Document:

Exhibit 10.8

 

Annex 1 to the Pledge and Security Agreement

PLEDGED INTERESTS ADDENDUM

This Pledged Interests
Addendum, dated as of December 31, 2006, is delivered pursuant to Sections 6(b)
of the Parent Pledge Agreement referred to below. The undersigned hereby agree
that this Pledged Interests Addendum may be attached to that certain Parent
Pledge Agreement, dated as of December 20, 2004 (as amended, restated,
supplemented, or otherwise modified from time to time, the “Pledge Agreement”),
made by the undersigned to The Bank of New York, as Agent. Initially
capitalized terms used but not defined herein shall have the meaning ascribed
to such terms in the Parent Pledge Agreement and/or the Indenture. The
undersigned hereby agree that the interests listed on this Pledged Interests
Addendum as set forth below shall be and become the Pledged Interests pledged
by the undersigned to Agent in the Parent Pledge Agreement and any pledged
company set forth on this Pledged Interests Addendum as set forth below shall be
and become a “Pledged Company” under the Parent Pledge Agreement, each with the
same force and effect as if originally named therein.

There undersigned hereby
certify that the representations and warranties set forth in Section 5 of the
Parent Pledge Agreement of the undersigned are true and correct as to the
Pledged Interests listed herein on and as of the date hereof.

 

	
  

  	
   

  	
  Robert R. Black, Sr. as trustee
  of the Robert R. Black, Sr.

  Gaming Properties Trust u/a/d May 24, 2004, as Pledgor

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
  /s/ Robert R. Black, Sr.

  	
   

  
	
   

  	
   

  	
  Name:

  	
  Robert R. Black, Sr.

  	
   

  
	
   

  	
   

  	
  Title:

  	
  Trustee

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Virgin River Casino Corporation,
  a Nevada corporation,

  as Pledgor

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
  /s/ Robert R. Black, Sr.

  	
   

  
	
   

  	
   

  	
  Name:

  	
  Robert R. Black, Sr.

  	
   

  
	
   

  	
   

  	
  Title:

  	
  President

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  The Bank of New York Trust Company, N.A., as Agent

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
  /s/ Kevin P. Smith

  	
   

  
	
   

  	
   

  	
  Name:

  	
  Kevin P. Smith

  	
   

  
	
   

  	
   

  	
  Title:

  	
  Vice President

  	
   

  

 

Schedule 1 – Pledged Companies

 

	
  Name of
  Pledged

  Companies

  	
   

  	
  Name of Pledgor

  	
   

  	
  Number of

  Shares/Units

  	
   

  	
  Class of

  Interests

  	
   

  	
  Percentage

  of Class

  Owned

  	
   

  	
  Certificate

  Nos.

  
	
  Black Gaming, LLC

  	
   

  	
  Robert R. Black, Sr.,

  Trustee of the Robert R.

  Black, Sr. Gaming

  Properties Trust u/a/d

  May 24, 2004

  	
   

  	
  9903

  	
   

  	
  Membership
  Interest

  	
   

  	
  99.03

  	
  %

  	
  2,3

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  R. Black, Inc.

  	
   

  	
  Virgin River Casino Corporation

  	
   

  	
  100

  	
   

  	
  Common Stock

  	
   

  	
  100

  	
  %

  	
  3

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  RBG, LLC

  	
   

  	
  Virgin River Casino Corporation

  	
   

  	
  N/A

  	
   

  	
  Membership
  Interests

  	
   

  	
  94.53

  	
  %

  	
  22Exhibit 10.9

 

CONSENT

THIS CONSENT (this “Consent”) is made this 31st day of December, 2006
by and among (i) The Bank of New York Trust Company, N.A, in its capacity as
Collateral Agent under the Parent Pledge Agreement (as hereinafter defined) (“Agent”)
and (ii) Robert R. Black, Sr., as trustee of the Robert R. Black, Sr. Gaming
Properties Trust u/a/d May 24, 2004 (the “Black Trust”) and R. Black, Inc. a
Nevada corporation (“RBI”, and together, with the Black Trust, collectively,
jointly and severally, the “Pledgors”).

RECITALS

WHEREAS, Agent entered into that certain Senior Secured Note Indenture,
dated December 20, 2004 (the “Indenture”), by and among by and among (i) Virgin
River Casino Corporation, a Nevada corporation (“Virgin River”), RBG, LLC, a Nevada limited-liability company (“RBG”), and B & B B, Inc., a Nevada
corporation (“B&BB”),
Casablanca Resorts, LLC, a Nevada limited-liability company (“CBR”), Oasis
Interval Ownership LLC, a Nevada limited-liability company (“OIO”), Oasis
Recreational Properties, Inc., a Nevada corporation (“ORP”), and Oasis Interval
Management LLC, a Nevada limited-liability company (“OIM”, together with RBG,
Virgin River, B&BB, CBR, OIO and ORP, collectively, the “Grantors”) and (ii) Agent, as trustee;
and

WHEREAS, pursuant to the Indenture, Agent and the Pledgors entered into
that certain Parent Pledge Agreement, dated December 20, 2004 (the “Parent
Pledge”); and

WHEREAS, Section 6(j) of the Parent Pledge provides that the Pledgors
shall not cause, permit, or suffer, directly or indirectly, any amendment to
the Convertible Note (as defined herein), the Convertible Note Pledge Agreement
(as defined herein), or the Convertible Note Purchase Agreement (as defined
herein) without the prior written consent of the Agent, which consent shall not
be unreasonably withheld; and

WHEREAS, the Pledgors desire to amend and restate that certain
Convertible Promissory Note, dated December 20, 2004 (the “Convertible Note”),
by RBI in favor of Gaughan, in a form substantially similar to the Amended and
Restated Convertible Promissory Note (the “Amendment”) attached hereto as Exhibit A,  primarily to cause the Black Trust to assume the
obligations of RBI under the Convertible Note and release RBI from its
obligations thereunder; and

WHEREAS, Agent desires to consent to the Amendment.

NOW, THEREFORE, in consideration of the understandings hereinafter set
forth, and for other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, Agent agrees as follows:

1.     Consent to the Amendment.  Agent hereby consents to the amendment
and restatement of the Convertible Note in the form of the Amendment.

2.     Binding on Successors.  This Consent shall be binding upon and shall
inure to the benefit of the parties and their respective successors, and
assigns and representatives.

3.     Headings.  The subject headings or captions of the
paragraphs of this Consent are included only for the purposes of convenience
and shall not affect the construction or interpretation of any provisions
contained herein.

IN WITNESS WHEREOF, the parties hereto have
executed this Consent on the day and year first set forth above.

 

	
  The Bank of New York Trust Company, N.A., as Agent

  	
   

  
	
   

  	
   

  
	
  By:

  	
    /s/ Sandee Parks

  	
   

  	
   

  
	
  Name:

  	
    Sandee Parks

  	
   

  	
   

  
	
  Title:

  	
    Vice President

  	
   

  	
   

  
	
   

  	
   

  
	
  Robert R. Black, Sr. as
  trustee of the Robert R. Black, Sr. Gaming Properties Trust u/a/d May 24,
  2004,

  as Pledgor

  	
   

  
	
   

  	
   

  
	
  By:

  	
    /s/ Robert R. Black, Sr.

  	
   

  	
   

  
	
  Name:

  	
    Robert R. Black, Sr.

  	
   

  	
   

  
	
  Title:

  	
    Trustee

  	
   

  	
   

  
	
   

  	
   

  
	
  R. Black, Inc., a Nevada
  corporation, as Pledgor

  	
   

  
	
   

  	
   

  
	
  By:

  	
    /s/ Robert R. Black, Sr.

  	
   

  	
   

  
	
  Name:

  	
    Robert R. Black, Sr.

  	
   

  	
   

  
	
  Title:

  	
    President

  	
   

  	
   

  

 

 2
 

EXHIBIT
A

 

[attached]

 3Exhibit 10.10

 

AMENDED AND RESTATED PARENT PLEDGE AGREEMENT

This AMENDED AND RESTATED PARENT PLEDGE AGREEMENT (this “Agreement”)
is made this      day of December, 2006, among Robert R.
Black, Sr., as the trustee of The Robert R. Black, Sr. Gaming Properties
Trust u/a/d May 24, 2004 (“Black”) and The Robert R. Black,
Sr. Gaming Properties Trust u/a/d May 24, 2004 (the “Trust”; Black
and Trust, collectively, jointly and severally, “Pledgors” and each
individually “Pledgor”), and WELLS FARGO FOOTHILL, INC., in its capacity
as administrative agent for the Lender Group and the Bank Product Provider
(together with its successors, “Agent”)

W I T N E S S E T H:

