

(k)           Liens
securing Indebtedness under FF&E Financings in an aggregate principal
amount not to exceed $30.0 million acquired with the proceeds of such
Indebtedness; provided that such Liens only extend to FF&E;

 

(l)            other
Liens securing Indebtedness outstanding in an aggregate principal amount not to
exceed $5.0 million, provided that no such Lien shall extend to or cover
any Collateral;

 

(m)          Permitted
Encumbrances;

 

(n)           Subject
to the terms of the Intercreditor Agreement, Lien securing Indebtedness under
Second Lien Credit Agreement in an aggregate principal amount not to exceed
$70.0 million;

 

(o)           inchoate
Liens incident to construction or maintenance of Real Property; or Liens
incident to construction or maintenance of Real Property now or hereafter filed
of record for which adequate reserves have been set aside and which are being
contested in good faith by appropriate actions and have not proceeded to
judgment or which the Title Company has agreed to insure over, provided that,
by reason of nonpayment of the obligations secured by such Liens, no material
property is subject to a material risk of loss or forfeiture;

 

88

 

(p)           Liens
on accounts or amounts held in accounts for the Commonwealth of Pennsylvania as
specified Section 1316 or Chapter 14 of the Pennsylvania Race Horse Development
and Gaming Act (Act 71 of 2004) (4 Pa. C.S.A. § 1401, et seq.); and

 

(q)           Liens
on the account cash collateralizing the Licensing Fee L/C;

 

provided, however, that no Lien other
than Permitted Encumbrances shall be permitted with respect to any property to
be subject to a Mortgage.

 

7.02.        Indebtedness.
Create, incur, assume or suffer to exist any Indebtedness, except:

 

(a)           obligations
(contingent or otherwise) existing or arising under any Swap Contract, provided
that (i) such obligations are (or were) entered into by such Person in the
ordinary course of business for the purpose of directly mitigating risks
associated with fluctuations in interest rates or foreign exchange rates and
(ii) such Swap Contract does not contain any provision exonerating the
non-defaulting party from its obligation to make payments on outstanding
transactions to the defaulting party;

 

(b)           Indebtedness
incurred pursuant to the Second Lien Credit Agreement; provided that, in the case of any replacement or refinancing after
the date hereof, (i) the Second Lien Collateral Agent shall enter into the
Intercreditor Agreement with the Collateral Agent, (ii) the aggregate principal
amount of the replacement or refinancing Indebtedness shall equal the aggregate
principal amount of the Indebtedness being replaced or refinanced, and the
yield on the replaced or refinanced Indebtedness shall not be greater than the
yield on the Indebtedness being replaced or refinanced and (iii) the Second
Lien Loan Documents shall not include any provisions, terms or conditions that
would not be permitted, under the Intercreditor Agreement, in any amendment of
the Second Lien Loan Documents;

 

(c)           Indebtedness
under FF&E Financings in an aggregate principal amount not to exceed $30.0
million;

 

(d)           [Reserved];

 

(e)           Indebtedness
of a Subsidiary of the Borrower owed to the Borrower or a Subsidiary of the
Borrower, which Indebtedness shall (i) in the case of Indebtedness owed to a
Loan Party, constitute “Pledged Debt” under the Security Agreement, (ii) be on
terms (including subordination terms) acceptable to the Administrative Agent
and (iii) be otherwise permitted under the provisions of Section 7.03;

 

(f)            Indebtedness
under the Loan Documents;

 

(g)           Indebtedness
outstanding on the date hereof and listed on Schedule 7.02 and any
refinancings, refundings, renewals or extensions thereof; provided that
the amount of such Indebtedness is not increased at the time of such
refinancing, refunding, renewal or extension except by an amount equal to a
reasonable premium or other reasonable 

 

89

 

amount paid, and fees and expenses reasonably incurred, in connection
with such refinancing and by an amount equal to any existing commitments unutilized
thereunder and the direct or any contingent obligor with respect thereto is not
changed, as a result of or in connection with such refinancing, refunding,
renewal or extension and such Indebtedness is on terms no less favorable in any
material respect to the Loan Parties or the Lenders than the terms of any
agreement or instrument governing the Indebtedness being refinanced, refunded,
renewed or extended and the interest rate applicable to any such refinancing,
refunding, renewing or extending Indebtedness does not exceed the then
applicable market interest rate;

 

(h)           Guarantees
of the Borrower or any Guarantor in respect of Indebtedness otherwise permitted
hereunder of the Borrower or any other Guarantor;

 

(i)            Indebtedness
in respect of Capitalized Leases, Synthetic Lease Obligations and purchase
money obligations for fixed or capital assets within the limitations set forth
in Section 7.01(j); provided, however, that the aggregate
amount of all such Indebtedness at any one time outstanding shall not exceed
$5.0 million; and

 

(j)            unsecured
Indebtedness in an aggregate principal amount not to exceed $5.0 million at any
time outstanding.

 

7.03.        Investments.
Make or hold any Investments, except:

 

(a)           Investments
held by the Borrower and its Subsidiaries in the form of Cash Equivalents;

 

(b)           U.S.
Corporate Bonds, rated at least Baa by S&P;

 

(c)           Common
stocks rated at least B by S&P and listed on the New York Stock Exchange,
American Stock Exchange, or National Association of Securities Dealers
Automated Quotation;

 

(d)           Investments,
classified in accordance with GAAP as current assets of the Borrower or any of
its Subsidiaries, in money market funds that comply with all provisions of Rule
2A-7 of the Investment Company Act of 1940;

 

(e)           advances
to officers, directors and employees of the Borrower and Subsidiaries in the
ordinary course of business, for travel, entertainment, relocation and
analogous ordinary business purposes;

 

(f)            (i)
Investments by the Borrower and its Subsidiaries in their respective Subsidiaries
outstanding on the date hereof, (ii) additional Investments by the Borrower and
its Subsidiaries in Loan Parties, and (iii) additional Investments by
Subsidiaries of the Borrower that are not Loan Parties in other Subsidiaries
that are not Loan Parties;

 

(g)           Investments
consisting of extensions of credit in the nature of accounts receivable or
notes receivable arising from the grant of trade credit in the ordinary course 

 

90

 

of business, and Investments received in satisfaction or partial
satisfaction thereof from financially troubled account debtors to the extent
reasonably necessary in order to prevent or limit loss;

 

(h)           Guarantees
permitted by Section 7.02;

 

(i)            Investments
existing on the date hereof (other than those referred to in Section
7.03(c)(i)) and set forth on Schedule 5.08(f); and

 

(j)            Investments
by the Borrower in Swap Contracts permitted under Section 7.02(a).

 

7.04.        Fundamental
Changes. Merge, dissolve, liquidate, consolidate with or into another
Person, or Dispose of (whether in one transaction or in a series of
transactions) all or substantially all of its assets (whether now owned or
hereafter acquired) to or in favor of any Person, except that, so long as no
Default exists or would result therefrom:

 

(a)           any
Subsidiary may merge with (i) the Borrower, provided that the Borrower
shall be the continuing or surviving Person, or (ii) any one or more other
Subsidiaries, provided that when any Loan Party is merging with another
Subsidiary, such Loan Party shall be the continuing or surviving Person;

 

(b)           any
Loan Party may Dispose of all or substantially all of its assets (upon
voluntary liquidation or otherwise) to the Borrower or to another Loan Party,
provided that the Lien on and security interest in any property so Disposed of
or to be Disposed of shall be maintained or created in favor of the Collateral
Agent;

 

(c)           any
Subsidiary that is not a Loan Party may dispose of all or substantially all its
assets (including any Disposition that is in the nature of a liquidation) to
(i) another Subsidiary that is not a Loan Party or (ii) to a Loan Party;

 

(d)           [Reserved]

 

(e)           in
connection with any acquisition permitted under Section 7.03, any
Subsidiary of the Borrower may merge into or consolidate with any other Person
or permit any other Person to merge into or consolidate with it; provided that
(i) the Person surviving such merger shall be a wholly-owned Subsidiary of the
Borrower and (ii) in the case of any such merger to which any Loan Party (other
than the Borrower) is a party, such Loan Party is the surviving Person; and

 

(f)            so
long as no Default has occurred and is continuing or would result therefrom, each of the Borrower and any of its
Subsidiaries may merge into or consolidate with any other Person or permit any
other Person to merge into or consolidate with it; provided, however,
that in each case, immediately after giving effect thereto (i) in the case of
any such merger to which the Borrower is a party, the Borrower is the surviving
corporation and (ii) in the case of any such merger to which any Loan Party is
a party, such Loan Party is the surviving corporation.

 

91

 

7.05.        Dispositions.
Make any Disposition or enter into any agreement to make any Disposition,
except:

 

(a)           Dispositions
of obsolete or worn out property, whether now owned or hereafter acquired, in
the ordinary course of business;

 

(b)           Dispositions
of inventory in the ordinary course of business;

 

(c)           Dispositions
of equipment or real property to the extent that (i) such property is exchanged
for credit against the purchase price of similar replacement property and, in
the event that any real property disposed of is property subject to a Mortgage,
all such replacement property shall be made subject to the Liens created by the
Collateral Documents, or (ii) the proceeds of such Disposition are reasonably
promptly applied to the purchase price of such replacement property;

 

(d)           Dispositions
of property by any Subsidiary to the Borrower or to a wholly-owned Subsidiary; provided
that the Lien on and security interest in any property so Disposed of or to be
Disposed of shall be maintained or created in favor of the Collateral Agent;
and provided that if the transferor of such property is a Guarantor, the
transferee thereof must either be the Borrower or a Guarantor;

 

(e)           Dispositions
permitted by Section 7.04; and

 

(f)            Dispositions
by the Racing Services Operator permitted under the RSA;

 

provided, however, that any Disposition
pursuant to Section 7.05(a) through Section 7.05(c) shall be for
fair market value.

 

7.06.        Restricted
Payments. Declare or make, directly or indirectly, any Restricted Payment,
or incur any obligation (contingent or otherwise) to do so, except that, so
long as no Default (and solely with respect to clause Section 7.06(e)
immediately below, so long as no Default under Section 8.01(a) or Event
of Default) shall have occurred and be continuing at the time of any action
described below or would result therefrom:

 

(a)           each
Subsidiary may make Restricted Payments to the Borrower, any Subsidiaries of
the Borrower that are Guarantors and any other Person that owns a direct Equity
Interest in such Subsidiary, ratably according to their respective holdings of
the type of Equity Interest in respect of which such Restricted Payment is
being made;

 

(b)           the
Borrower and each Subsidiary may declare and make dividend payments or other
distributions payable solely in the common stock or other common Equity
Interests of such Person;

 

(c)           except
to the extent the Net Cash Proceeds thereof are required to be applied to the
prepayment of the Loans pursuant to Section 2.05(b)(iii), the
Borrower and each Subsidiary may purchase, redeem or otherwise acquire its
common Equity Interests 

 

92

 

with the proceeds received from the substantially concurrent issue of
new common Equity Interests;

 

(d)           for
so long as the Borrower is treated as a partnership or other substantially
similarly treated pass-through entity for United States federal income tax
purposes, the Borrower shall be permitted to make Restricted Payments to the
Tax Recipients (which shall be deemed for any Tax purposes to be a distribution
with respect to equity from Borrower to its direct equity owner, and from such
equity owner to each successive direct equity owner until such amounts are
distributed to the Tax Recipients), in an amount not to exceed the Tax Amount
for the related period; provided, however, that (i) prior to
any distributions of Tax Amounts the Borrower shall deliver an officers’
certificate to the Administrative Agent to the effect that the Borrower is a
partnership or other substantially similarly treated pass-through entity, for
United States federal income tax purposes and (ii) at the time of such
distributions, the most recent audited financial statements of the Borrower
required to have been furnished pursuant to Section 6.01(a)reflect that
the Borrower is treated as a partnership or other substantially similarly
treated pass-through entity for United States federal income tax purposes for
the period covered by such financial statements; and provided, further,
that no such Restricted Payment shall be made if the Administrative Agent shall
have given the Borrower notice of the existence and continuance of an Event of
Default; and

 

(e)           subject
to the Management Fee Subordination Agreement, the Borrower may pay the
Management Compensation.

 

7.07.        Change
in Nature of Business. Engage in any material line of business substantially
different from those lines of business conducted by the Borrower and its
Subsidiaries on the date hereof (the development, construction or operation of
casinos) or any business substantially related or incidental thereto.

 

7.08.        Transactions
with Affiliates. Except as set forth on Schedule 7.08, enter into
any transaction of any kind with any Affiliate of the Borrower, whether or not
in the ordinary course of business, other than on fair and reasonable terms
substantially as favorable to the Borrower or such Subsidiary as would be
obtainable by the Borrower or such Subsidiary at the time in a comparable arm’s
length transaction with a Person other than an Affiliate; provided that the foregoing
restriction shall not apply to transactions between or among the Loan Parties.

