Document:

Exhibit 10.1

 

WARREN RESOURCES, INC.

 

RESTRICTED STOCK UNIT AGREEMENT

 

THIS
AGREEMENT, dated as of March 5, 2010 (“Grant Date”) by and between  Warren
Resources, Inc., a Maryland Corporation (“Corporation”), and                                       
(“Employee”), is entered into as follows:

 

WHEREAS,
the Corporation has established the 2001 Stock Incentive Plan (“Plan”), a copy
of which can be found on the Securities and Exchange Commission Web Site at:

 

http://www.sec.gov/Archives/edgar/data/892986/000089907801500373/ex103.txt

 

or
by written or telephonic request to the Corporation Secretary, and which Plan
made a part hereof; and

 

WHEREAS,
the Compensation Committee of the Board of Directors of the Corporation (“Committee”)
determined that the Employee be granted stock units subject to the restrictions
stated below, and as hereinafter set forth;

 

NOW,
THEREFORE, the parties hereby agree as follows:

 

1.  Grant of Units.

 

Subject
to the terms and conditions of this Agreement and of the Plan, the Corporation
hereby credits to a separate account maintained on the books of the Corporation
(“Account”)                       
restricted stock units (“Units”). On any date, the value of each Unit shall
equal the fair market value of a share of the Corporation’s Common Stock (“Stock”).
For purposes of this Agreement, “fair market value” shall be deemed to be the
mean of the highest and lowest quoted selling prices for a share of Stock on
that date as reported on The NASDAQ Stock Market, Inc.

 

2.  Vesting Schedule.

 

The
interest of the Employee in the Units shall vest (net of shares withheld for
applicable tax withholdings):

 

25%
of such Units on March 9, 2010,

25%
of such Units on June 10, 2010,

25%
of such Units on September 10, 2010, and

25%
of such Units on December 10, 2010,

 

so
as to be 100% vested on November 15, 2010, conditioned upon the Employee’s
continued employment with the Corporation as of each vesting date. Notwithstanding
the foregoing vesting schedule, if a Change in Control Event (as defined in the
Plan) occurs with respect to the Corporation, all unvested Units shall
immediately vest

 

3.  Restrictions.

 

(a) 
The Units granted hereunder may not be sold, pledged or otherwise transferred
and may not be subject to lien, garnishment, attachment or other legal process.
The period of time 

 

1

 

between
the date hereof and the date the Units become vested is referred to herein as
the “Restriction Period.”

 

(b) 
If the Employee’s employment with the Corporation is terminated by the Corporation
“for cause” or voluntarily by the Employee, the balance of the Units subject to
the provisions of this Agreement which have not vested at the time of the
Employee’s termination of employment shall be forfeited by the Employee.

 

4.  Dividends.

 

If
on any date the Corporation shall pay any dividend on the Stock (other than a
dividend payable in Stock), the number of Units credited to the Employee’s
Account shall as of such date be increased by an amount equal to: (a) the
product of the number of Units credited to the Employee’s Account as of the
record date for such dividend, multiplied by the per share amount of any
dividend (or, in the case of any dividend payable in property other than cash,
the per share value of such dividend, as determined in good faith by the Board
of Directors of the Corporation), divided by (b) the fair market value of
a share of Stock on the payment date of such dividend. In the case of any
dividend declared on Stock which is payable in Stock, the number of Units
credited to the Employee shall be increased by a number equal to the product of
(x) the aggregate number of Units that have been credited to the Employee’s
Account through the related dividend record date, multiplied by (y) the
number of shares of Stock (including any fraction thereof) payable as a
dividend on a share of Stock.

 

5.  Changes in Stock.

 

In
the event of any change in the number and kind of outstanding shares of Stock
by reason of any recapitalization, reorganization, merger, consolidation, stock
split or any similar change affecting the Stock (other than a dividend payable
in Stock) the Corporation shall make an appropriate adjustment in the number
and terms of the Units credited to the Employee’s Account so that, after such
adjustment, the Units shall represent a right to receive the same consideration
(or if such consideration is not available, other consideration of the same
value) that the Employee would have received in connection with such
recapitalization, reorganization, merger, consolidation, stock split or any
similar change if he had owned on the applicable record date a number of shares
of Stock equal to the number of Units credited to the Employee’s Account prior to
such adjustment.

 

6.  Form and Timing of Payment.

 

On
the first to occur of the following, the Corporation shall pay to the Employee
a number of shares of Stock equal to the aggregate number of vested Units
credited to the Employee as of such date:

 

(a) 
On the vesting anniversaries of the Grant Date; or

(b) 
The first date on which occurs a Change of Control.

 

7.  Taxes.

 

The
Employee shall be liable for any and all taxes, including withholding taxes,
arising out of this grant or the vesting of Units hereunder. Unless the
Employee makes payment of the withholding in cash, a portion of the Stock
subject to each Unit having a fair market value equal

 

2

 

to
the Corporation’s withholding obligation will be withheld to cover required
taxes, and the net number of shares of Stock will be paid to the Employee.

 

8.  Grant Subject to Plan;
Conflict

 

This
grant is subject to all the terms, conditions, limitations and restrictions
contained in the Plan.  In the event of
any conflict or inconsistency between the terms hereof and the terms of the
Plan, the terms of the Plan shall be controlling

 

9.  Miscellaneous.

 

(a)   This grant is not a contract of employment and the terms of your
employment shall not be affected hereby or by any agreement referred to herein
except to the extent specifically so provided herein or therein.  Nothing herein shall be construed to impose
any obligation on the Corporation, the Subsidiary or on any other subsidiary
corporation or parent corporation thereof to continue your employment, and it
shall not impose any obligation on your part to remain in the employ of the
Subsidiary or of any subsidiary corporation or parent corporation thereof.

 

(b)   All amounts credited to the
Employee’s Account under this Agreement, until vested, shall continue for all
purposes to be a part of the general assets of the Corporation. The Employee’s
interest in the Account shall make him only a general, unsecured creditor of
the Corporation.

 

(c)   The parties agree to execute
such further instruments and to take such action as may reasonably be necessary
to carry out the intent of this Agreement.

 

(d)   Any notice required or
permitted hereunder shall be given in writing and shall be deemed effectively
given upon delivery to the Employee at her address then on file with the Corporation.

 

(e)   You hereby represent that you have received a copy of the Plan and
that you have had ample opportunity to review the Plan and ask questions with
respect thereto.

 

(f)    This Agreement and the Plan
constitute the entire agreement of the parties with respect to the subject
matter hereof.

 

 

	
   

  	
  WARREN
  RESOURCES, INC.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By

  	
   

  
	
   

  	
  Name:
  Norman F. Swanton

  
	
   

  	
  Title:
  Chairman and Chief Executive Officer

  

 

AGREED
TO AND ACCEPTED:

 

 

	
   

  	
   

  	
   

  
	
  Name:

  	
   

  	
   

  

 

3Exhibit 10.34

 

EXECUTION
VERSION

 

AMENDMENT NO. 1

TO

FIRST
LIEN CREDIT AGREEMENT

 

This AMENDMENT NO. 1 TO FIRST LIEN CREDIT AGREEMENT,
dated as of March 3, 2010 (this “Amendment”), is entered into among
CANNERY CASINO RESORTS, LLC, a Nevada limited liability company (“CCR”
or “Borrower”), WASHINGTON TROTTING ASSOCIATION, INC., a Delaware
corporation (“WTA” and, collectively with CCR, the “Borrowers”),
each Lender (as defined below) party hereto, and BANK OF AMERICA, N.A., as Administrative
Agent, Collateral Agent, Swing Line Lender and L/C Issuer, and amends the FIRST
LIEN CREDIT AGREEMENT, dated as of May 18, 2007 (the “Credit Agreement”),
among the Borrowers, each lender from time to time party thereto (collectively,
the “Lenders” and individually, a “Lender”), and BANK OF AMERICA,
N.A., as Administrative Agent, Collateral Agent, Swing Line Lender and L/C
Issuer, MERRILL LYNCH, PIERCE, FENNER & SMITH INCORPORATED, as
Syndication Agent and CIT LENDING SERVICES CORPORATION, COMMERZBANK
AG, LOS ANGELES BRANCH and NEVADA STATE BANK, as Co-Documentation Agents.  Capitalized terms used and not otherwise
defined herein shall have the meanings assigned to them in the Credit Agreement.  Banc of America Securities LLC is the sole
arranger (in such capacity, the “Arranger”) and book running manager for
this Amendment.