WHEREAS,
pursuant to that certain Credit Agreement dated as of December 20, 2004 (as
amended, restated, supplemented or otherwise modified from time to time,
including all schedules thereto, the “Credit Agreement”) among B & B
B, INC., a Nevada corporation (“B&BB”), CASABLANCA RESORTS, LLC, a
Nevada limited liability company (“CBR”), OASIS INTERVAL MANAGEMENT,
LLC, a Nevada limited liability company (“OIM”), OASIS INTERVAL
OWNERSHIP, LLC, a Nevada limited liability company (“OIO”), OASIS
RECREATIONAL PROPERTIES, INC., a Nevada corporation (“ORC”), RBG, LLC, a
Nevada limited liability company (“RBG”), and VIRGIN RIVER CASINO
CORPORATION, a Nevada corporation (“VRCC”; B&BB, CBR, OIM, OIO, ORC,
RBG, and VRCC, are referred to hereinafter each individually as a “Borrower”,
and individually and collectively, jointly and severally, as the “Borrowers”),
the lenders party thereto as “Lenders” (“Lenders”), and Agent, the
Lender Group made and continue to make certain financial accommodations
available to Borrowers from time to time pursuant to the terms and conditions
thereof, and

WHEREAS,
Black, Trust, R. Black, Inc., a Nevada corporation (“RBI”), and Agent
previously entered into that certain Parent Pledge Agreement, dated as of
December 20, 2004 (the “Parent Pledge Agreement”), and

WHEREAS,
Pledgors wish to amend and restate the Parent Pledge Agreement, subject to the
terms and conditions set forth herein, to, among other things, and to amend the
schedules thereto

WHEREAS,
Pledgors own the Investment Related Property (as hereinafter defined and listed
on Schedule 1 attached hereto), and

WHEREAS,
in order to induce the Lender Group to continue to make financial
accommodations to Borrowers as provided for in the Credit Agreement, Pledgors
have agreed to grant a continuing security interest in and to the Collateral
(as hereinafter defined) in order to secure the prompt and complete payment,
observance and performance of, among other things, (a) the obligations of
Pledgors arising from this Agreement, (b) the obligations of Borrowers arising
from the Credit Agreement, and the other Loan Documents, (c) all Bank Product
Obligations, and (d) all Obligations of Borrowers (including, without
limitation, any interest, fees or expenses that accrue after the filing of an
Insolvency Proceeding, regardless of whether allowed or allowable in whole or
in part as a claim in any Insolvency Proceeding), plus reasonable attorneys
fees and expenses if the obligations represented thereunder are collected by
law, through an attorney-at-law, or under advice therefrom (clauses (a), (b),
(c), and (d) being hereinafter referred to as the “Secured Obligations”),
by the granting of the security interests contemplated by this Agreement, and

NOW,
THEREFORE, for and in consideration of the recitals made above and other good
and valuable consideration, the receipt, sufficiency and adequacy of which are
hereby acknowledged, the parties hereto agree as follows:

 

1.             Defined Terms.
All capitalized terms used herein (including, without limitation, in the
preamble and recitals hereof) without definition shall have the meanings
ascribed thereto in the Credit Agreement. 
In addition to those terms defined elsewhere in this Agreement, as used
in this Agreement, the following terms shall have the following meanings:

(a)           “Bank Product Obligations”
has the meaning specified therefor in the Credit Agreement.

(b)           “Bank Product Provider”
has the meaning specified therefor in the Credit Agreement.

(c)           “Books” has the
meaning specified therefor in Section 2 hereof.

(d)           “Closing Date” has
the meaning specified therefor in the Credit Agreement.

(e)           “Code” means the New
York Uniform Commercial Code, as in effect from time to time; provided,
however, that in the event that, by reason of mandatory provisions of law, any
or all of the attachment, perfection, priority, or remedies with respect to
Agent’s Lien on any Collateral is governed by the Uniform Commercial Code as
enacted and in effect in a jurisdiction other than the State of New York, the
term “Code” shall mean the Uniform Commercial Code as enacted and in effect in
such other jurisdiction solely for purposes of the provisions thereof relating
to such attachment, perfection, priority, or remedies.

(f)            “Collateral” has the
meaning specified therefor in Section 2 hereof.

(g)           “Commitment” has the
meaning specified therefor in the Credit Agreement.

(h)           “Convertible Note”
means that certain Amended and Restated Convertible
Promissory Note, dated as of December 28, 2005 issued by the Trust in favor of
Gaughan.

(i)            “Convertible Note Pledge
Agreement” means that certain Pledge Agreement, dated as of December 20,
2004, by and between Black and Gaughan, as Secured Party.

(j)            “Convertible Note
Purchase Agreement” means that certain Convertible
Senior Secured Note Purchase Agreement, dated as of December 20, 2004, by and
among RBI, Black and Gaughan.

(k)           “Event of Default”
has the meaning specified therefor in the Credit Agreement.

(l)            “Gaming Laws” means
all applicable federal, state and local laws, rules and regulations pursuant to
which the Nevada Gaming Authorities possess regulatory, licensing or permit
authority over the ownership or operation of gaming facilities within the State
of Nevada, including, the Nevada Gaming Control Act, as codified in Chapter 463
of the Nevada Revised Statutes, as amended from time to time, and the
regulations of the NGC promulgated thereunder.

(m)          “Gaughan” means
Michael J. Gaughan, a Nevada resident.

(n)           “Gaughan Liens” means
the Liens granted by Black to Gaughan pursuant to the Convertible Note Pledge
Agreement, to secure the Convertible Note, only so long as Black’s obligations
to Gaughan remain outstanding thereunder.

(o)           “Governing Documents”
has the meaning specified therefor in the Credit Agreement.

(p)           “Governmental Authority”
has the meaning specified therefor in the Credit Agreement.

 2
 

 

(q)           “Insolvency Proceeding”
has the meaning specified therefor in the Credit Agreement.

(r)            “Investment Related
Property” means (i) investment property (as that term is defined in the
Code) in the Pledged Companies, and (ii) all of the following regardless of
whether classified as investment property under the Code:  all Pledged Interests, Pledged Operating
Agreements, and Pledged Partnership Agreements.

(s)           “Lender Group” has
the meaning specified therefor in the Credit Agreement.

(t)            “Lien” has the
meaning specified therefor in the Credit Agreement.

(u)           “Loan Documents” has
the meaning specified therefor in the Credit Agreement.

(v)           Nevada Gaming Authorities” means the
NGC, the NGCB and applicable county, city and municipal authorities within the
State of Nevada possessing regulatory, licensing or permit authority over the
ownership or operation of gaming activities in the State of Nevada (or any such
county, city or municipality therein).

(w)          “NGC” means the
Nevada Gaming Commission.

(x)            “NGCB” means the
Nevada State Gaming Control Board.

(y)           “Obligations” has the
meaning specified therefor in the Credit Agreement.

(z)            “Permitted Reorganization
Transactions” means (a) the merger of one Borrower with and into another
Borrower, (b) the dissolution and transfer of assets or properties by a
Borrower to another Borrower, (c) the merger of one Guarantor with and into
another Guarantor or into a Borrower, (d) the dissolution and transfer of
assets or properties by a Guarantor to another Guarantor or a Borrower, or (e)
the formation of a holding company (“Holdco”) that owns the Stock of the
Borrowers so long as (i) at least 97% of the Stock of Holdco is owned by the
Permitted Holders, (ii) no Default or Event of Default shall have occurred and
be continuing, (iii) the Stock of Holdco that is owned, directly or indirectly,
by the Permitted Holders is pledged to the Agent on terms and conditions
satisfactory to Agent, (iv) Agent has a first priority perfected Lien on 65.3%
of the Stock of Holdco and a perfected Lien on 32.6% of the Stock of Holdco
subject only to a Lien in favor of Michael Gaughan, but only so long as the
Obligations owing to Michael Gaughn are outstanding, (v) Holdco executes a
joinder to the Credit Agreement and the Security Agreement, (vi) Holdco owns,
directly or indirectly, all of the Stock of Borrowers, (vii) Agent has a first
priority perfected Lien on the Stock owned by Holdco, (vii) Agent receives
opinions of Holdco’s and Borrowers’ counsel in form and substance satisfactory
to Agent, and (viii) Holdco, Robert R. Black, Sr, the Robert Black Trust, RBI
and Borrowers shall have received all approvals or other consents by any
Governmental Authority in connection with the transfer of the Stock from the
Robert Black Trust and RBI to Holdco and the pledge of such Stock to Agent.

(aa)         “Person” has the
meaning specified therefor in the Credit Agreement.

(bb)         “Pledged Companies”
means, each Person listed on Schedule 1 hereto as a “Pledged Company”,
together with each other Person, all or a portion of whose Stock, is acquired
or otherwise owned by a Pledgor after the Closing Date.

(cc)         “Pledged Interests”
means all of each Pledgor’s right, title and interest in and to all of the
Stock now or hereafter owned by such Pledgor, regardless of class or
designation, including, without limitation, in each of the Pledged Companies,
and all substitutions therefor and replacements thereof, all proceeds thereof
and all rights relating thereto, including, without limitation, any
certificates representing the Stock, the right to request after the occurrence
and during the continuation of an Event of Default that such

 3
 

 

Stock be registered in the name of Agent or any of
its nominees, the right to receive any certificates representing any of the
Stock and the right to require that such certificates be delivered to Agent
together with undated powers or assignments of investment securities with
respect thereto, duly endorsed in blank by such Pledgor, all warrants, options,
share appreciation rights and other rights, contractual or otherwise, in
respect thereof and of all dividends, distributions of income, profits,
surplus, or other compensation by way of income or liquidating distributions,
in cash or in kind, and cash, instruments, and other property from time to time
received, receivable, or otherwise distributed in respect of or in addition to,
in substitution of, on account of, or in exchange for any or all of the
foregoing.