 

7.09.        Burdensome
Agreements. Except as required by Gaming Authorities, enter into or permit
to exist any Contractual Obligation (other than this Agreement, any other Loan
Document or Related Documents) that (a) limits the ability (i) of any
Subsidiary to make Restricted Payments to the Borrower or any Guarantor or to
otherwise transfer property to or invest in the Borrower or any Guarantor,
except for any agreement in effect (A) on the date hereof and set forth on Schedule
7.09 or (B) at the time any Subsidiary becomes a Subsidiary of the
Borrower, so long as such agreement was not entered into solely in
contemplation of such Person becoming a Subsidiary of the Borrower, (ii) of any
Subsidiary to Guarantee the Indebtedness of the Borrower or (iii) of the
Borrower or any Subsidiary to create, incur, assume or suffer to exist Liens on
property of such Person; provided, however, that this clause
(iii) shall not prohibit any negative pledge incurred or provided in favor of
any holder of Indebtedness permitted under 

 

93

 

Section 7.02(i) solely to the extent any such
negative pledge relates to the property financed by or the subject of such
Indebtedness; or (b) requires the grant of a Lien to secure an obligation of
such Person if a Lien is granted to secure another obligation of such Person.

 

7.10.        Use
of Proceeds. Use the proceeds of any Credit Extension, whether directly or
indirectly, and whether immediately, incidentally or ultimately, to purchase or
carry margin stock (within the meaning of Regulation U of the FRB) or to extend
credit to others for the purpose of purchasing or carrying margin stock or to
refund indebtedness originally incurred for such purpose.

 

7.11.        Financial
Covenants.

 

(a)           [Reserved].

 

(b)           Consolidated
Interest Coverage Ratio. Permit the Consolidated Interest Coverage Ratio as
of the end of any fiscal quarter of the Borrower to be less than the ratio set
forth below opposite such fiscal quarter:

 

	
  Date

  	
   

  	
  Ratio

  	
   

  
	
  June 30, 2007(1)

  	
   

  	
  1.75 to 1.0

  	
   

  
	
  September 30, 2007

  	
   

  	
  1.75 to 1.0

  	
   

  
	
  December 31, 2007

  	
   

  	
  1.75 to 1.0

  	
   

  
	
  March 31, 2008

  	
   

  	
  1.75 to 1.0

  	
   

  
	
  June 30, 2008

  	
   

  	
  1.75 to 1.0

  	
   

  
	
  September 30, 2008

  	
   

  	
  1.75 to 1.0

  	
   

  
	
  December 31, 2008

  	
   

  	
  1.75 to 1.0

  	
   

  
	
  March 31, 2009

  	
   

  	
  1.75 to 1.0

  	
   

  
	
  June 30, 2009

  	
   

  	
  1.75 to 1.0

  	
   

  
	
  September 30, 2009

  	
   

  	
  1.75 to 1.0

  	
   

  
	
  December 31, 2009

  	
   

  	
  1.75 to 1.0

  	
   

  
	
  March 31, 2010

  	
   

  	
  1.75 to 1.0

  	
   

  
	
  June 30, 2010

  	
   

  	
  1.75 to 1.0

  	
   

  
	
  September 30, 2010

  	
   

  	
  1.75 to 1.0

  	
   

  
	
  December 31, 2010

  	
   

  	
  2.0 to 1.0

  	
   

  
	
  March 31, 2011

  	
   

  	
  2.0 to 1.0

  	
   

  

 

(1)          Applicable
only to the extent the Temporary Casino has been Operating for the “full” three
months for the fiscal period ended June 20, 2007.

 

94

 

	
  Date

  	
   

  	
  Ratio

  	
   

  
	
  June 30, 2011 and thereafter

  	
   

  	
  2.0 to 1.0

  	
   

  

 

(c)           Consolidated
Leverage Ratio. Permit the Consolidated Leverage Ratio at any time during
any period of four fiscal quarters of the Borrower set forth below to be
greater than the ratio set forth below opposite such period:

 

	
  Date

  	
   

  	
  Ratio

  	
   

  
	
  June 30, 2007(2)

  	
   

  	
  5.75 to 1.0

  	
   

  
	
  September 30, 2007

  	
   

  	
  5.75 to 1.0

  	
   

  
	
  December 31, 2007

  	
   

  	
  5.50 to 1.0

  	
   

  
	
  March 31, 2008

  	
   

  	
  5.25 to 1.0

  	
   

  
	
  June 30, 2008

  	
   

  	
  5.25 to 1.0

  	
   

  
	
  September 30, 2008

  	
   

  	
  5.00 to 1.0

  	
   

  
	
  December 31, 2008

  	
   

  	
  5.00 to 1.0

  	
   

  
	
  March 31, 2009

  	
   

  	
  5.00 to 1.0

  	
   

  
	
  June 30, 2009

  	
   

  	
  5.00 to 1.0

  	
   

  
	
  September 30, 2009

  	
   

  	
  5.00 to 1.0

  	
   

  
	
  December 31, 2009

  	
   

  	
  5.00 to 1.0

  	
   

  
	
  March 31, 2010

  	
   

  	
  5.00 to 1.0

  	
   

  
	
  June 30, 2010

  	
   

  	
  4.75 to 1.0

  	
   

  
	
  September 30, 2010

  	
   

  	
  4.75 to 1.0

  	
   

  
	
  December 31, 2010

  	
   

  	
  4.75 to 1.0

  	
   

  
	
  March 31, 2011

  	
   

  	
  4.75 to 1.0

  	
   

  
	
  June 30, 2011 and thereafter

  	
   

  	
  4.50 to 1.0

  	
   

  

 

7.12.        Capital
Expenditures. Make or become legally obligated to make any Capital
Expenditure (except for (A) $39.6 million for the first fiscal year following
the Closing Date pursuant to the Cash Collateral and Disbursement Agreement,
(B) (i) Maintenance Capital Expenditures during any fiscal year in an
aggregate amount not to exceed $1.0 million for fiscal years ended 2007 and
2008, $2.5 million for fiscal year ended 2009, $3.0 million for fiscal years
ended 2010 and 2011 and $3.5 million for fiscal year ended 2012 and
(ii) Expansion Capital Expenditures in an aggregate amount not to exceed
$5.0 million) and (C) Capital Expenditures funded with the net proceeds from
any Excluded Issuance.

 

(2)          Applicable
only to the extent the Temporary Casino has been Operating for the “full” three
months for the fiscal period ended June 20, 2007.

 

95

 

7.13.        Amendments of
Organization Documents. Amend any of its Organization Documents.

 

7.14.        Accounting Changes.  Make any change in (a) accounting
policies or reporting practices, except as required by GAAP or approved by the
Administrative Agent, or (b) fiscal year.

 

7.15.        Prepayments, Etc.
of Indebtedness.  Prepay, redeem,
purchase, defease or otherwise satisfy prior to the scheduled maturity thereof
in any manner, or make any payment in violation of any subordination terms of,
any Indebtedness, except (a) the prepayment of the Credit Extensions in
accordance with the terms of this Agreement and (b) regularly scheduled or
required repayments or redemptions of Indebtedness set forth in Schedule
7.02 and refinancings and refundings of such Indebtedness in compliance
with Section 7.02(g).

 

7.16.        Amendment, Etc. of
Related Documents and Indebtedness. 
(a) Cancel or terminate any Related Document or consent to or accept any
cancellation or termination thereof, (b) amend, modify or change in any manner
any term or condition of any Related Document or give any consent, waiver or
approval thereunder, (c) waive any default under or any breach of any term or
condition of any Related Document, (d) take any other action in connection with
any Related Document that would impair the value of the interest or rights of
any Loan Party thereunder or that would impair the rights or interests of the
Administrative Agent or any Lender, (e) amend, modify or change in any manner
any term or condition of any Indebtedness set forth in Schedule 7.02,
except for any refinancing, refunding, renewal or extension thereof permitted
by Section 7.02(g) or (f) amend, modify or change in any manner any
terms or conditions of the Second Lien Loan Documents other than in accordance
with the Intercreditor Agreement; provided, however, that nothing in
this Section 7.16 shall prevent the Borrower from terminating or
amending the Racing Services Agreement so long as such termination or amendment
does not impair the rights or interests of the Administrative Agent or the
Lenders.

 

7.17.        Construction of
the Project.  Do any of the following
in connection with the construction of the Project:

 

(a)           Fail to diligently
pursue the Project to the Completion Date in accordance with the Construction
Plans;

 

(b)           Fail on or before
the opening for business of the Project, to provide the Administrative Agent
with a written certificate executed by the prime architect, prime contractor
and the Construction Consultant (and any other relevant contracting parties
reasonably requested by the Construction Consultant) certifying that the
Project has been completed in all material respects in accordance with the
Construction Plans and that the Project has been or is ready to be opened for
business together with a Certificate of Occupancy executed by a Responsible
Officer to that effect; or

 

(c)           Fail, as soon as
practicable after the substantial completion of the physical improvements
associated with the Project, to provide the Administrative Agent with an “as
built” ALTA survey of the Project as of the Completion Date that (i) sets
forth all recorded easements and licenses burdening the Project site as of the
Completion Date,

 

96

 

(ii) reflects no unpermitted encroachments onto the affected Real
Property or onto adjoining Real Property, and (iii) certifies the legal
description of the Real Property subject to the related Mortgage in favor of
the Administrative Agent to be the same as that set forth in the related title
insurance policies, together with (A) an endorsement to its ALTA policy of
title insurance covering the Project that reflects the elements contained in
this clause (n) and the Lien-free completion of the Project and (B) evidence
that all insurance policies required pursuant to the Loan Documents have been
obtained relating to the Project together with the certificates of insurance,
naming the Collateral Agent, on behalf of the Lenders, as an additional insured
or loss payee, as the case may be, under all such insurance policies.

 

(d)           Fail, as soon as
practicable after the substantial completion of the physical improvements
associated with the Project, to provide the Administrative Agent with an “as
built” ALTA survey of the Project as of the Completion Date that (i) sets
forth all recorded easements and licenses burdening the Project site as of the
Completion Date, (ii) reflects no unpermitted encroachments onto that
property or onto adjoining Real Property, and (iii) certifies the legal
description of the Real Property subject to the related Mortgage in favor of
the Administrative Agent to be the same as that set forth in the related title
insurance policies, together with an (A) endorsement to its ALTA policy of
title insurance covering such Project that reflects the elements contained in
this clause (n) and the Lien-free completion of the Project and (B) evidence
that all insurance policies required pursuant to the Loan Documents have been
obtained relating to the Project together with the certificates of insurance, naming
the Administrative Agent, on behalf of the Lenders, as an additional insured or
loss payee, as the case may be, under all such insurance policies.

 

7.18.        Seller Holdback
Amount.  Make any payment in respect
of the Seller Holdback Amount (as defined in the Holdback Agreement) prior to
the completion of the permanent facility which shall replace the Temporary
Casino and the first date on which such permanent facility opens for operation
and accepts customers following the receipt by Borrower and its subsidiaries of
all gaming approvals necessary to open such permanent facility for operation
and to accept customers.

