Document:

Exhibit 10.5

 

SECURITY AGREEMENT

(MTRI)

 

THIS SECURITY
AGREEMENT (MTRI) (“Agreement”) is made and entered into as of March 28, 2003 by
and between MTR GAMING GROUP, INC., a Delaware corporation, party of the first
part (hereinafter collectively referred to as “Debtor”) and WELLS FARGO BANK,
National Association, as administrative and collateral agent for the Lenders,
the Swingline Lender and the L/C Issuer (all of which are defined in the Credit
Agreement referred to below), party of the second part (hereinafter referred
to, in such capacity, as “Secured Party”).

 

R_E_C_I_T_A_L_S:

 

A.                                   Reference
is made to that certain Third Amended and Restated Credit Agreement (as it may
be hereafter renewed, extended, amended, restated or otherwise modified, the
“Credit Agreement”) executed concurrently, or substantially concurrent,
herewith by and among Debtor, MOUNTAINEER PARK, INC., a West Virginia
corporation, SPEAKEASY GAMING OF LAS VEGAS, INC., a Nevada corporation,
SPEAKEASY GAMING OF RENO, INC., a Nevada corporation, PRESQUE ISLE DOWNS, INC.,
a Pennsylvania corporation and RACING ACQUISITION, INC., an Ohio corporation
(collectively, “Borrowers”), as borrowers, the Lenders therein named (each,
together with their respective successors and assigns, individually being referred
to herein as a “Lender” and collectively as the “Lenders”), the Swingline
Lender therein named (referred to herein, together with its successors and
assigns, as the “Swingline Lender”), the L/C Issuer therein named (referred to
herein, together with its successors and assigns, as the “L/C Issuer”), and
Agent Bank.  Agent Bank, the Lenders,
the Swingline Lender and the L/C Issuer are collectively referred to herein as
the “Banks”.

 

B.                                     In
this Agreement all capitalized words and terms not otherwise defined herein
shall have the respective meanings and be construed herein as provided in
Section 1.01 of the Credit Agreement and any reference to a provision of
the Credit Agreement shall be deemed to incorporate that provision as a part
hereof in the same manner and with the same effect as if the same were fully
set forth herein.

 

C.                                     Pursuant
to the Credit Agreement, and subject to the terms and conditions specified
therein, the Banks have agreed, among other things, to provide the Bank
Facilities to Borrowers.

 

D.                                    The
provisions of Section 1.02 of the Credit Agreement shall be applied to
this Agreement in the same manner as applied therein to the Credit Agreement.

 

 

E.                                      As
a condition of their entry into the Credit Agreement, and their commitment to
provide the Bank Facilities for the benefit of Borrowers (subject to the terms
of the Credit Agreement and the other Loan Documents), the Banks have required,
among other things, that Debtor grant the security interests, and undertake the
obligations, contemplated by this Agreement.

 

NOW,
THEREFORE, in order to induce the Banks to enter into the Credit Agreement, and
to provide the Bank Facilities, and for other good and valuable consideration,
the receipt and adequacy of which hereby is acknowledged, Debtor and Secured
Party hereby agree as follows:

 

ARTICLE I

SECURITY INTEREST AND COLLATERAL

 

Section 1.01.                             Creation
of Security Interest.

 

(a)                                  For
valuable consideration, Debtor hereby assigns, pledges and grants to Secured
Party a continuing security interest in, and lien upon, all presently existing
and hereafter acquired Collateral (as defined below), as security for the
timely payment and performance of each and every Secured Obligation (as also
defined below).  This Agreement is a
continuing and irrevocable agreement and all the rights, powers, privileges and
remedies hereunder shall apply to any and all Secured Obligations, including
those arising under successive transactions which shall either continue the
Secured Obligations, increase or decrease them, or from time to time create new
Secured Obligations after any prior Secured Obligations have been satisfied,
and notwithstanding the bankruptcy of any Borrowers or any other Person or any
other event or proceeding affecting any Person.

 

(b)                                 The
security interest which is granted hereunder is subject to the following:

 

(i)                                     The
right of Debtor to sell or otherwise dispose of Collateral (as defined below)
in the ordinary course of business, free and clear of the lien hereof,
provided, and to the extent, that such sale or other disposition is permitted
under the terms of the Credit Agreement; and

 

(ii)                                  As
to the fixtures and equipment covered hereby, the leases and/or purchase money
security interests pursuant to which Debtor has acquired an interest in such
fixtures and equipment provided, and to the extent, that such leases and/or
purchase money security interests are permitted under the terms of the Credit
Agreement.

 

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Section 1.02.                             Description
of Collateral.  All references
herein to the “Collateral” shall be to all right, title and interest of Debtor,
whether now owned or existing, or hereafter acquired or arising, in, to and
under any of the following:

 

(a)                                  All
present and future: (i) accounts; (ii) chattel paper;
(iii) commercial tort claims; (iv) deposit accounts;
(v) documents; (vi) equipment, inventory and other goods of any kind
or nature; (vii) instruments; (viii) investment property;
(ix) letter of credit rights; (x) money; (xi) general
intangibles; and (xii) proceeds of any of the foregoing; all as defined by
Article 9 of the Commercial Code;

 

(b)                                 All
present and future chattels, furniture, furnishings, equipment and fixtures,
all of every kind and nature, and other tangible personal property in
which Debtor now has or hereafter acquires an interest; all including, without
limitation:  (aa) all office and
administrative furniture, equipment and supplies including, without limitation,
office appliances, filing cabinets, computers, peripheral computer equipment
and other data processing and storage equipment, stationery and other office
supply items, and other office and administrative furniture, equipment and
supplies; (bb) all tools and other maintenance and repair equipment; and
(cc) all equipment and supplies utilized in connection with any activity
engaged in by Debtor;

 

(c)                                  All
present and future supplies, inventory and merchandise which is used in
connection with, or in the conduct of, the business of Debtor or in which
Debtor has or acquires an interest, including, without limitation:  (i) all present and future goods held
for sale or lease or to be furnished under a contract of service, all raw
materials, work in process and finished goods, all packing materials, supplies
and containers relating  to or used in
connection with any of the foregoing, and all bills of lading, warehouse
receipts or documents of title relating to any of the foregoing; (ii) all
food stuffs, beverages, prepared food and other similar items; and
(iii) all cleaning supplies, office supplies, consumables and similar
items;

 

(d)                                 All
present and future goods, which are not otherwise set forth herein, and which
are used in connection with, or in the conduct of, the business of Debtor or in
which Debtor has or acquires an interest;

 

(e)                                  All
present and future accounts, accounts receivable, rentals, deposits, rights to
payment, instruments, documents, chattel paper, security agreements,
guaranties, undertakings, surety bonds, insurance policies and notes and drafts
which are owned, or used in connection with, or in the conduct of, the business
of Debtor, or in which Debtor has or acquires an interest, however created or
arising;

 

(f)                                    All
present and future contracts, or agreements and all other present and future
general intangibles which are owned, or used in connection with, or in

 

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the conduct of, the business of Debtor, or in which Debtor has or
acquires an interest, including, without limitation:  (aa) all leases and purchase contracts for equipment,
furniture and/or fixtures of any kind and character; and (bb) all
goodwill, choses in action, trade secrets, customer lists, trademarks, trade
names and service marks, patents, copyrights, technology, software, processes,
and proprietary information which are owned, or used in connection with, or in
the conduct of, the business of Debtor, or in which Debtor has or acquires an
interest;

 

(g)                                 All
present and future deposit accounts which are owned, or used in connection
with, or in the conduct of, the business of Debtor, or in which Debtor has or
acquires an interest including, without limitation, any demand, time, savings,
passbook or like account maintained with any bank, savings and loan
association, credit union or like organization, and all money, cash and cash
equivalents of Debtor, whether or not deposited in any such deposit account;

 

(h)                                 All
present and future revenues, receipts, payments and income of any nature
whatsoever, in which Debtor now owns or hereafter acquires an interest,
regardless of the source of such items;

 

(i)                                     All
present and future information, books, records, computer hardware, computer
peripheral equipment, software and computer systems which are owned, or used in
connection with, or in the conduct of, the business of Debtor, or in which
Debtor has or acquires an interest including, without limitation:  (aa) books of account and ledgers of
every kind and nature, all electronically recorded data relating to the Debtor
or any of its businesses, all receptacles and containers for such records, and
all files and correspondence; (bb) all player tracking, slot club, and
customer monitoring information, software, computers, equipment and systems;
and (cc) all other hotel, casino, bar, restaurant and hospitality
information, software, computers, equipment and systems;

 

(j)                                     All
present and future investment property, stocks, bonds, debentures, securities,
subscription rights, options, warrants, puts, calls, certificates, partnership
interests, joint venture interests, investments and/or brokerage accounts which
are owned, or used in connection with, or in the conduct of, the business of
Debtor, or in which Debtor has or acquires an interest and all rights,
preferences, privileges, dividends, distributions, redemption payments, or
liquidation payments with respect thereto;

 

(k)                                  All
plans, specifications, soil reports, engineering reports, land planning maps
and surveys together with all amendments and modifications thereof;

 

(l)                                     The
Green Shingle Loan Documents, as they may be renewed, extended, amended,
restated, replaced, substituted or otherwise modified from time to time.

 

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(m)                               All
other tangible and intangible property of Debtor;

 

(n)                                 All
present and future accessions, appurtenances, components, repairs, repair
parts, spare parts, replacements, substitutions, additions, issue and/or
improvements to or of or with respect to any of the foregoing;

 

(o)                                 All
rights, remedies, powers and/or privileges of Debtor with respect to any of the
foregoing; and

 

(p)                                 Any
and all proceeds, products, rents, income and profits of any of the foregoing,
including, without limitation, all money, accounts, general intangibles,
deposit accounts, documents, instruments, chattel paper, goods, insurance
proceeds, and any other tangible or intangible property received upon the sale
or disposition of any of the foregoing.

 

Section 1.03.                             Secured
Obligations.  This Agreement
secures, and the Collateral is security for, the following (collectively, the
“Secured Obligations”):

 

(a)                                  Payment
when due, whether at stated maturity, by required prepayment, declaration,
acceleration, demand or otherwise (including payment of amounts that would
become due but for the operation of the automatic stay under
Section 362(a) of the Bankruptcy Code, 11 U.S.C. §362(a)), of: (i) the principal
sum which is, at any time, advanced and unpaid under the Credit Facility (as
defined in the Credit Agreement, referred to below), not to exceed Fifty
Million Dollars ($50,000,000.00) at any one time, all on a revolving line of
credit basis; (ii) interest and other charges accrued on said principal
sum, or accrued on interest and other charges then outstanding under the Credit
Facility (all including, without limitation, interest and other charges that,
but for the filing of a petition in bankruptcy with respect to any of the
Borrowers (referred to below) would accrue on such obligations); and
(iii) any other obligations of Borrowers, or any or them, under the RLC
Note referred to below; all according to the terms of a Revolving Credit Note
dated concurrently, or substantially concurrent, herewith which is made by
Borrowers (referred to below) and is payable to the order of Secured Party
according to the tenor and effect of said Revolving Credit Note, and all
renewals, extensions, amendments, restatements, replacements, substitutions and
other modifications thereof (hereinafter collectively referred to as the “RLC
Note”);

 

(b)                                 Payment
when due, whether at stated maturity, by required prepayment, declaration,
acceleration, demand or otherwise (including payment of amounts that would
become due but for the operation of the automatic stay under
Section 362(a) of the Bankruptcy Code, 11 U.S.C. § 362(a)), of:  (i) the principal sum

 

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which is, at any time, advanced and unpaid under the Swingline Facility
(as defined in the Credit Agreement), not to exceed Ten Million Dollars
($10,000,000.00) at any one time, all on a revolving line of credit basis; (ii) interest
and other charges accrued on said principal sum, or accrued on interest and
other charges then outstanding under the Swingline Facility (all including,
without limitation, interest and other charges that, but for the filing of a
petition in bankruptcy with respect to Borrowers, or any of them, would accrue
on such obligations); and (iii) any other obligations of Borrowers, or any
of them, under the S/L Note referred to below; all according to the terms of a
Swingline Note dated concurrently, or substantially concurrent, herewith which is made
by the Borrowers and is payable to the order of the Swingline Lender (referred
to below) according to the tenor and effect of said Swingline Note, and all
renewals, extensions, amendments, restatements, replacements, substitutions and
other modifications thereof (hereinafter referred to as the “S/L Note”, and
together with the RLC Note, collectively referred to as the “Notes”);

 

(c)                                  Payment
and performance of every obligation, covenant, promise and agreement of
Borrowers, to: (i) reimburse the L/C Issuer (which is referred to below)
for amounts disbursed under any letter of credit issued pursuant to the L/C
Facility (as defined in the Credit Agreement); and (ii) pay any amounts
required under any instrument executed by any of the Borrowers in connection
with the issuance of any letter of credit under the L/C Facility;

 

(d)                                 Payment
and performance of every obligation, warranty, representation, covenant,
promise and agreement of Borrowers, or any of them, contained in that certain
Certificate and Indemnification Regarding Hazardous Substances, which is
executed by Borrowers concurrently, or substantially concurrent, herewith,
together with all extensions, renewals, amendments, restatements and other
modifications thereof;

 

(e)                                  Payment
and performance of every obligation, covenant, promise and agreement of Debtor
herein contained or incorporated herein by reference, including any sums paid
or advanced by Secured Party or any of the Banks pursuant to the terms hereof;

 

(f)                                    Payment
of the expenses and costs incurred or paid by Secured Party or any of the Banks
in the preservation and enforcement of the rights and remedies of Secured Party
and the duties and liabilities of Debtor hereunder, including, but not by way
of limitation, reasonable attorney’s fees, court costs, witness fees, expert
witness fees, collection costs, and reasonable costs and expenses paid by
Secured Party or any of the Banks in performing for Debtor’s account any
obligation of said Debtor;

 

(g)                                 Payment
of any sums which may hereafter be owing by Borrowers, or any of them, to any
of the Banks or any of their affiliates, under the terms of

 

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any interest rate swap agreement, interest rate cap agreement, basis
swap agreement, forward rate agreement, interest collar agreement or interest
floor agreement to which Borrowers, or any of them, may be a party, or under
any other agreement or arrangement to which Borrowers, or any of them, may be a
party, which in each case is designed to protect Borrowers, or any of them,
against fluctuations in interest rates or currency exchange rates with respect
to any indebtedness secured by this Agreement;

 

(h)                                 Payment
of additional sums and interest thereon which may hereafter be loaned to
Borrowers, or any of them, pursuant to the Credit Agreement when evidenced by a
promissory note or notes which recite that this Agreement is security therefor;

 

(i)                                     Performance
and payment of every obligation, warranty, representation, covenant, agreement
and promise of Borrowers, or any of them, which are contained in the Credit
Agreement; and

 

(j)                                     Performance
and payment of every obligation, warranty, representation, covenant, agreement
and promise of Borrowers, or any of them, contained in, or established by, any
of the Loan Documents, which are defined in the Credit Agreement.