(dd)         “Pledged Interests
Addendum” means a Pledged Interests Addendum substantially in the form of Exhibit
A to this Agreement.

(ee)         “Pledged Operating
Agreements” means all of each Pledgor’s rights, powers, and remedies under
the limited liability company operating agreements of the Pledged Companies
that are limited liability companies.

(ff)           “Pledged Partnership
Agreements” means all of each Pledgor’s rights, powers, and remedies under
the partnership agreements of each of the Pledged Companies that are
partnerships.

(gg)         “Proceeds” has the meaning specified thereto
in Section 2 hereof.

(hh)         “Robert Black Trust” means the Robert R.
Black, Sr. Gaming Properties Trust u/a/d May 24, 2004.

(ii)           “Security Interest” has the meaning specified
thereto in Section 2 hereof.

(jj)           “Senior Secured Notes” means the Senior
Secured Notes due 2011 issued by BB&B, RBG and VRCC pursuant to the Senior
Secured Note Indenture.

(kk)         “Senior Secured Note Indenture” means that
certain indenture dated as of December 20, 2004, among the Trustee, Borrowers
and their Subsidiaries.

(ll)           Senior Subordinated Notes” means the
Senior Subordinated Notes due 2012 issued by BB&B, RBG and VRCC pursuant to
the Senior Subordinated Note Indenture.

(mm)       “Senior Subordinated Note Indenture” means
that certain indenture dated as of December 20, 2004, among the Trustee,
Borrowers and their Subsidiaries.

(nn)         “Stock” has the meaning specified therefor in
the Credit Agreement.

(oo)         “Trustee” means The Bank of New York, in its
capacity as trustee for the holders of the Senior Secured Notes and Senior
Subordinated Notes.

(pp)         “Trustee Liens” means the Liens granted by
Pledgors to the Trustee as Collateral Agent under the Senior Secured Note
Indenture pursuant to the Trustee Pledge Agreement, only so long as Pledgors’
obligations remain outstanding thereunder and to the extent such Lien remains
subject to the Intercreditor Agreement.

(qq)         “Trustee Pledge Agreement” means that certain
Parent Pledge Agreement dated as of the date hereof, by and among Pledgors and
the Trustee.

2.             Grant of Security.  Each
Pledgor hereby unconditionally grants, assigns and pledges to Agent, for the
benefit of the Lender Group and the Bank Product Provider, a continuing
security interest in

 4
 

 

(hereinafter referred to as the “Security
Interest”), such Pledgor’s right, title, and interest in and to the
following personal property, whether now owned or hereafter acquired or arising
and wherever located (the “Collateral”):

(a)           all of such Pledgor’s
Investment Related Property in the Pledged Companies;

(b)           all of such Pledgor’s books
and records indicating, summarizing, or evidencing its Investment Related
Property (“Books”);

(c)           all of the proceeds and products,
whether tangible or intangible, of the foregoing, including proceeds of
insurance or commercial tort claims covering or relating to the foregoing, and
any and all Investment Related Property, money, or other tangible or intangible
property resulting from the sale, lease, license, exchange, collection, or
other disposition of any of the foregoing, any rebates or refunds, whether for
taxes or otherwise, and all proceeds of any such proceeds, or any portion
thereof or interest therein, and the proceeds thereof, and all proceeds of any
loss of, damage to, or destruction of the above, whether insured or not
insured, and, to the extent not otherwise included, any indemnity, warranty, or
guaranty payable by reason of loss or damage to, or otherwise with respect to
the foregoing Collateral (the “Proceeds”).  Without limiting the generality of the
foregoing, the term “Proceeds” includes whatever is receivable or received when
Investment Related Property or proceeds are sold, exchanged, collected, or
otherwise disposed of, whether such disposition is voluntary or involuntary,
and includes, without limitation, proceeds of any indemnity or guaranty payable
to any Pledgor or Agent from time to time with respect to any of the Investment
Related Property.

3.             Security for Obligations.  This
Agreement and the Security Interest created hereby secures the payment and
performance of all the Secured Obligations, whether now existing or arising
hereafter.  Without limiting the
generality of the foregoing, this Agreement secures the payment of all amounts
which constitute part of the Obligations and would be owed by Borrowers, or any
of them, to Agent, the Lender Group, the Bank Product Provider or any of them,
but for the fact that they are unenforceable or not allowable due to the
existence of an Insolvency Proceeding involving any Borrower.

4.             Pledgors Remain Liable. 
Anything herein to the contrary notwithstanding, (a) each of the
Pledgors shall remain liable under the contracts and agreements included in the
Collateral, including, without limitation, the Pledged Operating Agreements and
the Pledged Partnership Agreements, to perform all of the duties and
obligations thereunder to the same extent as if this Agreement had not been
executed, (b) the exercise by Agent or any other member of the Lender Group of
any of the rights hereunder shall not release any Pledgor from any of its
duties or obligations under such contracts and agreements included in the
Collateral, and (c) none of the members of the Lender Group shall have any obligation
or liability under such contracts and agreements included in the Collateral by
reason of this Agreement, nor shall any of the members of the Lender Group be
obligated to perform any of the obligations or duties of any Pledgor thereunder
or to take any action to collect or enforce any claim for payment assigned
hereunder.  Without limiting the
generality of the foregoing, it is the intention of the parties hereto that
record and beneficial ownership of the Pledged Interests, including, without
limitation, all voting, consensual, and dividend rights, shall remain in the
applicable Pledgor until the occurrence and continuation of an Event of Default
and until Agent shall notify the applicable Pledgor of Agent’s exercise of
voting, consensual, and/or dividend rights with respect to the Pledged
Interests pursuant to Section 10 hereof.

5.             Representations and Warranties.  Each
Pledgor, jointly and severally, hereby represents and warrants as follows:

(a)           The exact legal name of each
of the Pledgors is set forth on the signature pages of this Agreement or a
written notice provided to Agent pursuant to Section 6.5 of the Credit
Agreement.

 5
 

 

(b)           This Agreement creates a
valid security interest in the Collateral of each of the Pledgors, to the
extent a security interest therein can be created under the Code, securing the
payment of the Secured Obligations. 
Except to the extent a security interest in the Collateral cannot be
perfected by the filing of a financing statement under the Code,  all filings and other actions necessary or
desirable to perfect and protect such security interest have been duly taken or
will have been taken upon the filing of financing statements listing each
applicable Pledgor, as a debtor, and Agent, as secured party, in the jurisdictions
listed next to such Pledgor’s name on Schedule 2 attached hereto.  Upon the making of such filings, Agent shall
have a first priority (subject to the Gaughan Liens) perfected security
interest in the Collateral of each Pledgor to the extent such security interest
can be perfected by the filing of a financing statement.

(c)           Except for the Security
Interest created hereby, each Pledgor is and will at all times be the sole
holder of record and the legal and beneficial owner, free and clear of all
Liens other than the Gaughan Liens and the Trustee Liens, of the Pledged
Interests indicated on Schedule 1 as being owned by such Pledgor and,
when acquired by such Pledgor, any Pledged Interests acquired after the Closing
Date; (ii) all of the Pledged Interests are duly authorized, validly issued,
fully paid and nonassessable and the Pledged Interests constitute or will
constitute the percentage of the issued and outstanding Equity Interests of the
Pledged Companies of such Pledgor identified on Schedule 1 hereto as supplemented
or modified by any Pledged Interests Addendum; (ii) such Pledgor has the right
and requisite authority to pledge, the Investment Related Property pledged by
such Pledgor to Agent as provided herein; (iii) all actions necessary or
desirable to perfect, establish the first priority of, or otherwise protect,
Agent’s Liens in the Investment Related Collateral, and the proceeds thereof,
have been duly taken, (A) upon the execution and delivery of this Agreement;
(B) upon the taking of possession by Agent of any certificates constituting the
Pledged Interests, to the extent such Pledged Interests are represented by
certificates, together with undated powers endorsed in blank by the applicable
Pledgor; and (C) upon the filing of financing statements in the applicable
jurisdiction set forth on Schedule 2 attached hereto for such Pledgor
with respect to the Pledged Interests of such Pledgor that are not represented
by certificates, and (iv) each Pledgor has delivered to and deposited with
Agent (or, with respect to any Pledged Interests created after the Closing
Date, will deliver and deposit in accordance with Sections 6(a) and 7
hereof) all certificates representing the Pledged Interests owned by such
Pledgor to the extent such Pledged Interests are represented by certificates,
and undated powers endorsed in blank with respect to such certificates; other
than the certificates representing the Pledged Interests securing the Gaughan
Liens, which shall not be required to be delivered to the Agent until the release
or termination of the Gaughan Liens.