 

WHEREAS, the Borrowers, the Administrative Agent and
the undersigned Lenders, constituting the Required Lenders, wish to amend the
Credit Agreement to effect the changes described below; and

 

WHEREAS, Section 10.01 of the Credit Agreement
permits the Credit Agreement to be amended from time to time.

 

NOW, THEREFORE, in consideration of the premises and
covenants contained herein and for other good and valuable consideration, the
receipt and sufficiency of which are hereby acknowledged, the parties hereto,
intending to be legally bound hereby, agree as follows:

 

Section
1.              Amendments
to Credit Agreement.  As of the Amendment No. 1 Effective Date (as
defined below), the Credit Agreement shall be amended as follows:

 

(a)           Section 1.01 of the Credit Agreement is hereby
amended by deleting the definitions of “Increase Effective Date”, “Increase
Option Amount” and “Repricing Transaction”.

 

(b)           Section 1.01 of the Credit Agreement is hereby
amended by adding the following new definitions to appear in proper
alphabetical order:

 

“Amendment No. 1 Effective Date” means March 3,
2010.

 

 

“Cage Cash” means the amount of cash reasonably determined by
the Borrowers as necessary to operate their respective gaming businesses.

 

“Fronting Exposure” means, at any time there is a Defaulting
Lender, (a) with respect to the L/C Issuer, such Defaulting Lender’s
Applicable Percentage of the outstanding L/C Obligations other than L/C
Obligations as to which such Defaulting Lender’s participation obligation has
been reallocated to other Lenders or Cash Collateralized in accordance with the
terms hereof, and (b) with respect to the Swing Line Lender, such
Defaulting Lender’s Applicable Percentage of Swing Line Loans other than Swing
Line Loans as to which such Defaulting Lender’s participation obligation has
been reallocated to other Lenders or Cash Collateralized in accordance with the
terms hereof.

 

“Permitted Auction Rate Securities” means Investments by the
Borrowers in auction rate securities existing on the Amendment No. 1
Effective Date in an aggregate principal amount of approximately $13,000,000,
which amount shall be reduced dollar-for-dollar upon the maturity or
monetization of such auction rate securities.

 

“Permitted Meadows Transaction” means a transaction pursuant to
which CCR Pennsylvania Racing, Inc. sells, leases or assigns up to 5.0
acres of the Meadows Property (the “Subject Parcel”) to a third-party,
which third-party shall not be an Affiliate of the Borrowers, which may create
easements, licenses, covenants and rights-of-way of the type described in
clause (p) of the definition of “Permitted Liens” for the development,
construction and operation of a hotel on the Subject Parcel, subject to the
following conditions:

 

(a)           the hotel will be situated
on the Subject Parcel, which will be substantially contiguous to the north side
of the Permanent Meadows Casino location, it being understood that the
Borrowers may alter the location of the Subject Parcel in its reasonable discretion
in accordance with the other provisions of the Credit Agreement;

 

(b)           such sale, lease or
assignment, as the case may be, of the Subject Parcel shall be for
consideration determined by the Borrowers in their sole discretion and may be
at no cost or a below-market price; provided that such transaction is
reasonably calculated to result in a hotel development that will not materially
(i) impair the value or marketability of the remainder of the Meadows
Property encumbered by the Meadows Property Mortgage, (ii) interfere with
the ordinary conduct of the business of the Permanent Meadows Casino or (iii) impair
the enforceability of the Administrative Agent’s mortgage lien on the remainder
of the Meadows Property encumbered by the Meadows Property Mortgage;

 

(c)           the applicable Loan Party
shall deliver the following items in connection with the sale, lease or
assignment of the Subject Parcel, each in form and substance reasonably
satisfactory to the Administrative Agent: (i) copies of the applicable
deed, lease or assignment, as the case may be, together with copies of any
other agreements or documents

 

2

 

executed in connection with
the consummation of such transaction as shall be reasonably requested by the
Administrative Agent, (ii) such subordination, non-disturbance and
attornment agreements, estoppel certificates, consents, approvals, amendments,
memoranda of lease or other instruments as shall be reasonably requested by the
Administrative Agent, (iii) such documentation as the Borrowers may have
and receive from time to time regarding the status of construction of the
hotel, and (iv) any other agreements or documents reasonably requested by
the Administrative Agent to ensure the continuing priority of the
Administrative Agent’s first-priority lien on and security interest in the
applicable Loan Party’s right, title and interest in the Real Property
encumbered by the Meadows Property Mortgage (including, without limitation, to
the extent the Administrative Agent reasonably deems necessary, amendments to
the Meadows Property Mortgage to encumber the applicable Loan Party’s right,
title and interest in, to and under any easement, license, covenant and
right-of-way granted or entered into in connection with the development,
construction and operation of a hotel on the Subject Parcel) and to confirm the
perfection, validity, effectiveness and priority thereof;

 

(d)           the applicable Loan Party
shall deliver the following items with respect to the Meadows Property, each in
form and substance reasonably satisfactory to the Administrative Agent: (i) an
endorsement to the Mortgage Policy for the Meadows Property relating to the
enforceability of the Administrative Agent’s first-priority mortgage lien on
the remainder of the Meadows Property encumbered by the Meadows Property Mortgage,
together with such affidavits, certificates and instruments of indemnification
as shall be reasonably requested by the Administrative Agent, and (ii) an
updated ALTA survey of the remainder of the Meadows Property and the Subject Parcel;

 

(e)           both before and after giving
effect to such transactions, no Default or Event of Default shall have occurred
and be continuing; and

 

(f)            100% of the Net Cash
Proceeds from any such transactions shall be used to repay the Term Loan in
accordance with the provisions of Section 2.07(b)(I).

 

“Series C Preferred Units” means the Series C
Non-Participating Units of CCR.

 

(c)           Section 1.01 of the Credit Agreement is hereby
amended by restating the definition of “Aggregate Revolving Commitments”
and in its entirety as follows:

 

“Aggregate
Revolving Commitments” shall mean the Revolving Commitments of all
Revolving Lenders.  As of the Amendment No. 1
Effective Date, the Aggregate Revolving Commitments are $70,000,000.

 

(d)           Section 1.01 of the Credit Agreement is hereby
amended by restating the definition of “Applicable Rate” in its entirety
as follows:

 

3

 

“Applicable
Rate” shall mean (a) with respect to the Term Loans (i) 4.25% per
annum, in the case of Eurodollar Rate Loans, and (ii) 3.25% per annum, in
the case of Base Rate Loans and (b) with respect to the Revolving Loans, (i) 4.25%
per annum, in the case of Eurodollar Rate Loans, and (ii) 3.25% in the
case of Base Rate Loans.