 

Section 1.04.                             For
Security Purposes Only.  The
assignment, pledge, and grant of a security interest in Debtor’s interest(s) in
the Collateral, hereunder, is for security purposes only and shall not make
Secured Party responsible for, or otherwise affect or modify, any duty,
obligation or liability of Debtor under any of the Collateral, or under any
transaction related thereto.

 

ARTICLE II

REPRESENTATIONS, WARRANTIES AND COVENANTS

 

Section 2.01.                             Certain
Representations and Warranties.  The
Debtor represents and warrants to Secured Party as follows:

 

(a)                                  The
execution and delivery of this Agreement and the performance by the Debtor of
its obligations hereunder have been duly authorized by all necessary corporate
action, and do not and will not contravene or conflict with any provision of
law or of the charter or bylaws of the Debtor or of any agreement binding upon
the Debtor, and this Agreement is a legal, valid and binding obligation of the
Debtor, enforceable in accordance with its terms, except as such enforcement
may be limited by bankruptcy, insolvency and other laws of general application
relating to or affecting the enforcement of creditors’ rights.

 

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(b)                                 This
Agreement creates a first priority 
security interest in the Collateral subject only to MTRI Permitted
Encumbrances.

 

Section 2.02.                             Other
Assurances.  Debtor shall execute
and deliver to Secured Party all such financing statements and other
instruments and documents, each in a form and substance which is satisfactory
to Secured Party, and shall do and accomplish such other acts as Secured Party
may, from time to time, deem necessary or advisable to provide further
assurances of, and where applicable, to fully perfect, the rights and security
interests that are granted hereunder or to carry out or facilitate the intended
purpose of this Agreement.  With respect
to any Collateral consisting of certificated securities, instruments,
documents, investment property, certificates of title or the like, as to which
Secured Party’s security interest need be perfected by, or the priority thereof
need be assured by, possession or control of such Collateral, Debtor will upon
demand of Secured Party deliver possession of same in pledge to Secured Party
(except to the extent that such Collateral is not capable of being reduced to
possession, in which case Debtor shall enter into a control agreement with the
custodian of such collateral containing sufficient provisions, for the benefit
of Secured Party, in order to provide for perfection and first priority of a
security interest in favor of Secured Party with respect to such Collateral).

 

Section 2.03.                             Maintenance
of Name, etc.  Debtor will not
change its name, identity or structure (collectively an “Identity Change”) in
any manner which might make any financing or continuation statement filed in
respect of the Collateral seriously misleading within the meaning of
Section 9-506 (or any other then applicable provision) of the Commercial
Code unless:  (i) such Identity
Change is permissible under the Credit Agreement; and (ii) Debtor shall
have given the Secured Party at least thirty (30) days’ prior written notice
thereof.

 

Section 2.04.                             Maintenance
of Office.  Except to the extent
otherwise permitted under the Credit Agreement, Debtor shall at all times
maintain its chief executive office within the State of West Virginia.

 

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ARTICLE III

SECURED PARTY’S RIGHTS

REGARDING COLLATERAL

 

Section 3.01.                             Collections
on the Collateral.

 

(a)                                  Notwithstanding
the security interest in the Collateral which is granted pursuant to
Section 1.01 hereof, and except as otherwise provided hereunder or in any
Loan Document, so long as no Event of Default shall have occurred and be
continuing, Debtor shall have the right to use and to continue to make
collections on and receive any payments which may be made to, or for the
benefit of, Debtor under any of the Collateral and to exercise all other rights
with respect to the Collateral including, without limitation, rights to modify,
amend, sell or dispose of Collateral, exercise options or elections with
respect to the Collateral, all to the extent permitted under the Credit
Agreement.

 

(b)                                 Notwithstanding
the security interest in the Collateral which is granted pursuant to
Section 1.01 hereof, and except as otherwise provided hereunder or in any
Loan Document, Debtor shall have the right to use and to continue to make
collections on and receive any payments which may be made to, or for the
benefit of, Debtor under any of the Collateral so long as no Event of Default
shall have occurred and be continuing.

 

(c)                                  Upon
the occurrence and during the continuance of an Event of Default, at the option
of Secured Party, and except as prohibited by applicable law, Debtor’s right to
make collections on and receive dividends and other proceeds of the Collateral
and to use or dispose of such collections and proceeds shall terminate, and any
and all dividends, proceeds and collections, including all partial or total
prepayments, then held or thereafter received on or on account of the
Collateral will be held or received by Debtor in trust for Secured Party and,
upon demand by Secured Party, immediately delivered in kind to Secured Party.

 

(d)                                 Except
as otherwise provided under the Credit Agreement, any remittance received by
Debtor from any Person shall be presumed to relate to the Collateral and to be
subject to the security interests which are granted to Secured Party hereunder.

 

(e)                                  Upon
the occurrence and during the continuance of an Event of Default, Secured Party
shall have the right at all times to receive, issue receipt for, endorse,
assign, deposit and deliver, in the name of Secured Party or in the name of
Debtor, any and all checks, notes, drafts and other instruments for the payment
of money constituting proceeds of or otherwise relating to the Collateral; and
Debtor hereby

 

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authorizes Secured Party to affix, by facsimile signature or otherwise,
the general or special endorsement of Debtor, in such manner as Secured Party
shall deem advisable, to any such instrument in the event the same has been
delivered to or obtained by Secured Party without appropriate endorsement, and
Secured Party and any collection bank are hereby authorized to consider such
endorsement to be a sufficient, valid and effective endorsement by Debtor, to
the same extent as though it were manually executed by the duly authorized
officer of Debtor, regardless of by whom or under what circumstances or by what
authority such facsimile signature or other endorsement actually is affixed,
without duty of inquiry or responsibility as to such matters, and Debtor hereby
expressly waives demand, presentment, protest and notice of protest or dishonor
and all other notices of every kind and nature with respect to any such
instrument.

 

Section 3.02.                             Possession
of Collateral by Secured Party.

 

(a)                                  All
the Collateral now, heretofore or hereafter delivered to Secured Party shall be
held by Secured Party in its possession, custody and control.  Any or all of the Collateral delivered to
Secured Party, which is held in an account, may be held in an interest bearing
or non-interest bearing account, in Secured Party’s sole and absolute
discretion, and Secured Party may, in its discretion, apply any such interest
to payment of the Secured Obligations. 
Nothing herein shall obligate Secured Party to invest any Collateral or obtain
any particular return thereon.

 

(b)                                 Upon
the occurrence and during the continuance of an Event of Default, whenever any
of the Collateral is in Secured Party’s possession, custody or control, Secured
Party may use, operate and consume the Collateral, whether for the purpose of
preserving and/or protecting the Collateral, or for the purpose of performing
any of Debtor’s obligations with respect thereto, or otherwise.  Secured Party may at any time deliver or redeliver
the Collateral or any part thereof to Debtor, and the receipt of any of the
same by Debtor shall be complete and full acquittance for the Collateral so
delivered, and Secured Party thereafter shall be discharged from any liability
or responsibility therefor.

 

(c)                                  So
long as Secured Party exercises reasonable care with respect to any Collateral
in its possession, custody or control, Secured Party shall have no liability
for any loss of or damage to such Collateral, and in no event shall Secured
Party have liability for any diminution in value of Collateral occasioned by
economic or market conditions or events. 
Secured Party shall be deemed to have exercised reasonable care within
the meaning of the preceding sentence if the Collateral in the possession,
custody or control of Secured Party is accorded treatment substantially equal
to that which Secured Party accords its own property, it being understood that
Secured Party shall not have any responsibility for (a) ascertaining or taking
action with respect to calls, conversions, exchanges, maturities, tenders or
other matters relating to any Collateral, whether or not Secured Party has or
is deemed to have knowledge of such matters, or (b)

 

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taking any necessary steps to preserve rights against any Person with
respect to any Collateral.

 

ARTICLE IV

DEFAULT

 

Section 4.01.                             Remedies.  Upon the occurrence and during the
continuance of an Event of Default (as defined in the Credit Agreement),
Secured Party shall have, in any jurisdiction where enforcement hereof is
sought:  (i) in addition to all
other rights and remedies that Secured Party may have under applicable law, in
equity, under this Agreement or under any other Loan Document; and (ii) in
addition to all rights and remedies of a Secured Party under the Commercial
Code; the following rights and remedies, all of which may be exercised without
affecting the obligations of Debtor hereunder or under any other Loan Document,
or the enforceability of the liens and security interests created hereby:

 

(a)                                  To
foreclose the liens and security interests created hereunder or under any other
agreement relating to any Collateral by any available judicial procedure;

 

(b)                                 To
enter any premises (at reasonable times and with reasonable notice) where any
Collateral may be located for the purpose of securing, protecting,
inventorying, appraising, inspecting, repairing, preserving, storing,
preparing, processing, taking possession of or removing the same;

 

(c)                                  To
request from obligors under the Collateral, in the name of Debtors or in the
name of Secured Party, information concerning the Collateral and the amounts
owing thereof;

 

(d)                                 Secured
Party shall at all reasonable times, and on reasonable notice, have full access
to and the right to audit any and all of Debtors’ books and records pertaining
to the Collateral, and to confirm and verify the value of the Collateral and to
do whatever else Secured Party reasonably may deem necessary or desirable to
protect its interests;

 

(e)                                  To
sell, assign, lease or otherwise dispose of any Collateral or any part thereof
either at public or private sale or at any broker’s board, in lot or in bulk,
with or without representation or warranties and upon such terms as shall be
acceptable to Secured Party;

 

(f)                                    To
notify obligors on the Collateral that the Collateral has been assigned to
Secured Party and that all payments thereon are to be made directly and
exclusively to Secured Party;

 

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(g)                                 To
cause the Collateral to be registered in the name of Secured Party, as legal
holder;

 

(h)                                 To
collect by legal proceedings or otherwise all dividends, distributions,
interest, principal or other sums now or hereafter payable upon or on account
of the Collateral;

 

(i)                                     To
enter into any extension, reorganization, deposit, merger or consolidation
agreement, or any other agreement relating to or affecting the Collateral, and
in connection therewith Secured Party may deposit or surrender control of the
Collateral and/or accept other property in exchange for the Collateral;

 

(j)                                     To
settle, compromise or release, on terms acceptable to Secured Party, in whole
or in part, any amounts owing on the Collateral and/or disputes with respect
thereto;

 

(k)                                  To
amend the terms of, extend the time of payment, make allowances and adjustments
to, and issue credits in connection with, the Collateral in the name of Secured
Party or in the name of Debtor;

 

(l)                                     To
enforce payment and prosecute any action or proceeding with respect to any or
all of the Collateral and take or bring, in the name of Secured Party or in the
name of Debtor, any and all steps, actions, suits or proceedings deemed by
Secured Party necessary or desirable to effect collection of or to realize upon
the Collateral, including any judicial or nonjudicial foreclosure thereof or
thereon, and Debtor specifically consents to any nonjudicial foreclosure of any
or all of the Collateral or any other action taken by Secured Party which may
release any obligor from personal liability on any of the Collateral, and
Debtor waives any right not expressly provided for in this Agreement to receive
notice of any public or private judicial or nonjudicial sale or foreclosure of
any security or any of the Collateral; and any money or other property received
by Secured Party in exchange for or on account of the Collateral, whether
representing collections or proceeds of Collateral (and whether resulting from
voluntary payments or foreclosure proceedings or other legal action taken by
Secured Party or Debtor) may be applied to the Secured Obligations by Secured
Party in the manner which is provided by the Credit Agreement or by any other
Loan Documents;

 

(m)                               To
insure, process and preserve the Collateral;

 

(n)                                 To
exercise all rights, remedies, powers or privileges provided under any of the
Loan Documents or the Collateral;

 

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(o)                                 To
remove, from any premises where the same may be located, the Collateral and any
and all documents, instruments, files and records, and any receptacles and
cabinets containing the same, relating to the Collateral, and Secured Party
may, at the cost and expense of Debtor, use such of Debtor’s supplies,
equipment, facilities and space at Debtor’s places of business as may be
necessary or appropriate to properly administer, process, store, control,
prepare for sale or disposition and/or sell or dispose of the Collateral or to
properly administer and control the handling of collections and realizations
thereon, and Secured Party shall be deemed to have a rent-free tenancy of any
premises of Debtor for such purposes and for such periods of time as reasonably
required by Secured Party;

 

(p)                                 To
exercise all other rights, powers, privileges and remedies of an owner of the
Collateral; all at Secured Party’s sole option and as Secured Party in its sole
discretion may deem advisable.  Debtor
will, at Secured Party’s request, assemble the Collateral and make it available
to Secured Party at places which Secured Party may designate, whether at the
premises of Debtor or elsewhere, and will make available to Secured Party, free
of cost, all premises, equipment and facilities of Debtor for the purpose of
Secured Party’s taking possession of the Collateral or storing same or removing
or putting the Collateral in salable form or selling or disposing of same; and

 

(q)                                 At
the expense of Debtor, perform any obligation of Debtor under this Agreement or
under any of the Collateral.

 

Section 4.02.                             Possession.  Upon the occurrence and during the
continuance of an Event of Default, Secured Party also shall have the right,
either in person, by agent or by a receiver to be appointed by a court of
competent jurisdiction (and Debtor hereby expressly consents upon the
occurrence and during the continuance of an Event of Default to the appointment
of such a receiver), and without regard to the adequacy of any security for the
Secured Obligations, to take possession of the Collateral or any part thereof
and to collect and receive the rents, issues, profits, income and proceeds
thereof.  Secured Party’s taking
possession of the Collateral shall not cure or waive any Event of Default or
notice thereof or invalidate any act done pursuant to such notice.  The rights, remedies and powers of any
receiver appointed by a court shall be as ordered by said court.