 

ARTICLE VIII

EVENTS OF DEFAULT AND REMEDIES

 

8.01.        Events of Default.  Any of the following shall constitute an
Event of Default:

 

(a)           Non-Payment.  The Borrower or any other Loan Party fails to
(i) pay when and as required to be paid herein, any amount of principal of any
Loan or any L/C Obligation or deposit when and as required any funds as Cash
Collateral in respect of L/C Obligations, or (ii) pay within three Business
Days after the same becomes due, any interest on any Loan or on any L/C
Obligation, or any fee due hereunder, or (iii) pay within five days after the
same becomes due, any other amount payable hereunder or under any other Loan
Document; or

 

97

 

(b)           Specific
Covenants.  The Borrower fails to
perform or observe any term, covenant or agreement contained in any of Section
6.01, 6.02, 6.03, 6.05, 6.10, 6.11, 6.12,
6.20, or Article VII; or

 

(c)           Other Defaults.  Any Loan Party fails to perform or observe
any other covenant or agreement (not specified in Section 8.01(a) or (b)
above) contained in any Loan Document on its part to be performed or observed
and such failure continues for 30 days after such Loan Party obtains knowledge
of such failure; or

 

(d)           Representations
and Warranties.  Any representation,
warranty, certification or statement of fact made or deemed made by or on
behalf of the Borrower or any other Loan Party herein, in any other Loan
Document, or in any document delivered in connection herewith or therewith
shall be incorrect or misleading in any material respect when made or deemed
made; or

 

(e)           Cross-Default.  (i) Any Loan Party or any Subsidiary thereof
(A) fails to make any payment when due after giving effect to any applicable
notice and cure periods (whether by scheduled maturity, required prepayment,
acceleration, demand, or otherwise) in respect of any Indebtedness or Guarantee
(other than Indebtedness hereunder and Indebtedness under Swap Contracts)
having an aggregate principal amount (including undrawn committed or available
amounts and including amounts owing to all creditors under any combined or
syndicated credit arrangement) of more than the Threshold Amount, or (B) fails
to observe or perform any other agreement or condition relating to any such
Indebtedness or Guarantee or contained in any instrument or agreement
evidencing, securing or relating thereto, or any other event occurs, in each
case after giving effect to any applicable notice and cure periods, the effect
of which default or other event is to cause, or to permit the holder or holders
of such Indebtedness or the beneficiary or beneficiaries of such Guarantee (or
a trustee or agent on behalf of such holder or holders or beneficiary or
beneficiaries) to cause, with the giving of notice if required, such
Indebtedness to be demanded or to become due or to be repurchased, prepaid,
defeased or redeemed (automatically or otherwise), or an offer to repurchase,
prepay, defease or redeem such Indebtedness to be made, prior to its stated
maturity, or such Guarantee to become payable or cash collateral in respect
thereof to be demanded; or (ii) there occurs under any Swap Contract an Early
Termination Date (as defined in such Swap Contract) resulting from (A) any
event of default under such Swap Contract as to which a Loan Party or any
Subsidiary thereof is the Defaulting Party (as defined in such Swap Contract)
or (B) any Termination Event (as so defined) under such Swap Contract as to
which a Loan Party or any Subsidiary thereof is an Affected Party (as so
defined) and, in either event, the Swap Termination Value owed by such Loan
Party or such Subsidiary as a result thereof is greater than the Threshold
Amount; or

 

(f)            Insolvency
Proceedings, Etc.  Any Loan Party or
any Subsidiary thereof institutes or consents to the institution of any
proceeding under any Debtor Relief Law, or makes an assignment for the benefit
of creditors; or applies for or consents to the appointment of any receiver,
trustee,

 

98

 

custodian, conservator, liquidator, rehabilitator or similar officer
for it or for all or any material part of its property; or any receiver,
trustee, custodian, conservator, liquidator, rehabilitator or similar officer
is appointed without the application or consent of such Person and the
appointment continues undischarged or unstayed for 60 calendar days; or any
proceeding under any Debtor Relief Law relating to any such Person or to all or
any material part of its property is instituted without the consent of such
Person and continues undismissed or unstayed for 60 calendar days, or an order
for relief is entered in any such proceeding; or

 

(g)           Inability to Pay
Debts; Attachment.  (i) Any Loan
Party or any Subsidiary thereof becomes unable or admits in writing its
inability or fails generally to pay its debts as they become due, or (ii) any
writ or warrant of attachment or execution or similar process is issued or levied
against all or any material part of the property of any such Person and is not
released, vacated or fully bonded within 60 days after its issue or levy; or

 

(h)           Judgments.  There is entered against any Loan Party or
any Subsidiary thereof (i) one or more final judgments or orders for the
payment of money in an aggregate amount (as to all such judgments and orders)
exceeding the Threshold Amount (to the extent not covered by independent
third-party insurance as to which the insurer is rated at least “A” by A.M.
Best Company, has been notified of the potential claim and does not dispute
coverage), or (ii) any one or more non-monetary final judgments that have, or
could reasonably be expected to have, individually or in the aggregate, a
Material Adverse Effect and, in either case, (A) enforcement proceedings are
commenced by any creditor upon such judgment or order, or (B) there is a period
of 20 consecutive days during
which a stay of enforcement of such judgment, by reason of a pending appeal or
otherwise, is not in effect; or

 

(i)            ERISA.  (i) An ERISA Event occurs with respect to a
Pension Plan or Multiemployer Plan which has resulted or could reasonably be
expected to result in liability of the Borrower under Title IV of ERISA to
the Pension Plan, Multiemployer Plan or the PBGC in an aggregate amount in
excess of the Threshold Amount, or (ii) the Borrower or any ERISA Affiliate
fails to pay when due, after the expiration of any applicable grace period, any
installment payment with respect to its withdrawal liability under Section 4201
of ERISA under a Multiemployer Plan in an aggregate amount in excess of the
Threshold Amount; or

 

(j)            Invalidity of
Loan Documents.  Any provision of any
Loan Document, at any time after its execution and delivery and for any reason
other than as expressly permitted hereunder or thereunder or satisfaction in
full of all the Obligations, ceases to be in full force and effect; or any Loan
Party or any other Person contests in any manner the validity or enforceability
of any provision of any Loan Document; or any Loan Party denies that it has any
or further liability or obligation under any provision of any Loan Document, or
purports to revoke, terminate or rescind any provision of any Loan Document; or

 

(k)           Change of Control.  There occurs any Change of Control; or

 

(l)            Collateral
Documents.  Any Collateral Document
after delivery thereof pursuant to Section 4.01 or 6.12
shall for any reason (other than pursuant to the terms

 

99

 

thereof) cease to create a valid and perfected first priority Lien
(subject to Liens permitted by Section 7.01) on the Collateral purported
to be covered thereby or shall be so asserted by the Borrower or any Loan
Party; or

 

(m)          Gaming Matters.  (i)  If
the Borrower or any of its Subsidiaries fails to keep in full force and effect,
suffers the termination, revocation, forfeiture, nonrenewal or suspension of,
or suffers a material adverse amendment, condition or limitation to, any Gaming
License, finding of suitability or other approval or authorization required to
enable Borrower or Subsidiary to own, operate, or otherwise conduct or manage
any gaming activities where Borrower or any of its Subsidiaries conduct such
business for seven consecutive calendar days; or

 

(ii)           if
any Governmental Authority terminates, suspends, revokes, repeals, fails to
issue or fails to renew any Gaming License held by William Wortman, William
Paulos or OCM or finding of suitability or other approvals or authorization
required to enable William Wortman, William Paulos or OCM to own, operate,
participate or associate in the business of Borrower and its Subsidiaries; or

 

(iii)          if
the Temporary Casino is not Operating within one year of the Closing Date; or

 

(n)           Other Matters.  If a party to the Equity Guarantee fails to
perform or observe any covenant or agreement contained in the Equity Guarantee
on its part to be performed or observed.

 

8.02.        Remedies upon
Event of Default.  If any Event of
Default occurs and is continuing, the Administrative Agent shall, at the
request of, or may, with the consent of, the Required Lenders, take any or all
of the following actions:

 

(a)           declare the
commitment of each Lender to make Loans and any obligation of the L/C Issuer to
make L/C Credit Extensions to be terminated, whereupon such commitments and
obligation shall be terminated;

 

(b)           declare the unpaid
principal amount of all outstanding Loans, all interest accrued and unpaid
thereon, and all other amounts owing or payable hereunder or under any other
Loan Document to be immediately due and payable, without presentment, demand,
protest or other notice of any kind, all of which are hereby expressly waived
by the Borrower;

 

(c)           require that the
Borrower Cash Collateralize the L/C Obligations (in an amount equal to the then
Outstanding Amount thereof); and

 

(d)           exercise on behalf
of itself, the Lenders and the L/C Issuer all rights and remedies available to
it, the Lenders and the L/C Issuer under the Loan Documents;

 

provided, however, that upon the occurrence
of an actual or deemed entry of an order for relief with respect to the
Borrower under the Bankruptcy Code of the United States, the obligation of

 

100

 

each Lender to make Loans and any obligation of the L/C Issuer to make
L/C Credit Extensions shall automatically terminate, the unpaid principal
amount of all outstanding Loans and all interest and other amounts as aforesaid
shall automatically become due and payable, and the obligation of the Borrower
to Cash Collateralize the L/C Obligations as aforesaid shall automatically
become effective, in each case without further act of the Administrative Agent
or any Lender.

 

8.03.        Application of
Funds.  Subject to the Intercreditor
Agreement, after the exercise of remedies provided for in Section 8.02
(or after the Loans have automatically become immediately due and payable and
the L/C Obligations have automatically been required to be Cash Collateralized
as set forth in the proviso to Section 8.02), any amounts received on
account of the Obligations shall be applied by the Administrative Agent in the
following order:

 

First, to payment of
that portion of the Obligations constituting fees, indemnities, expenses and
other amounts (other than principal, interest and Letter of Credit Fees but
including fees, charges and disbursements of counsel to the Administrative
Agent and amounts payable under Article III) payable to the
Administrative Agent in its capacity as such;

 

Second, to payment
of that portion of the Obligations constituting fees, indemnities and other
amounts (other than principal, interest and Letter of Credit Fees) payable to
the Lenders and the L/C Issuer (including fees, charges and disbursements of
counsel to the respective Lenders and the L/C Issuer (including fees and time
charges for attorneys who may be employees of any Lender or the L/C Issuer) and
amounts payable under Article III, ratably among them in proportion to
the respective amounts described in this clause Second payable to them;

 

Third, to payment of
that portion of the Obligations constituting accrued and unpaid Letter of
Credit Fees and interest on the Loans, L/C Borrowings and other Obligations,
ratably among the Lenders and the L/C Issuer in proportion to the respective
amounts described in this clause Third payable to them;

 

Fourth, to payment
of that portion of the Obligations constituting unpaid principal of the Loans,
L/C Borrowings and amounts owing under Secured Hedge Agreements and Secured
Cash Management Agreements, ratably among the Lenders, the L/C Issuer, the
Hedge Banks and the Cash Management Banks in proportion to the respective
amounts described in this clause Fourth held by them;

 

Fifth, to the
Administrative Agent for the account of the L/C Issuer, to Cash Collateralize
that portion of L/C Obligations comprised of the aggregate undrawn amount of
Letters of Credit; and

 

Last, the balance,
if any, after all of the Obligations have been indefeasibly paid in full, to
the Borrower or as otherwise required by Law.

 

Subject to Section 2.03(c), amounts used to Cash Collateralize
the aggregate undrawn amount of Letters of Credit pursuant to clause Fifth
above shall be applied to satisfy drawings under such Letters of Credit as they
occur.  If any amount remains on deposit
as Cash Collateral after all

 

101

 

Letters of Credit have either been fully drawn or expired, such
remaining amount shall be applied to the other Obligations, if any, in the
order set forth above.

 

ARTICLE IX

ADMINISTRATIVE AGENT

 

9.01.        Appointment and
Authority.

 

(a)           Each of the Lenders
and the L/C Issuer hereby irrevocably appoints Bank of America to act on its
behalf as the Administrative Agent hereunder and under the other Loan Documents
and authorizes the Administrative Agent to take such actions on its behalf and
to exercise such powers as are delegated to the Administrative Agent by the
terms hereof or thereof, together with such actions and powers as are
reasonably incidental thereto.  The
provisions of this Article are solely for the benefit of the Administrative
Agent, the Lenders and the L/C Issuer, and the Borrower shall not have rights
as a third party beneficiary of any of such provisions.

 

(b)           The Administrative
Agent shall also act as the “collateral agent” under the Loan Documents,
and each of the Lenders (in its capacities as a Lender, potential Hedge Bank
and potential Cash Management Bank) and the L/C Issuer hereby irrevocably
appoints and authorizes the Administrative Agent to act as the agent of such
Lender and the L/C Issuer for purposes of acquiring, holding and enforcing any
and all Liens on Collateral granted by any of the Loan Parties to secure any of
the Obligations, together with such powers and discretion as are reasonably
incidental thereto.  In this connection,
the Administrative Agent, as “collateral agent” and any co-agents, sub-agents
and attorneys-in-fact appointed by the Administrative Agent pursuant to Section
9.05 for purposes of holding or enforcing any Lien on the Collateral (or any
portion thereof) granted under the Collateral Documents, or for exercising any
rights and remedies thereunder at the direction of the Administrative Agent),
shall be entitled to the benefits of all provisions of this Article IX
and Article XI (including Section 11.04(c), as though such
co-agents, sub-agents and attorneys-in-fact were the “collateral agent” under
the Loan Documents) as if set forth in full herein with respect thereto.

 

9.02.        Rights as a Lender.  The Person serving as the Administrative Agent
hereunder shall have the same rights and powers in its capacity as a Lender as
any other Lender and may exercise the same as though it were not the
Administrative Agent and the term “Lender” or “Lenders” shall, unless otherwise
expressly indicated or unless the context otherwise requires, include the
Person serving as the Administrative Agent hereunder in its individual
capacity.  Such Person and its Affiliates
may accept deposits from, lend money to, act as the financial advisor or in any
other advisory capacity for and generally engage in any kind of business with
the Borrower or any Subsidiary or other Affiliate thereof as if such Person
were not the Administrative Agent hereunder and without any duty to account
therefor to the Lenders.