 

(e)           Section 1.01 of the Credit Agreement is hereby
amended by restating the definition of “Cash Collateralize” in its
entirety as follows:

 

“Cash Collateralize”
means to pledge and deposit with or deliver to the Administrative Agent, for
the benefit of the L/C Issuer or Swing Line Lender (as applicable), as
collateral for L/C Obligations, Obligations in respect of Swing Line Loans (as
the context may require), cash or deposit account balances or, if the L/C
Issuer or Swing Line Lender benefiting from such collateral shall agree in its
sole discretion, other credit support, in each case pursuant to documentation
in form and substance satisfactory to (a) the Administrative Agent and (b) the
L/C Issuer or the Swing Line Lender (as applicable).  “Cash Collateral” shall have a meaning
correlative to the foregoing and shall include the proceeds of such cash
collateral and other credit support.

 

(f)            Section 1.01 of the Credit Agreement is hereby
amended by restating the definition of “Defaulting Lender” in its
entirety as follows:

 

“Defaulting Lender” means, subject
to Section 2.16(b), any Lender that, as determined by the Administrative
Agent, (a) has failed to perform any of its funding obligations hereunder
including in respect of its Loans or participations in respect of Letters of
Credit or Swing Line Loans within three Business Days of the date required to
be funded by it hereunder, (b) has notified the Borrowers or the
Administrative Agent that it does not intend to comply with its funding
obligations or has made a public statement to that effect with respect to its
funding obligations hereunder or under other agreements in which it commits to
extend credit, (c) has failed, within three Business Days after request by
the Administrative Agent, to confirm in a manner satisfactory to the
Administrative Agent, that it will comply with its funding obligations, or (d) has,
or has a direct or indirect parent company (unless such Lender demonstrates to
the reasonable satisfaction of the Administrative Agent and the Borrowers that
its access to funds shall continue notwithstanding any of the following actions
by its parent) that has, after the Amendment No. 1 Effective Date (i) become
the subject of a proceeding under any Debtor Relief Law, (ii) had a
receiver, conservator, trustee, administrator, assignee for the benefit of
creditors or similar Person charged with reorganization or liquidation of its
business or a custodian appointed for it, or (iii) taken any action in
furtherance of, or indicated its consent to, approval of or acquiescence in any
such proceeding or appointment; provided that a Lender shall not be a
Defaulting Lender solely by virtue of the ownership or acquisition of any
equity interest in that Lender or any direct or indirect parent company thereof
by a Governmental Authority; and provided  further that a Lender
described in this clause (d) shall not continue to be a Defaulting Lender
upon its providing reasonable 

 

4

 

assurances satisfactory to the Administrative
Agent and the Borrowers that it will comply with its funding obligations
hereunder, including without limitation any confirmation that such persons may
require from a bankruptcy court or trustee.

 

(g)           Section 1.01 of the Credit Agreement is hereby
amended by amending the definition of “Permitted Holders” by adding the
words “Crown Limited, Crown CCR Group Investments One, LLC, Crown CCR Group
Investments Two, LLC” after the word “OCM” in such definition.

 

(h)           Section 1.01 of the Credit Agreement is hereby
amended by amending the definition of “Permitted Liens” by (i) deleting
the word “and” at the end of clause (n) of such definition, (ii) replacing
the “.” at the end of clause (o) of such definition with “; and” and (iii) inserting
the following text as new clause (p):

 

“(p)         commercially
reasonable reciprocal easements, licenses, covenants, rights-of-way,
restrictions and other similar encumbrances created or modified in connection
with the Permitted Meadows Transaction that shall not materially interfere with
the ordinary conduct of the business of the Permanent Meadows Casino.”

 

(i)            Section 2.03(a)(iii)(F) of the Credit
Agreement is hereby restated entirety as follows:

 

(F)           any Lender is at that time a
Defaulting Lender, unless the L/C Issuer has entered into arrangements, which
may include the delivery of Cash Collateral, satisfactory to the L/C Issuer (in
its sole discretion) with the Borrowers or such Lender to eliminate the L/C
Issuer’s Fronting Exposure (after giving effect to Section 2.16(a)(iv))
with respect to the Defaulting Lender arising from either the Letter of Credit
then proposed to be issued or that Letter of Credit and all other L/C
Obligations as to which the L/C Issuer has actual or potential Fronting
Exposure from such Defaulting Lender.

 

(j)            Section 2.03(g) of the Credit Agreement is
hereby deleted in its entirety and replaced with “[Reserved].”

 

(k)           Section 2.03(i) of the Credit Agreement is
hereby amended by inserting the following text immediately before the period at
the end of the first sentence of such section:

 

“provided, however,
any Letter of Credit Fees otherwise payable for the account of a Defaulting
Lender with respect to any Letter of Credit as to which such Defaulting Lender
has not provided Cash Collateral satisfactory to the L/C Issuer pursuant to
this Section 2.03 shall be payable, to the maximum extent permitted
by applicable law, to the other Lenders in accordance with the upward
adjustments in their respective Applicable Percentages allocable to such Letter
of Credit pursuant to Section 2.16(a)(iv), with the balance of such
fee, if any, payable to the L/C Issuer for its own account”

 

5

 

(l)            Section 2.05(e) of the Credit Agreement is
hereby restated in its entirety as follows:

 

“(e)         Upon any voluntary
prepayment of the Term Loans (in whole or in part, including pursuant to a
refinancing thereof) at any time prior to the 18-month anniversary of the
Amendment No. 1 Effective Date with the proceeds received from issuance of
any Indebtedness, Borrowers shall pay a premium equal to 1.00% of the principal
amount of any portion of such Term Loans voluntarily prepaid.”

 

(m)          Section 2.07(a) of the Credit Agreement is
hereby amended by deleting the text “, plus, (iii) following each Increase
Effective Date, if any, the aggregate principal amount of Increased Term Loans
advanced on such Increase Effective Date” from the first sentence of such
section.

 

(n)           Section 2.07(b)(B) of the Credit Agreement
is hereby amended by replacing “25%” and “0%” in such section with “75%” and “50%”,
respectively.

 

(o)           Section 2.07(b)(C) of the Credit Agreement
is hereby amended by replacing the table in such section with the following:

 

	
  Consolidated
  Total

  Leverage Ratio

  	
   

  	
  Percentage
  of

  Excess Cash Flow

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  Greater than or equal to 5.0x

  	
   

  	
  100

  	
  %

  
	
   

  	
   

  	
   

  	
   

  
	
  Less than 5.0x

  	
   

  	
  50

  	
  %

  

 

(p)           Section 2.07(b)(D) of the Credit Agreement
is hereby restated in its entirety as follows:

 

(D)          Within five Business Days
after receipt thereof, the Borrowers shall make a mandatory prepayment of the
Loans by an amount equal to 100% of the Net Cash Proceeds received from
issuance of (i) any Indebtedness (other than Indebtedness permitted under Section 7.03)
or (ii) Subordinated Debt or Unsecured Indebtedness incurred pursuant to Section 7.03(g);
provided that such amount shall equal 50% of such Net Cash Proceeds so
long as the Consolidated Total Leverage Ratio (determined by reference to the
most recent Compliance Certificate delivered in accordance with Section 6.02(b))
is less than 4.5x;

 

(q)           Section 2.07(b) of the Credit Agreement is
hereby amended by adding new paragraph (H) as follows:

 

6

 

“(H)        Within five Business Days
after receipt thereof, the Borrowers shall make a mandatory prepayment of the
Loans by an amount equal to 100% of the Net Cash Proceeds received from the
issuance of Permitted Cure Securities pursuant to Section 8.04, which
amount shall not be less than the Cure Amount.”