 

13

 

Section 4.03.                             Conduct
of Sale.

 

(a)                                  Any
public or private sale or other disposition of the Collateral may be held at
any office of Secured Party, or at Debtor’s place of business, or at any other
place permitted by applicable law, and without the necessity of the Collateral
being within the view of the prospective purchasers.  Secured Party may direct the order and manner of sale of the
Collateral, or portions thereof, as it in its sole and absolute discretion may
determine, and Debtor expressly waives any right to direct the order and manner
of sale of any Collateral.  Secured
Party or any Person on Secured Party’s behalf may bid and purchase at any such
sale or other disposition.  The net cash
proceeds resulting from the collection, liquidation, sale, lease or other
disposition of the Collateral shall be applied, first, to the expenses
(including reasonable attorneys’ fees and disbursements) of retaking, holding,
storing, processing and preparing for sale or lease, selling, leasing,
collecting, liquidating and the like, and then to the satisfaction of the
Secured Obligations in such order as shall be determined by Secured Party in
its sole and absolute discretion, all unless otherwise provided by the Credit
Agreement or any other Loan Documents. 
Debtor and any other Person then obligated therefor shall pay to Secured
Party on demand any deficiency with regard thereto which may remain after such
sale, disposition, collection or liquidation of the Collateral.

 

(b)                                 Unless
the Collateral is perishable or threatens to decline speedily in value or is of
a type customarily sold on a recognized market, Secured Party will send or
otherwise make available to Debtor reasonable notice of the time and place of
any public sale thereof or of the time at, or after, which any private sale
thereof is to be made.  The requirement
of sending reasonable notice conclusively shall be met if such notice is
mailed, first class mail, postage prepaid, to Debtor at its address set forth
in the Credit Agreement, or delivered or otherwise sent to Debtor, at least
five (5) days before the date of the sale.

 

(c)                                  With
respect to any Collateral consisting of securities, partnership interests,
joint venture interests, other investments or the like, and whether or not any
of such Collateral has been effectively registered under the Securities Act of
1933 or other applicable laws, Secured Party may, in its sole and absolute
discretion, sell all or any part of such Collateral at private sale in such
manner and under such circumstances as Secured Party may deem necessary or
advisable in order that the sale may be lawfully conducted.  Without limiting the foregoing, Secured
Party may (i) approach and negotiate with a limited number of potential
purchasers; and (ii) restrict the prospective bidders or purchasers to
persons who will represent and agree that they are purchasing such Collateral
for their own account for investment and not with a view to the distribution or
resale thereof.  In the event that any
such Collateral is sold at private sale, Debtor agrees that if such Collateral
is sold in a manner that conforms with the reasonable commercial practice of
banks, commercial finance companies, insurance companies or other financial

 

14

 

institutions in disposing of property similar to the Collateral,
then:  (aa) the sale shall be deemed to
be commercially reasonable in all respects; (bb) the credit against the Secured
Obligations, to which Debtor may be entitled, shall not exceed the purchase
price; and (cc) Secured Party shall not incur any liability or responsibility
to Debtor in connection therewith, notwithstanding the possibility that a
substantially higher price might have been realized at a public sale.  Debtor recognizes that a ready market may
not exist for such Collateral if it is not regularly traded on a recognized
securities exchange, and that a sale by Secured Party of any such Collateral
for an amount substantially less than a pro rata share of the fair market value
of the issuer’s assets minus liabilities may be commercially reasonable in view
of the difficulties that may be encountered in attempting to sell a large
amount of such Collateral or Collateral that is privately traded.

 

(d)                                 Upon
consummation of any sale of Collateral hereunder, Secured Party shall have the
right to assign, transfer and deliver to the purchaser or purchasers thereof
the Collateral so sold.  Each such
purchaser at any such sale shall hold the Collateral so sold absolutely free
from any claim or right upon the part of Debtor or any other Person except a
third party lienholder permitted under the Loan Documents, and Debtor hereby
waives (to the extent permitted by applicable laws) all rights of redemption,
stay and appraisal which it now has or may at any time in the future have under
any rule of law or statute now existing or hereafter enacted.

 

ARTICLE V

MISCELLANEOUS

 

Section 5.01.                             Attorney-in-Fact.  Debtor hereby irrevocably nominates and
appoints Secured Party as its attorney-in-fact for the following purposes:  (a) to do all acts and things which Secured
Party may deem necessary or advisable to perfect, and continue perfected, the
security interests created by this Agreement and, upon the occurrence and
during the continuance of an Event of Default, to preserve, process, develop,
maintain and protect the Collateral; (b) upon the occurrence and during
the continuance of an Event of Default, to do any and every act which Debtor is
obligated to do under this Agreement, at the expense of the Debtor, and without
any obligation to do so; (c) to prepare, sign, file and/or record, for
Debtor, in the name of the Debtor, any financing statement, application for
registration, or like paper, and to take any other action deemed by Secured
Party necessary or desirable in order to perfect or maintain perfected the
security interests granted hereby;  and
(d) upon the occurrence and during the continuance of an Event of Default, to
execute any and all papers and instruments and do all other things necessary or
desirable to preserve and protect the Collateral and to protect Secured Party’s
security interests therein; provided, however, that Secured Party shall be
under no obligation whatsoever to take any of the foregoing actions, and,
absent bad faith or actual malice, Secured Party shall have no liability or
responsibility for any act taken or omission with respect thereto.  Debtor hereby consents and agrees that,
where applicable,

 

15

 

the issuers of, the obligors
on, or the parties to any of the Collateral, shall be entitled to accept the
provisions of this Agreement as conclusive evidence of the right of Secured
Party to effect any transfer or exercise any right hereunder or with respect to
any such Collateral, notwithstanding any other notice or direction to the
contrary heretofore or hereafter given by Debtor or any other Person to such
issuers, obligors or parties.

 

Section 5.02.                             Costs
and Expenses.  Debtor agrees to pay
to Secured Party all costs and expenses (including, without limitation,
reasonable attorneys’ fees and disbursements) incurred by Secured Party in the
enforcement or attempted enforcement of this Agreement, whether or not an
action is filed in connection therewith, and in connection with any waiver or
amendment of any term or provision hereof. 
All advances, charges, costs and expenses, including reasonable
attorneys’ fees and disbursements, incurred or paid by Secured Party in
exercising any right, privilege, power or remedy conferred by this Agreement
(including, without limitation, the right to perform any Secured Obligation of
Debtor under the Loan Documents), or in the enforcement or attempted
enforcement thereof, shall be secured hereby and shall become a part of the
Secured Obligation and shall be paid to the Secured Party by Debtor,
immediately upon demand, together with interest thereon at the rate(s) provided
for under the Credit Agreement.

 

Section 5.03.                             Statute
of Limitations and Other Laws.  Until
the Secured Obligations shall have been paid and performed in full, and all
obligations of the Banks, or any of them, to advance funds under the Bank
Facilities, have been unconditionally and indefeasibly terminated and Bank
Facilities Termination shall have occurred, the power of sale and all other
rights, remedies, and privileges which are granted hereunder shall continue to
exist and may be exercised by Secured Party at any time and from time to
time.  Debtor expressly waives the
benefit of any and all laws providing for exemption of property from execution
or for valuation and appraisal upon foreclosure, to the maximum extent
permitted by applicable law.

 

Section 5.04.                             Other
Agreements.  The rights and remedies
of Secured Party upon the occurrence and continuance of an Event of Default
(whether such rights and remedies are conferred by statute, by rule of law, by
this Agreement, the Loan Documents or otherwise) may be exercised by Secured
Party, in the sole discretion of Secured Party, either alternatively,
concurrently, or consecutively in any order. 
The exercise by Secured Party of any one or more of such rights and
remedies shall not be construed to be an election of remedies nor a waiver of
any other rights and remedies which may be available to Secured Party.

 

Section 5.05.                             Understandings
With Respect to Waivers and Consents. 
Debtor warrants and agrees that each of the waivers and consents set
forth herein are made after consultation with legal counsel and with full
knowledge of their significance and consequences, with the understanding that
events giving rise to any defense or right

 

16

 

waived may diminish, destroy or
otherwise adversely affect rights which Debtor otherwise may have against Secured
Party or others, or with respect to the Collateral, and that, under the
circumstances, the waivers and consents herein given are reasonable and not
contrary to public policy or law.  If
any of the waivers or consents herein are determined to be contrary to any
applicable law or public policy, such waivers and consents shall be effective
to the maximum extent permitted by law.

 

Section 5.06.                             Release
of Debtor.  This Agreement and all
Secured Obligations of Debtor hereunder shall be released when all Secured
Obligations have been paid in full in cash or otherwise performed in full and
when all obligations which the Banks, or any of them, may have to advance funds
under the Bank Facilities, have been unconditionally and indefeasibly
terminated and Bank Facilities Termination shall have occurred.  Upon such release of Debtor’s Secured
Obligations hereunder, Secured Party shall return any pledged Collateral to
Debtor, or to the Person or Persons legally entitled thereto, and shall
endorse, execute, deliver, record and file all instruments and documents, and
do all other acts and things, reasonably required for the return of the
Collateral to Debtor, or to the Person or Persons legally entitled thereto, and
to evidence or document the release of Secured Party’s interests arising under
this Agreement, all as reasonably requested by, and at the sole expense of,
Debtor.

 

Section 5.07.                             Indemnity.  Neither Secured Party nor any of the Banks
shall be obligated to perform or discharge any obligation or duty to be performed
or discharged by Debtor with respect to the Collateral or hereunder.  Debtor hereby agrees to indemnify Secured
Party and each of the Banks, as well as their respective trustees, directors,
officers, employees, agents, attorneys and stockholders (collectively, the
“Indemnified Parties”) from and against any and all losses, damages, expenses
or liabilities of any kind or nature from any suits, claims, demands or other
proceedings, including reasonable counsel fees incurred in investigating or
defending such claim, suffered by any of them and caused by, relating to,
arising out of, resulting from, or in any way connected with: (i) this
Agreement; (ii) any of the Collateral; or (iii) the management,
control, care, operation, maintenance or repair of the Collateral; all in
accordance with Section 5.14 of the Credit Agreement, which is
incorporated by reference herein, as if fully set forth herein.  This Agreement shall not place
responsibility for the management, control, care, operation, maintenance or
repair of the Collateral upon any of the Indemnified Parties; nor shall this
Agreement cause any of the Indemnified Parties to be responsible or liable for
any negligence in the management, care, operation, maintenance or repair of the
Collateral which results in loss, injury or death to any tenant, guest,
licensee, employee or stranger (provided that this Section 5.07 shall not
act to relieve any Indemnified Party from liability which results from such
Indemnified Party’s own gross negligence or willful misconduct).

 

17

 

Section 5.08                                Governing
Law.  This Agreement shall be
governed by, and shall be construed and enforced in accordance with, the
internal laws of the State of Nevada without regard to conflict of law
principles; provided, however, that, with respect to: (i) the perfection
and enforcement of liens and interests granted herein; and (ii) the
exercise of any remedies granted herein; all with respect to any of the
Collateral, this Agreement shall be governed by the laws of the state where
such Collateral is deemed to be located, under applicable law, for choice of
law purposes.  To the extent that this
Agreement is governed and construed in accordance with the laws of the State of
Nevada, all references herein to the “Commercial Code” shall be to the Uniform
Commercial Code as enacted in the State of Nevada.  To the extent that this Agreement is governed in accordance with
the laws of any other state, all references herein to the “Commercial Code”
shall be to the Uniform Commercial Code as enacted in such state.

 

Section 5.09.                             Counterparts.  This Agreement may be executed in any number
of separate counterparts with the same effect as if the signatures hereto and
hereby were upon the same instrument. 
All such counterparts shall together constitute one and the same
document.

 

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

 

	
  DEBTOR:

  	
   

  	
  SECURED PARTY:

  
	
   

  	
   

  	
   

  
	
  MTR GAMING GROUP, INC.,

  a Delaware corporation

  	
   

  	
  WELLS FARGO BANK, National

  Association

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  By

  	
  /s/ Edson R. Arneault

  	
   

  	
   

  	
  By

  	
  /s/ Virginia S. Christenson

  	
   

  
	
  Edson R. Arneault,

  	
   

  	
  Virginia S. Christenson,

  
	
  President

  	
   

  	
  Vice President

  
							

 

18Exhibit 10.6

 

Prepared by and when

recorded mail to:

 

James L. Morgan, Esq.

Henderson & Morgan, LLC

164 Hubbard Way, Suite B

Reno, NV 
89502

 

Mail tax statements to:

 

A
CREDIT LINE DEED OF TRUST, FIXTURE FILING AND

SECURITY AGREEMENT WITH ASSIGNMENT OF RENTS
(MPI)

 

NOTICE:  THIS DEED OF TRUST SECURES CREDIT IN THE
INITIAL MAXIMUM PRINCIPAL AMOUNT OF FIFTY MILLION DOLLARS ($50,000,000.00),
TOGETHER WITH: (i) INTEREST ON THE OUTSTANDING PORTION OF SAID PRINCIPAL
AMOUNT; AND (ii) OTHER AMOUNTS DESCRIBED HEREIN.  THE OBLIGATIONS SECURED HEREBY INCLUDE REVOLVING CREDIT
OBLIGATIONS, WHICH PERMIT BORROWING, REPAYMENT AND REBORROWING, ALL SUBJECT TO
THE TERMS AND CONDITIONS OF THE CREDIT AGREEMENT AND THE NOTES THAT ARE REFERRED
TO HEREIN.  INTEREST ON OBLIGATIONS SECURED
HEREBY ACCRUES AT RATES THAT MAY FLUCTUATE FROM TIME TO TIME.

 

THIS CREDIT LINE DEED OF TRUST, FIXTURE
FILING AND SECURITY AGREEMENT WITH ASSIGNMENT OF RENTS (MPI) (the “Deed of
Trust”) is made as of the 28th day of March, 2003 by and among MOUNTAINEER
PARK, INC., a West Virginia corporation, as grantor and debtor (hereinafter
referred to as “Grantor”), JOYCE F. OFSA and G. THOMAS BATTLE, both
residents of Kanawha County, West Virginia, as trustees (hereinafter
collectively referred to as “Trustee”), and WELLS FARGO BANK, National
Association, as Agent Bank on behalf of the Lenders, the Swingline Lender and
the L/C Issuer, all of which are defined and described in the

 

EXHIBIT “A”

 

 

Credit Agreement referred to
below, as secured party (together with its successors and assigns, in such
capacity, hereinafter referred to as “Secured Party”).