 

9.03.        Exculpatory
Provisions.  The Administrative Agent
shall not have any duties or obligations except those expressly set forth
herein and in the other Loan Documents. 
Without limiting the generality of the foregoing, the Administrative
Agent:

 

102

 

(a)           shall not be subject
to any fiduciary or other implied duties, regardless of whether a Default has
occurred and is continuing;

 

(b)           shall not have any
duty to take any discretionary action or exercise any discretionary powers,
except discretionary rights and powers expressly contemplated hereby or by the
other Loan Documents that the Administrative Agent is required to exercise as
directed in writing by the Required Lenders (or such other number or percentage
of the Lenders as shall be expressly provided for herein or in the other Loan
Documents), provided that the Administrative Agent shall not be required
to take any action that, in its opinion or the opinion of its counsel, may
expose the Administrative Agent to liability or that is contrary to any Loan
Document or applicable law; and

 

(c)           shall not, except as
expressly set forth herein and in the other Loan Documents, have any duty to
disclose, and shall not be liable for the failure to disclose, any information
relating to the Borrower or any of its Affiliates that is communicated to or
obtained by the Person serving as the Administrative Agent or any of its
Affiliates in any capacity.

 

The Administrative Agent shall not be liable for any action taken or
not taken by it (i) with the consent or at the request of the Required Lenders
(or such other number or percentage of the Lenders as shall be necessary, or as
the Administrative Agent shall believe in good faith shall be necessary, under
the circumstances as provided in Sections 11.01 and 8.02) or (ii)
in the absence of its own gross negligence or willful misconduct.  The Administrative Agent shall be deemed not
to have knowledge of any Default unless and until notice describing such
Default is given to the Administrative Agent by the Borrower, a Lender or the
L/C Issuer.

 

The Administrative Agent shall not be responsible for or have any duty
to ascertain or inquire into (i) any statement, warranty or representation made
in or in connection with this Agreement or any other Loan Document, (ii) the
contents of any certificate, report or other document delivered hereunder or
thereunder or in connection herewith or therewith, (iii) the performance
or observance of any of the covenants, agreements or other terms or conditions
set forth herein or therein or the occurrence of any Default, (iv) the
validity, enforceability, effectiveness or genuineness of this Agreement, any
other Loan Document or any other agreement, instrument or document, or the
creation, perfection or priority of any Lien purported to be created by the
Collateral Documents, (v) the value or the sufficiency of any Collateral, or
(v) the satisfaction of any condition set forth in Article IV or
elsewhere herein, other than to confirm receipt of items expressly required to
be delivered to the Administrative Agent.

 

9.04.        Reliance by
Administrative Agent.  The
Administrative Agent shall be entitled to rely upon, and shall not incur any
liability for relying upon, any notice, request, certificate, consent,
statement, instrument, document or other writing (including any electronic
message, Internet or intranet website posting or other distribution) believed
by it to be genuine and to have been signed, sent or otherwise authenticated by
the proper Person.  The Administrative
Agent also may rely upon any statement made to it orally or by telephone and
believed by it to have been made by the proper Person, and shall not incur any
liability for relying thereon.  In
determining compliance with any condition hereunder to the making of a Loan, or
the issuance of a Letter of Credit, that by its terms must be fulfilled to the
satisfaction of a Lender or the L/C

 

103

 

Issuer, the Administrative Agent may presume that such condition is satisfactory
to such Lender or the L/C Issuer unless the Administrative Agent shall have
received notice to the contrary from such Lender or the L/C Issuer prior to the
making of such Loan or the issuance of such Letter of Credit.  The Administrative Agent may consult with
legal counsel (who may be counsel for the Borrower), independent accountants
and other experts selected by it, and shall not be liable for any action taken
or not taken by it in accordance with the advice of any such counsel,
accountants or experts.

 

9.05.        Delegation of
Duties.  The Administrative Agent may
perform any and all of its duties and exercise its rights and powers hereunder
or under any other Loan Document by or through any one or more sub-agents
(including, without limitation, the Control Agent) appointed by the
Administrative Agent.  The Administrative
Agent and any such sub-agent may perform any and all of its duties and exercise
its rights and powers by or through their respective Related Parties.  The exculpatory provisions of this Article
shall apply to any such sub-agent and to the Related Parties of the
Administrative Agent and any such sub-agent, and shall apply to their
respective activities in connection with the syndication of the credit
facilities provided for herein as well as activities as Administrative Agent.

 

9.06.        Resignation of
Administrative Agent.  The
Administrative Agent may at any time give notice of its resignation to the
Lenders, the L/C Issuer and the Borrower. 
Upon receipt of any such notice of resignation, the Required Lenders
shall have the right, in consultation with the Borrower, to appoint a
successor, which shall be a bank with an office in the United States, or an
Affiliate of any such bank with an office in the United States.  If no such successor shall have been so
appointed by the Required Lenders and shall have accepted such appointment
within 30 days after the retiring Administrative Agent gives notice of its
resignation, then the retiring Administrative Agent may on behalf of the Lenders
and the L/C Issuer, appoint a successor Administrative Agent meeting the
qualifications set forth above; provided that if the Administrative
Agent shall notify the Borrower and the Lenders that no qualifying Person has
accepted such appointment, then such resignation shall nonetheless become
effective in accordance with such notice and (a) the retiring
Administrative Agent shall be discharged from its duties and obligations
hereunder and under the other Loan Documents (except that in the case of any
collateral security held by the Administrative Agent on behalf of the Lenders
or the L/C Issuer under any of the Loan Documents, the retiring Administrative
Agent shall continue to hold such collateral security until such time as a
successor Administrative Agent is appointed) and (b) all payments,
communications and determinations provided to be made by, to or through the
Administrative Agent shall instead be made by or to each Lender and the L/C
Issuer directly, until such time as the Required Lenders appoint a successor
Administrative Agent as provided for above in this Section.  Upon the acceptance of a successor’s
appointment as Administrative Agent hereunder, such successor shall succeed to
and become vested with all of the rights, powers, privileges and duties of the
retiring (or retired) Administrative Agent, and the retiring Administrative
Agent shall be discharged from all of its duties and obligations hereunder or
under the other Loan Documents (if not already discharged therefrom as provided
above in this Section).  The fees payable
by the Borrower to a successor Administrative Agent shall be the same as those
payable to its predecessor unless otherwise agreed between the Borrower and
such successor.  After the retiring
Administrative Agent’s resignation hereunder and under the other Loan
Documents, the provisions of this Article and Section 11.04 shall
continue in effect for the benefit of such retiring

 

104

 

Administrative Agent, its sub-agents and their respective Related
Parties in respect of any actions taken or omitted to be taken by any of them
while the retiring Administrative Agent was acting as Administrative Agent.

 

Any resignation by Bank of America as Administrative Agent pursuant to
this Section shall also constitute its resignation as L/C Issuer.  Upon the acceptance of a successor’s
appointment as Administrative Agent hereunder, (i) such successor shall succeed
to and become vested with all of the rights, powers, privileges and duties of
the retiring L/C Issuer, (ii) the retiring L/C Issuer shall be discharged from
all of their respective duties and obligations hereunder or under the other
Loan Documents, and (iii) the successor L/C Issuer shall issue letters of
credit in substitution for the Letters of Credit, if any, outstanding at the
time of such succession or make other arrangements satisfactory to the retiring
L/C Issuer to effectively assume the obligations of the retiring L/C Issuer
with respect to such Letters of Credit.

 

9.07.        Non-Reliance on Administrative
Agent and Other Lenders.  Each Lender
and the L/C Issuer acknowledges that it has, independently and without reliance
upon the Administrative Agent or any other Lender or any of their Related
Parties and based on such documents and information as it has deemed
appropriate, made its own credit analysis and decision to enter into this
Agreement.  Each Lender and the L/C
Issuer also acknowledges that it will, independently and without reliance upon
the Administrative Agent or any other Lender or any of their Related Parties
and based on such documents and information as it shall from time to time deem
appropriate, continue to make its own decisions in taking or not taking action
under or based upon this Agreement, any other Loan Document or any related
agreement or any document furnished hereunder or thereunder.

 

9.08.        No Other Duties,
Etc.  Anything herein to the contrary
notwithstanding, none of the Bookrunners, Arrangers or other titles as
necessary listed on the cover page hereof shall have any powers, duties or
responsibilities under this Agreement or any of the other Loan Documents,
except in its capacity, as applicable, as the Administrative Agent, a Lender or
the L/C Issuer hereunder.

 

9.09.        Administrative
Agent May File Proofs of Claim.  In
case of the pendency of any proceeding under any Debtor Relief Law or any other
judicial proceeding relative to any Loan Party, the Administrative Agent
(irrespective of whether the principal of any Loan or L/C Obligation shall then
be due and payable as herein expressed or by declaration or otherwise and
irrespective of whether the Administrative Agent shall have made any demand on
the Borrower) shall be entitled and empowered, by intervention in such
proceeding or otherwise

 

(a)           to file and prove a
claim for the whole amount of the principal and interest owing and unpaid in
respect of the Loans, L/C Obligations and all other Obligations that are owing
and unpaid and to file such other documents as may be necessary or advisable in
order to have the claims of the Lenders, the L/C Issuer and the Administrative
Agent (including any claim for the reasonable compensation, expenses,
disbursements and advances of the Lenders, the L/C Issuer and the
Administrative Agent and their respective agents and counsel and all other
amounts due the Lenders, the L/C Issuer and the Administrative Agent under Sections
2.03(i) and (j), 2.09 and 10.04) allowed in such
judicial proceeding; and

 

105

 

(b)           to collect and
receive any monies or other property payable or deliverable on any such claims
and to distribute the same;

 

and any custodian, receiver, assignee, trustee, liquidator,
sequestrator or other similar official in any such judicial proceeding is
hereby authorized by each Lender and the L/C Issuer to make such payments to
the Administrative Agent and, if the Administrative Agent shall consent to the
making of such payments directly to the Lenders and the L/C Issuer, to pay to
the Administrative Agent any amount due for the reasonable compensation,
expenses, disbursements and advances of the Administrative Agent and its agents
and counsel, and any other amounts due the Administrative Agent under Sections 2.09
and 10.04.

 

Nothing contained herein shall be deemed to authorize the Administrative
Agent to authorize or consent to or accept or adopt on behalf of any Lender or
the L/C Issuer any plan of reorganization, arrangement, adjustment or
composition affecting the Obligations or the rights of any Lender or the L/C
Issuer to authorize the Administrative Agent to vote in respect of the claim of
any Lender or the L/C Issuer or in any such proceeding.

 

9.10.        Collateral and
Guaranty Matters.  The Lenders and
the L/C Issuer irrevocably authorize the Administrative Agent, at its option and
in its discretion,

 

(a)           to release any Lien
on any property granted to or held by the Administrative Agent under any Loan
Document (i) upon termination of the Aggregate Commitments and payment in full
of all Obligations (other than contingent indemnification obligations) and the
expiration or termination of all Letters of Credit, (ii) that is sold or to be
sold as part of or in connection with any sale permitted hereunder or under any
other Loan Document, or (iii)  if
approved, authorized or ratified in writing in accordance with Section 11.01;

 

(b)           to release any
Guarantor from its obligations under the Guaranty if such Person ceases to be a
Subsidiary as a result of a transaction permitted hereunder; and

 

(c)           to subordinate any
Lien on any property granted to or held by the Administrative Agent under any
Loan Document to the holder of any Lien on such property that is permitted by Section
7.01(i).

 

Upon request by the Administrative Agent at any time, the Required
Lenders will confirm in writing the Administrative Agent’s authority to release
or subordinate its interest in particular types or items of property, or to
release any Guarantor from its obligations under the Guaranty pursuant to this Section
9.10.  In each case as specified in
this Section 9.10, the Administrative Agent will, at the Borrower’s
expense, execute and deliver to the applicable Loan Party such documents as
such Loan Party may reasonably request to evidence the release of such item of
Collateral from the assignment and security interest granted under the
Collateral Documents or to subordinate its interest in such item, or to release
such Guarantor from its obligations under the Guaranty, in each case in
accordance with the terms of the Loan Documents and this Section 9.10.