 

(r)            Section 2.07(b) of the Credit Agreement is
hereby amended by adding new paragraph (I) as follows:

 

“(I)          Within five Business Days
after receipt thereof, the Borrowers or the applicable Loan Party shall make a
mandatory prepayment of the Term Loans by an amount equal to 100% of the Net Cash
Proceeds received from a Permitted Meadows Transaction.”

 

(s)           Section 2.07 of the Credit Agreement is hereby
amended by adding new clause (f) as follows:

 

“(f)          The Borrowers shall repay
the Revolving Loans and/or Cash Collateralize L/C Obligations in accordance
with Section 7.16.”

 

(t)            Section 2.09(a) of the Credit Agreement is
hereby amended by (i) replacing the text “the Applicable Rate” in the
first sentence of such section with the text “0.50% per annum” and (ii) deleting
the last sentence of such section in its entirety.

 

(u)           Section 2.13 of the Credit Agreement is hereby
amended by restating clause (ii) of such section in its entirety as
follows:

 

“(ii) the provisions of
this Section shall not be construed to apply to (x) any payment made
by the Borrowers pursuant to and in accordance with the express terms of this
Agreement (including the application of funds arising from the existence of a
Defaulting Lender), (y) the application of Cash Collateral provided for in
Section 2.14, or (z) any payment obtained by a Lender as
consideration for the assignment of or sale of a participation in any of its
Committed Loans or subparticipations in L/C Obligations or Swing Line Loans to
any assignee or participant, other than to the Borrowers or any Subsidiary thereof
(as to which the provisions of this Section shall apply).”

 

(v)           Section 2.14 of the Credit Agreement is hereby
restated in its entirety as follows:

 

“2.14      Cash Collateral.

 

(a)           Certain Credit
Support Events.  Upon the
request of the Administrative Agent or the L/C Issuer (i) if the L/C
Issuer has honored any full or partial drawing request under any Letter of
Credit and such drawing has resulted in an L/C Borrowing, or (ii) if, as
of the Letter of Credit Expiration Date, any L/C Obligation for any reason remains

 

7

 

outstanding, the Borrowers shall, in each case, immediately Cash
Collateralize the then Outstanding Amount of all L/C Obligations.  At any time that there shall exist a Defaulting
Lender, immediately upon the request of the Administrative Agent, the L/C Issuer
or the Swing Line Lender, the Borrowers shall deliver to the Administrative
Agent Cash Collateral in an amount sufficient to cover all Fronting Exposure
(after giving effect to Section 2.16(a)(iv) and any Cash Collateral
provided by the Defaulting Lender).

 

(b)           Grant of
Security Interest.  All Cash
Collateral (other than credit support not constituting funds subject to
deposit) shall be maintained in blocked, non-interest bearing deposit accounts
at a depository institution selected by the Administrative Agent.  The Borrowers, and to the extent Cash
Collateral is provided by any Lender, such Lender, hereby grants to (and
subjects to the control of) the Administrative Agent, for the benefit of the
Administrative Agent, the L/C Issuer and the Lenders (including the Swing Line
Lender), and agrees to maintain, a first priority security interest in all such
cash, deposit accounts and all balances therein, and all other property so
provided as collateral pursuant hereto, and in all proceeds of the foregoing,
all as security for the obligations to which such Cash Collateral may be
applied pursuant to Section 2.14(c).  If at any time the Administrative Agent
determines that Cash Collateral is subject to any right or claim of any Person
other than the Administrative Agent as herein provided (other than the liens of
the depository institution), or that the total amount of such Cash Collateral
is less than the applicable Fronting Exposure and other obligations secured
thereby, the Borrowers or the relevant Defaulting Lender will, promptly upon
demand by the Administrative Agent, pay or provide to the Administrative Agent
additional Cash Collateral in an amount sufficient to eliminate such deficiency.

 

(c)           Application.  Notwithstanding anything to the contrary
contained in this Agreement, Cash Collateral provided under any of this Section 2.14
or Sections 2.03, 2.04, 2.05, 2.16 or 8.02
in respect of Letters of Credit or Swing Line Loans shall be held and applied to the satisfaction of the specific L/C Obligations, Swing Line Loans,
obligations to fund participations therein (including, as to Cash Collateral
provided by a Defaulting Lender, any interest accrued on such obligation) and
other obligations for which the Cash Collateral was so provided, prior to any
other application of such property as may be provided for herein.

 

(d)           Release.  Cash Collateral (or the appropriate portion
thereof) provided to reduce Fronting Exposure or other obligations shall be released
promptly following (i) the elimination of the applicable Fronting Exposure
or other obligations giving rise thereto (including by the termination of
Defaulting Lender status of the applicable Lender (or, as appropriate, its
assignee following compliance with Section 10.06(b)(v))) or (ii) when
the Administrative Agent shall determine in good faith that there exists excess
Cash Collateral; provided,
however, (x) that Cash Collateral furnished by or on behalf of a Loan
Party shall not be released during the continuance of a Default or Event of
Default (and following application as provided in this Section 2.14
may be otherwise applied in

 

8

 

accordance with Section 8.03), and (y) the Person
providing Cash Collateral and the L/C Issuer or Swing Line Lender, as
applicable, may agree that Cash Collateral shall not be released but instead
held to support future anticipated Fronting Exposure or other obligations.”

 

(w)          Article II of the Credit Agreement is hereby
amended by adding a new Section 2.16 as follows:

 

“2.16      Defaulting
Lenders.  (a)  Adjustments.  Notwithstanding anything to the contrary
contained in this Agreement, if any Lender becomes a Defaulting Lender, then,
until such time as that Lender is no longer a Defaulting Lender, to the extent
permitted by applicable Law:(i)   Waivers and Amendments.  That Defaulting Lender’s right to approve or
disapprove any amendment, waiver or consent with respect to this Agreement
shall be restricted as set forth in Section 10.01.

 

(ii)           Reallocation of
Payments. Any payment of principal, interest, fees or other
amounts received by the Administrative Agent for the account of that Defaulting
Lender (whether voluntary or mandatory, at maturity, pursuant to Article VIII
or otherwise, and including any amounts made available to the Administrative
Agent by that Defaulting Lender pursuant to Section 10.08), shall
be applied at such time or times as may be determined by the Administrative
Agent as follows: first, to the payment of any
amounts owing by that Defaulting Lender to the Administrative Agent hereunder; second, to the payment on a pro rata basis of any amounts
owing by that Defaulting Lender to the L/C Issuer or Swing Line Lender
hereunder; third, if so determined by the Administrative
Agent or requested by an L/C Issuer or Swing Line Lender, to be held as Cash
Collateral for future funding obligations of that Defaulting Lender of any participation
in any Swing Line Loan or Letter of Credit; fourth, as the
Borrowers may request (so long as no Default or Event of Default exists), to
the funding of any Loan in respect of which that Defaulting Lender has failed
to fund its portion thereof as required by this Agreement, as determined by the
Administrative Agent; fifth, if so determined
by the Borrowers, with the consent of the Administrative Agent, not to be
unreasonably withheld, to be held in escrow in a non-interest bearing deposit
account and released in order to satisfy obligations of that Defaulting
Lender to fund Loans under this Agreement (but only to the extent such
Defaulting Lender is so obligated); sixth, to the
payment of any amounts owing to the Lenders, the L/C Issuer or Swing Line
Lender as a result of any judgment of a court of competent jurisdiction
obtained by any Lender, the L/C Issuer or Swing Line Lender against that
Defaulting Lender as a result of that Defaulting Lender’s breach of its
obligations under this Agreement; seventh, so
long as no Default or Event of Default exists, to the payment of any amounts owing
to the Borrowers as a result of any judgment of a court of competent
jurisdiction obtained by the Borrowers against that Defaulting Lender as a
result of that Defaulting Lender’s breach of its obligations under this Agreement;
and eighth, to that Defaulting Lender or as
otherwise directed by a court of competent jurisdiction; provided that
if (x) such payment is a payment of the principal