 

W_I_T_N_E_S_S_E_T_H:

 

THAT FOR AND IN CONSIDERATION OF THE
INDEBTEDNESS AND TRUSTS HEREINAFTER SET FORTH AND OF THE SUM OF TEN DOLLARS
($10.00), CASH IN HAND PAID, THE RECEIPT AND SUFFICIENCY OF WHICH ARE HEREBY
ACKNOWLEDGED:

 

A.                                   Grantor grants,
bargains, sells, transfers, conveys and assigns the following described real
property and related collateral to Trustee, in trust, with power of sale, to
have and to hold the same unto Trustee and its successors in interest for and
on behalf of Secured Party upon the trusts, covenants and agreements herein
expressed:

 

DESCRIPTION OF
COLLATERAL

 

That certain real property situate in the
Grant and Clay Districts, Hancock County, State of West Virginia, that is more
particularly described on that certain exhibit marked Exhibit “A”, affixed
hereto and by this reference incorporated herein and made a part hereof (the
“Land”), together with and including, without limitation:

 

(a)                                  All right, title and
interest of Grantor whether now owned or hereafter acquired, in or to any real
property lying within the right of way of any street, open or proposed,
which adjoins any of said Land and any and all sidewalks, bridges, elevated walkways,
tunnels, alleys, strips and gores of real property adjacent to, connecting or
used in connection with any of said Land (collectively, the “Adjacent
Property”);

 

(b)                                 All buildings,
structures and all other improvements and fixtures that are, or that may be
hereafter erected or placed on, or in, the Land and all right, title and
interest of Grantor which is now owned or hereafter acquired, in or to, all
buildings, structures and all other improvements and fixtures that are, or that
may be hereafter, erected or placed on, or in, any of the Adjacent Property
(collectively, the “Improvements”);

 

(c)                                  All water rights and
conditional water rights that are now, or may hereafter be, appurtenant to,
used in connection with or intended for use in connection with the Land, the
Adjacent Property and/or the Improvements, including, without limitation:  (i) ditch, well, pipeline, spring and
reservoir rights, whether or not adjudicated or evidenced by any well

 

2

 

or other permit; (ii) all rights with
respect to groundwater underlying the Land or the Adjacent Property; and
(iii) any permit to construct any water well, water from which is intended
to be used in connection with the Land or the Adjacent Property; (collectively,
the “Water Rights”, and together with the Land, the Adjacent Property and the
Improvements, the “Real Estate”);

 

(d)                                 All present and future
interest of Grantor as lessor, sublessor, licensor, concessionor, franchisor,
grantor, or similar party to any lease, sublease, license, concession,
franchise and other use or occupancy agreement now or hereafter relating to any
of the Real Estate and all renewals, extensions, amendments, restatements and
other modifications thereof (collectively, the “Occupancy Agreements”);

 

(e)                                  All present and
future rents, issues, products, earnings, revenues, payments, profits,
royalties and other proceeds and income of the Real Estate, and of any
activities conducted thereon or in connection therewith, subject specifically
to the prior rights of the West Virginia Lottery Commission in accordance with
West Virginia Code Section 29-22A-10(b), regardless of whether such
proceeds or income accrue by virtue of the Occupancy Agreements, or otherwise
(collectively, the “Rents”), subject, however, to the absolute assignment given
to Secured Party in Section 9 hereof entitled Assignment of Rents, and to
which Section this grant to the Trustee is subject and subordinate;

 

(f)                                    All right, title
and interest of Grantor, whether now owned or hereafter acquired, in, or to,
any and all present and future awards or payments, including without
limitation, interest on them, and the right to receive them, which may be made
with respect to the Real Estate, the Occupancy Agreements, and/or the Rents as
a result of: (i) the exercise of the right of eminent domain; (ii) the
alteration of the grade of any street; (iii) any loss of or damage to any
building or other improvement included in the Real Estate; (iv) any other
injury to or decrease in the value of the Real Estate, the Occupancy
Agreements, and/or the Rents (including, without limitation, proceeds of any
policy of insurance); and (v) any refund due on account of the payment of real
estate taxes, assessments or other charges levied against or imposed upon the
Real Estate, the Occupancy Agreements, and/or the Rents (collectively, the
“Awards”);

 

(g)                                 All development
rights, governmental or quasi-governmental licenses, permits or approvals,
zoning rights and other similar rights or interests which relate to the
development, use or operation of, or that benefit or are appurtenant to, any
portion of the Real Estate (collectively, the “Entitlements”);

 

3

 

(h)                                 All and singular the
tenements, easements, hereditaments and appurtenances now, or hereafter,
belonging to or in any wise appertaining to the Real Estate, the Rents, the
Awards, the Entitlements and the reversion and reversions, remainder and
remainders thereof and all the estate, right, title, interest or other claim
which Grantor now has or hereafter may acquire of, in and to the Real Estate,
the Occupancy Agreements, the Rents, the Awards, the Entitlements and/or any
part thereof, with the appurtenances thereto (collectively, the “Other
Interests”); and

 

(i)                                     All right, title
and interest of Grantor, whether now owned, or hereafter acquired, in or to,
the Personal Property which is referred to below.

 

The Real Estate, the Occupancy Agreements,
the Rents, the Awards, the Entitlements and the Other Interests are hereinafter
collectively referred to as the “Real Property”; and

 

B.                                     Grantor grants a
security interest to Secured Party in the following described collateral, which
Grantor now has or may hereafter acquire, pursuant to applicable provisions of
the Commercial Code (which is defined by Section 28 below):

 

DESCRIPTION OF COLLATERAL

 

All right, title and interest of Grantor,
which is now owned, or hereafter acquired, in or to, any of the following
described personal property, whether now existing or hereafter coming into
existence (collectively, the “Personal Property”):

 

(a)                                  All present and
future: (i) accounts; (ii) chattel paper; (iii) commercial tort
claims; (iv) deposit accounts; (v) documents; (vi) equipment,
inventory and other goods of any kind or nature; (vii) instruments;
(viii) investment property; (ix) letter of credit rights;
(x) money; (xi) general intangibles; and (xii) proceeds of any
of the foregoing; all as defined by Article 9 of the Uniform Commercial Code as
enacted in the State of Nevada;

 

(b)                                 All present and future
chattels, furniture, furnishings, machinery, tools, apparatus, fixtures,
building materials, building contents and building components, all of every
kind and nature, and all other tangible personal property:  (i) which is used in connection with,
situate in or on, affixed to, or incorporated into any portion of the Real
Property; (ii) which is used in connection with, situate in or on, affixed
to, or incorporated into, any building, structure or other improvement that is
now or that may be hereafter constructed on or under the Real Property; and/or
(iii) in which Grantor otherwise has or acquires an interest; all
including, without limitation: 
(aa) all lumber, bricks, cement,

 

4

 

masonry, steel, doors, windows,
fasteners, nails, bolts, scaffolding, tools, construction supplies,
construction equipment and all other building materials, supplies and equipment
of any kind or nature; (bb) all air conditioning, heating, electrical, lighting,
fire fighting and fire prevention, plumbing, food and beverage preparation,
laundry, security, sound, signaling, telephone, television, entertainment
stage, window washing, irrigation, storage, shop, landscaping, and other
equipment and fixtures, of whatever kind or nature, consisting of, without
limitation, air conditioners, compressors, fans, duct work, thermostats,
furnaces, boilers, radiators, burners, wiring, conduits, cables, generators,
transformers, switching gear, lighting fixtures, sprinkler systems and other
fire extinguishing equipment, fire alarms and other fire detection equipment,
piping, pumps, valves, sinks, toilets, tubs, motors, carts, elevators and other
lifts, ovens, refrigerators, dishwashers and dishwashing equipment, fabric washing
and drying equipment, lock and key systems, surveillance and entry detection
systems, speakers, intercoms and public address systems, hardware, shelving,
maintenance and repair equipment and all other similar items; (cc) all
furniture, furnishings, wall coverings, floor coverings, window coverings,
artwork and decorative items including, without limitation, casino, guest room,
bathroom, lobby, bar, restaurant, storage, retail, meeting, convention,
leisure, recreation, office, administrative and other furniture, furnishings,
wall coverings, floor coverings, window coverings, artwork and decorative
items; (dd) all hotel equipment and supplies, including without
limitation, televisions, radios, telephones, linen, bedding, amenities, carts,
recreational equipment, leisure equipment and all other equipment and supplies
utilized in the occupation or renting of hotel guest rooms and public areas;
(ee) all bar and restaurant equipment and supplies, including, without
limitation, kitchen and bar appliances, pots, pans, plates, dishes, cups,
glasses, serving utensils, cooking utensils and all other equipment and
supplies used in the operation of bars and/or restaurants; (ff) all
Racetrack, Video Lottery Terminal and Associated Equipment as defined in West
Virginia Code § 29-22A-3 and all other equipment and supplies utilized in
the operation of a racetrack or gaming business; (gg) all cabaret, stage
and entertainment equipment and supplies including, without limitation, stage
equipment, sets, spotlights, sound equipment, musical instruments and other
equipment and supplies utilized in the operation of stage and cabaret shows and
other entertainment productions; (hh) all office and administrative
equipment and supplies including, without limitation, office appliances, filing
cabinets, computers, peripheral computer equipment and other data processing
and storage equipment, stationery and other office supply items, and other
office and administrative equipment and supplies; (ii) all equipment and
supplies utilized in the operation of a golf course; (jj) all indoor and
outdoor pool and recreational equipment and supplies; (kk) all tools and
other maintenance and repair equipment; (ll) all landscaping equipment and
supplies; and (mm) all equipment and supplies utilized in connection with
any other activity engaged in by Grantor;

 

(c)                                  All present and
future supplies, stock in trade, product components and raw materials which are
used in connection with, or in the conduct of, the business of Grantor or in
which Grantor has or acquires an interest, including, without limitation:  (i) tangible property held for sale or
lease or to be furnished under a contract of service,

 

5

 

all raw materials, work in
process and finished goods, all packing materials and containers relating to or
used in connection with any of the foregoing, and all bills of lading,
warehouse receipts or documents of title relating to any of the foregoing;
(ii) all food stuffs, beverages, prepared food and other similar items;
and (iii) all hotel amenities, cleaning supplies, office supplies,
consumables and similar items;

 

(d)                                 All present and future
movable tangible property, which is not otherwise set forth herein, and which
is used in connection with, or in the conduct of, the business of Grantor or in
which Grantor has or acquires an interest;

 

(e)                                  All present and
future accounts receivable, rentals, deposits, rights to payment, negotiable
instruments, writings evidencing a right to payment and/or a security interest,
documents of title, guaranties, undertakings, surety bonds, insurance policies
and notes and drafts which are owned, or used in connection with, or in the
conduct of, the business of Grantor, or in which Grantor has or acquires an
interest, however created or arising;

 

(f)                                    All present and
future contracts, or agreements and all other present and future entitlements
which are owned, or used in connection with, or in the conduct of, the business
of Grantor, or in which Grantor has or acquires an interest, including, without
limitation:  (aa) all leases and
purchase contracts for equipment, furniture and/or fixtures of any kind and
character relating to the Real Property and the businesses conducted thereon; and
(bb) all goodwill, choses in action, trade secrets, customer lists,
trademarks, trade names and service marks, patents, copyrights, technology,
software, processes, and proprietary information which are owned, or used in
connection with, or in the conduct of, the business of Grantor, or in which Grantor
has or acquires an interest (including, without limitation, the trade names of
“Mountaineer Park,” “Speakeasy” and/or any derivation thereof including any and
all state and federal registrations thereof);

 

(g)                                 All present and future
depository accounts which are owned, or used in connection with, or in the
conduct of, the business of Grantor, or in which Grantor has or acquires an
interest including, without limitation, any demand, time, savings, passbook or
like account maintained with any bank, savings and loan association, credit
union or like organization, and all money, cash and cash equivalents of
Grantor, whether or not deposited in any such deposit account;

 

(h)                                 All present and future
revenues, receipts, profits, payments and income of any nature whatsoever, in
which Grantor now owns or hereafter acquires an interest, regardless of whether
such items are derived from or received with respect to hotel rooms, banquet
facilities, convention facilities, retail premises, bars, restaurants, racetrack
operations, video lottery terminals, gaming operations, golf courses or any
other facilities on the Real Property and regardless of whether such items are
derived from any other source;

 

6

 

(i)                                     All present and
future information, books, records, computer hardware, computer peripheral
equipment, software and computer systems which are owned, or used in connection
with, or in the conduct of, the business of Grantor, or in which Grantor has or
acquires an interest including, without limitation: (aa) books of account
and ledgers of every kind and nature, all electronically recorded data relating
to Grantor or any of its businesses, all receptacles and containers for such
records, and all files and correspondence; (bb) all player tracking,
racetrack, video lottery, golf course, and customer monitoring information,
software, computers, equipment and systems; (cc) all other hotel,
racetrack, video lottery, golf course, bar, restaurant and hospitality information,
software, computers, equipment and systems; and (dd) all licenses,
contracts, leases and other agreements and entitlements relating to any such
items;

 

(j)                                     All present and
future stocks, bonds, debentures, certificated and uncertificated securities,
subscription rights, options, warrants, puts, calls, certificates, partnership
interests, joint venture interests, investments, security accounts, commodity
accounts, and/or brokerage accounts which are owned, or used in connection
with, or in the conduct of, the business of Grantor, or in which Grantor has or
acquires an interest and all rights, preferences, privileges, dividends,
distributions, redemption payments, or liquidation payments with respect
thereto;

 

(k)                                  All right, title and
interest of Grantor in and to all leases, licenses, concessions, or similar
agreements whether or not specific­ally herein described which now or may
hereafter pertain to the Real Property and all amendments to the same,
including, but not limited to the following: 
(aa) all payments due and to become due under such agreements,
whether as rent, damages, insurance payments, condemnation awards, or
otherwise; (bb) all claims, rights, powers, privileges and remedies under
such agreements; and (cc) all rights of Grantor under such leases to
exercise any election or option, or to give or receive any notice, consent,
waiver or approval, or to accept any surrender of the premises or any part
thereof, together with full power and authority in the name of Grantor or
otherwise, to demand and receive, enforce, collect, or receipt for any or all
of the foregoing, to endorse or execute any checks or any instruments or
orders, to file any claims or to take any action which Secured Party may deem
necessary or advisable in connection therewith;

 

(l)                                     All plans,
specifications, soil reports, engineering reports, land planning maps, surveys,
and any other reports, exhibits or plans used or to be used in connection with
the construction, planning, operation or maintenance of the Real Property,
together with all amendments and modifications thereof;

 

(m)                               The Water Rights;

 

(n)                                 The Awards;

 

7

 

(o)                                 The Entitlements;

 

(p)                                 All other tangible and
intangible property of Grantor;

 

(q)                                 All present and future
accessions, appurtenances, components, repairs, repair parts, spare parts,
replacements, substitutions, additions, issue and/or improvements to or of or
with respect to any of the foregoing;

 

(r)                                    All rights,
remedies, powers and/or privileges of Grantor with respect to any of the
foregoing; and

 

(s)                                  Any and all proceeds,
products, rents, income and profits of any of the foregoing, including, without
limitation, all money, entitlements, rights to payment and any other tangible
or intangible property received upon the sale or disposition of any of the
foregoing.