 

106

 

ARTICLE X

[RESERVED]

 

ARTICLE XI

MISCELLANEOUS

 

11.01.      Amendments, Etc.  No amendment or waiver of any provision of
this Agreement or any other Loan Document, and no consent to any departure by
the Borrower or any other Loan Party therefrom, shall be effective unless in
writing signed by the Required Lenders and the Borrower or the applicable Loan
Party, as the case may be, and acknowledged by the Administrative Agent, and
each such waiver or consent shall be effective only in the specific instance
and for the specific purpose for which given; provided, however,
that no such amendment, waiver or consent shall:

 

(a)           waive any condition
set forth in Section 4.01 (other than Section 4.01(b)(i) or (c)),
or, in the case of the initial Credit Extension, Section 4.02,
without the written consent of each Lender;

 

(b)           without limiting the
generality of clause (a) above, waive any condition set forth in Section
4.02 as to any Credit Extension under a particular Facility without the
written consent of the Required Revolving Lenders or the Required Term B
Lenders, as the case may be;

 

(c)           extend or increase
the Commitment of any Lender (or reinstate any Commitment terminated pursuant
to Section 8.02) without the written consent of such Lender;

 

(d)           postpone any date
fixed by this Agreement or any other Loan Document for any payment (excluding mandatory prepayments) of
principal, interest, fees or other amounts due to the Lenders (or any of them)
hereunder or under such other Loan Document without the written consent of each
Lender entitled to such payment;

 

(e)           reduce or forgive
the principal of, or the rate of interest specified herein on, any Loan or L/C
Borrowing, or (subject to clause (v) of the second proviso to this Section
11.01) any fees or other amounts payable hereunder (including, without
limitation, amounts under Section 2.06(c))or under any other Loan
Document without the written consent of each Lender entitled to such amount; provided,
however, that only the consent of the Required Lenders shall be
necessary to amend the definition of “Default Rate” or to waive any obligation
of the Borrower to pay interest or Letter of Credit Fees at the Default Rate;

 

(f)            change (i) (A) Section
8.03 in a manner that would alter the order of or pro rata sharing of
payments required thereby without the written consent of each Lender or (B) the
third sentence of Sections 2.12(a), (f) and 2.13 or the
definition of “Applicable Percentage” without the written consent of each
Lender or (ii) the order of application of any reduction in the Commitments or
any prepayment of Loans among the Facilities from the application thereof set
forth in the applicable provisions of Section 2.05(b) or 2.06(b),
respectively, in any manner that materially and adversely affects the Lenders
under a Facility

 

107

 

without the written consent of (i)  if such Facility is the Term B
Facility, the Required Term B Lenders and (ii) if such Facility is the
Revolving Credit Facility, the Required Revolving Lenders;

 

(g)           change (i) any
provision of this Section 11.01 or the definition of “Required Lenders”
or any other provision hereof specifying the number or percentage of Lenders
required to amend, waive or otherwise modify any rights hereunder or make any
determination or grant any consent hereunder (other than the definitions
specified in clause (ii) of this Section 11.01(g)), without the written
consent of each Lender or (ii) the definition of “Required Revolving Lenders”
or “Required Term B Lenders” without the written consent of each Lender under
the applicable Facility;

 

(h)           release all or
substantially all of the Collateral in any transaction or series of related
transactions, without the written consent of each Lender (except as expressly
specified in the Collateral Documents);

 

(i)            release all or
substantially all of the value of the Guaranty, without the written consent of
each Lender (except as expressly specified in the Guaranty);

 

(j)            impose any greater
restriction on the ability of any Lender under a Facility to assign any of its
rights or obligations hereunder without the written consent of (i) if such
Facility is the Term B Facility, the Required Term B Lenders and (ii) if such
Facility is the Revolving Credit Facility, the Required Revolving Lenders;

 

and provided, further, that (i) no amendment, waiver or
consent shall, unless in writing and signed by the L/C Issuer in addition to
the Lenders required above, affect the rights or duties of the L/C Issuer under
this Agreement or any Issuer Document relating to any Letter of Credit issued
or to be issued by it; (ii) no amendment, waiver or consent shall, unless in
writing and signed by the Administrative Agent in addition to the Lenders
required above, affect the rights or duties of the Administrative Agent under
this Agreement or any other Loan Document; and (iii) the Fee Letter may be
amended, or rights or privileges thereunder waived, in a writing executed only
by the parties thereto.  Notwithstanding
anything to the contrary herein, no Defaulting Lender shall have any right to
approve or disapprove any amendment, waiver or consent hereunder, except that
the Commitment of such Lender may not be increased or extended without the
consent of such Lender.

 

If any Lender does not consent to a proposed amendment, waiver, consent
or release with respect to any Loan Document that requires the consent of each
Lender and that has been approved by the Required Lenders, the Borrower may
replace such non-consenting Lender in accordance with Section 11.13; provided
that such amendment, waiver, consent or release can be effected as a result of
the assignment contemplated by such Section (together with all other such
assignments required by the Borrower to be made pursuant to this paragraph).

 

11.02.      Notices;
Effectiveness; Electronic Communications.

 

(a)           Notices Generally.  Except in the case of notices and other
communications expressly permitted to be given by telephone (and except as
provided in subsection (b) below),

 

108

 

all notices and other communications provided for herein shall be in
writing and shall be delivered by hand or overnight courier service, mailed by
certified or registered mail or sent by telecopier as follows, and all notices
and other communications expressly permitted hereunder to be given by telephone
shall be made to the applicable telephone number, as follows:

 

(i)            if
to the Borrower, the Administrative Agent or the L/C Issuer, to the address,
telecopier number, electronic mail address or telephone number specified for
such Person on Schedule 11.02; and

 

(ii)           if
to any other Lender, to the address, telecopier number, electronic mail address
or telephone number specified in its Administrative Questionnaire.

 

Notices sent by hand or overnight courier service, or mailed by
certified or registered mail, shall be deemed to have been given when received;
notices sent by telecopier shall be deemed to have been given when sent (except
that, if not given during normal business hours for the recipient, shall be
deemed to have been given at the opening of business on the next business day
for the recipient).  Notices delivered
through electronic communications to the extent provided in subsection (b)
below shall be effective as provided in such subsection (b).

 

(b)           Electronic
Communications.  Notices and other
communications to the Lenders and the L/C Issuer hereunder may be delivered or
furnished by electronic communication (including e-mail and Internet or
intranet websites) pursuant to procedures approved by the Administrative Agent,
provided that the foregoing shall not apply to notices to any Lender or
the L/C Issuer pursuant to Article II if such Lender or the L/C Issuer,
as applicable, has notified the Administrative Agent that it is incapable of
receiving notices under such Article by electronic communication.  The Administrative Agent or the Borrower may,
in its discretion, agree to accept notices and other communications to it hereunder
by electronic communications pursuant to procedures approved by it, provided
that approval of such procedures may be limited to particular notices or
communications.

 

Unless the Administrative Agent otherwise prescribes, (i) notices
and other communications sent to an e-mail address shall be deemed received
upon the sender’s receipt of an acknowledgement from the intended recipient
(such as by the “return receipt requested” function, as available, return
e-mail or other written acknowledgement), provided that if such notice
or other communication is not sent during the normal business hours of the
recipient, such notice or communication shall be deemed to have been sent at
the opening of business on the next business day for the recipient, and
(ii) notices or communications posted to an Internet or intranet website
shall be deemed received upon the deemed receipt by the intended recipient at
its e-mail address as described in the foregoing clause (i) of
notification that such notice or communication is available and identifying the
website address therefor.

 

(c)           The Platform.  THE PLATFORM IS PROVIDED “AS IS” AND “AS
AVAILABLE.”  THE AGENT PARTIES (AS
DEFINED BELOW) DO NOT WARRANT THE ACCURACY OR COMPLETENESS OF THE BORROWER
MATERIALS OR THE ADEQUACY OF THE PLATFORM, AND EXPRESSLY DISCLAIM LIABILITY FOR
ERRORS IN OR OMISSIONS FROM THE BORROWER MATERIALS.  NO WARRANTY OF ANY KIND, EXPRESS, IMPLIED OR
STATUTORY, INCLUDING ANY WARRANTY OF MERCHANTABILITY,

 

109

 

FITNESS FOR A PARTICULAR PURPOSE, NON-INFRINGEMENT OF THIRD PARTY
RIGHTS OR FREEDOM FROM VIRUSES OR OTHER CODE DEFECTS, IS MADE BY ANY AGENT
PARTY IN CONNECTION WITH THE BORROWER MATERIALS OR THE PLATFORM.  In no event shall the Administrative Agent or
any of its Related Parties (collectively, the “Agent Parties”) have any
liability to the Borrower, any Lender, the L/C Issuer or any other Person for
losses, claims, damages, liabilities or expenses of any kind (whether in tort,
contract or otherwise) arising out of the Borrower’s or the Administrative
Agent’s transmission of Borrower Materials through the Internet, except to the
extent that such losses, claims, damages, liabilities or expenses are
determined by a court of competent jurisdiction by a final and nonappealable
judgment to have resulted from the gross negligence or willful misconduct of
such Agent Party; provided, however, that in no event shall any
Agent Party have any liability to the Borrower, any Lender, the L/C Issuer or
any other Person for indirect, special, incidental, consequential or punitive
damages (as opposed to direct or actual damages).

 

(d)           Change of
Address, Etc.  Each of the Borrower,
the Administrative Agent and the L/C Issuer may change its address, telecopier
or telephone number for notices and other communications hereunder by notice to
the other parties hereto.  Each other
Lender may change its address, telecopier or telephone number for notices and
other communications hereunder by notice to the Borrower, the Administrative
Agent and the L/C Issuer.  In addition,
each Lender agrees to notify the Administrative Agent from time to time to
ensure that the Administrative Agent has on record (i) an effective address,
contact name, telephone number, telecopier number and electronic mail address
to which notices and other communications may be sent and (ii) accurate wire
instructions for such Lender.

 

(e)           Reliance by
Administrative Agent, L/C Issuer and Lenders.  The Administrative
Agent, the L/C Issuer and the Lenders shall be entitled to rely and act upon
any notices (including telephonic Committed Loan Notices) purportedly given by
or on behalf of the Borrower even if (i) such notices were not made in a manner
specified herein, were incomplete or were not preceded or followed by any other
form of notice specified herein, or (ii) the terms thereof, as understood by
the recipient, varied from any confirmation thereof.  The Borrower shall indemnify the
Administrative Agent, the L/C Issuer, each Lender and the Related Parties of
each of them from all losses, costs, expenses and liabilities resulting from
the reliance by such Person on each notice purportedly given by or on behalf of
the Borrower.  All telephonic notices to
and other telephonic communications with the Administrative Agent may be
recorded by the Administrative Agent, and each of the parties hereto hereby
consents to such recording.

 

11.03.      No Waiver;
Cumulative Remedies.  No failure by
any Lender, the L/C Issuer or the Administrative Agent to exercise, and no
delay by any such Person in exercising, any right, remedy, power or privilege
hereunder or under any other Loan Document shall operate as a waiver thereof;
nor shall any single or partial exercise of any right, remedy, power or
privilege hereunder preclude any other or further exercise thereof or the exercise
of any other right, remedy, power or privilege. 
The rights, remedies, powers and privileges herein provided, and
provided under each other Loan Document, are cumulative and not exclusive of
any rights, remedies, powers and privileges provided by law.

 

110

 

11.04.      Expenses;
Indemnity; Damage Waiver.

 

(a)           Costs and
Expenses.  The Borrower shall pay
(i) all reasonable out-of-pocket expenses incurred by the Administrative
Agent and its Affiliates (including the reasonable fees, charges and
disbursements of counsel for the Administrative Agent), in connection with the
syndication of the credit facilities provided for herein, the preparation,
negotiation, execution, delivery and administration of this Agreement and the
other Loan Documents or any amendments, modifications or waivers of the
provisions hereof or thereof (whether or not the transactions contemplated
hereby or thereby shall be consummated), (ii) all reasonable out-of-pocket
expenses incurred by the L/C Issuer in connection with the issuance, amendment,
renewal or extension of any Letter of Credit or any demand for payment
thereunder and (iii) all out-of-pocket expenses incurred by the
Administrative Agent, any Lender or the L/C Issuer (including the fees, charges
and disbursements of any counsel for the Administrative Agent, any Lender or
the L/C Issuer), and shall pay all fees and time charges for attorneys who may
be employees of the Administrative Agent, any Lender or the L/C Issuer, in
connection with the enforcement or protection of its rights (A) in connection
with this Agreement and the other Loan Documents, including its rights under
this Section, or (B) in connection with Loans made or Letters of Credit issued
hereunder, including all such out-of-pocket expenses incurred during any
workout, restructuring or negotiations in respect of such Loans or Letters of
Credit.