 

9

 

amount of any Loans or L/C Borrowings in respect of which that
Defaulting Lender has not fully funded its appropriate share and (y) such
Loans or L/C Borrowings were made at a time when the conditions set forth in Section 4.02
were satisfied or waived, such payment shall be applied solely to pay the Loans
of, and L/C Borrowings owed to, all non-Defaulting Lenders on a pro rata basis
prior to being applied to the payment of any Loans, or L/C Borrowings owed to,
that Defaulting Lender.  Any payments,
prepayments or other amounts paid or payable to a Defaulting Lender that are
applied (or placed in escrow) to pay amounts owed by a Defaulting Lender or to
post Cash Collateral pursuant to this Section 2.16(a)(ii) shall
be deemed paid to and redirected by that Defaulting Lender, and each Lender
irrevocably consents hereto.

 

(iii)          Certain Fees.  That Defaulting Lender (x) shall not be
entitled to receive any commitment fee pursuant to Section 2.09(a) for
any period during which that Lender is a Defaulting Lender (and the Borrowers
shall not be required to pay any such fee that otherwise would have been
required to have been paid to that Defaulting Lender) and (y) shall be
limited in its right to receive Letter of Credit Fees as provided in Section 2.03(i).

 

(iv)          Reallocation of
Applicable Percentages to Reduce Fronting Exposure.  During any period in which there is a
Defaulting Lender, for purposes of computing the amount of the obligation of
each non-Defaulting Lender to acquire, refinance or fund participations in
Letters of Credit or Swing Line Loans pursuant to Sections 2.03 and 2.04,
the “Applicable Percentage” of each non-Defaulting Lender shall be computed
without giving effect to the Commitment of that Defaulting Lender; provided,
that, (i) each such reallocation shall be given effect only if, at the
date the applicable Lender becomes a Defaulting Lender, no Default or Event of
Default exists; and (ii) the aggregate obligation of each non-Defaulting
Lender to acquire, refinance or fund participations in Letters of Credit and
Swing Line Loans shall not exceed the positive difference, if any, of (1) the
Commitment of that non-Defaulting Lender minus (2) the aggregate Outstanding
Amount of the Committed Loans of that Lender.

 

(b)           Defaulting Lender Cure.  If
the Borrowers, the Administrative Agent, Swing Line Lender and the L/C Issuer
agree in writing in their sole discretion that a Defaulting Lender should no
longer be deemed to be a Defaulting Lender, the Administrative Agent will so
notify the parties hereto, whereupon as of the effective date specified in such
notice and subject to any conditions set forth therein (which may include arrangements
with respect to any Cash Collateral), that Lender will, to the extent
applicable, purchase that portion of outstanding Loans of the other Lenders or
take such other actions as the Administrative Agent may determine to be
necessary to cause the Committed Loans and funded and unfunded participations
in Letters of Credit and Swing Line Loans to be held on a pro rata basis by the
Lenders in accordance with their Applicable Percentages (without giving effect
to Section 2.16(a)(iv)), whereupon that Lender will cease to be a
Defaulting Lender; provided that no adjustments will be made retroactively with
respect to fees accrued or payments made by or on behalf of the Borrowers while
that Lender was a Defaulting Lender; and provided,

 

10

 

further, that except to the extent otherwise
expressly agreed by the affected parties, no change hereunder from Defaulting
Lender to Lender will constitute a waiver or release of any claim of any party
hereunder arising from that Lender’s having been a Defaulting Lender.

 

(c)           Section 2.16 shall not limit any claim
of any party hereto arising from the Lender’s status as a Defaulting Lender.

 

(x)            Section 7.02(i) of the Credit Agreement is
hereby restated in its entirety as follows:

 

“(i)          Investments in Unrestricted
Subsidiaries in an aggregate amount of up to $45,000,000 if (A) pro forma
for such Investment, the sum of availability under the Revolving Loans and
unrestricted balance sheet cash (excluding Cage Cash) (the “Liquidity Amount”)
is at least $35,000,000 and (B) CCR’s Consolidated Total Leverage Ratio
(determined by reference to the most recent Compliance Certificate delivered in
accordance with Section 6.02(b)) is less than 4.5x.”

 

(y)           Section 7.05 of the Credit Agreement is hereby
amended by (i) deleting the word “and” immediately after the “;” at the
end of clause (i) of such section, (ii) inserting the word “and”
immediately after the “;” at the end of clause (j) of such section and (iii) adding
the following as new clause (k):

 

“(k)          the Permitted Meadows
Transaction;”

 

(z)            Section 7.06(f) of the Credit Agreement is
hereby amended by inserting the text “so long as the Consolidated Total
Leverage Ratio is less than or equal to 4.5x,” immediately
before the text “Restricted Payments”.

 

(aa)         Section 7.06(g) of the Credit Agreement is
hereby amended by deleting such section in its entirety and replacing it with
the following:

 

“(g)         so long as (x) no
Default or Event of Default shall have occurred and be continuing at the time
thereof or that would result therefrom and (y) the Consolidated Total
Leverage Ratio is less than 4.5x on a pro forma basis after giving effect to
the application of the proceeds as set forth below, CCR may declare and make
dividend payments to any direct owner of CCR’s Equity Interest in an aggregate
amount not to exceed 50% of the Net Cash Proceeds received by CCR from the
concurrent sale of its Equity Interest to non-affiliated third-parties; provided
that an equivalent percentage of such Net Cash Proceeds shall have been first
used by the Borrowers to mandatorily prepay the Loans.”

 

(bb)         Section 7.06 of the Credit Agreement is hereby
amended by (i) deleting the word “and” immediately after the “;” at the
end of clause (f) of such section, (ii) replacing the

 

11

 

“.” at the end of clause (g) of such section with “;” and (iii) adding
the following as new clauses (h), (i) and (j):

 

“(h)         CCR may declare and make
dividend payments to any direct owners of CCR’s Equity Interests from the Net
Cash Proceeds received by CCR from the substantially concurrent sale of its
Equity Interests to non-affiliated third-parties from the Effective Date to the
Amendment No. 1 Effective Date;

 

(i)            CCR may make a one time
payment to Magna Entertainment Corporation (“Magna”) in an amount not to
exceed $5,000,000 in exchange for complete resolution of Magna’s claims under
the Holdback Agreement and a full release of all claims by Magna to additional
and/or future payment under the Holdback Agreement; and

 

(j)            CCR may declare and make
dividend payments or other distributions on account of the Series C
Preferred Units payable in additional Series C Preferred Units.”

 

(cc)         Section 7.06 of the Credit Agreement is hereby
amended by deleting last paragraph of such section in its entirety.