 

SUBJECT, HOWEVER, to the following:

 

(i)                                     The right of
Grantor to sell or otherwise dispose of Personal Property in the ordinary
course of business, free and clear of the lien hereof, provided, and to the
extent, that such sale or other disposition is permitted under the terms of the
Credit Agreement (which is referred to below); and

 

(ii)                                  As to the fixtures
and equipment covered hereby, the leases and/or purchase money security
interests pursuant to which Grantor has acquired an interest in such fixtures
and equipment provided, and to the extent, that such leases and/or purchase
money security interests are permitted under the terms of the Credit Agreement.

 

The Real Property and the Personal Property
described hereinabove are hereinafter collectively referred to as the
“Property.”  The parties intend for this
Deed of Trust to create a lien on and security interest in the Property, and,
as provided in Section 9 hereof entitled Assignment of Rents, an absolute
assignment of the Rents, all in favor of Secured Party.  To the extent any of said Property and/or
Rents are not encumbered by a perfected lien or security interest created
above, and are not absolutely assigned by the assignment set forth in
Section 9 below, it is the intention of the parties that such Property
and/or Rents shall constitute “proceeds, product, offspring, rents or profits”
(as defined in and for the purposes of Section 552(b) of the United States
Bankruptcy Code, as such section may be modified or supplemented) of the Real
Property and/or “fees, charges, accounts, or other payments for the use or
occupancy of rooms and other public facilities
in . . . lodging properties,” as applicable (as such terms
are defined in and for the purpose of Section 552(b) of the United States
Bankruptcy Code, as such Section may be modified or supplemented).

 

8

 

FOR THE PURPOSE OF SECURING:

 

A.                                   Payment when due,
whether at stated maturity, by required prepayment, declaration, acceleration,
demand or otherwise (including payment of amounts that would become due but for
the operation of the automatic stay under Section 362(a) of the Bankruptcy
Code, 11 U.S.C. §362(a)), of: (i) the principal sum which is, at any
time, advanced and unpaid under the Credit Facility (as defined in the Credit
Agreement, referred to below), not to exceed Fifty Million Dollars
($50,000,000.00) at any one time, all on a revolving line of credit basis;
(ii) interest and other charges accrued on said principal sum, or accrued
on interest and other charges then outstanding under the Credit Facility (all
including, without limitation, interest and other charges that, but for the
filing of a petition in bankruptcy with respect to any of the Borrowers (referred
to below) would accrue on such obligations); and (iii) any other
obligations of Borrowers, or any or them, under the RLC Note referred to below;
all according to the terms of a Revolving Credit Note dated concurrently, or
substantially concurrent, herewith which is made by Borrowers (referred to
below) and is payable to the order of Secured Party according to the tenor and
effect of said Revolving Credit Note, and all renewals, extensions, amendments,
restatements, replacements, substitutions and other modifica­tions thereof
(hereinafter collectively referred to as the “RLC Note”), an unexecuted copy of
which is attached hereto as Exhibit ”B” and incorporated by reference
herein.

 

B.                                     Payment when due,
whether at stated maturity, by required prepayment, declaration, acceleration,
demand or otherwise (including payment of amounts that would become due but for
the operation of the automatic stay under Section 362(a) of the Bankruptcy
Code, 11 U.S.C. § 362(a)), of: 
(i) the principal sum which is, at any time, advanced and unpaid
under the Swingline Facility (as defined in the Credit Agreement), not to
exceed Ten Million Dollars ($10,000,000.00) at any one time, all on a revolving
line of credit basis; (ii) interest and other charges accrued on said
principal sum, or accrued on interest and other charges then outstanding under
the Swingline Facility (all including, without limitation, interest and other
charges that, but for the filing of a petition in bankruptcy with respect to
Borrowers, or any of them, would accrue on such obligations); and
(iii) any other obligations of Borrowers, or any of them, under the S/L
Note referred to below; all according to the terms of a Swingline Note dated
concurrently, or substantially concurrent, herewith which is made by the
Borrowers and is payable to the order of the Swingline Lender (referred to
below) according to the tenor and effect of said Swingline Note, and all
renewals, extensions, amendments, restatements, replace­ments, substitutions
and other modifications thereof (hereinafter referred to as the “S/L Note”), an
unexecuted copy of which is attached hereto as Exhibit ”C” and
incorporated by reference herein.  The
RLC Note and S/L Note are collectively referred to herein as the “Notes.”

 

9

 

C.                                     Payment and
performance of every obligation, covenant, promise and agreement of Borrowers,
to:  (i) reimburse the L/C Issuer
(which is referred to below) for amounts disbursed under any letter of credit
issued pursuant to the L/C Facility (as defined in the Credit Agreement); and
(ii) pay any amounts required under any instrument executed by any of the
Borrowers in connection with the issuance of any letter of credit under the L/C
Facility.

 

D.                                    Payment and
performance of every obliga­tion, covenant, promise and agreement of Grantor
herein contained or incorporated herein by reference (other than obligations
which Grantor may have under Section 2 hereof to make payment or perform
under the Environmental Certificate which is defined by Section 31 below),
including, without limitation, reimbursement of any sums paid or advanced by
Secured Party or any of the Banks (which are defined below) pursuant to the
terms hereof.

 

E.                                      Payment of the
expenses and costs incurred or paid by Secured Party or any of the Banks in the
preservation and enforcement of the rights and remedies of Secured Party and
the duties and liabilities of Grantor hereunder, including, but not by way of
limitation, reasonable attorney’s fees, court costs, witness fees, expert
witness fees, collection costs, Trustee’s fees, foreclosures costs, and
reasonable costs and expenses paid by Secured Party or any of the Banks in
performing for the account of Grantor any obligation of said Grantor.

 

F.                                      Payment of any
sums which may hereafter be owing by Borrowers, or any of them, to any of the
Banks or any of their affiliates, under the terms of any interest rate swap
agreement, interest rate cap agreement, basis swap agreement, forward rate
agreement, interest collar agreement or interest floor agreement to which
Borrowers, or any of them, may be a party, or under any other agreement or
arrangement to which Borrowers, or any of them, may be a party, which in each
case is designed to protect Borrowers, or any of them, as the case may be,
against fluctua­tions in interest rates or currency exchange rates with respect
to any other indebtedness secured by the Deed of Trust.

 

G.                                     Payment of
additional sums and interest thereon which may hereafter be loaned to
Borrowers, or any of them, pursuant to the Credit Agreement when evidenced by a
promissory note or notes which recite that this Deed of Trust is security
therefor.

 

H.                                    Performance and
payment of every obligation, warranty, representation, covenant, agreement and
promise of Borrowers, or any of them, contained in, or established by, that
certain Third Amended and Restated Credit

 

10

 

Agreement (together with all
extensions, renewals, amendments, restatements, substitutions and other modifications
thereof, the “Credit Agreement”) executed concurrently, or substantially
concurrent, herewith by and among Grantor, MTR GAMING GROUP, INC., a Delaware
corporation, SPEAKEASY GAMING OF LAS VEGAS, INC., a Nevada corporation,
SPEAKEASY GAMING OF RENO, INC., a Nevada corporation, PRESQUE ISLE DOWNS, INC.,
a Pennsylvania corporation, and RACING ACQUISITION, INC., an Ohio corporation
(collectively referred to herein, together with any other person or entity
which hereafter becomes a Borrower under the Credit Agreement, as the
“Borrowers”), the Lenders therein named (each, together with any entity which
hereafter becomes a Lender under the Credit Agreement, being individually
referred to herein as a “Lender” and collectively referred to herein as the “Lenders”),
the Swingline Lender therein named (together with its successors and assigns,
referred to herein as the “Swingline Lender”), the L/C Issuer named therein
(together with its successors and assigns, referred to herein as the “L/C
Issuer”), and Wells Fargo Bank, National Association, as administrative and
collateral agent for the Lenders, the Swingline Lender and the L/C Issuer
(referred to herein, in such capacity, together with its successors and
assigns, as the “Agent Bank” and, together with the Lenders, the Swingline
Lender and the L/C Issuer, collectively referred to herein as the “Banks”),
excluding, however, any obligation which any of the Borrowers may have
thereunder to perform any obligations under the Environmental Certificate.

 

I.                                         Performance
and payment of every obligation, warranty, representation, covenant, agreement
and promise of Borrowers, or any of them, contained in, or established by, any
of the Loan Documents, which are defined in the Credit Agreement (other than
the Environmental Certificate).

 

The foregoing are collectively referred to
herein as the “Secured Obligations.” 
The Secured Obligations include, without limitation, the obligation to
repay advances under the Credit Facility, together with accrued interest
thereon, which advances may include, without limitation: (i) future
advances which are made subsequent to the date when this Deed of Trust is
recorded in the office of the Clerk of the County Commission of Hancock County,
West Virginia; and (ii) revolving credit advances which are made after the
credit amount being advanced has previously been borrowed or reborrowed and
thereafter repaid; all including, without limitation, advances which are made
when the principal balance of the Secured Obligations is zero ($0.00).  All such advances shall be secured to the
same extent, and with the same priority, as if they were each made on the date
hereof.  Interest accrues, as part of
the Secured Obligations, at interest rates which may vary from time to
time.    All persons who may have or
acquire an interest in all or any part of the Property will be considered to
have notice of, and will be bound by, the terms of the Secured Obligations and
each other agreement or instrument made or entered into in connection with each
of the Secured Obligations.  Grantor
expressly understands and agrees that this Deed of Trust secures future
advances or extensions of credit with interest thereon that the Secured Party

 

11

 

shall make to Grantor from time
to time.  All advances, whether made at
the time of recording hereof or to be made in the future, are secured by this
Deed of Trust as if made on the date of recording hereof.  However, the aggregate maximum principal
amount of the indebtedness secured hereunder at any one time outstanding shall
not exceed the sum of Fifty Million Dollars ($50,000,000.00).  THE FUTURE
ADVANCES TO BE SECURED BY THIS DEED OF TRUST ARE INTENDED TO BE OBLIGATORY FOR
PURPOSES OF WEST VIRGINIA CODE § 38-1-14 (a)(3).

 

AND THIS INDENTURE
FURTHER WITNESSETH:

 

1.                                       Certain
Representations and Warranties of Grantor. 
Grantor represents, warrants and covenants that:

 

(a)                                  This Deed of Trust
creates a first priority deed of trust lien and/or, to the extent applicable, a
first priority security interest on the Property, subject only to MPI Permitted
Encumbrances (as defined in the Credit Agreement); and

 

(b)                                 Neither Grantor, nor
any Affiliate of Grantor (as defined in the Credit Agreement), has any interest
in any real property, not encumbered hereby, which is utilized in any material
manner in connection with the use and/or operation of said Real Property or
which is necessary and required for the use and operation of said Real
Property.

 

2.                                       Payment of
Secured Obligations.  Grantor shall
pay, or cause to be paid, when due: (i) the principal of, and interest on,
the indebtedness evidenced by the Notes; (ii) all charges, fees and other
sums as provided in the Loan Documents (as defined in the Credit Agreement)
including, without limitation, all reasonable costs, fees and expenses of this
trust incurred by Secured Party in con­nection with any default hereunder or
under the Credit Agr­eement; (iii) the principal of, and interest on, any
future advances secured by this Deed of Trust; and (iv) the principal of,
and interest on, any other indebtedness secured by this Deed of Trust.

 

3.                                       Compliance
with Laws.  Grantor shall comply in
all material respects with all applicable material existing and future laws,
rules, regulations, orders, ordinances and requirements of all Governmental
Authorities (as defined in the Credit Agreement), and with all recorded
covenants and restrictions affecting the Real Property.

 

4.                                       Maintenance
of Property.  Except to the extent
that any of the following would be prohibited under, or would constitute a
violation of, the terms and conditions of the Credit Agreement, Grantor
agrees:  (a) to properly care for and
keep said Property in good condition and repair; (b) not to remove,
demolish or substantially alter any material building on the Real Property,
except upon the prior written consent of

 

12

 

Secured Party; (c) to complete
promptly and in a good and workmanlike manner any building or other improvement
which may be constructed thereon, and to pay when due all claims for labor
performed and materials furnished therefor (subject to Grantor’s right to
contest the validity or amount of mechanic’s and/or materialman’s liens in
accordance with Section 5.03 of the Credit Agreement); (d) not to commit
or permit any waste or deterioration of the Property (ordinary wear and tear,
casualty and condemnation excepted); (e) not to commit, suffer or permit any
act to be done, or condition to exist, in or upon said Property in material violation
of any law, covenant, condition or restriction now, or hereafter, affecting
said Property (including any which require alteration or improvement thereof);
(f) to keep and maintain all grounds, sidewalks, roads, parking and
landscaped areas situate on the Property in good and neat order and repair;
(g) not to drill or extract or enter into any lease for the drilling for
or extraction of oil, gas or other hydrocarbon substances or any mineral of any
kind or character on or from the Property or any part thereof; (h) not to
apply for, willingly suffer or permit any subdivision, change in zoning, change
in land use regulation, or inclusion within a general improvement district or
similar assessment mechanism, with regard to any portion of the Real Property
without the prior written consent of Secured Party; and (i) except as
otherwise permitted in the Credit Agreement, to do all other acts, in a timely
and proper manner, which, from the character or use of the Property, may be
reasonably necessary to maintain and preserve its value, the specific
enumerations herein not excluding the general.