 

(b)           Indemnification
by the Borrower.  The Borrower shall
indemnify the Administrative Agent (and any sub-agent thereof), each Lender and
the L/C Issuer, and each Related Party of any of the foregoing Persons (each
such Person being called an “Indemnitee”) against, and hold each
Indemnitee harmless from, any and all losses, claims, damages, liabilities and
related expenses (including the reasonable fees, charges and disbursements of
any counsel for any Indemnitee), and shall indemnify and hold harmless each
Indemnitee from all fees and time charges and disbursements for attorneys who
may be employees of any Indemnitee, incurred by any Indemnitee or asserted
against any Indemnitee by any third party or by the Borrower or any other Loan
Party arising out of, in connection with, or as a result of (i) the
execution or delivery of this Agreement, any other Loan Document or any
agreement or instrument contemplated hereby or thereby, the performance by the
parties hereto of their respective obligations hereunder or thereunder or the
consummation of the transactions contemplated hereby or thereby, or, in the
case of the Administrative Agent (and any sub-agent thereof) and its Related
Parties only, the administration of this Agreement and the other Loan
Documents, (ii) any Loan or Letter of Credit or the use or proposed use of
the proceeds therefrom (including any refusal by the L/C Issuer to honor a
demand for payment under a Letter of Credit if the documents presented in
connection with such demand do not strictly comply with the terms of such
Letter of Credit), (iii) any actual or alleged presence or release of
Hazardous Materials on or from any property owned or operated by the Borrower
or any of its Subsidiaries, or any Environmental Liability related in any way
to the Borrower or any of its Subsidiaries, or (iv) any actual or
prospective claim, litigation, investigation or proceeding relating to any of
the foregoing, whether based on contract, tort or any other theory, whether
brought by a third party or by the Borrower or any other Loan Party or any of
the Borrower’s or such Loan Party’s directors, shareholders, trustees or
creditors, and regardless of whether any Indemnitee is a party thereto; provided
that such indemnity shall not, as to any Indemnitee, be available to the extent
that such losses, claims, damages, liabilities or related expenses (x) are
determined by a court of competent jurisdiction

 

111

 

by final and nonappealable judgment to have resulted from the gross
negligence or willful misconduct of such Indemnitee or (y) result from a
claim brought by the Borrower or any other Loan Party against an Indemnitee for
breach in bad faith of such Indemnitee’s obligations hereunder or under any
other Loan Document, if the Borrower or such Loan Party has obtained a final
and nonappealable judgment in its favor on such claim as determined by a court
of competent jurisdiction.

 

(c)           Reimbursement by
Lenders.  To the extent that the
Borrower for any reason fails to pay any amount required under
subsection (a) or (b) of this Section to be paid by it to the
Administrative Agent (or any sub-agent thereof), the L/C Issuer or any Related
Party of any of the foregoing (and without limiting its obligation to do so),
each Lender severally agrees to pay to the Administrative Agent (or any such
sub-agent), the L/C Issuer or such Related Party, as the case may be, such
Lender’s Applicable Percentage (determined as of the time that the applicable
unreimbursed expense or indemnity payment is sought) of such unpaid amount, provided
that the unreimbursed expense or indemnified loss, claim, damage, liability or
related expense, as the case may be, was incurred by or asserted against the
Administrative Agent (or any such sub-agent) or the L/C Issuer in its capacity
as such, or against any Related Party of any of the foregoing acting for the
Administrative Agent (or any such sub-agent) or L/C Issuer in connection with
such capacity.  The obligations of the
Lenders under this subsection (c) are subject to the provisions of Section 2.12(d);
provided, further, that to the extent indemnification of the L/C Issuer
is required under this Section 11.04(c), such obligation will be limited
to the Revolving Credit Lenders only.

 

(d)           Waiver of
Consequential Damages, Etc.  To the
fullest extent permitted by applicable law, the Borrower shall not assert, and
hereby waives, any claim against any Indemnitee, on any theory of liability,
for special, indirect, consequential or punitive damages (as opposed to direct
or actual damages) arising out of, in connection with, or as a result of, this
Agreement, any other Loan Document or any agreement or instrument contemplated
hereby, the transactions contemplated hereby or thereby, any Loan or Letter of
Credit or the use of the proceeds thereof. 
No Indemnitee referred to in subsection (b) above shall be liable for
any damages arising from the use by unintended recipients of any information or
other materials distributed to such unintended recipients by such Indemnitee
through telecommunications, electronic or other information transmission
systems in connection with this Agreement or the other Loan Documents or the
transactions contemplated hereby or thereby other than for direct or actual
damages resulting from the gross negligence or willful misconduct of such
Indemnitee as determined by a final and nonappealable judgment of a court of
competent jurisdiction.

 

(e)           Payments.  All amounts due under this Section shall be
payable not later than ten Business Days after demand therefor.

 

(f)            Survival.  The agreements in this Section shall survive
the resignation of the Administrative Agent, the L/C Issuer, the replacement of
any Lender, the termination of the Aggregate Commitments and the repayment,
satisfaction or discharge of all the other Obligations.

 

11.05.      Payments Set Aside.  To the extent that any payment by or on
behalf of the Borrower is made to the Administrative Agent, the L/C Issuer or
any Lender, or the Administrative

 

112

 

Agent, the L/C Issuer or any Lender exercises its right of setoff, and
such payment or the proceeds of such setoff or any part thereof is subsequently
invalidated, declared to be fraudulent or preferential, set aside or required
(including pursuant to any settlement entered into by the Administrative Agent,
the L/C Issuer or such Lender in its discretion) to be repaid to a trustee,
receiver or any other party, in connection with any proceeding under any Debtor
Relief Law or otherwise, then (a) to the extent of such recovery, the
obligation or part thereof originally intended to be satisfied shall be revived
and continued in full force and effect as if such payment had not been made or
such setoff had not occurred, and (b) each Lender and the L/C Issuer severally
agrees to pay to the Administrative Agent upon demand its applicable share
(without duplication) of any amount so recovered from or repaid by the
Administrative Agent, plus interest thereon from the date of such demand
to the date such payment is made at a rate per annum equal to the Federal Funds
Rate from time to time in effect.  The
obligations of the Lenders and the L/C Issuer under clause (b) of the preceding
sentence shall survive the payment in full of the Obligations and the
termination of this Agreement.

 

11.06.      Successors and
Assigns.

 

(a)           Successors and
Assigns Generally.  The provisions of
this Agreement shall be binding upon and inure to the benefit of the parties
hereto and their respective successors and assigns permitted hereby, except
that the Borrower may not assign or otherwise transfer any of its rights or
obligations hereunder without the prior written consent of the Administrative
Agent and each Lender and no Lender may assign or otherwise transfer any of its
rights or obligations hereunder except (i) to an assignee in accordance with
the provisions of Section 11.06(b), (ii) by way of participation in accordance
with the provisions of Section 11.06(d), or (iii) by way of pledge or
assignment of a security interest subject to the restrictions of Section
11.06(f) (and any other attempted assignment or transfer by any party
hereto shall be null and void).  Nothing
in this Agreement, expressed or implied, shall be construed to confer upon any
Person (other than the parties hereto, their respective successors and assigns
permitted hereby, Participants to the extent provided in subsection (d) of this
Section and, to the extent expressly contemplated hereby, the Related Parties
of each of the Administrative Agent, the L/C Issuer and the Lenders) any legal
or equitable right, remedy or claim under or by reason of this Agreement.

 

(b)           Assignments by
Lenders.  Any Lender may at any time
assign to one or more assignees all or a portion of its rights and obligations
under this Agreement (including all or a portion of its Commitment(s) and the
Loans (including for purposes of this Section 11.06(b), participations
in L/C Obligations) at the time owing to it); provided that any such
assignment shall be subject to the following conditions:

 

(i)            Minimum
Amounts.

 

(A)          in
the case of an assignment of the entire remaining amount of the assigning
Lender’s Commitment under any Facility and the Loans at the time owing to it
under such Facility or in the case of an assignment to a Lender, an Affiliate
of a Lender or an Approved Fund, no minimum amount need be assigned; and

 

(B)           in
any case not described in subsection (b)(i)(A) of this Section, the aggregate
amount of the Commitment (which for this purpose includes Loans outstanding

 

113

 

thereunder) or, if the Commitment is not then in effect, the principal
outstanding balance of the Loans of the assigning Lender subject to each such
assignment, determined as of the date the Assignment and Assumption with
respect to such assignment is delivered to the Administrative Agent or, if “Trade
Date” is specified in the Assignment and Assumption, as of the Trade Date,
shall not be less than $1,000,000, in the case of any assignment in respect of
the Revolving Credit Facility, or $1,000,000, in the case of any assignment in
respect of the Term B Facility, unless each of the Administrative Agent and, so
long as no Event of Default has occurred and is continuing, the Borrower
otherwise consents (each such consent not to be unreasonably withheld or
delayed); provided, however, that concurrent assignments to
members of an Assignee Group and concurrent assignments from members of an
Assignee Group to a single Eligible Assignee (or to an Eligible Assignee and
members of its Assignee Group) will be treated as a single assignment for
purposes of determining whether such minimum amount has been met;

 

(ii)           Proportionate
Amounts.  Each partial assignment
shall be made as an assignment of a proportionate part of all the assigning
Lender’s rights and obligations under this Agreement with respect to the Loans
or the Commitment assigned, except that this clause (ii) shall not prohibit any
Lender from assigning all or a portion of its rights and obligations among
separate Facilities on a non-pro rata basis;

 

(iii)          Required
Consents.  No consent shall be
required for any assignment except to the extent required by subsection
(b)(i)(B) of this Section and, in addition:

 

(A)          the
consent of the Borrower (such consent not to be unreasonably withheld or
delayed) shall be required unless (1) an Event of Default has occurred and is
continuing at the time of such assignment or (2) such assignment is to a
Lender, an Affiliate of a Lender or an Approved Fund;

 

(B)           the
consent of the Administrative Agent (such consent not to be unreasonably
withheld or delayed) shall be required for assignments in respect of (i) any
Term B Commitment or Revolving Credit Commitment if such assignment is to a
Person that is not a Lender with a Commitment in respect of the applicable
Facility, an Affiliate of such Lender or an Approved Fund with respect to such
Lender or (ii) any Term B Loan to a Person that is not a Lender, an Affiliate
of a Lender or an Approved Fund; and

 

(C)           the
consent of the L/C Issuer (such consent not to be unreasonably withheld or
delayed) shall be required for any assignment that increases the obligation of
the assignee to participate in exposure under one or more Letters of Credit
(whether or not then outstanding).

 

(iv)          Assignment
and Assumption.  The parties to each
assignment shall execute and deliver to the Administrative Agent an Assignment
and Assumption, together with a processing and recordation fee in the amount,
if any, required as set forth in Schedule 11.06; provided, however,
that the Administrative Agent may, in its sole discretion, elect to waive such
processing and recordation fee in the case of any assignment.

 

114

 

The assignee, if it shall not be a Lender, shall deliver to the
Administrative Agent an Administrative Questionnaire.

 

(v)           No
Assignment to Borrower.  No such
assignment shall be made to the Borrower or any of the Borrower’s Affiliates or
Subsidiaries.

 

(vi)          No
Assignment to Natural Persons.  No
such assignment shall be made to a natural person.

 

Subject to acceptance and recording thereof by the Administrative Agent
pursuant to subsection (c) of this Section, from and after the effective
date specified in each Assignment and Assumption, the assignee thereunder shall
be a party to this Agreement and, to the extent of the interest assigned by
such Assignment and Assumption, have the rights and obligations of a Lender
under this Agreement, and the assigning Lender thereunder shall, to the extent
of the interest assigned by such Assignment and Assumption, be released from
its obligations under this Agreement (and, in the case of an Assignment and
Assumption covering all of the assigning Lender’s rights and obligations under
this Agreement, such Lender shall cease to be a party hereto but shall continue
to be entitled to the benefits of Sections 3.01, 3.04, 3.05
and 11.04 with respect to facts and circumstances occurring prior to the
effective date of such assignment).  Upon
request, the Borrower (at its expense) shall execute and deliver a Note to the
assignee Lender.  Any assignment or
transfer by a Lender of rights or obligations under this Agreement that does
not comply with this subsection shall be treated for purposes of this Agreement
as a sale by such Lender of a participation in such rights and obligations in
accordance with Section 11.06(d).

 

(c)           Register.  The Administrative Agent, acting solely for
this purpose as an agent of the Borrower, shall maintain at the Administrative
Agent’s Office a copy of each Assignment and Assumption delivered to it and a
register for the recordation of the names and addresses of the Lenders, and the
Commitments of, and principal amounts of the Loans and L/C Obligations owing
to, each Lender pursuant to the terms hereof from time to time (the “Register”).  The entries in the Register shall be
conclusive, and the Borrower, the Administrative Agent and the Lenders shall
treat each Person whose name is recorded in the Register pursuant to the terms
hereof as a Lender hereunder for all purposes of this Agreement,
notwithstanding notice to the contrary. 
The Register shall be available for inspection by the Borrower and any
Lender, at any reasonable time and from time to time upon reasonable prior
notice.