 

(dd)         Section 7.11(b) of the Credit Agreement is
hereby amended by replacing the last nine rows in the table set forth in such
section with the following:

 

	
  Date

  	
   

  	
  Ratio

  	
   

  
	
  December 31, 2009

  	
   

  	
  6.00 to 1.00

  	
   

  
	
  March 31, 2010

  	
   

  	
  7.75 to 1.00

  	
   

  
	
  June 30, 2010

  	
   

  	
  8.30 to 1.00

  	
   

  
	
  September 30, 2010

  	
   

  	
  8.30 to 1.00

  	
   

  
	
  December 31, 2010

  	
   

  	
  8.30 to 1.00

  	
   

  
	
  March 31, 2011

  	
   

  	
  7.90 to 1.00

  	
   

  
	
  June 30, 2011

  	
   

  	
  7.50 to 1.00

  	
   

  
	
  September 30, 2011

  	
   

  	
  7.00 to 1.00

  	
   

  
	
  December 31, 2011

  	
   

  	
  6.50 to 1.00

  	
   

  
	
  March 31, 2012

  	
   

  	
  6.50 to 1.00

  	
   

  
	
  June 30, 2012

  	
   

  	
  6.25 to 1.00

  	
   

  
	
  September 30, 2012

  	
   

  	
  6.00 to 1.00

  	
   

  
	
  December 31, 2012 and
  thereafter

  	
   

  	
  5.75 to 1.00

  	
   

  

 

12

 

(ee)         Section 7.11 of the Credit Agreement is hereby
amended by adding a new paragraph (c) as follows:

 

“(c)         Minimum EBITDA.  Permit the Consolidated EBITDA for the
twelve-month period ending as of the ending date of any fiscal quarter set
forth below to be less than the amount set forth below opposite the ending date
of such twelve-month period:

 

	
  Twelve-Month Period Ending

  	
   

  	
  Consolidated EBITDA

  	
   

  
	
  December 31, 2009

  	
   

  	
  $

  	
  80.0

  	
   

  
	
  March 31, 2010

  	
   

  	
  $

  	
  62.0

  	
   

  
	
  June 30, 2010

  	
   

  	
  $

  	
  60.0

  	
   

  
	
  September 30, 2010

  	
   

  	
  $

  	
  58.0

  	
   

  
	
  December 31, 2010

  	
   

  	
  $

  	
  58.0

  	
   

  
	
  March 31, 2011

  	
   

  	
  $

  	
  60.0

  	
   

  
	
  June 30, 2011

  	
   

  	
  $

  	
  63.0

  	
   

  
	
  September 30, 2011

  	
   

  	
  $

  	
  66.0

  	
   

  
	
  December 31, 2011 and
  thereafter

  	
   

  	
  $

  	
  70.0

  	
   

  

 

(ff)           Section 7.12 of the Credit Agreement is hereby
amended by deleting such section in its entirety and replacing it with the
following:

 

“7.12      Capital Expenditures.  Make or become legally obligated to make any
expenditure in respect of the purchase or other acquisition of any fixed or
capital asset except for (a) Maintenance Capital Expenditures in any
fiscal year in an amount not to exceed 5% of the Borrowers’ consolidated net
revenue for the most recent fiscal year for which a Compliance Certificate has
been delivered pursuant to Section 6.02(b), (b) Capital
Expenditures of up to $20,000,000 in connection with the acquisition of table
gaming licenses in Pennsylvania, (c) Capital Expenditures of up to
$5,000,000 for the purchase of table games and related equipment for the
Permanent Meadows Casino and (d) other Expansion Capital Expenditures in
an aggregate amount not to exceed $15,000,000 from the Amendment No. 1
Effective Date through the Maturity Date.”

 

(gg)         Article VII of the Credit Agreement is hereby
amended by adding a new Section 7.16 as follows:

 

13

 

“7.16      Cash Management.  Hold cash (excluding Cage Cash) or
Investments of the type described in Section 7.02(a) (other
than Permitted Auction Rate Securities) in an amount in excess of $15,000,000
for any period of five (5) consecutive Business Days (or such longer
period as the Administrative Agent may agree) during any time that Revolving
Loans or Swing Line Loans are outstanding. 
Any amount of cash and/or such Investments in excess of $15,000,000 held
by the Borrowers or any Restricted Subsidiary for greater than five (5) consecutive
Business Days (or such longer period as the Administrative Agent may agree)
shall be applied to repay Revolving Loans and/or Cash Collateralize Letters of
Credit in accordance with Section 2.07(f).”

 

(hh)         Section 8.03 of the Credit Agreement is hereby
amended by (i) inserting the text “, subject to the provisions of Sections
2.14 and 2.16,” immediately after the word “shall” and immediately before the
word “be” in the first sentence of such Section and (ii) inserting
the text “to the extent not otherwise Cash Collateralized by the Borrowers
pursuant to Sections 2.03 and 2.14” immediately before the semicolon at the end
of clause Fifth of such Section.

 

(ii)           Section 8.04 of the Credit Agreement is hereby
amended by deleting such section in its entirety and replacing it with the
following:

 

8.04        Equity Cure.  Notwithstanding anything to the contrary
contained in Section 8.01 or any other provision of this Agreement,
in the event that CCR fails to comply (or believes it may fail to comply) with
any financial covenant contained in Section 7.11, CCR shall have
the right on one or more occasions from the Amendment No. 1 Effective Date
until the Term Loan Maturity Date, including during the applicable Measurement
Period through and including the 10th Business Day after the delivery of a
Notice of Issuance of Permitted Cure Securities, to issue Permitted Cure
Securities for cash in an aggregate principal amount not to exceed $35,000,000
(collectively, the “Cure Right”), the net cash proceeds of which shall
be applied in accordance with Section 2.07(b)(H), and upon the later of (a) the
application by CCR of such net cash proceeds and (b) the end of the
relevant Measurement Period, such financial covenant shall be calculated or
recalculated, as the case may be, giving effect to the following:

 

(i)          Consolidated EBITDA shall be
increased, as provided in the definition thereof, solely for the purpose of
measuring compliance with the financial covenants in Section 7.11
and will not be applied for any other purpose under this Agreement, including
but not limited to other provisions hereof that are based upon the Consolidated
Total Leverage Ratio in effect from time to time, by an amount not to exceed
the amount necessary to cure the non-compliance or potential non-compliance
(the “Cure Amount”), as applicable;

 

(ii)         if, after giving effect to
the foregoing increase in Consolidated EBITDA, CCR shall be in compliance with
the requirements of such financial covenant, CCR shall be deemed to have
satisfied the requirements of such financial

 

14

 

covenant as of the end of the relevant Measurement Period and there
shall be (or shall be deemed to be) no applicable breach or default of such
financial covenant for all purposes of this Agreement and the other Loan Documents;

 

(iii)        Indebtedness shall not be
deemed to have been repaid for purposes of calculating the financial covenants
for the applicable Measurement Period with respect to which such Cure Right was
exercised; and

 

(iv)        to the extent a fiscal
quarter ended for which such financial covenant is calculated giving effect to
a Cure Amount is included in the calculation of a financial covenant in a
subsequent fiscal period, the Cure Amount shall continue to be included in the
amount of Consolidated EBITDA for such fiscal quarter;

 

provided that CCR may
not exercise such Cure Right in respect of more than six fiscal quarters from
and after the Amendment No. 1 Effective Date.  If CCR shall have delivered a Notice of
Issuance of Permitted Cure Securities in accordance with Section 6.01(f),
then (subject to the preceding sentence) the Lenders shall not have the right
to declare a Default or Event of Default or otherwise declare the Loans due and
payable and terminate the Commitments pursuant to Section 8.01
solely as a result of a Default under Section 7.11 until 10
Business Days following the date of delivery of such Notice of Issuance of
Permitted Cure Securities, and then only if CCR has not applied the net cash proceeds
of the Cure Amount by such date.