 

5.                                       Insurance.  During the continuance of this trust,
Grantor shall obtain, or cause to be obtained, and shall maintain or cause to
be maintained, at all times throughout the terms of the Credit Facility, at its
own cost and expense, and shall deposit with Secured Party, Certificates of
Insurance, and/or such other documentation, all in a form and substance, and at
such times, as is required under Section 5.09 of the Credit
Agreement.  All monies received from
“All Risk” insurance policies (including flood and earthquake policies)
covering any of the Property shall be paid directly to Secured Party and:
(i) retained by Secured Party; or (ii) released to Grantor by Secured
Party; all in accordance with Section 8.02 of the Credit Agreement.  Nothing in this Deed of Trust shall be
deemed to excuse Grantor from restoring, repairing and maintaining the
Property, as herein provided, regardless of whether or not insurance proceeds
are available for restoration, whether or not any such proceeds are sufficient
in amount, or whether or not the Property can be restored to the same condition
and character as existed prior to such damage or destruction.

 

6.                                       Taxes and
Assessments.  Grantor shall pay all
taxes, assessments and other governmental charges or levies affecting said
Property, or any part thereof, in the manner required by the Credit Agreement
except such taxes, assessments and other governmental levies as are being
contested in good faith in the manner provided by Section 4.07 or
Section 5.10 of the Credit Agreement.

 

13

 

7.                                       Lien Claims.  If any mechanic’s lien or materialman’s lien
shall be recorded, filed or suffered to exist against the Property or any
interest therein by reason of any work, labor, services or materials supplied,
furnished or claimed to have been supplied and furnished in connection with any
work of improvement upon the Property, said lien or claim shall be paid,
released or otherwise discharged of record to the extent required by, and in
accordance with, Section 5.03 of the Credit Agreement.

 

8.                                       Easements.  If an easement or other incorporeal right
(collectively, an “Easement”) constitutes any portion of the Real Property,
Grantor shall not amend, change, terminate or modify such Easement, or any
right thereto or interest therein, without the prior written consent of Secured
Party, which consent may be withheld in Secured Party’s sole discretion, and
any such amendment, change, termination or modification without such prior
written consent shall be deemed void and of no force or effect.  Grantor agrees to perform all obligations
and agreements with respect to said Easement and shall not take any action or
omit to take any action, which would effect or permit the termination
thereof.  Upon receipt of notice, or
otherwise becoming aware, of any default or purported default under any
Easement, by any party thereto, Grantor shall promptly notify Secured Party in
writing of such default or purported default and shall deliver to Secured Party
copies of all notices, demands, complaints or other communications received or
given by Grantor with respect to any such default or purported default.

 

14

 

9.                                       Assignment of
Rents.

 

(a)                                  Grantor hereby
presently, absolutely and unconditionally assigns to Secured Party, which
assignment shall be effective without Secured Party having to first take
possession of the Property, all of Grantor’s interests in any and all present
and future Occupancy Agreements and Rents, reserving unto Grantor the right,
prior to the occurrence of any Event of Default (as defined in the Credit
Agreement), to collect and retain the Rents as they may become due and
payable.  Upon the occurrence of any
Event of Default as defined in the Credit Agreement, such license reserved to
Grantor shall be immediately revoked without further demand or notice, and any
Rents, including those past due, unpaid or undetermined, may be collected by
Secured Party or its agent.  In addition
to any other actions which may be taken by Secured Party to collect the Rents
in accordance herewith, Secured Party may, at any time, by a receiver to be
appointed by a court of competent jurisdiction in accordance with
subsection 19(b) below, enter upon and take possession of said Property,
or any part thereof, and exercise such rights and remedies as are provided by
subsections 19(b) and 19(c) below including, without limitation, suing for
or otherwise collecting the Rents (including those past due or unpaid).  All Rents collected hereunder, less costs
and expenses of operation and collection (including reasonable attorneys’
fees), shall be applied towards satisfaction of the Secured Obligations, in such
order as is required under the Credit Agreement.  The collection of such Rents, and the application thereof as
aforesaid, shall not cure or constitute a waiver of any default or notice of
default hereunder or invalidate any act done pursuant to such notice.  Grantor and Secured Party intend that this
assignment shall be a present, absolute and unconditional assignment, not an
assignment for additional security only, and shall, immediately upon the
execution hereof, subject to the license granted above, give Secured Party, and
its agent, the right to collect the Rents and to apply them as aforesaid.  Nothing contained herein, nor any collection
of Rents by Secured Party, or its agent or a receiver, shall be construed to
make Secured Party:  (i) a “Mortgagee-in-Possession”
of the Property so long as Secured Party has not itself entered into actual
possession of the Property; (ii) responsible for performing any of the
obligations of the lessor under any Occupancy Agreement; (iii) responsible
for any waste committed by lessees or any other parties, any dangerous or
defective condition of the Property, or any negligence in the management,
upkeep, repair or control of the Property; or (iv) liable in any manner
for the Property or the use, occupancy, enjoyment or operation of all or any
part of it (provided that this clause (iv) shall not act to relieve
Secured Party from liability resulting from the gross negligence or willful
misconduct of Secured Party).

 

(b)                                 Grantor hereby
represents that there are no assignments or pledges of any leases of, or
rentals or income from, said Property now in effect and covenants that, until
Credit Facility Termination (as defined in the Credit Agreement), it will not
make any such assign­ment or pledge to anyone other than Secured Party.

 

15

 

10.                                 Performance by
Trustee or Secured Party.  Should
Grantor fail to make any payment or perform any act which it is obligated to
make or perform hereunder or under the Credit Agreement, then the Trustee, or
Secured Party, at the election of either of them, without giving notice to
Grantor, or any successor in interest of Grantor, and without releasing Grantor
from any obliga­tion hereunder, may make such payment or perform such act and
incur any liability, or expend whatever amounts, in its discretion, it may deem
necessary therefor.  All sums incurred
or expended by the Trustee, or Secured Party, under the terms of this Section,
shall become due and payable by Grantor to the Secured Party, on the next
interest or installment payment date under any of the promissory notes secured
hereby and shall bear interest until paid at an annual percentage rate equal to
the Default Rate expressed in the Credit Agreement.  In no event shall such payment or performance of any such act by
Trustee or Secured Party be construed as a waiver of the default occasioned by
Grantor’s failure to make such payment(s) or perform such act(s).

 

11.                                 Actions Affecting
Property.  Grantor promises and
agrees that if, during the existence of this trust, there shall be commenced or
pending any suit or action affecting said Property, or any part thereof, or the
title thereto, or if any adverse claim for or against said Property, or any
part thereof, be made or asserted, it will appear in and defend any such matter
purporting to affect the security of this Deed of Trust and will pay all costs
and damages arising because of such action.

 

12.                                 Eminent Domain.  Any award of damages in connection with any
condemnation or similar actions in regard to said Property, or any part
thereof, shall be paid directly to Secured Party and shall be:
(i) retained by Secured Party; or (ii) released to Grantor by
Secured Party; all in accordance with Section 8.02 of the Credit Agreement.

 

13.                                 Subrogation.  To the extent that any sums advanced by
Secured Party are used to pay any outstanding lien, charge or prior encumbrance
against the Property, such sums shall be deemed to have been advanced by
Secured Party at the  request of Grantor
and Secured Party shall be subrogated to any and all rights and liens held by
any owner or holder of such outstanding liens, charges and prior encumbrances,
regardless of whether said liens, charges or encumbrances are released.

 

14.                                 Due on Sale.  If Grantor shall be voluntarily, or
involuntarily, divested of title or possession of any Property, by merger or
otherwise, or shall lease, sell, convey, further encumber or in any other
manner voluntarily or involuntarily alienate any of its interest in any of the
Property, or shall enter into an agreement to do any of the foregoing, other
than as permitted in the Credit Agreement, any indebtedness

 

16

 

or obligation secured hereby,
irrespective of the maturity dates expressed in any notes evidencing the same,
shall at the option of Secured Party, and upon the giving of any notice which
may be required under the Credit Agreement, immediately become due and payable.

 

15.                                 Partial or Late
Payment.  By accepting payment of
any sum secured hereby after its due date, Secured Party does not waive its
right either to require prompt payment, when due, of all other sums so secured
or to declare default, as herein provided, for failure to so pay.

 

16.                                 Certain Acts by
Trustee or Secured Party.  At any
time, and from time to time, without liability therefor and without notice to
Grantor, upon written request of Secured Party and, if required by Trustee,
upon presentation of this Deed of Trust and the Notes secured hereby for
endorsement, and without affecting the effect of this Deed of Trust upon the
remainder of said Property, Trustee may: 
reconvey to Grantor any part of said Property; consent in writing to the
making of any map or plat thereof; join in granting any easement thereon, or
join in any extension agreement or subordination agreement in connection
herewith.  The Secured Party may without
notice to or consent of Grantor extend the time of the payment of any
indebtedness secured hereby to any successors in interest of Grantor without
discharging Grantor from liability thereon.

 

17.                                 Release.  Upon payment in full of the Secured
Obligations and all other then accrued indebtedness and performance in full of
all obligations hereunder, Secured Party, at Grantor’s expense, shall release
the liens and security interests created by this Deed of Trust.

 

18.                                 Right of Secured
Party and Trustee to Appear.  If,
during the existence of the trust, there be commenced or pending any suit or
action affecting the Property, or any part thereof, or the title thereto, or if
any adverse claim for or against the Property, or any part thereof, be made or
asserted, the Trustee or Secured Party (unless such suit, action or claim is
being contested in good faith by Grantor and Grantor shall have established and
maintained adequate reserves in accordance with generally accepted accounting
principles for the full payment and satisfaction of such suit or action if
determined adversely to Grantor), may appear or intervene in the suit or action
and retain counsel therein and defend same, or otherwise take such action
therein as they may be advised, and may settle or compromise same or the
adverse claim; and in that behalf and for any of the purposes may pay and
expend such sums of money as the Trustee or Secured Party may deem to be
necessary and Grantor shall reimburse Trustee, or Secured Party, as the case
may be, for such sums expended,

 

17

 

together with accrued interest
thereon, at the Default Rate which is defined in the Credit Agreement.

 

19.                                 Remedies.  Upon, and at any time subsequent to, the
occurrence of an Event of Default, as defined in the Credit Agreement, Secured
Party and/or Trustee will be entitled to invoke any and all of the following
rights and remedies, all of which will be cumulative, it being provided that
exercise of any one or more of such rights and remedies shall not constitute an
election of remedies:

 

(a)                              With respect to any Event
of Default as defined in any of subsections 7.01(a) through (f) or (j)
through (v) of the Credit Agreement, all sums secured hereby shall, at the
option of Secured Party, and upon the giving of notice required by the Credit
Agreement, if any, become immediately due and payable.  With respect to any Event of Default as
defined in any of subsections 7.01(g), (h) or (i) of the Credit Agreement,
all sums secured hereby shall automatically become due and payable without
notice and without any action on the part of Secured Party.

 

(b)                             Secured Party and/or
Trustee may apply to any court of competent jurisdiction, by ex parte
application or otherwise, for, and obtain appointment of, a receiver for the
Property or any part thereof, without notice to Grantor or anyone claiming
under Grantor, as a matter of absolute right, and without regard to the then
value of the Property, the adequacy of any security for the obligations secured
hereby or the solvency of any person or entity liable therefor, and Grantor
hereby irrevocably consents to such appointment and waives notice of any
application therefor.  Any such receiver
or receivers shall have all the usual powers of receivers in like or similar
cases and all the powers of Secured Party in case of entry as provided by
subsection (c) below and as provided in the Credit Agreement and shall
continue as such and exercise all such powers until the termination of such
receivership with the consent of Secured Party or pursuant to an order of a
court of competent jurisdiction.  All
expenses incurred by the receiver or his agents, including obligations to repay
funds borrowed by the receiver, shall constitute a part of the obligations
secured hereby.  Any revenues collected
by the receiver shall be applied first to the expenses of the receivership,
including attorneys’ fees incurred by the receiver and by Secured Party,
together with interest thereon at the Default Rate (as defined the Credit
Agreement) from the date incurred until repaid, and the balance shall be
applied toward the obligations secured hereby or in such other manner as the
court may direct.  Secured Party may
also request, in connection with any foreclosure proceeding hereunder, that the
West Virginia State Lottery Commission and/or the West Virginia Racing
Commission, to the extent permissible by law, petition the Circuit Court of the
applicable County of West Virginia for the appointment of a supervisor to
conduct the normal racetrack, video lottery and related activities on the
Property following such foreclosure proceeding.

 

18

 

(c)                                  Secured Party, in
person, by agent or by court appointed receiver, under subsection (b)
above, may enter, take possession of, manage and operate all or any part of the
Property, subject to applicable laws, and may also do any and all other things
in connection with those actions that Secured Party may, in its sole
discretion, consider necessary and appropriate to protect the security of this
Deed of Trust; all with or without process of law, and without liability to
Grantor or to any other owner or owners of the Property.  Such other things may include, among other
things, any of the following:  taking
and possessing all of Grantor’s or the then owner’s books and records with
respect to the Property; obtaining and evicting tenants in accordance with any
applicable leases; fixing or modifying rents in accordance with any applicable
leases; collecting and receiving any payment of money owing to Grantor with
respect to the Property; completing construction; and contracting for and
making repairs and alterations.  If Secured
Party so requests, Grantor shall assemble all of the Property that has been
removed from the Real Property in violation of any of the Loan Documents (as
defined in the Credit Agreement) and make all of it available to Secured Party
at the site of the Real Property. 
Grantor hereby irrevocably constitutes and appoints Secured Party (or,
if applicable, Secured Party’s receiver) as Grantor’s attorney-in-fact to
perform such acts and execute such documents as Secured Party in its sole
discretion may consider to be appropriate in connection with taking these
measures.  All expenses incurred by
Secured Party or its agents under this subsection 19(c) shall constitute a
part of the obligations secured hereby. 
Any revenues collected by Secured Party shall be applied first to the
expenses so incurred (including attorneys’ fees) together with interest thereon
at the Default Rate (as defined the Credit Agreement) from the date incurred
until repaid, and the balance shall be applied toward the obligations secured hereby
or in such other manner as the court may direct.  Regardless of any provision of this Deed of Trust, or the Credit
Agreement, Secured Party shall not be considered to have accepted any personal
property (other than cash or immediately available funds which have been
actually, and indefeasibly, delivered to Secured Party and are not held in the
hands of a receiver or other third party) in satisfaction of any obligation of
Grantor to Secured Party, unless Secured Party has given express written notice
of Secured Party’s election of that remedy in accordance with the Commercial
Code.  Any person, or persons in
possession of all or any part of the Property upon exercise of any remedies
under this subsection 19(c) shall be deemed a tenant at will and shall at
once surrender such possession on demand of Secured Party, the Trustee, a
receiver, or the agent of any of them.