 

(d)           Participations.  Any Lender may at any time, without the
consent of, or notice to, the Borrower or the Administrative Agent, sell
participations to any Person (other than a natural person or the Borrower or
any of the Borrower’s Affiliates or Subsidiaries) (each, a “Participant”)
in all or a portion of such Lender’s rights and/or obligations under this
Agreement (including all or a portion of its Commitment and/or the Loans (including
such Lender’s participations in L/C Obligations) owing to it); provided
that (i) such Lender’s obligations under this Agreement shall remain
unchanged, (ii) such Lender shall remain solely responsible to the other
parties hereto for the performance of such obligations and (iii) the
Borrower, the Administrative Agent, the Lenders and the L/C Issuer shall
continue to deal solely and directly with such Lender in connection with such
Lender’s rights and obligations under this Agreement.  Any agreement or instrument pursuant to which
a Lender sells such a participation shall provide that such Lender shall retain
the sole right to enforce this Agreement and to approve any amendment,

 

115

 

modification or waiver of any provision of this Agreement; provided
that such agreement or instrument may provide that such Lender will not,
without the consent of the Participant, agree to any amendment, waiver or other
modification described in the first proviso to Section 11.01 that
affects such Participant.  Each Lender
that sells a Participation shall, acting solely for this purpose as a
non-fiduciary agent of the Borrower, maintain a register on which it enters the
name and address of each Participant and the principal amounts of each
Participant’s interest in the Loans or L/C Obligations held by it (“the Participant
Register”).  The entries in the
Participant Register shall be conclusive, absent manifest error, and such
Lender shall treat each Person whose name is recorded in the Participant
Register as the owner of such Loan or other obligation hereunder as the owner
thereof for all purposes of this Agreement notwithstanding any notice to the
contrary.  Any such Participant Register
shall be available for inspection by the Borrower or any Lender at any
reasonable time and from time to time upon reasonable prior notice.  Subject to subsection (e) of this
Section, the Borrower agrees that each Participant shall be entitled to the
benefits of Sections 3.01, 3.04 and 3.05 to the same extent as if it were a Lender
and had acquired its interest by assignment pursuant to subsection (b) of this
Section, provided that any such payment shall subject the Lender granting such
participation to replacement pursuant to the terms of Section 11.13.  To the extent permitted by law, each
Participant also shall be entitled to the benefits of Section 11.08 as though it were a Lender, provided
such Participant agrees to be subject to Section 2.13 as though it were
a Lender.  Section 11.19 shall
apply to any Lender that has a Participant that is Disqualified, unless such
Lender replaces such Participant or repurchases such Participant’s interest in
the Commitment and/or the Loans.

 

(e)           Limitations upon
Participant Rights.  A Participant
shall not be entitled to receive any greater payment under Section 3.01
or 3.04 than the
applicable Lender would have been entitled to receive with respect to the
participation sold to such Participant, unless the sale of the participation to
such Participant is made with the Borrower’s prior written consent.  A Participant that would be a Foreign Lender
if it were a Lender shall not be entitled to the benefits of Section 3.01
unless the Borrower is notified of the participation sold to such Participant
and such Participant agrees, for the benefit of the Borrower, to comply with Section
3.01(e) as though it were a Lender.

 

(f)            Certain Pledges.  Any Lender may, without the consent of the
Borrower or Administrative Agent, at any time pledge or assign a security interest
in all or any portion of its rights under this Agreement (including under its
Note, if any) to secure obligations of such Lender, including any pledge or
assignment to secure obligations to a Federal Reserve Bank; provided
that no such pledge or assignment shall release such Lender from any of its
obligations hereunder or substitute any such pledgee or assignee for such
Lender as a party hereto.

 

(g)           Electronic
Execution of Assignments.  The words “execution,”
“signed,” “signature,” and words of like import in any Assignment and
Assumption shall be deemed to include electronic signatures or the keeping of
records in electronic form, each of which shall be of the same legal effect,
validity or enforceability as a manually executed signature or the use of a
paper-based recordkeeping system, as the case may be, to the extent and as
provided for in any applicable law, including the Federal Electronic Signatures
in Global and National Commerce Act, the New York State Electronic Signatures
and Records Act, or any other similar state laws based on the Uniform
Electronic Transactions Act.

 

116

 

(h)           Resignation as
L/C Issuer after Assignment. 
Notwithstanding anything to the contrary contained herein, if at any
time Bank of America assigns all of its Revolving Credit Commitments and
Revolving Credit Loans pursuant to Section 11.06(b), Bank of America
may, upon 30 days’ notice to the Borrower and the Lenders, resign as L/C
Issuer.  In the event of any such
resignation as L/C Issuer, the Borrower shall be entitled to appoint from among
the Lenders a successor L/C Issuer hereunder; provided, however,
that no failure by the Borrower to appoint any such successor shall affect the
resignation of Bank of America as L/C Issuer, as the case may be.  If Bank of America resigns as L/C Issuer, it
shall retain all the rights, powers, privileges and duties of the L/C Issuer
hereunder with respect to all Letters of Credit outstanding as of the effective
date of its resignation as L/C Issuer and all L/C Obligations with respect
thereto (including the right to require the Lenders to make Base Rate Loans or
fund risk participations in Unreimbursed Amounts pursuant to Section 2.03(c)).  Upon the appointment of a successor L/C
Issuer, (a) such successor shall succeed to and become vested with all of the
rights, powers, privileges and duties of the retiring L/C Issuer, and (b) the
successor L/C Issuer shall issue letters of credit in substitution for the
Letters of Credit, if any, outstanding at the time of such succession or make
other arrangements satisfactory to Bank of America to effectively assume the
obligations of Bank of America with respect to such Letters of Credit.

 

11.07.      Treatment of
Certain Information; Confidentiality. 
Each of the Administrative Agent, the Lenders and the L/C Issuer agrees
to maintain the confidentiality of the Information (as defined below), except
that Information may be disclosed (a) to its Affiliates and to its and its
Affiliates’ respective partners, directors, officers, employees, agents,
advisors and representatives (it being understood that the Persons to whom such
disclosure is made will be informed of the confidential nature of such
Information and instructed to keep such Information confidential), (b) to
the extent requested by any regulatory authority purporting to have
jurisdiction over it (including any self-regulatory authority, such as the
National Association of Insurance Commissioners), (c) to the extent
required by applicable laws or regulations or by any subpoena or similar legal
process, (d) to any other party hereto, (e) in connection with the exercise of
any remedies hereunder or under any other Loan Document or any action or
proceeding relating to this Agreement or any other Loan Document or the
enforcement of rights hereunder or thereunder, (f) subject to an agreement
containing provisions substantially the same as those of this Section, to (i)
any assignee of or Participant in, or any prospective assignee of or
Participant in, any of its rights or obligations under this Agreement or (ii)
any actual or prospective counterparty (or its advisors) to any swap or
derivative transaction relating to the Borrower and its obligations, (g) with
the consent of the Borrower or (h) to the extent such Information
(i) becomes publicly available other than as a result of a breach of this
Section or (ii) becomes available to the Administrative Agent, any Lender,
the L/C Issuer or any of their respective Affiliates on a nonconfidential basis
from a source other than the Borrower and not known to them to be under any
duty of confidentiality to the Borrower.

 

For purposes of this Section, “Information” means all
information received from any Loan Party or any Subsidiary thereof relating to
any Loan Party or any Subsidiary thereof or their respective businesses, other
than any such information that is available to the Administrative Agent, any
Lender or the L/C Issuer on a nonconfidential basis prior to disclosure by any
Loan Party or any Subsidiary thereof, provided that, in the case of
information received from a Loan Party or any such Subsidiary after the date
hereof, such information is clearly identified at

 

117

 

the time of delivery as confidential. 
Any Person required to maintain the confidentiality of Information as
provided in this Section shall be considered to have complied with its
obligation to do so if such Person has exercised the same degree of care to
maintain the confidentiality of such Information as such Person would accord to
its own confidential information.

 

Each of the Administrative Agent, the Lenders and the L/C Issuer
acknowledges that (a) the Information may include material non-public
information concerning the Borrower or a Subsidiary, as the case may be, (b) it
has developed compliance procedures regarding the use of material non-public
information and (c) it will handle such material non-public information in
accordance with applicable Law, including Federal and state securities Laws.

 

11.08.      Right of Setoff.  If an Event of Default shall have occurred
and be continuing, each Lender, the L/C Issuer and each of their respective
Affiliates is hereby authorized at any time and from time to time, to the
fullest extent permitted by applicable law, to set off and apply any and all
deposits (general or special, time or demand, provisional or final, in whatever
currency) at any time held and other obligations (in whatever currency) at any
time owing by such Lender, the L/C Issuer or any such Affiliate to or for the
credit or the account of the Borrower against any and all of the obligations of
the Borrower now or hereafter existing under this Agreement or any other Loan
Document to such Lender or the L/C Issuer, irrespective of whether or not such
Lender or the L/C Issuer shall have made any demand under this Agreement or any
other Loan Document and although such obligations of the Borrower may be
contingent or unmatured or are owed to a branch or office of such Lender or the
L/C Issuer different from the branch or office holding such deposit or
obligated on such indebtedness.  The
rights of each Lender, the L/C Issuer and their respective Affiliates under
this Section are in addition to other rights and remedies (including other
rights of setoff) that such Lender, the L/C Issuer or their respective
Affiliates may have.  Each Lender and the
L/C Issuer agrees to notify the Borrower and the Administrative Agent promptly
after any such setoff and application, provided that the failure to give
such notice shall not affect the validity of such setoff and application.

 

11.09.      Interest Rate
Limitation.  Notwithstanding anything
to the contrary contained in any Loan Document, the interest paid or agreed to
be paid under the Loan Documents shall not exceed the maximum rate of
non-usurious interest permitted by applicable Law (the “Maximum Rate”).  If the Administrative Agent or any Lender
shall receive interest in an amount that exceeds the Maximum Rate, the excess
interest shall be applied to the principal of the Loans or, if it exceeds such
unpaid principal, refunded to the Borrower. 
In determining whether the interest contracted for, charged, or received
by the Administrative Agent or a Lender exceeds the Maximum Rate, such Person
may, to the extent permitted by applicable Law, (a) characterize any payment
that is not principal as an expense, fee, or premium rather than interest, (b)
exclude voluntary prepayments and the effects thereof, and (c) amortize,
prorate, allocate, and spread in equal or unequal parts the total amount of
interest throughout the contemplated term of the Obligations hereunder; provided
that in each case the Loan Parties are not thereby required to make any greater
payment hereunder than would otherwise be required.

 

11.10.      Counterparts; Integration;
Effectiveness.  This Agreement may be
executed in counterparts (and by different parties hereto in different
counterparts), each of which shall constitute an original, but all of which
when taken together shall constitute a single contract.

 

118

 

This Agreement and the other Loan Documents constitute the entire
contract among the parties relating to the subject matter hereof and supersede
any and all previous agreements and understandings, oral or written, relating
to the subject matter hereof.  Except as
provided in Section 4.01, this Agreement shall become effective when it
shall have been executed by the Administrative Agent and when the
Administrative Agent shall have received counterparts hereof that, when taken
together, bear the signatures of each of the other parties hereto.  Delivery of an executed counterpart of a
signature page of this Agreement by telecopy shall be effective as delivery of
a manually executed counterpart of this Agreement.

 

11.11.      Survival of
Representations and Warranties.  All
representations and warranties made hereunder and in any other Loan Document or
other document delivered pursuant hereto or thereto or in connection herewith
or therewith shall survive the execution and delivery hereof and thereof.  Such representations and warranties have been
or will be relied upon by the Administrative Agent and each Lender, regardless
of any investigation made by the Administrative Agent or any Lender or on their
behalf and notwithstanding that the Administrative Agent or any Lender may have
had notice or knowledge of any Default at the time of any Credit Extension, and
shall continue in full force and effect as long as any Loan or any other
Obligation hereunder shall remain unpaid or unsatisfied or any Letter of Credit
shall remain outstanding.

 

11.12.      Severability.  If any provision of this Agreement or the
other Loan Documents is held to be illegal, invalid or unenforceable, (a) the
legality, validity and enforceability of the remaining provisions of this
Agreement and the other Loan Documents shall not be affected or impaired
thereby and (b) the parties shall endeavor in good faith negotiations to
replace the illegal, invalid or unenforceable provisions with valid provisions
the economic effect of which comes as close as possible to that of the illegal,
invalid or unenforceable provisions.  The
invalidity of a provision in a particular jurisdiction shall not invalidate or
render unenforceable such provision in any other jurisdiction.