 

(jj)           Section 10.06(b) of the Credit Agreement is
hereby amended by deleting the word “and” at the end of clause (iii) of
such section; replacing the “.” at the end of clause (iv) of such section
with “; and”; and inserting the following text as a new clause (v):

 

(v)           Certain Additional Payments.  In connection with any assignment of rights
and obligations of any Defaulting Lender hereunder, no such assignment shall be
effective unless and until, in addition to the other conditions thereto set
forth herein, the parties to the assignment shall make such additional payments
to the Administrative Agent in an aggregate amount sufficient, upon
distribution thereof as appropriate (which may be outright payment, purchases
by the assignee of participations or subparticipations, or other compensating
actions, including funding, with the consent of the Borrowers and the
Administrative Agent, the applicable pro rata share of Loans previously
requested but not funded by the Defaulting Lender, to each of which the
applicable assignee and assignor hereby irrevocably consent), to (x) pay
and satisfy in full all payment liabilities then owed by such Defaulting Lender
to the Administrative Agent or any Lender hereunder (and interest accrued
thereon) and (y) acquire (and fund as appropriate) its full pro rata share
of all Loans and participations in Letters of Credit and Swing Line Loans in
accordance with its Applicable Percentage. Notwithstanding the foregoing, in
the event that any assignment of rights and obligations of any Defaulting
Lender hereunder shall become effective under applicable Law without compliance
with the provisions of this paragraph, then the assignee of such interest shall

 

15

 

be deemed to be a Defaulting
Lender for all purposes of this Agreement until such compliance occurs.

 

(kk)         Section 10.06(c) of the Credit Agreement
is hereby amended by inserting the following new sentence immediately between
the second and third sentences of such section:

 

“In addition, the
Administrative Agent shall maintain on the Register information regarding the
designation, and revocation of designation, of any Lender as a Defaulting
Lender.”

 

(ll)           Section 10.06(d) of the Credit Agreement
is hereby amended by inserting the text “, a Defaulting Lender” immediately
after the word “person” and immediately before the word “or” in the first
sentence of such section.

 

(mm)       Section 10.08 of the Credit Agreement is hereby
amended by inserting the following text immediately before the period at the
end of the first sentence of such section:

 

“provided, that in
the event that any Defaulting Lender shall exercise any such right of setoff, (x) all
amounts so set off shall be paid over immediately to the Administrative Agent
for further application in accordance with the provisions of Section 2.16
and, pending such payment, shall be segregated by such Defaulting Lender from
its other funds and deemed held in trust for the benefit of the Administrative
Agent and the Lenders, and (y) the Defaulting Lender shall provide
promptly to the Administrative Agent a statement describing in reasonable
detail the Obligations owing to such Defaulting Lender as to which it exercised
such right of setoff”

 

Section
2.              Amendments to Schedules and
Exhibits.

 

(a)           Schedule 2.01 to the Credit Agreement is hereby amended
by replacing the columns entitled “Revolving Credit Commitment” and “Revolving
Credit Applicable Percentage” with the respective columns on Schedule 2.01
hereto.

 

Section
3.              Representations and Warranties.  On and as of the Amendment No. 1 Effective Date,
after giving effect to this Amendment, each Borrower hereby represents and
warrants to the Administrative Agent and each Lender as follows:

 

(a)           this Amendment has been duly authorized, executed
and delivered by each Borrower and constitutes the legal, valid and binding
obligations of each Borrower enforceable against each Borrower in accordance
with its terms and the Credit Agreement as amended by this Amendment and
constitutes the legal, valid and binding obligation of each Borrower
enforceable against each Borrower in accordance with its terms;

 

(b)           each of the representations and warranties contained
in Article V (Representations and Warranties) of the Credit
Agreement and each other Loan Document is

 

16

 

true and correct in all material respects on and as of the Amendment No. 1
Effective Date, as if made on and as of such date and except to the extent that
such representations and warranties specifically relate to a specific date, in
which case such representations and warranties shall be true and correct in all
material respects as of such specific date; provided, however,
that references therein to the “Credit Agreement” shall be deemed to refer to
the Credit Agreement as amended hereby and after giving effect to the consents
and waivers set forth herein;

 

(c)           no Default or Event of Default has occurred and is
continuing; and

 

(d)           After giving effect to this Amendment, neither the
modification of the Credit Agreement effected pursuant to this Amendment nor
the execution, delivery, performance or effectiveness of this Amendment:

 

(i)            impairs the
validity, effectiveness or priority of the Liens granted pursuant to any Loan
Document, and such Liens continue unimpaired with the same priority to secure
repayment of all Obligations, whether heretofore or hereafter incurred; or

 

(ii)           requires that
any new filings be made or other action taken to perfect or to maintain the
perfection of such Liens other than the actions required by Section 7 of
this Amendment.

 

Section
4.              Affirmation
of Obligations.  The
undersigned hereby (i) expressly acknowledges the terms of this Amendment, (ii)
ratifies and confirms its obligations under the Loan Documents (including
guarantees and security agreements) executed by the undersigned and (iii)
acknowledges, renews and extends its continued liability under all such Loan
Documents and agrees such Loan Documents remain in full force and effect.

 

Section
5.              Conditions
to Effectiveness.  This
Amendment shall become effective as of the date when each of the following
conditions is satisfied (the “Amendment No. 1 Effective Date”):

 

(a)           the Administrative Agent (or
its counsel) shall have received from the Required Lenders, the L/C Issuer, the
Swing Line Lender, the Borrowers and each of the other parties hereto, a
counterparts of this Amendment signed on behalf of such party;

 

(b)           the Administrative Agent
shall have received payment of a consent fee on behalf of each Lender
consenting to this Amendment in an amount equal to 0.50% of the aggregate
amount of Term Loans and/or Revolving Commitments held by such Lender after
giving effect to this Amendment;

 

17

 

(c)           the Administrative Agent
shall have received reimbursement or payment of all fees and expenses
(including the reasonable fees, charges and disbursements of Cahill Gordon &
Reindel LLP) incurred in connection with this Amendment;

 

(d)           all corporate or other
proceedings taken or to be taken in connection with this Amendment and all
documents incidental thereto, whether or not referred to herein, shall be
reasonably satisfactory in form and substance to the Administrative Agent and
the Administrative Agent shall have received certified true and complete copies
of the charter and by-laws and all amendments thereto (or equivalent documents)
of each Borrower and of all corporate or other authority for each Borrower
(including board of directors (or the functional equivalent thereof)
resolutions with respect to the execution, delivery and performance of this
Amendment and each other document to be delivered by each Borrower from time to
time in connection herewith and the extensions of credit hereunder), certified
as of the Amendment No. 1 Effective Date as complete and correct copies
thereof by the Secretary or Assistant Secretary of each Borrower;

 

(e)           the representations and
warranties in Section 3 of this Amendment shall be true and correct and
the Administrative Agent shall have received an Officer’s Certificate of the
Borrowers, dated the Amendment No. 1 Effective Date, certifying to the
effect set forth in Sections 3(b) and 3(c) of this Amendment;

 

(f)            the Borrowers and the
Administrative Agent shall be satisfied that all approvals required for this
Amendment from any applicable Gaming Board shall have been received;

 

(g)           the Borrowers shall have (i) received
a cash equity contribution of not less than $75,000,000 (the “Equity
Contribution”) on terms acceptable to the Arranger and the Administrative
Agent and applied the proceeds of such Equity Contribution to repay $65,000,000
aggregate principal amount of the Term Loans and $10,000,000 aggregate
principal amount of Revolving Loans and (ii) applied the remaining balance
(approximately $16,000,000) in the Construction Reserve Account to repay the
Term Loans;