 

(d)                                 At any time after the
exercise by Secured Party of the option to declare the sums secured hereby
immediately due and payable (or at any time after the sums secured hereby have
automatically become due and payable), Trustee, upon the written request of
Secured Party, shall foreclose upon and sell the Property, in whole or in part,
to satisfy the Secured Obligations at public auction at the front door of the
courthouse of Hancock County, West Virginia, in the City of New Cumberland, for
cash in hand on the day of sale, or upon such other terms as Secured Party may
designate and direct to Trustee, after first giving notice of such sale by publishing
such

 

19

 

notice in a newspaper of
general circulation published in the county wherein the Property is located, or
if there be no such newspaper, in a qualified newspaper of general circulation
in said county, once a week for two successive weeks preceding the day of sale
and after giving notice by certified mail, return receipt requested, to Grantor
and to any subordinate lienholder who has previously notified Secured Party of
the existence of a subordinate lien at least twenty (20) days prior to the
sale, and no other notice of such sale shall be required.  Out of the proceeds of such sale Trustee
shall pay, first, the costs and expenses of executing this trust, together with
a commission as provided by law to Trustee, or to the one so acting; second, to
Secured Party and Trustee all moneys which they or either of them may have paid
for taxes, assessments or other governmental charges or fees, insurance,
repairs, court costs, and all other costs and expenses incurred or paid under
the provisions of this Deed of Trust, together with interest thereon at the
rate provided in the Note from the date of payment; third, to Secured Party the
full amount due and unpaid on the Secured Obligations and all other indebtedness
hereby secured, together with all interest accrued thereon to date of payment;
and fourth, the balance, if any, to Grantor, its successors or assigns, upon
delivery of and surrender to the purchaser or purchasers of possession of the
Property less the expense, if any, of obtaining such possession.  The parties hereto agree that any sale
hereunder may be adjourned, from time to time, without notice other than oral
proclamation of such adjournment at the time and place of sale, or at the time
and place of any adjourned sale.

 

(e)                                  The rights and
remedies of Secured Party upon the occurrence of one or more Events of Default
as defined in the Credit Agreement (whether such rights and remedies are
conferred by statute, by rule of law, by this Deed of Trust, by any Loan
Document, as defined in the Credit Agreement, or otherwise) may be exercised by
Secured Party, in the sole discretion of Secured Party, either alternatively,
concur­rently, or consecutively in any order. 
The exercise by Secured Party or Trustee at the express direction of
Secured Party, of any one or more of such rights and remedies shall not be
construed to be an election of remedies nor a waiver of any other rights and
remedies Secured Party might have unless, and limited to the extent that,
Secured Party shall so elect or so waive by an instrument in writing delivered
to Trustee.  Without limiting the
generality of the foregoing, to the extent that this Deed of Trust covers both
Real Property and Personal Property, Secured Party may, in the sole discretion
of Secured Party, either alternatively, concurrently, or consecu­tively in any
order:

 

(i) proceed as to both the Real Property and
Personal Property in accordance with Secured Party’s rights and remedies in
respect of the Real Property; or

 

(ii) proceed as to the Real Property in
accordance with Secured Party’s rights and remedies in respect of the Real
Property and proceed as to

 

20

 

the Personal Property in
accordance with Secured Party’s rights and remedies in respect of the Personal
Property.

 

If Secured Party should elect to proceed as
to both the Real Property and Personal Property collateral in accordance with
Secured Party’s rights and remedies in respect to the Real Property:

 

(i) all, or any portion of, the Real Property
and all, or any portion of, the Personal Property may be sold, in the manner
and at the time(s) and place(s) provided in this Deed of Trust, in one lot, or
in separate lots consisting of any combination or combinations of Real Property
and Personal Property, as the Secured Party may elect, in the sole discretion
of Secured Party.

 

(ii) Grantor acknowledges and agrees that a
disposition of the Personal Property collateral in accordance with Secured
Party’s rights and remedies in respect of Real Property, as hereinabove
provided, is a commercially reasonable disposition of said collateral.

 

If Secured Party should elect to proceed as
to the Personal Property collateral in accordance with Secured Party’s rights
and remedies with respect to personal property, Secured Party shall have all
the rights and remedies conferred on a secured party by the Uniform Commercial
Code-Secured Transactions (NRS 104.9101 et seq.; as amended and recodified from
time to time).  Secured Party may, in
the sole discretion of Secured Party, appoint Trustee as the agent of Secured
Party for the purpose of disposition of the Personal Property in accordance
with the Uniform Commercial Code-Secured Transactions.

 

(f)                                    Every right, power
and remedy granted to Trustee or Secured Party in this Deed of Trust shall be
cumulative and not exclusive, and in addition to all rights, powers and
remedies granted at law or in equity or by statute, and each such right, power
and remedy may be exercised from time to time and as often and in such order as
may be deemed expedient by Trustee or Secured Party, and the exercise of any
such right, power or remedy shall not be deemed a waiver of the right to
exercise, at the time or thereafter, any other right, power or remedy.  In the event foreclosure proceedings are
instituted under the terms and provisions of this Deed of Trust, but are not
completed, the Trustee shall be entitled to charge and collect the necessary
costs and expenses incurred by it.

 

20.                                 Substitution of
Trustee.  The parties hereto agree
that Secured Party may, at any time and from time to time hereafter, without
notice, appoint and substitute another Trustee or Trustees, corporations or
persons, in place of the Trustee herein named to execute this Trust.  Upon such appointment, either with or
without a conveyance to the substituted Trustee or Trustees by the Trustee
herein named, or by any substituted Trustee in case the right of appointment is
exercised more than once,

 

21

 

the new and substituted Trustee
or Trustees in each instance shall be vested with all the rights, titles,
interests, powers, duties and trusts in the premises which are vested in and
conferred upon the Trustee herein named; and such new and substituted Trustee
or Trustees shall be considered the successors and assigns of the Trustee who
is named herein within the meaning of this Deed of Trust, and substituted in
his place and stead.  Each such appointment
and substitution shall be evidenced by an instrument in writing which shall
recite the parties to, and the book and page of record of this Deed of Trust,
and be executed and acknowledged by Secured Party, and, upon recordation in the
office of the Clerk of the County Commission of Hancock County, West Virginia,
shall be conclusive proof of the proper substitution and appointment of such
successor Trustee or Trustees, and notice of such proper substitution and
appointment to all parties in interest. 
In the event two or more Trustees are named herein, or in the event two
or more substitute Trustees are appointed under the provisions of this
Section 20, any one or more of such Trustees or substitute Trustees may
act in the execution of this trust with the full power and authority granted
hereunder.  The Trustee herein may act
by agent or attorney in the execution of this Trust and it shall not be
necessary for the Trustee to be present in person at any foreclosure sale
conducted hereunder.

 

21.                                 Binding Nature.  This Deed of Trust applies to, inures to the
benefit of, and binds all parties hereto, their heirs, legatees, devisees,
administrators, executors, successors, and assigns.  It is expressly agreed that the Trust created hereby is
irrevocable by Grantor.  If there is
more than one Grantor hereunder, the obligations of said Grantors hereunder
shall be joint and several.

 

22.                                 Acceptance of
Trust; Recognition by Trustee. 
Trustee accepts this trust when this Deed of Trust, duly executed and
acknowledged, is made a public record as provided by law, reserving, however,
unto the Trustee, the right to resign from the duties and obligations imposed
herein whenever Trustee, in its sole discretion, deems such resignation to be
in the best interest of the Trustee. 
Written notice of such resignation shall be given to Grantor and Secured
Party.

 

23.                                 Waiver of Certain
Rights by Grantor.  Grantor waives,
to the fullest extent permitted by law: 
(i) all rights to direct the order in which any of the Property
shall be sold in the event of any sale or sales pursuant hereto; and
(ii) the rights to have any of the Property or any other property now or
hereafter constituting security for the indebtedness secured hereby marshaled
upon any foreclosure of this Deed of Trust or of any other security for any such
indebtedness.

 

24.                                 Attorney-in-Fact.  Upon the occurrence of an Event of Default
as defined in Section 7.01 of the Credit Agreement, Grantor shall be
deemed to have appointed and does hereby appoint Secured Party the
attorney-in-fact of Grantor to:  

 

22

 

(i) prepare, sign, file
and/or record one or more financing statements, any documents of title or regis­tration,
or any similar papers; and (ii) take any other action(s) deemed necessary,
useful or desirable by Secured Party to perfect and preserve the lien and/or
security interest of this Deed of Trust against the rights or interests of
third persons.

 

25.                                 Environmental
Indemnity.

 

(a)                                  Grantor agrees to
indemnify, protect, defend and save harmless Secured Party and each of the
Banks, as well as their respective, trustees, officers, employees, agents,
attorneys and shareholders (individually, an “Indemnified Party” and
collectively, the “Indemnified Parties”) from and against any and all losses,
damages, expenses or liabilities, of any kind or nature from any
investigations, suits, claims or demands, including reasonable counsel fees
incurred in investigating or defending such claim, suffered by any of them and
caused by, relating to, arising out of, resulting from or in any way connected
with:  (a) the presence in, on or under
the Property of any Hazardous Materials, referred to below, or any releases or
discharges of any Hazardous Materials on, under or from the Property; (b) any
violation of Hazardous Materials Laws, as also referred to below; or
(c) any activity carried on or undertaken on or off the Property, whether
prior to or during the term of the Credit Facility, and whether by Grantor or
any predecessor in title or any employees, agents, contractors or subcontractors
of Grantor or any predecessor in title, or any third persons at any time
occupying or present on the Property, in connection with the handling,
treatment, removal, storage, decontamination, clean-up, transport or disposal
of any Hazardous Materials at any time located or present on or under the
Property.  The foregoing indemnity shall
further apply to any residual contamination on or under the Property, or
affecting any natural resources, and to any contamination of any property or
natural resources, arising in connection with the generation, use, handling,
storage, transport or disposal of any such Hazardous Materials, and
irrespective of whether any of such activities were or will be undertaken in
accordance with applicable laws, regulations, codes and ordinances.  It is provided, however, that Grantor shall
not be obligated to indemnify, protect, defend or save harmless an Indemnified
Party if, and to the extent that, any such loss, damage, expense or liability
was caused by:  (i) the gross negligence
or intentional misconduct of such Indemnified Party; or (ii) the breach of
this Deed of Trust, the Credit Agreement or any other Loan Document by such
Indemnified Party or the breach of any laws, rules or regulations by such
Indemnified Party (other than those breaches arising from Grantor’s
default).  Grantor hereby acknowledges
and agrees that, notwithstanding any other provision of this Deed of Trust or
any of the other Loan Documents to the contrary, the obligations of Grantor
under this Section 25 shall be unlimited personal obligations of Grantor
and shall survive any foreclosure under this Deed of Trust, any transfer in
lieu thereof, any reconveyance of this Deed of Trust and any satisfaction of
the obligations which are secured hereby. 
Grantor acknowledges that Secured Party’s appraisal of the Property is
such that Secured Party would not extend the Credit Facility but for the
personal liability undertaken by Grantor for the

 

23

 

obligations under this
Section 25.  Grantor and Secured
Party agree that any obligations of Grantor under this Section 25 which
may also be obligations of Grantor under the Environmental Certificate (which
is referred to below) shall be deemed to arise solely under this
Section 25 and not under the Environmental Certificate.  The obligations of Grantor under this
Section 25 are separate from and in addition to the obligations to pay the
indebtedness evidenced by the Notes, the obligations under the Credit Agreement
and the other obligations secured by, or imposed under, this Deed of
Trust.  The liability of Grantor under
this Section 25 shall not be limited to or measured by the amount of the
indebtedness secured hereby or the value of the Property.  Grantor shall be fully and personally liable
for all obligations of Grantor under this Section 25 and a separate action
may be brought and prosecuted against Grantor under this Section 25.  Grantor waives the right to assert any
statute of limitations as a bar to the enforcement of this Section 25 or
to any action brought to enforce this Section 25.  This Section 25 shall not affect,
impair or waive any rights or remedies of Secured Party or any obligations of
Grantor with respect to Hazardous Materials created or imposed by Hazardous
Materials Laws (including Secured Party’s rights of reimbursement or
contribution under Hazardous Materials Laws). 
The remedies under this Section 25 are cumulative and in addition
to all remedies provided by law.

 

(b)                                 In case any action
shall be brought against any Indemnified Party based upon any of the above and
in respect to which indemnity may be sought against Grantor, Secured Party
shall promptly notify Grantor in writing, and Grantor shall assume the defense
thereof, including the employment of counsel selected by Grantor and reasonably
satisfactory to the Indemnified Party, the payment of all costs and expenses
and the right to negotiate and consent to settlement upon the consent of the
Indemnified Party.  Upon reasonable
determination made by an Indemnified Party that such counsel would have a
conflict representing such Indemnified Party and Grantor, the applicable
Indemnified Party shall have the right to employ, at the expense of Grantor,
separate counsel in any such action and to participate in the defense
thereof.  Grantor shall not be liable
for any settlement of any such action effected without its consent, but if
settled with Grantor’s consent, or if there be a final judgment for the
claimant in any such action, Grantor agrees to indemnify, defend and save
harmless such Indemnified Parties from and against any loss or liability by
reason of such settlement or judgment.