 

11.13.      Replacement of
Lenders.  If any Lender requests
compensation under Section 3.04, or if the Borrower is required to pay
any additional amount to any Lender or any Governmental Authority for the
account of any Lender pursuant to Section 3.01, or if any Lender ceases
to make Eurodollar Rate Loans pursuant to Section 5.02, or if any Lender
is a Defaulting Lender, or if any other circumstances exist hereunder that give
the Borrower the right hereunder to replace such Lender as a party hereto, then
the Borrower may, at its sole expense and effort, upon notice to such Lender
and the Administrative Agent, require such Lender to assign and delegate,
without recourse (in accordance with and subject to the restrictions contained
in, and consents required by, Section 11.06), all of its interests,
rights and obligations under this Agreement and the related Loan Documents to
an assignee that shall assume such obligations (which assignee may be another
Lender, if a Lender accepts such assignment), provided that:

 

(a)           the Borrower shall
have paid to the Administrative Agent the assignment fee specified in Section
11.06(b);

 

(b)           such Lender shall
have received payment of an amount equal to the outstanding principal of its
Loans and L/C Advances, accrued interest thereon, accrued fees and all other
amounts payable to it hereunder and under the other Loan Documents (including
any amounts under Section 2.06(c) or Section 3.05) from the
assignee (to the extent

 

119

 

of such outstanding principal and accrued interest and fees) or the
Borrower (in the case of all other amounts);

 

(c)           in the case of any
such assignment resulting from a claim for compensation under Section 3.04
or payments required to be made pursuant to Section 3.01, such
assignment will result in an avoidance of or a reduction in such compensation
or payments thereafter; and

 

(d)           such assignment does
not conflict with applicable Laws.

 

A Lender shall not be required to make any such assignment or
delegation if, prior thereto, as a result of a waiver by such Lender or
otherwise, the circumstances entitling the Borrower to require such assignment
and delegation cease to apply.

 

11.14.      Governing Law;
Jurisdiction; Etc.

 

(a)           GOVERNING LAW.  THIS AGREEMENT SHALL BE GOVERNED BY, AND
CONSTRUED IN ACCORDANCE WITH, THE LAW OF THE STATE OF NEW YORK.

 

(b)           SUBMISSION TO
JURISDICTION.  THE BORROWER
IRREVOCABLY AND UNCONDITIONALLY SUBMITS, FOR ITSELF AND ITS PROPERTY, TO THE
NONEXCLUSIVE JURISDICTION OF THE COURTS OF THE STATE OF NEW YORK SITTING IN
BOROUGH OF MANHATTAN AND OF THE UNITED STATES DISTRICT COURT OF THE SOUTHERN
DISTRICT OF NEW YORK, AND ANY APPELLATE COURT FROM ANY THEREOF, IN ANY ACTION
OR PROCEEDING ARISING OUT OF OR RELATING TO THIS AGREEMENT OR ANY OTHER LOAN
DOCUMENT, OR FOR RECOGNITION OR ENFORCEMENT OF ANY JUDGMENT, AND EACH OF THE
PARTIES HERETO IRREVOCABLY AND UNCONDITIONALLY AGREES THAT ALL CLAIMS IN
RESPECT OF ANY SUCH ACTION OR PROCEEDING MAY BE HEARD AND DETERMINED IN SUCH
NEW YORK STATE COURT OR, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, IN
SUCH FEDERAL COURT.  EACH OF THE PARTIES
HERETO AGREES THAT A FINAL JUDGMENT IN ANY SUCH ACTION OR PROCEEDING SHALL BE
CONCLUSIVE AND MAY BE ENFORCED IN OTHER JURISDICTIONS BY SUIT ON THE JUDGMENT
OR IN ANY OTHER MANNER PROVIDED BY LAW. 
NOTHING IN THIS AGREEMENT OR IN ANY OTHER LOAN DOCUMENT SHALL AFFECT ANY
RIGHT THAT THE ADMINISTRATIVE AGENT, ANY LENDER OR THE L/C ISSUER MAY OTHERWISE
HAVE TO BRING ANY ACTION OR PROCEEDING RELATING TO THIS AGREEMENT OR ANY OTHER
LOAN DOCUMENT AGAINST THE BORROWER OR ITS PROPERTIES IN THE COURTS OF ANY
JURISDICTION.

 

(c)           WAIVER OF VENUE.  THE BORROWER IRREVOCABLY AND UNCONDITIONALLY
WAIVES, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY OBJECTION THAT
IT MAY NOW OR HEREAFTER HAVE TO THE LAYING OF VENUE OF ANY ACTION OR PROCEEDING
ARISING OUT OF OR RELATING TO THIS AGREEMENT OR ANY OTHER LOAN DOCUMENT IN ANY
COURT REFERRED TO IN PARAGRAPH (B) OF THIS SECTION.  EACH OF THE PARTIES HERETO HEREBY

 

120

 

IRREVOCABLY WAIVES, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW,
THE DEFENSE OF AN INCONVENIENT FORUM TO THE MAINTENANCE OF SUCH ACTION OR
PROCEEDING IN ANY SUCH COURT.

 

(d)           SERVICE OF
PROCESS.  EACH PARTY HERETO IRREVOCABLY
CONSENTS TO SERVICE OF PROCESS IN THE MANNER PROVIDED FOR NOTICES IN SECTION 11.02.  NOTHING IN THIS AGREEMENT WILL AFFECT THE
RIGHT OF ANY PARTY HERETO TO SERVE PROCESS IN ANY OTHER MANNER PERMITTED BY
APPLICABLE LAW

 

11.15.      Waiver of Jury
Trial.  EACH PARTY HERETO HEREBY
IRREVOCABLY WAIVES, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY
RIGHT IT MAY HAVE TO A TRIAL BY JURY IN ANY LEGAL PROCEEDING DIRECTLY OR
INDIRECTLY ARISING OUT OF OR RELATING TO THIS AGREEMENT OR ANY OTHER LOAN
DOCUMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY OR THEREBY (WHETHER BASED ON
CONTRACT, TORT OR ANY OTHER THEORY). 
EACH PARTY HERETO (A) CERTIFIES THAT NO REPRESENTATIVE, AGENT OR
ATTORNEY OF ANY OTHER PERSON HAS REPRESENTED, EXPRESSLY OR OTHERWISE, THAT SUCH
OTHER PERSON WOULD NOT, IN THE EVENT OF LITIGATION, SEEK TO ENFORCE THE
FOREGOING WAIVER AND (B) ACKNOWLEDGES THAT IT AND THE OTHER PARTIES HERETO
HAVE BEEN INDUCED TO ENTER INTO THIS AGREEMENT AND THE OTHER LOAN DOCUMENTS BY,
AMONG OTHER THINGS, THE MUTUAL WAIVERS AND CERTIFICATIONS IN THIS SECTION.

 

11.16.      No Advisory or
Fiduciary Responsibility.  In connection with all aspects of
each transaction contemplated hereby, the Borrower each acknowledge and agree,
and acknowledge their respective Affiliates’ understanding, that: (i) the
credit facilities provided for hereunder and any related arranging or other
services in connection therewith (including in connection with any amendment,
waiver or other modification hereof or of any other Loan Document) are an arm’s-length
commercial transaction between the Borrower and its Affiliates, on the one
hand, and the Administrative Agent and the Arrangers, on the other hand, and
the Borrower is capable of evaluating and understanding and understands and
accepts the terms, risks and conditions of the transactions contemplated hereby
and by the other Loan Documents (including any amendment, waiver or other
modification hereof or thereof); (ii) in connection with the process leading to
such transaction, the Administrative Agent and the Arrangers each is and has
been acting solely as a principal and is not the financial advisor, agent or
fiduciary, for the Borrower or any of its Affiliates, stockholders, creditors
or employees or any other Person; (iii) neither the Administrative Agent nor
the Arrangers has assumed or will assume an advisory, agency or fiduciary
responsibility in favor of the Borrower with respect to any of the transactions
contemplated hereby or the process leading thereto, including with respect to
any amendment, waiver or other modification hereof or of any other Loan
Document (irrespective of whether the Administrative Agent or the Arrangers has
advised or is currently advising the Borrower or any of its Affiliates on other
matters) and neither the Administrative Agent nor the Arrangers has any
obligation to the Borrower or any of its Affiliates with respect to the
transactions contemplated hereby except those obligations expressly set forth
herein and in the other Loan Documents; (iv) the Administrative Agent and the
Arrangers and their respective Affiliates may be engaged in a broad range

 

121

 

of transactions that involve interests that differ from those of the
Borrower and its Affiliates, and neither the Administrative Agent nor the
Arrangers has any obligation to disclose any of such interests by virtue of any
advisory, agency or fiduciary relationship; and (v) the Administrative Agent
and the Arranger have not provided and will not provide any legal, accounting,
regulatory or tax advice with respect to any of the transactions contemplated
hereby (including any amendment, waiver or other modification hereof or of any
other Loan Document) and the Borrower has consulted its own legal, accounting,
regulatory and tax advisors to the extent it has deemed appropriate.  The Borrower hereby waives and releases, to
the fullest extent permitted by law, any claims that it may have against the
Administrative Agent and the Arrangers with respect to any breach or alleged
breach of agency or fiduciary duty.

 

11.17.      USA PATRIOT Act
Notice.  Each Lender that is subject
to the Act (as hereinafter defined) and the Administrative Agent (for itself
and not on behalf of any Lender) hereby notifies the Borrower that pursuant to
the requirements of the USA PATRIOT Act (Title III of Pub. L. 107-56 (signed
into law October 26, 2001)) (the “Act”), it is required to obtain,
verify and record information that identifies each Loan Party, which
information includes the name and address of each Loan Party and other
information that will allow such Lender or the Administrative Agent, as
applicable, to identify each Loan Party in accordance with the Act.

 

11.18.      Gaming Authorities.  The Administrative Agent and each of the
Lenders agree to cooperate with all Gaming Authorities in connection with the
administration of their regulatory jurisdiction over the Administrative Agent,
each of the Lenders, and the Borrower and its Subsidiaries, including the
provision of such documents or other information as may be requested by any
such Gaming Authority relating to Borrower or any of its Subsidiaries or to the
Loan Documents.

 

11.19.      Removal of a Lender.  Borrower shall have the right to remove a
Lender as a party to this Agreement in accordance with this Section if such
Lender is the subject of a Disqualification. 
If Borrower is entitled to remove a Lender pursuant to this section,
upon notice from Borrower, the Lender being removed shall execute and deliver
an Assignment and Assumption Agreement covering the Lender’s Commitment under
any Facility and the Loans at any time owing to it under such Facility in favor
of one or more Eligible Assignees designated by Borrower (and acceptable to the
Administrative Agent, which acceptance shall not be unreasonably delayed or
withheld), subject to the payment of a purchase price by such Eligible Assignee
equal to all principal and accrued interest, fees and other amounts payable to
such Lender under this Agreement through the date of assignment.

 

11.20.      Time of
the Essence.  Time is of
the essence of the Loan Documents.

 

11.21.      ENTIRE
AGREEMENT.  THIS AGREEMENT AND THE OTHER LOAN DOCUMENTS
REPRESENT THE FINAL AGREEMENT AMONG THE PARTIES AND MAY NOT BE CONTRADICTED BY
EVIDENCE OF PRIOR, CONTEMPORANEOUS, OR SUBSEQUENT ORAL AGREEMENTS OF THE
PARTIES.  THERE ARE NO UNWRITTEN ORAL
AGREEMENTS AMONG THE PARTIES.

 

122

 

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

 

	
   

  	
  PA MEADOWS, LLC

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ William J. Paulos

  
	
   

  	
  Name:

  	
  William J. Paulos

  
	
   

  	
  Title:

  	
  Authorized Signatory

  
					

 

Signature Page

 

 

	
   

  	
  BANK OF AMERICA, N.A., as 

  Administrative Agent

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Chris M. Levine

  
	
   

  	
  Name:

  	
  Chris M. Levine

  
	
   

  	
  Title:

  	
  Assistant Vice President

  
					

 

 

	
   

  	
  BANK OF AMERICA, N.A., as a Lender and L/C

  Issuer

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Justin Lien

  
	
   

  	
  Name:

  	
  Justin Lien

  
	
   

  	
  Title:

  	
  Vice President

  
					

 

 

	
   

  	
  Wells Fargo Bank, N.A.

  as a Lender

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Tracie D. Plummer

  
	
   

  	
  Name:

  	
  Tracie D. Plummer

  
	
   

  	
  Title:

  	
  Assistant Vice President

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00113-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00113-of-00352.parquet"}]]