(d)           Except for such
authorizations, consents and other actions as those described in Section 23
hereof and as shall have been obtained and shall be in effect, no
authorization, consent, approval or other action by, and no notice to or
registration, recordation or filing with, any Governmental Authority is
required for (i) the due execution, delivery and performance by each Pledgor of
this Agreement, (ii) the grant by each Pledgor of the Security Interest granted
by this Agreement, (iii) the perfection of such Security Interest (except for
the filing of any appropriate financing statements) or (iv) the exercise by the
Lender Group and the Bank Product Providers of their rights and remedies under
this Agreement; in each case under clauses (i) through (iv) above, except as
may be required by applicable Gaming Laws or except as may be required in
connection with such disposition of Investment Related Property by laws
affecting the offering and sale of securities generally.

(e)           The Robert Black Trust is validly existing and has
not been revoked.

6.             Covenants.  Each Pledgor, jointly and
severally, covenants and agrees with Agent and the Lender Group that from and
after the date of this Agreement and until the date of termination of this
Agreement in accordance with Section 21 hereof:

(a)           Possession of Collateral.  In the event that any Collateral, including
proceeds, is evidenced by or consists of Negotiable Collateral (as such term
may be defined in the Code), Investment Related Property, or Chattel Paper (as
such term may be defined in the Code), and if and to the extent that perfection
or priority of Agent’s Security Interest is dependent on or enhanced by
possession, the applicable

 6
 

 

Pledgor, immediately upon the request of Agent and
in accordance with Section 8 hereof, shall execute such other documents
as shall be requested by Agent in its Permitted Discretion or, if applicable,
endorse and deliver physical possession of such Negotiable Collateral (as such
term may be defined in the Code), Investment Related Property, or Chattel Paper
(as such terms may be defined in the Code) to Agent, together with such undated
powers endorsed in blank as shall be requested by Agent; provided, however,
that so long as the Gaughan Liens remain outstanding, such Pledgor will not be
required to deliver the certificates representing the Pledged Interests
securing the Gaughan Liens until the release or termination of the Gaughan
Liens.

(b)           Investment Related Property.

(i)            If any Pledgor shall receive
or become entitled to receive any Pledged Interests after the Closing Date, it
shall promptly (and in any event within 2 Business Days of receipt thereof)
deliver to Agent a duly executed Pledged Interests Addendum identifying such
Pledged Interests;

(ii)           All sums of money and
property paid or distributed in respect of the Investment Related Property
which are received by any Pledgor shall be held by the Pledgors in trust for
the benefit of Agent segregated from such Pledgor’s other property, and such
Pledgor shall deliver it forthwith to Agent in the exact form received; provided,
however, that cash dividends received by any Pledgor, if and to the
extent they are not prohibited by the Credit Agreement, may be retained by such
Pledgor so long as no Event of Default has occurred or is continuing;

(iii)          Each Pledgor shall promptly
deliver to Agent a copy of each notice or other communication received by it in
respect of any Pledged Interests;

(iv)          No Pledgor shall make or
consent to any amendment or other modification or waiver with respect to any
Pledged Interests, Pledged Operating Agreement, or Pledged Partnership
Agreement, or enter into any agreement or permit to exist any restriction with
respect to any Pledged Interests other than pursuant to the Loan Documents;

(v)           Each Pledgor agrees that it
will cooperate with Agent in obtaining all necessary approvals and making all
necessary filings under federal, state, local, or foreign law in connection
with the Security Interest on the Investment Related Property or any sale or
transfer thereof; and

(vi)          As to all limited liability
company or partnership interests, issued under any Pledged Operating Agreement
or Pledged Partnership Agreement, all limited liability company or partnership
interests, issued each Pledgor, jointly and severally, hereby represents,
warrants and covenants that the Pledged Interests issued pursuant to such
agreement (A) are not and shall not be dealt in or traded on securities
exchanges or in securities markets, (B) do not and will not constitute
investment company securities, and (C) are not and will not be held by
such Pledgor in a securities account.  In
addition, none of the Pledged Operating Agreements, the Pledged Partnership
Agreements, or any other agreements governing any of the Pledged Interests
issued under any Pledged Operating Agreement or Pledged Partnership Agreement,
provide or shall provide that such Pledged Interests are securities governed by
Article 8 of the Uniform Commercial Code as in effect in any relevant jurisdiction.

(c)           Transfers and Other Liens.  Pledgors shall not (i) sell, assign (by
operation of law or otherwise) or otherwise dispose of, or grant any option
with respect to, any of the Collateral, except in connection with a Permitted
Reorganization Transaction or (ii) create or permit to exist any Lien upon or
with respect to any of the Collateral of any of Pledgors, except for the
Gaughan Liens, the Trustee Liens, and Permitted Reorganization
Transactions.  The inclusion of Proceeds
in the Collateral shall not be deemed to constitute Agent’s consent to any sale
or other disposition of any of the Collateral except as expressly permitted in
this Agreement or the other Loan Documents.

 7
 

 

(d)           Other Actions as to Any and
All Collateral.  Each
Pledgor shall promptly (and in any event within 2 Business Days of acquiring or
obtaining such Collateral) notify Agent in writing upon acquiring or otherwise
obtaining any Collateral after the date hereof consisting of Investment Related
Property and, upon the request of Agent and in accordance with Section 8
hereof, promptly execute such other documents, or if applicable, deliver
certificates evidencing any Investment Related Property in accordance with Section
6 hereof and do such other acts or things deemed necessary or desirable by
Agent to protect Agent’s Security Interest therein.

(e)           Restrictions on Fundamental Changes.  No Pledgor shall (i) enter into any merger,
consolidation, reorganization, or recapitalization, or reclassify its Stock,
(ii) liquidate, wind up, or dissolve itself (or suffer any liquidation or
dissolution), (iii) convey, sell, lease, license, assign, transfer, or
otherwise dispose of, in one transaction or a series of transactions, all or
any substantial part of any of the Collateral of any of Pledgors, or (iv)
suspend or go out of a substantial portion of its or their business, except in
connection with a Permitted Reorganization Transaction.

(f)            Change Name.  No Pledgor shall change, and no Pledgor shall
cause any Borrower’s or any of its Subsidiaries’ to change, its name,
organizational identification number, state of organization, or organizational
identity; provided, however, that a Borrower or a Subsidiary of a
Borrower may change its name upon at least 30 days prior written notice by
Administrative Borrower to Agent of such change, and so long as, at the time of
such written notification, such Borrower or such Subsidiary provides any
financing statements necessary to perfect and continue perfected the Agent’s
Liens.

(g)           Records.  Each Pledgor shall at all times keep at least
one complete set of its records concerning substantially all of the Collateral
at the location set forth on Schedule 3 hereto, and not change such
location or such records without giving Agent at least thirty (30) days prior written
notice thereof.

(h)           Additional Stock.  Each Pledgor shall, to the extent it may
lawfully do so, use its best efforts to prevent the Pledged Companies from
issuing additional Stock or Proceeds, except for cash dividends or other
distributions, if any, that are not prohibited by the terms of the Credit
Agreement to be paid by the Pledged Companies to Pledgors.

(i)            Amendment of Governing Documents.  Pledgors shall not permit the Pledged
Companies to (i) authorize the amendment of or amend the Governing Documents of
the Pledged Companies to provide that the Stock of such Pledged Company is
governed by Article 8 of the Code, or (ii) authorize the issuance of or issue
certificates evidencing the Stock of the Pledged Companies unless such
certificates have been pledged and delivered to Agent pursuant to the terms of
this Agreement.

(j)            Amendment of Documents.  Pledgors shall not cause, permit, or suffer,
directly or indirectly, any amendment to the Convertible Note, the Convertible
Note Pledge Agreement, or the Convertible Note Purchase Agreement without the
prior written consent of Agent, which consent shall not be unreasonably
withheld.

(k)           Revocation of Trust.  Black shall, to the extent he may lawfully do
so, use his best efforts to prevent the revocation of the Robert Black Trust.

(l)            Gaming Laws.  Each Pledgor shall obtain, as promptly as
practicable following the date hereof, the applicable approvals of the Nevada
Gaming Authorities, as referred to in Section 23 hereof, required to
authorize the pledge of the Investment Related Property in this Agreement and
shall promptly execute any and all such instruments and documents, deliver any
certificates and do all such other acts or things deemed necessary, appropriate
or desirable by the Nevada Gaming Authorities to obtain such approvals.

7.             Relation to Other Security Documents.  The
provisions of this Agreement shall be read and construed with the other Loan
Documents referred to below in the manner so indicated.

 8
 

 

(a)           Credit Agreement. In the event
of any conflict between any provision in this Agreement and a provision in the
Credit Agreement, such provision of the Credit Agreement shall control.

8.             Further
Assurances.

(a)           Each Pledgor agrees that from time to time, at its
own expense, such Pledgor will promptly execute and deliver all further
instruments and documents, and take all further action, that may be necessary
or that Agent may reasonably request, in order to perfect and protect any
Security Interest granted or purported to be granted hereby or to enable Agent
to exercise and enforce its rights and remedies hereunder with respect to any
of the Collateral.

(b)           Each Pledgor authorizes the
filing of such financing or continuation statements, or amendments thereto, and
such Pledgor will execute and deliver to Agent such other instruments or
notices, as may be necessary or as Agent may reasonably request, in order to
perfect and preserve the Security Interest granted or purported to be granted
hereby.