 

(c)                                  As used herein, the
term “Hazardous Materials Laws” shall mean any and all state, federal and local
statutes, regulations, ordinances, plans, policies or decrees and the like
relating to:  (i) environmental
matters, including, without limitation, those relating to fines, injunctions,
penalties, damages, contribution, cost recovery compensation, losses or
injuries resulting from the release or threatened release of Hazardous
Materials; (ii) the generation, use, storage, transportation, disposal or
release of Hazardous Materials; or (iii) occupational safety and health,
industrial hygiene; in any manner applicable to Grantor or to any of the
Property; all including, without limitation, the Federal Water Pollution
Control Act (33 U.S.C. Section 1251, et seq.),

 

24

 

the Resource Conservation and
Recovery Act (42 U.S.C. Section 6901, et seq.), the Superfund Amendments and
Reauthorization Act of 1986 (Pub.L. No. 99-499), the Comprehensive
Environmental Response, Compensation, and Liability Act (42 U.S.C. Section 9601
et seq.), the Toxic Substances Control Act (15 U.S.C. Section 2601, et seq.),
the Hazardous Materials Transportation Act (49 U.S.C.§ 1801, et seq.), the
Clean Air Act (42 U.S.C. § 7401, et seq.), the Occupational Safety and
Health Act (29 U.S.C. § 651, et seq.), the Emergency Planning and
Community Right-to-Know Act (42 U.S.C. § 11001, et seq.), the Federal
Insecticide, Fungicide and Rodenticide Act (7 U.S.C. § 136 et seq.),
NRS 618.750 through NRS 618.850, the Surface Mining Control and
Reclamation Act of 1977, the West Virginia Water Pollution Control Act, the West
Virginia Hazardous Waste Management Act, the West Virginia Solid Waste
Management Act, the West Virginia Underground Storage Tank Act, the West
Virginia Groundwater Protection Act, the West Virginia Air Pollution Control
Act, the West Virginia Surface Coal Mining and Reclamation Act, the Uniform
Fire Code (1988 Edition), the United States Environmental Protection Agency’s
rules concerning underground storage tanks, and any and all federal or state
rules promulgated from time to time under the above, and any other
environmental laws administered by the Environmental Protection Agency or
similar laws and regulations of the State of West Virginia or any other
governmental organization or agency having jurisdiction over any of the
Property; all as recodified, amended or supplemented, and any analogous future
or present local, state and federal statutes and regulations promulgated
pursuant thereto, each as in effect as of the date of determination.

 

(d)                                 As
used herein, the term “Hazardous Material” or “Hazardous Materials” shall mean
(a) any chemical, material or substance at any time defined as or included
in the definition of “hazardous substances”, “hazardous wastes”, “hazardous
materials”, “extremely hazardous waste”, “restricted hazardous waste”, “infectious
waste”, “toxic substances” or any other formulations intended to define, list
or classify substances by reason of deleterious properties such as
ignitability, corrosivity, reactivity, carcinogenicity, toxicity, reproduction
toxicity, “TCLP toxicity” or “EP toxicity” or words of similar import
under any applicable Hazardous Materials Laws or publications promulgated
pursuant thereto; (b) any petroleum, including crude oil and any fraction
thereof, petroleum derived substances, any drilling fluids, produced waters and
other wastes associated with the exploration, development or production of
crude oil, natural gas or geothermal resources, any flammable substances or
explosives, any radioactive materials; (c) asbestos in any regulated form,
urea formaldehyde foam insulation, electrical equipment which contains any oil
or dielectric fluid containing levels of polychlorinated biphenyls in excess of
fifty parts per million; (d) any pesticides; and (e) any other
chemical, material or substance, exposure to which is prohibited, limited or
regulated by any governmental authority under any Hazardous Material Law or
which could reasonably be expected to pose a hazard to the health and safety of
the owners, occupants, or any persons in the vicinity of, the Real Property.

 

25

 

(e)                                  Notwithstanding
anything in this Section 25 to the contrary, the indemnity provided herein
shall not extend to any Environmental Event (as defined below) which occurs
subsequent to the Title Divestment Date (as also defined below).  As used herein “Environmental Event” shall
mean an occurrence of any of the following: (i) a release of Hazardous
Materials onto, under or from the Real Property; or (ii) any activity
undertaken at the Real Property in violation of any Hazardous Materials
Law.  As used herein “Title Divestment
Date” shall mean the date when: (i) a consummated foreclosure has occurred
(or a deed in lieu of such foreclosure has been recorded) under this Deed of
Trust which indefeasibly divests Grantor of any interest which it may have in
the Real Property; and (ii) Grantor has indefeasibly delivered possession and
control of the Real Property to the person or entity in which the Real Property
title has vested.  For the purposes of
this Section 25, all Environmental Events shall be rebuttably presumed to have
occurred prior to the Title Divestment Date, which presumption may only be
rebutted by clear and convincing evidence.

 

26.                                 Governing Law.  This Deed of Trust shall, in all respects,
be governed by and construed in accordance with the internal laws of the State
of Nevada without regard to principles of conflicts of law; provided, however,
that with respect to the perfection and enforcement of the liens and interests
granted herein and the foreclosure and receivership remedies herein, this Deed
of Trust shall be governed by the laws of the State of West Virginia.  To the extent that this Deed of Trust is
governed and construed in accordance with the laws of the State of Nevada, all
references herein to the “Commercial Code” shall be to the Uniform Commercial
Code as enacted in the State of Nevada. 
To the extent that this Deed of Trust is governed in accordance with the
laws of the State of West Virginia, all references herein to the “Commercial
Code” shall be to the Uniform Commercial Code as enacted in the State of West
Virginia.

 

27.                                 Notice.  A copy of any notice of Trustee’s sale under
this Deed of Trust shall be served on Grantor by certified mail, return receipt
requested, directed to Grantor at the address stated below or such other
address given to Secured Party in writing by Grantor, subsequent to the
execution and delivery of this Deed of Trust. 
Any other notice shall be effective upon the deposit of such notice, in
writing, in the regular United States mail, postage prepaid, addressed to the
party or parties who receive such notice at the following addresses or at such
other addresses any such party may give to the other parties in writing:

 

	
  To Grantor:

  	
   

  
	
   

  	
  Mountaineer
  Park, Inc.

  
	
   

  	
  State Route
  2 South, P.O. Box 356

  
	
   

  	
  Chester,
  WV  26034

  
	
   

  	
  Attn:  Edson R. Arneault

  

 

26

 

	
  With a copy to:

  	
   

  
	
   

  	
  Robert L. Ruben, Esq.

  
	
   

  	
  Ruben & Aronson, LLP

  
	
   

  	
  3299 “K” Street, N.W., Suite 403

  
	
   

  	
  Washington, DC  20007

  
	
   

  	
   

  
	
  To Secured Party:

  	
   

  
	
   

  	
  Wells Fargo
  Bank, National Association

  
	
   

  	
  3800 Howard
  Hughes Parkway

  
	
   

  	
  Las Vegas,
  NV  89109

  
	
   

  	
  Attn:  Virginia S. Christenson, V.P.

  
	
   

  	
   

  
	
  To Trustee:

  	
   

  
	
   

  	
  Joyce F. Ofsa and G. Thomas Battle

  
	
   

  	
  Spilman, Thomas & Battle, PLLC

  
	
   

  	
  P.O. Box 273

  
	
   

  	
  Charleston, WV  25321

  

 

28.                                 Uniform Commercial
Code.

 

(a)                                  Fixture Filing.  Inasmuch as Grantor and Secured Party intend
that this Deed of Trust shall, among other things, constitute a fixture filing
financing statement, the undersigned sets forth the following:

 

(i)                                     The debtor is the
Grantor, Mountaineer Park, Inc., a West Virginia corporation, and its address
is set forth in Paragraph 27 above.  The
Grantor’s Federal Tax Identification Number is 
550672058.

 

(ii)                                  The secured party is
the Secured Party, Wells Fargo Bank, National Association, Agent Bank and its
address is set forth in Paragraph 27 above.

 

(iii)                               The real estate
concerned is described in Exhibit A and the record owner thereof is the
Grantor.

 

(iv)                              THE SECURED PARTY DESIRES
THIS FINANCING STATEMENT TO BE INDEXED AGAINST THE RECORD OWNER OF THE
PROPERTY.

 

(v)                                 Notices of other liens
which may be given in accordance with West Virginia Code Section 38-1-14
may be sent to Secured Party at the address stated above and shall be effective
upon receipt.

 

27

 

(b)                                 Remedies in Respect
of Personal Property.  Upon the
occurrence and during the continuance of an Event of Default, as defined in the
Credit Agreement:

 

(i)                                     Secured Party may
exercise in respect of the Personal Property, in addition to other rights and
remedies provided for herein or otherwise available to it, all the rights and
remedies of a secured party after default under Article 9 of the
Commercial Code (whether or not Article 9 of the Commercial Code applies
to the affected Personal Property). 
Secured Party may also: (aa) require Grantor to, and Grantor hereby
agrees that it will, at its expense and at the request of Secured Party upon
reasonable notice, assemble all or part of its Personal Property as directed by
Secured Party and make it available to Secured Party at a place to be
designated by Secured Party which is reasonably convenient to both parties; and
(bb) without notice except as specified below, sell the Personal Property
or any part thereof in one or more parcels at public or private sale, at any of
Secured Party’s offices or elsewhere, for cash, on credit or for future
delivery, and upon such other terms as Secured Party may deem to be
commercially reasonable.  Grantor agrees
that, to the extent notice of sale shall be required by law, at least ten (10)
days’ prior notice to Grantor of the time and place of any public sale or the
time after which any private sale is to be made shall constitute reasonable
notification.  Secured Party shall not
be obligated to make any sale of Personal Property regardless of notice of sale
having been given.  Secured Party may
adjourn any public or private sale from time to time by announcement at the
time and place fixed therefor, and such sale may, without further notice, be
made at the time and place to which it was so adjourned;

 

(ii)                                  Upon any sale of the
Personal Property (whether public or private) by Secured Party, Secured Party
shall have the right to deliver, assign and transfer to the purchaser thereof
the Personal Property so sold.  Each
purchaser (including Secured Party and the other Banks) at any such sale shall
hold the Personal Property so sold free from any claim or right of whatever
kind, including any equity or right of redemption of Grantor, and Grantor, to
the extent permitted by law, hereby specifically waives all rights of
redemption under the Commercial Code, and any right to a judicial or other stay
or approval which it has or may have under any law now existing or hereafter adopted;

 

(iii)                               Secured Party shall have
the right and power to institute and maintain such suits and proceedings as it
may deem appropriate to protect and enforce the rights vested in it by this
Deed of Trust and may proceed by suit or suits at law or in equity to enforce
such

 

28

 

rights and to foreclose upon and sell the
Personal Property or any part thereof pursuant to the judgment or decree of a
court of competent jurisdiction;

 

(iv)                              To the extent permitted by
law and without regard to the solvency or insolvency at the time of any Person
then liable for the payment of any of the Secured Obligations or the then value
of the Personal Property, and without requiring any bond from any party to such
proceedings, be entitled to request the appointment of a special receiver or
receivers (who may be Secured Party or any other Bank) for the Personal
Property or any part thereof and for the rents, issues, tolls, profits,
royalties, revenues and other income therefrom, which receiver shall have such
powers as the court making such appointment shall confer, and to request the
entry of an order directing that the rents, issues, tolls, profits, royalties,
revenues and other income of the property constituting the whole or any part of
the Personal Property be segregated, sequestered and impounded for the benefit
of Secured Party and the other Banks; and

 

(v)                                 No remedy conferred
upon or reserved to Secured Party in this Deed of Trust is intended to be
exclusive of any other remedy or remedies, but every such remedy shall be
cumulative and shall be in addition to every other remedy conferred herein or
now or hereafter existing at law, in equity or by statute.

 

(c)                                  Further Assurances.  Grantor agrees that, in addition to all
other obligations of further assurance which Grantor may have hereunder, it
shall file such financing statements, execute such amendments to this Deed of
Trust, obtain such agreements and documents from third parties, and take such
other actions as may be necessary or desirable under Revised Article 9, or
that Secured Party may reasonably request in accordance with Revised
Article 9, in order to: (i) provide for perfection, preservation and
protection of the security interests granted or intended to be granted hereunder;
and (ii) enable Secured Party to exercise and enforce its rights and remedies
hereunder with respect to any Property.

 

29.                                 Principal Place of
Business.  Grantor’s principal place
of business is in Hancock County in the State of West Virginia.   Grantor does not do business under any
trade name except as previously disclosed in writing to Secured Party.  Grantor will immediately notify Secured
Party in writing of any change in its place of business or the adoption or
change of any trade name or fictitious business name by it, and will upon
request of Secured Party, execute any additional financing statements or other
certificates necessary to reflect any such adoption or change in trade name or
fictitious business name.

 

29

 

30.                                 Credit Agreement.  This Deed of Trust has been executed
pursuant to and is subject to the terms of the Credit Agreement executed
concurrently, or substantially concurrent, herewith, and is one of the Loan
Documents referred to therein.  Grantor
agrees to observe and perform all provisions contained in the Credit Agreement
and in the other Loan Documents.  Except
as otherwise provided herein, any consent, notice or other communication which
is required or permitted hereunder shall be in writing and shall be delivered
in the matter which is set forth by Section 10.03 of the Credit Agreement.

 

31.                                 Environmental
Certificate. Concurrently, or substantially concurrent, herewith, Grantor
executed an instrument entitled “Certificate and Indemnification Regarding
Hazardous Materials” (which, together with all amendments, modifications,
extensions, renewals or restatements thereof, is referred to herein as the
“Environmental Certificate”).  The obligations
of Grantor under the Environmental Certificate are not secured by this Deed of
Trust.

 

32.                                 Notices.  All notices, reports, demands, requests and
other communications authorized or required under this Deed of Trust to be
given to Grantor or Secured Party, shall be given in the manner and to the
addresses specified in the Credit Agreement for the giving of notices.

 

IN WITNESS WHEREOF, Grantor has executed this
instrument as of the day and year first above written.

 

	
   

  	
  GRANTOR:

  
	
   

  	
   

  
	
   

  	
  MOUNTAINEER
  PARK, INC., a West Virginia corporation

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By

  	
  /s/ Edson R.
  Arneault

  	
   

  
	
   

  	
   

  	
  Edson R.
  Arneault,

  	
   

  
	
   

  	
   

  	
  President

  	
   

  

 

30

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