(c)           Each Pledgor authorizes
Agent to file, transmit, or communicate, as applicable, financing statements
and amendments describing the Collateral as all ownership interest of such
Pledgor in each of B&BB, RBG, and VRCC, and the proceeds thereof or words
of similar effect, in order to perfect Agent’s security interest in the
Collateral without such Pledgor’s signature. 
Each Pledgor also hereby ratifies its authorization for Agent to have
filed in any appropriate jurisdiction any financing statements filed prior to
the date hereof.

(d)           Each Pledgor acknowledges that
it is not authorized to file any financing statement or amendment or
termination statement with respect to any financing statement filed in
connection with this Agreement without the prior written consent of Agent,
subject to such Pledgor ‘s rights under Section 9-509(d)(2) of the Code.

9.             Agent’s Right to Perform Contracts.  Upon
the occurrence of an Event of Default, Agent (or its designee) may proceed to
perform any and all of the obligations of any Pledgor contained in any
contract, lease, or other agreement and exercise any and all rights of any
Pledgor therein contained as fully as such Pledgor itself could.

10.           Agent Appointed Attorney-in-Fact.  Each
Pledgor hereby irrevocably appoints Agent its attorney-in-fact, with full
authority in the place and stead of such Pledgor and in the name of such
Pledgor or otherwise, at such time as an Event of Default has occurred and is
continuing under the Credit Agreement, to take any action and to execute any
instrument which Agent may reasonably deem necessary or advisable to accomplish
the purposes of this Agreement.

11.           Agent May Perform.  If
any of Pledgors fails to perform any agreement contained herein, Agent may
itself perform, or cause performance of, such agreement, and the reasonable
expenses of Agent incurred in connection therewith shall be payable, jointly
and severally, by Pledgors.

12.           Agent’s Duties.  The
powers conferred on Agent hereunder are solely to protect Agent’s interest in
the Collateral, for the benefit of the Lender Group and the Bank Product
Provider, and shall not impose any duty upon Agent to exercise any such
powers.  Except for the safe custody of
any Collateral in its actual possession and the accounting for moneys actually
received by it hereunder, Agent shall have no duty as to any Collateral or as
to the taking of any necessary steps to preserve rights against prior parties
or any other rights pertaining to any Collateral.  Agent shall be deemed to have exercised
reasonable care in the custody and preservation of any Collateral in its actual
possession if such Collateral is accorded treatment substantially equal to that
which Agent accords its own property.

 9
 

 

13.           Disposition of Pledged Interests by Agent.  None
of the Pledged Interests existing as of the date of this Agreement are, and
none of the Pledged Interests hereafter acquired on the date of acquisition
thereof will be, registered or qualified under the various federal or state
securities laws of the United States and disposition thereof after an Event of
Default may be restricted to one or more private (instead of public) sales in
view of the lack of such registration. 
Each Pledgor understands that in connection with such disposition, Agent
may approach only a restricted number of potential purchasers and further
understands that a sale under such circumstances may yield a lower price for
the Pledged Interests than if the Pledged Interests were registered and
qualified pursuant to federal and state securities laws and sold on the open
market.  Each Pledgor, therefore, agrees
that:  (a) if Agent shall, pursuant to
the terms of this Agreement, sell or cause the Pledged Interests or any portion
thereof to be sold at a private sale, Agent shall have the right to rely upon
the advice and opinion of any nationally recognized brokerage or investment
firm (but shall not be obligated to seek such advice and the failure to do so
shall not be considered in determining the commercial reasonableness of such
action) as to the best manner in which to offer the Pledged Interest for sale
and as to the best price reasonably obtainable at the private sale thereof; and
(b) such reliance shall be conclusive evidence that Agent has handled the
disposition in a commercially reasonable manner.

14.           Voting Rights.

(a)           Upon the occurrence and
during the continuation of an Event of Default, (i) Agent may, at its option,
and with prior notice to any Pledgor, and in addition to all rights and
remedies available to Agent under any other agreement, at law, in equity, or
otherwise, exercise all voting rights, and all other ownership or consensual
rights in respect of the Pledged Interests owned by such Pledgor, but under no
circumstances is Agent obligated by the terms of this Agreement to exercise
such rights, and (ii) if Agent duly exercises its right to vote any of such
Pledged Interests, each Pledgor hereby appoints Agent, such Pledgor ‘s true and
lawful attorney-in-fact and IRREVOCABLE PROXY to vote such Pledged Interests in
any manner Agent deems advisable for or against all matters submitted or which
may be submitted to a vote of shareholders, partners or members, as the case
may be.  The power-of-attorney granted
hereby is coupled with an interest and shall be irrevocable.

(b)           For so long as any Pledgor
shall have the right to vote the Pledged Interests owned by it, such Pledgor
covenants and agrees that it will not, without the prior written consent of
Agent, vote or take any consensual action with respect to such Pledged
Interests which would materially adversely affect the rights of Agent and the
other members of the Lender Group or the value of the Pledged Interests.

15.           Remedies.  Upon the occurrence and during
the continuance of an Event of Default:

(a)           Agent may exercise in
respect of the Collateral, in addition to other rights and remedies provided
for herein, in the other Loan Documents, or otherwise available to it, all the
rights and remedies of a secured party on default under the Code or any other
applicable law.

(b)           Without limiting the
generality of the foregoing, each Pledgor expressly agrees that, in any such
event, Agent without demand of performance or other demand, advertisement or
notice of any kind (except a notice specified below of time and place of public
or private sale) to or upon any of Pledgors or any other Person (all and each
of which demands, advertisements and notices are hereby expressly waived to the
maximum extent permitted by the Code or any other applicable law), may take
immediate possession of all or any portion of the Collateral and (i) require
Pledgors to, and each Pledgor hereby agrees that it will at its own expense and
upon request of Agent forthwith, assemble all or part of the Collateral as
directed by Agent and make it available to Agent at one or more locations where
such Pledgor regularly maintains Inventory, and (ii) without notice except as
specified below, sell the Collateral or any part thereof in one or more parcels
at public or private sale, at any of Agent’s offices or elsewhere, for cash, on
credit, and upon such other terms as Agent may deem commercially reasonable.  Each Pledgor agrees that, to the extent
notice of sale shall be required by law, at least 10 days notice to any of
Pledgors 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 and
specifically such notice shall

 10
 

 

constitute a reasonable “authenticated notification
of disposition” within the meaning of Section 9-611 of the Code.  Agent shall not be obligated to make any sale
of Collateral regardless of notice of sale having been given.  Agent 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.

16.           Remedies Cumulative.  Each
right, power, and remedy of Agent as provided for in this Agreement or in the
other Loan Documents or now or hereafter existing at law or in equity or by
statute or otherwise shall be cumulative and concurrent and shall be in
addition to every other right, power, or remedy provided for in this Agreement
or in the other Loan Documents or now or hereafter existing at law or in equity
or by statute or otherwise, and the exercise or beginning of the exercise by
Agent, of any one or more of such rights, powers, or remedies shall not
preclude the simultaneous or later exercise by Agent of any or all such other
rights, powers, or remedies.

17.           Marshaling. Agent shall not be required to marshal any present or future
collateral security (including but not limited to the Collateral) for, or other
assurances of payment of, the Secured Obligations or any of them or to resort
to such collateral security or other assurances of payment in any particular
order, and all of its rights and remedies hereunder and in respect of such
collateral security and other assurances of payment shall be cumulative and in
addition to all other rights and remedies, however existing or arising.  To the extent that it lawfully may, each Pledgor
hereby agrees that it will not invoke any law relating to the marshaling of
collateral which might cause delay in or impede the enforcement of Agent’s
rights and remedies under this Agreement or under any other instrument creating
or evidencing any of the Secured Obligations or under which any of the Secured
Obligations is outstanding or by which any of the Secured Obligations is
secured or payment thereof is otherwise assured, and, to the extent that it
lawfully may, each Pledgor hereby irrevocably waives the benefits of all such
laws.

18.           Indemnity and Expenses.

(a)           Each Pledgor agrees to
indemnify Agent and the other members of the Lender Group from and against all
claims, lawsuits and liabilities (including reasonable attorneys fees) growing
out of or resulting from this Agreement (including, without limitation,
enforcement of this Agreement) or any other Loan Document to which such Pledgor
is a party, except claims, losses or liabilities resulting from the gross
negligence or willful misconduct of the party seeking indemnification as determined
by a final non-appealable order of a court of competent jurisdiction.  This provision shall survive the termination
of this Agreement and the Credit Agreement and the repayment of the Secured
Obligations.

(b)           Pledgors, jointly and
severally, shall, upon demand, pay to Agent (or Agent, may charge to the Loan
Account) all the Lender Group Expenses which Agent may incur in connection with
(i) the administration of this Agreement, (ii) the custody, preservation, use
or operation of, or, upon the occurrence or continuation of an Event of
Default, the sale of, collection from, or other realization upon, any of the
Collateral in accordance with this Agreement and the other Loan Documents,
(iii) the exercise or enforcement of any of the rights of Agent hereunder or
(iv) the failure by any of Pledgors to perform or observe any of the provisions
hereof.

19.           Merger, Amendments; Etc.  THIS
WRITTEN AGREEMENT, TOGETHER WITH THE OTHER LOAN DOCUMENTS, REPRESENTS THE FINAL
AGREEMENT BETWEEN THE PARTIES AND MAY NOT BE CONTRADICTED BY EVIDENCE OF PRIOR,
CONTEMPORANEOUS OR SUBSEQUENT ORAL AGREEMENTS OF THE PARTIES.  THERE ARE NO UNWRITTEN AGREEMENTS BETWEEN THE
PARTIES.  No waiver of any provision of
this Agreement, and no consent to any departure by any of Pledgors herefrom,
shall in any event be effective unless the same shall be in writing and signed
by Agent, and then such waiver or consent shall be effective only in the
specific instance and for the specific purpose for which given.  No amendment of any provision of this
Agreement shall be

 11
 

 

effective unless the same shall be in writing and
signed by Agent and each of Pledgors to which such amendment applies.

20.           Addresses for Notices.  All
notices and other communications provided for hereunder shall be given in the form
and manner and delivered to Agent at its address specified in the Credit
Agreement, and to Pledgors at the address set forth below, or, as to any party,
at such other address as shall be designated by such party in a written notice
to the other party.

	
  If to Black:

  	
  911 North Buffalo, Suite 201

  
	
   

  	
  Las Vegas, Nevada 89128

  
	
   

  	
  Attn: Robert R. Black,
  Sr., Trustee

  
	
   

  	
   

  
	
  If to Agent:

  	
  Wells Fargo Foothill, Inc.

  
	
   

  	
  2450 Colorado Avenue, Suite 3000 West

  
	
   

  	
  Santa Monica, California 90404

  
	
   

  	
  Attn: Specialty Finance Manager

  
	
   

  	
  Fax No.: 310-453-7442

  

 

21.           Continuing Security Interest: Assignments
under Credit Agreement.  This Agreement shall create a continuing
security interest in the Collateral and shall (a) remain in full force and
effect until the Obligations have been paid in full in cash in accordance with
the provisions of the Credit Agreement and the Commitments have expired or have
been terminated, (b) be binding upon each of Pledgors, and their respective
successors and assigns, and (c) inure to the benefit of, and be enforceable by,
Agent, and its successors, transferees and assigns.  Without limiting the generality of the
foregoing clause (c), any the Lender may, in accordance with the provisions of
the Credit Agreement, assign or otherwise transfer all or any portion of its
rights and obligations under the Credit Agreement to any other Person, and such
other Person shall thereupon become vested with all the benefits in respect
thereof granted to such the Lender herein or otherwise.  Upon payment in full in cash of the
Obligations in accordance with the provisions of the Credit Agreement and the
expiration or termination of the Commitments, the Security Interest granted
hereby shall terminate and this Agreement all rights to the Collateral shall
revert to Pledgors or any other Person entitled thereto.  At such time, Agent will authorize the filing
of appropriate termination statements to terminate such Security Interests.  No transfer or renewal, extension,
assignment, or termination of this Agreement or of the Credit Agreement, any
other Loan Document, or any other instrument or document executed and delivered
by any Pledgor to Agent nor any additional Advances or other loans made by any
the Lender to Borrowers, nor the taking of further security, nor the retaking
or re-delivery of the Collateral to Pledgors, or any of them, by Agent, nor any
other act of the Lender Group or the Bank Product Provider, or any of them,
shall release any of Pledgors from any obligation, except a release or
discharge executed in writing by Agent in accordance with the provisions of the
Credit Agreement.  Agent shall not by any
act, delay, omission or otherwise, be deemed to have waived any of its rights or
remedies hereunder, unless such waiver is in writing and signed by Agent and
then only to the extent therein set forth. 
A waiver by Agent of any right or remedy on any occasion shall not be
construed as a bar to the exercise of any such right or remedy which Agent
would otherwise have had on any other occasion.

22.           Governing Law.

(a)           THE VALIDITY OF THIS
AGREEMENT AND THE OTHER LOAN DOCUMENTS (UNLESS EXPRESSLY PROVIDED TO THE
CONTRARY IN ANOTHER LOAN DOCUMENT IN RESPECT OF SUCH OTHER LOAN DOCUMENT), THE
CONSTRUCTION, INTERPRETATION, AND ENFORCEMENT HEREOF AND THEREOF, AND THE
RIGHTS OF THE PARTIES HERETO AND THERETO WITH RESPECT TO ALL MATTERS ARISING
HEREUNDER OR THEREUNDER OR RELATED HERETO OR THERETO SHALL BE DETERMINED UNDER,
GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW
YORK, APPLICABLE TO CONTRACTS MADE AND TO BE PERFORMED IN THE STATE OF NEW 

 12
 

 

YORK, INCLUDING, WITHOUT LIMITATION, SECTIONS 5-1401
AND 5-1402 OF THE NEW YORK GENERAL OBLIGATIONS LAW AND NEW YORK CIVIL PRACTICE
LAWS AND RULES 327(B).

(b)           THE PARTIES AGREE THAT ALL
ACTIONS OR PROCEEDINGS ARISING IN CONNECTION WITH THIS AGREEMENT AND THE OTHER
LOAN DOCUMENTS SHALL BE TRIED AND LITIGATED ONLY IN THE STATE AND, TO THE
EXTENT PERMITTED BY APPLICABLE LAW, FEDERAL COURTS LOCATED IN THE COUNTY OF NEW
YORK, STATE OF NEW YORK; PROVIDED, HOWEVER, THAT ANY SUIT SEEKING
ENFORCEMENT AGAINST ANY COLLATERAL OR OTHER PROPERTY MAY BE BROUGHT, AT AGENT’S
OPTION, IN THE COURTS OF ANY JURISDICTION WHERE AGENT ELECTS TO BRING SUCH
ACTION OR WHERE SUCH COLLATERAL OR OTHER PROPERTY MAY BE FOUND.  EACH PLEDGOR AND EACH MEMBER OF THE LENDER
GROUP WAIVE, TO THE EXTENT PERMITTED UNDER APPLICABLE LAW, ANY RIGHT EACH MAY
HAVE TO ASSERT THE DOCTRINE OF FORUM  NON  CONVENIENS OR TO
OBJECT TO VENUE TO THE EXTENT ANY PROCEEDING IS BROUGHT IN ACCORDANCE WITH THIS
SECTION 22.

(c)           EACH PLEDGOR AND EACH MEMBER
OF THE LENDER GROUP HEREBY WAIVE THEIR RESPECTIVE RIGHTS TO A JURY TRIAL OF ANY
CLAIM OR CAUSE OF ACTION BASED UPON OR ARISING OUT OF ANY OF THE LOAN DOCUMENTS
OR ANY OF THE TRANSACTIONS CONTEMPLATED THEREIN, INCLUDING CONTRACT CLAIMS,
TORT CLAIMS, BREACH OF DUTY CLAIMS, AND ALL OTHER COMMON LAW OR STATUTORY
CLAIMS.  EACH PLEDGOR AND EACH MEMBER OF
THE LENDER GROUP REPRESENT THAT EACH HAS REVIEWED THIS WAIVER AND EACH
KNOWINGLY AND VOLUNTARILY WAIVES ITS JURY TRIAL RIGHTS FOLLOWING CONSULTATION
WITH LEGAL COUNSEL.  IN THE EVENT OF
LITIGATION, A COPY OF THIS AGREEMENT MAY BE FILED AS A WRITTEN CONSENT TO A
TRIAL BY THE COURT.

23.           Compliance with Gaming Laws. 
Notwithstanding anything to the contrary contained herein or in any
other Loan Documents, Agent expressly acknowledges and agrees that the exercise
of its rights and remedies under this Agreement is subject to the mandatory
provisions of the Gaming Laws. 
Specifically, Agent acknowledges and agrees that:

(a)           The pledge of the Investment Related Property by
Pledgors, and any restrictions on the transfer of and agreements not to
encumber the Investment Related Property contained in this Agreement or in any
other Loan Document, are not effective without the prior approval of the NGC
upon the recommendation of the NGCB.  The
certificates or instruments representing or evidencing the Investment Related
Property may not be delivered to Agent until such approval has been
obtained.  The approval of the pledge of
the Investment Related Property may require amendment of this Agreement to
include additional references to regulatory requirements under the Gaming
Laws.  In addition, no amendment of this
Agreement shall be effective until applicable approvals of the Nevada Gaming
Authorities have been obtained.

(b)           In the event that Agent exercises one or more of the
remedies set forth in this Agreement with respect to any Investment Related
Property, including without limitation, foreclosure or transfer of any interest
in the Investment Related Property (except back to Pledgors), the exercise of
voting and consensual rights, and any other resort to or enforcement of the
security interest in the Investment Related Property, such action shall require
the separate and prior approval of the Nevada Gaming Authorities and the
licensing of Agent, unless such licensing requirement is waived by the Nevada
Gaming Authorities.

(c)           Agent and any custodial agent of Agent in the State
of Nevada shall be required to comply with the conditions, if any, imposed by
the Nevada Gaming Authorities in connection with its approval of the pledge
granted hereunder by Pledgors, including, without limitation, the requirement
that Agent or its agent maintain the certificates evidencing the Investment
Related Property at a location in Nevada designated

 13
 

 

to
the NGCB, and that Agent or its agent permit agents or employees of the NGCB to
inspect such certificates immediately upon request during normal business
hours.

(d)           Neither Agent nor any agent of Agent shall surrender
possession of any Investment Related Property to any Person other than Pledgors
without the prior approval of the Nevada Gaming Authorities or as otherwise
permitted by the Gaming Laws.

(e)           The approval by the Nevada Gaming Authorities of
this Agreement, or any amendment hereto, is not, and shall not be construed as,
the approval, either express or implied, of Agent to take any actions provided
for in this Agreement for which approval by the Nevada Gaming Authorities is
required, without first obtaining such prior and separate approval, to the
extent required by the Gaming Laws.

24.           Agent.  Each reference herein to any
right granted to, benefit conferred upon or power exercisable by the “Agent”
shall be a reference to Agent, for the benefit of the Lender Group and the Bank
Product Provider.

25.           Limited Recourse. 
Notwithstanding anything contained in this Agreement to the contrary,
Pledgors shall not have any personal liability under this Agreement for the
Secured Obligations to Agent and/or the Lenders and any claim based on or in
respect of any of the Secured Obligations shall be enforced only against the
Collateral pledged hereunder and not against any other assets, properties or
funds of Pledgors or against any officer, director, manager, member,
shareholder of RBI.

26.           Waivers.

(a)           Each Pledgor hereby waives:  (i) notice of acceptance hereof;
(ii) notice of any loans or other financial accommodations made or
extended under the Credit Agreement, or the creation or existence of any
Secured Obligations; (iii) notice of the amount of the Secured
Obligations, subject, however, to such Pledgor’s right to make inquiry of Agent
to ascertain the amount of the Secured Obligations at any reasonable time;
(iv) notice of any adverse change in the financial condition of Borrowers
or of any other fact that might increase such Pledgor’s risk hereunder;
(v) notice of presentment for payment, demand, protest, and notice thereof
as to any instrument among the Loan Documents; (vi) notice of any Default
or Event of Default under the Credit Agreement; and (vii) all other
notices and demands to which such Pledgor might otherwise be entitled.

(b)           Each Pledgor hereby waives the right by statute or
otherwise to require any member of the Lender Group to institute suit against
any Borrower or to exhaust any rights and remedies which the Lender Group, has
or may have against such Borrower.  Each
Pledgor further waives any defense arising by reason of any disability or other
defense (other than the defense that the Secured Obligations shall have been
performed and indefeasibly paid in cash, to the extent of any such payment) of
any Borrower or by reason of the cessation from any cause whatsoever of the
liability of any Borrower in respect thereof.

(c)           Each Pledgor hereby waives:  (i) any rights to assert against the
Lender Group any defense (legal or equitable), set-off, counterclaim, or claim
which such Pledgor may now or at any time hereafter have against any Borrower
or any other party liable to the Lender Group; (ii) any defense, set-off,
counterclaim, or claim, of any kind or nature, arising directly or indirectly
from the present or future lack of perfection, sufficiency, validity, or
enforceability of the Secured Obligations or any security therefor;
(iii) any defense arising by reason of any claim or defense based upon an
election of remedies by the Lender Group, including any defense based upon an
election of remedies by Lender under the provisions of §§ 580d and 726 of
the California Code of Civil Procedure or any similar law of any other
jurisdiction to the extent that a similar law exists; (iv) the benefit of
any statute of limitations affecting such Pledgor’s liability hereunder or the
enforcement thereof, and any act which shall defer or delay the operation of
any statute of limitations applicable to the Secured Obligations shall
similarly operate to defer or delay the operation of such statute of
limitations applicable to such Pledgor’s liability hereunder.

 14
 

 

(d)           Until such time as all of the Secured Obligations
have been fully, finally and indefeasibly paid in full in cash:  (i) each Pledgor hereby waives and postpones
any right of subrogation such Pledgor has or may have as against Borrowers with
respect to the Secured Obligations, including, without limitation, under any
one or more of California Civil Code §§ 2847, 2848, and 2849 or any similar law
of any other jurisdiction to the extent that a similar law exists; (ii) in
addition, each Pledgor hereby waives and postpones any right to proceed against
Borrowers or any other Person, now or hereafter, for contribution, indemnity,
reimbursement, or any other suretyship rights and claims (irrespective of
whether direct or indirect, liquidated or contingent), with respect to the
Secured Obligations; and (iii) in addition, each Pledgor also hereby waives and
postpones any right to proceed or to seek recourse against or with respect to
any property or asset of Borrowers.

(e)           If any of the Secured Obligations at any time are
secured by a mortgage or deed of trust upon real property, any member of the
Lender Group may elect, in their sole discretion, upon a default with respect
to the Secured Obligations, to foreclose such mortgage or deed of trust
judicially or nonjudicially in any manner permitted by law, before or after
enforcing this Agreement, without diminishing or affecting the liability of
Pledgors hereunder.  Each Pledgor
understands that (a) by virtue of the operation of California’s antideficiency
law applicable to nonjudicial foreclosures, an election by the Lender Group
nonjudicially to foreclose such a mortgage or deed of trust probably would have
the effect of impairing or destroying rights of subrogation, reimbursement,
contribution, or indemnity of such Pledgor against Borrowers or other guarantors
or sureties, and (b) absent the waiver given by such Pledgor herein, such an
election would estop the Lender Group from enforcing this Agreement against
such Pledgor.  Understanding the
foregoing, and understanding that each Pledgor hereby is relinquishing a
defense to the enforceability of this Agreement, each Pledgor hereby waives any
right to assert against any member of the Lender Group any defense to the
enforcement of this Agreement, whether denominated “estoppel” or otherwise,
based on or arising from an election by any member of the Lender Group
nonjudicially to foreclose any such mortgage or deed of trust.  Each Pledgor understands that the effect of
the foregoing waiver may be that such Pledgor may have liability hereunder for
amounts with respect to which such Pledgor may be left without rights of
subrogation, reimbursement, contribution, or indemnity against Borrowers or
other guarantors or sureties.  Each
Pledgor also agrees that the “fair market value” provisions of Section 580a of
the California Code of Civil Procedure or any similar law of any other
jurisdiction to the extent that a similar law exists shall have no
applicability with respect to the determination of such Pledgor’s liability
under this Agreement.

(f)            Without limiting the generality of any other waiver
or other provision set forth in this Agreement, each Pledgor waives all rights
and defenses that such Pledgor may have if Borrowers’ debt is secured by real
property.  This means, among other
things:

(i)            any member of the Lender Group may collect from any
Pledgor without first foreclosing on any real or personal property collateral
that may be pledged by Borrowers.

(ii)           If any member of the Lender Group foreclose(s) on
any real property collateral that may be pledged by Borrowers:

(iii)          the amount of the debt may be reduced only by the
price for which that collateral is sold at the foreclosure sale, even if the
collateral is worth more than the sale price.

(iv)          Agent may collect from any Pledgor even if Agent or
the Lenders, by foreclosing on the real property collateral, has/have destroyed
any right such Pledgor may have to collect from Borrowers.

This
is an unconditional and irrevocable waiver of any rights and defenses Pledgors
may have if Borrowers’ debt is secured by real property.  These rights and defenses are based upon
Section 580a, 580b, 580d, or 726 of the California Code of Civil Procedure or
any similar law of any other jurisdiction to the extent that a similar law
exists.

 15
 

 

(g)           WITHOUT LIMITING THE GENERALITY OF ANY OTHER WAIVER
OR OTHER PROVISION SET FORTH IN THIS AGREEMENT, EACH PLEDGOR HEREBY WAIVES, TO
THE MAXIMUM EXTENT SUCH WAIVER IS PERMITTED BY LAW, ANY AND ALL BENEFITS OR
DEFENSES ARISING DIRECTLY OR INDIRECTLY UNDER ANY ONE OR MORE OF CALIFORNIA
CIVIL CODE §§ 2787 THROUGH AND INCLUDING 2855, CALIFORNIA CODE OF CIVIL
PROCEDURE §§ 580a, 580b, 580c, 580d, AND 726, AND CHAPTER 2 OF
TITLE 14 OF THE CALIFORNIA CIVIL CODE OR ANY SIMILAR LAW OF ANY OTHER
JURISDICTION TO THE EXTENT THAT A SIMILAR LAW EXISTS.

(h)           WITHOUT LIMITING THE GENERALITY OF ANY OTHER WAIVER
OR OTHER PROVISION SET FORTH IN THIS AGREEMENT, EACH PLEDGOR WAIVES ALL RIGHTS
AND DEFENSES ARISING OUT OF AN ELECTION OF REMEDIES BY LENDER, EVEN THOUGH THAT
ELECTION OF REMEDIES, SUCH AS A NONJUDICIAL FORECLOSURE WITH RESPECT TO
SECURITY FOR A SECURED OBLIGATION, HAS DESTROYED SUCH PLEDGOR’S RIGHTS OF
SUBROGATION AND REIMBURSEMENT AGAINST BORROWERS BY THE OPERATION OF SECTION
580d OF THE CALIFORNIA CODE OF CIVIL PROCEDURE OR OTHERWISE OR ANY SIMILAR LAW
OF ANY OTHER JURISDICTION TO THE EXTENT THAT A SIMILAR LAW EXISTS.

(i)            Without affecting the generality of this Section,
each Pledgor hereby also agrees to the following waivers:

(i)            Each Pledgor agrees that the Agent’s right to
enforce this Agreement is absolute and is not contingent upon the genuineness,
validity or enforceability of any of the Loan Documents.  Each Pledgor waives all benefits and defenses
it may have under California Civil Code Section 2810 or any similar law of any
other jurisdiction to the extent that a similar law exists and agrees that
Agent’s rights under this Agreement shall be enforceable even if Borrowers had
no liability at the time of execution of the Loan Documents or later ceases to
be liable.

(ii)           Each Pledgor waives all benefits and defenses it may
have under California Civil Code Section 2809 or any similar law of any other
jurisdiction to the extent that a similar law exists with respect to its
obligations under this Agreement and agrees that Agent’s rights under the Loan
Documents will remain enforceable even if the amount secured by the Loan
Documents is larger in amount and more burdensome than that for which Borrowers
are responsible.  The enforceability of
this Agreement against Pledgors shall continue until all sums due under the
Loan Documents have been paid in full and shall not be limited or affected in
any way by any impairment or any diminution or loss of value of any security or
collateral for Borrowers’ obligations under the Loan Documents, from whatever
cause, the failure of any security interest in any such security or collateral
or any disability or other defense of Borrowers, any other guarantor of
Borrowers’ obligations under the Loan Documents, any pledgor of collateral for
any person’s obligations to any member of the Lender Group or any other person
in connection with the Loan Documents.

(iii)          Each Pledgor waives all benefits and defenses it may
have under California Civil Code Sections 2845, 2849 and 2850 or any similar
law of any other jurisdiction to the extent that a similar law exists with
respect to its obligations under this Agreement, including, without limitation,
the right to require Agent to (A) proceed against Borrowers, any guarantor of
Borrowers’ obligations under the Loan Documents, any other pledgor of
collateral for any person’s obligations to the Lender Group or any other person
in connection with Borrowers’ loan, (B) proceed against or exhaust any other
security or collateral Agent may hold for the benefit of the Lender Group, or
(C) pursue any other right or remedy for such Pledgor’s benefit, and agrees
that Agent may exercise its right under this Agreement without taking any
action against Borrowers, any guarantor of Borrowers’ obligations under the
Loan Documents, any pledgor of collateral for any person’s obligations to the
Lender Group or any other person in connection with Borrowers’ loan, and
without proceeding against or exhausting any security or collateral Agent holds
for the benefit of the Lender Group.

 16
 

 

27.           Miscellaneous.

(a)           This Agreement may be
executed in any number of counterparts and by different parties on separate
counterparts, each of which, when executed and delivered, shall be deemed to be
an original, and all of which, when taken together, shall constitute but one
and the same Agreement.  Delivery of an
executed counterpart of this Agreement by telefacsimile or other electronic
method of transmission shall be equally as effective as delivery of an original
executed counterpart of this Agreement. 
Any party delivering an executed counterpart of this Agreement by
telefacsimile or other electronic method of transmission also shall deliver an
original executed counterpart of this Agreement but the failure to deliver an
original executed counterpart shall not affect the validity, enforceability,
and binding effect of this Agreement. 
The foregoing shall apply to each other Loan Document mutatis mutandis.

(b)           Any provision of this
Agreement which is prohibited or unenforceable shall be ineffective to the
extent of such prohibition or unenforceability without invalidating the
remaining provisions hereof in that jurisdiction or affecting the validity or
enforceability of such provision in any other jurisdiction.

(c)           Headings used in this
Agreement are for convenience only and shall not be used in connection with the
interpretation of any provision hereof.

(d)           The pronouns used herein
shall include, when appropriate, either gender and both singular and plural,
and the grammatical construction of sentences shall conform thereto.

[Signature pages to follow]

 17

IN WITNESS WHEREOF, the undersigned parties hereto have executed this
Agreement by and through their duly authorized officers, as of the day and year
first above written.

	
   

  	
  ROBERT R. BLACK, SR., as trustee of The Robert R.

  Black, Sr. Gaming Properties Trust u/a/d May 24, 2004, as

  Pledgor

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Robert R.
  Black, Sr.

  	
   

  
	
   

  	
  Name: Robert R.
  Black, Sr.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  THE
  ROBERT R. BLACK, SR. GAMING PROPERTIES

  TRUST U/A/D MAY 24, 2004, as Pledgor

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Robert R.
  Black, Sr

  	
   

  
	
   

  	
  Name: Robert R.
  Black, Sr.

  
	
   

  	
  Title: Trustee

  
					

 

 

[SIGNATURE PAGE TO
AMENDED AND RESTATED PARENT PLEDGE AGREEMENT]

 

 

IN
WITNESS WHEREOF, the undersigned parties hereto have executed this Agreement by
and through their duly authorized officers, as of the day and year first above
written.

 

	
  

  	
  WELLS FARGO FOOTHILL, INC., as Agent

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Kevin P. Smith

  	
   

  
	
   

  	
  Name:

  	
  Kevin P. Smith

  	
   

  
	
   

  	
  Title:

  	
  Vice President

  	
   

  

 

 

[SIGNATURE PAGE TO
AMENDED AND RESTATED PARENT PLEDGE AGREEMENT]

 

SCHEDULE 1

 

PLEDGED COMPANIES

	
  Name of Pledgor

  	
   

  	
  Name of Pledged

  Company

  	
   

  	
  Number of

  Shares/Units

  	
   

  	
  Class of

  Interests

  	
   

  	
  Percentage of

  Class Owned

  	
   

  	
  Certificate

  Nos.

  	
   

  
	
  Robert R. Black,
  Sr.,

  Trustee of the Robert R.

  Black, Sr. Gaming

  Properties Trust u/a/d

  May 24, 2004

  	
   

  	
  Black
  Gaming, LLC

  	
   

  	
  9903

  	
   

  	
  Membership

  Interest

  	
   

  	
  99.03

  	
  %

  	
  2,3

  	
   

  

 

 

SCHEDULE 2

LIST OF UNIFORM COMMERCIAL CODE FILING JURISDICTIONS

	
  Pledgor

  	
   

  	
  Jurisdictions

  
	
   

  	
   

  	
   

  
	
  Robert R. Black,
  Sr., Trustee

  of the Robert R. Black, Sr.

  Gaming Properties Trust

  u/a/d May 24, 2004

  	
   

  	
  

  Nevada Secretary of State

  Clark County, Nevada

  

 

 

SCHEDULE 3

	
  Pledgor

  	
   

  	
  Location

  
	
   

  	
   

  	
   

  
	
  Robert R. Black, Sr., Trustee

  of the Robert R. Black, Sr.

  Gaming Properties Trust

  u/a/d May 24, 2004

  	
   

  	
  6885 West Charleston Blvd.

  Las Vegas, NV 89117

  

 

 

EXHIBIT A

 

Annex 1 to Pledge and Security Agreement

PLEDGED INTERESTS ADDENDUM

This Pledged Interests Addendum, dated as of                        
      , 20     , is
delivered pursuant to Section 5(b) of the Parent  Pledge Agreement referred to below.  The undersigned hereby agrees that this
Pledged Interests Addendum may be attached to that certain Parent Pledge
Agreement, dated as of December     , 2004 (as amended,
restated, supplemented or otherwise modified from time to time, the “Parent
Pledge Agreement”), made by the undersigned in favor of Wells Fargo
Foothill, Inc., as Agent.  Capitalized
terms used but not defined herein shall have the meaning ascribed to such terms
in the Parent Pledge Agreement and/or the Credit Agreement.  The undersigned hereby agrees that the
additional interests listed on this Pledged Interests Addendum as set forth
below shall be and become part of the Pledged Interests pledged by the
undersigned to the Agent in the Parent Pledge Agreement and any pledged company
set forth on this Pledged Interests Addendum as set forth below shall be and
become a “Pledged Company” under the Parent Pledge Agreement, each with the
same force and effect as if originally named therein.

The undersigned hereby certifies that the representations and
warranties set forth in Section 4 of the Parent Pledge Agreement of the
undersigned are true and correct as to the Pledged Interests listed herein on
and as of the date hereof.

	
   

  	
   

  	
  [PLEDGOR]

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Title

  	
   

  	
   

  
							

 

 

 

	
  Name of Pledgor

  	
   

  	
  Name of Pledged

  Company

  	
   

  	
  Number of

  Shares/Units

  	
   

  	
  Class of

  Interests

  	
   

  	
  Percentage of

  Class Owned

  	
   

  	
  Certificate

  Nos.

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00115-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00115-of-00352.parquet"}], [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00115-of-00352.parquet"}]]