 

(h)           the Borrowers shall have
delivered to the Administrative Agent copies of all documentation as the
Administrative Agent may reasonably require evidencing or relating to the
Equity Contribution;

 

(i)            the Borrowers shall have
obtained an amendment to the credit agreement governing the FF&E Financing,
which amendment shall be in full force and effect on the Amendment No. 1
Effective Date on terms reasonably satisfactory to the Administrative Agent and
the Administrative Agent shall have received written documentation thereof;

 

(j)            a copy of, or a certificate
as to coverage under, the insurance policies required by Section 6.07 and
the applicable provisions of the Collateral Documents, each of which shall be
endorsed or otherwise amended to include a “standard” or “New York” 

 

18

 

lender’s loss payable or
mortgagee endorsement (as applicable) and shall name the Administrative Agent,
on behalf of the Secured Parties, as additional insured, in form and substance
satisfactory to the Administrative Agent; and

 

(k)           the Administrative Agent
shall have received the legal opinion of (i) Munger, Tolles and Olson LLP
and (ii) certain local counsel to the Borrowers, each dated the Amendment No. 1
Effective Date, addressed to the Administrative Agent and each Lender and with
respect to such matters as the Administrative Agent shall reasonably request.

 

Upon satisfaction of the conditions precedent set
forth above, the Administrative Agent shall promptly notify the Borrowers and
the Lenders of its determination that this Amendment has become effective,
which determination shall, absent manifest error, be conclusive and binding on
the Borrowers and the Lenders for all purposes.

 

Section
6.              Real
Estate Matters.  With
respect to each Mortgaged Property, Borrowers shall cause to be delivered, or
shall cause the applicable Loan Party to cause to be delivered, to the
Administrative Agent, on behalf of the Secured Parties, the following:

 

(a)           with respect to each Mortgage,
an amendment (the “Mortgage Amendment”) duly executed and acknowledged
by the applicable Loan Party, and in form for recording in the recording office
where such Mortgage was recorded, together with such certificates, affidavits,
questionnaires or returns as shall be required in connection with the recording
or filing thereof under applicable law, in each case in form and substance
reasonably satisfactory to the Administrative Agent; provided, however,
that Borrowers or the applicable Loan Party shall not be required to deliver a
Mortgage Amendment for any Mortgaged Property for which Borrower provides a
local counsel opinion opining that such Mortgaged Amendment is not necessary in
connection with this Amendment;

 

(b)           with respect to the Mortgage
Amendment, an endorsement to the existing title insurance policy assuring the
Administrative Agent that the Mortgage, as amended by the Mortgage Amendment,
is a valid and enforceable first priority lien on such Mortgaged Property in
favor of the Administrative Agent (as
appropriate) for the benefit of the Secured Parties free and clear of
all Liens except those Liens created or permitted by the Mortgage or by the
Administrative Agent, and such endorsement to title insurance policy shall
otherwise be in form and substance reasonably satisfactory to the Administrative
Agent;

 

(c)           to the extent available on
commercially reasonable terms, a completed “Life-of-Loan” Federal Emergency
Management Agency Standard Flood Hazard Determination with respect to the
Mortgaged Property (together with a notice about special flood hazard area
status and flood disaster assistance duly executed by the Borrowers and the
applicable Loan Party relating thereto), unless the Administrative Agent, in
its reasonable judgment, waives such requirement; and

 

19

 

(d)           to the extent reasonably
requested by the Administrative Agent, with respect to each Mortgage Amendment,
opinions of local counsel to the Loan Parties, which opinions (x) shall be addressed to Administrative Agent and each of
the Lenders, (y) shall cover the enforceability of the respective Mortgage
as amended by the Mortgage Amendment, and (z) shall be in form and
substance reasonably satisfactory to the Administrative Agent.

 

The Borrowers shall deliver
or cause to be delivered each of the documents and instruments required
pursuant to this Section 6 within ninety (90) days after the Amendment No. 1
Effective Date, unless extended by the Administrative Agent in its sole discretion.

 

Section 7.              Counterparts.  This Amendment may be
executed in counterparts (and by different parties hereto in different
counterparts), each of which shall constitute an original, but all of which
when taken together shall constitute a single contract.  Delivery of an executed counterpart of a
signature page of this Agreement by telecopy shall be effective as
delivery of a manually executed counterpart of this Agreement.

 

Section 8.              Applicable Law.  THIS AGREEMENT SHALL BE GOVERNED BY, AND
CONSTRUED IN ACCORDANCE WITH, THE LAW OF THE STATE OF NEW YORK.

 

Section 9.              Headings.  Section headings herein
and in the Loan Documents are included for convenience of reference only and
shall not affect the interpretation of this Amendment or any Loan Document.

 

Section 10.            Effect of Amendment.  On and after the Amendment No. 1
Effective Date, each reference in the Credit Agreement to “this Agreement,” “hereunder,”
“hereof” or words of like import referring to the Credit Agreement, and each
reference in each of the Loan Documents to “the Credit Agreement,” “thereunder,”
“thereof” or words of like import referring to the Credit Agreement, shall mean
and be a reference to the Credit Agreement as amended by this Amendment.  The Credit Agreement and each of the other
Loan Documents, as supplemented by this Amendment, are and shall continue to be
in full force and effect and are hereby in all respects ratified and
confirmed.  Except as expressly set forth
herein, this Amendment shall not by implication or otherwise limit, impair,
constitute a waiver of or otherwise affect the rights and remedies of the
Lenders or the Administrative Agent under the Credit Agreement or any other
Loan Document, and shall not alter, modify, amend or in any way affect any of
the terms, conditions, obligations, covenants or agreements contained in the
Credit Agreement or any other provision of the Credit Agreement or any other
Loan Document, all of which are ratified and affirmed in all respects and shall
continue in full force and effect.  By
executing and delivering a copy hereof, each applicable Loan Party hereby
agrees and confirms that all Loans and Obligations shall be guaranteed and
secured pursuant to the Loan Documents as provided therein.

 

[Signature pages follow]

 

20

 

IN WITNESS WHEREOF, the parties hereto have caused
this Amendment to be duly executed as of the date first above written.

 

	
   

  	
  CANNERY CASINO RESORTS, LLC,

  
	
   

  	
  a Nevada limited liability
  company,

  
	
   

  	
  as Borrower

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ William C. Wortman

  
	
   

  	
   

  	
  Name:

  	
  William
  C. Wortman

  
	
   

  	
   

  	
  Title:

  	
  Manager

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  WASHINGTON TROTTING
  ASSOCIATION, INC.,

  
	
   

  	
  a Delaware corporation,

  
	
   

  	
  as Borrower

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ William C. Wortman

  
	
   

  	
   

  	
  Name:

  	
  William
  C. Wortman

  
	
   

  	
   

  	
  Title:

  	
  Chief
  Executive Officer

  

 

[Amendment
No. 1 to First Lien Credit Agreement]

 

 

	
   

  	
  BANC OF AMERICA SECURITIES LLC,

  
	
   

  	
  as Sole Arranger and
  Bookrunning Manager

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Richard Arendale

  
	
   

  	
   

  	
  Name:

  	
  Richard Arendale

  
	
   

  	
   

  	
  Title:

  	
  Managing Director

  

 

[Amendment
No. 1 to First Lien Credit Agreement]

 

 

	
   

  	
  BANK OF AMERICA, N.A.,

  
	
   

  	
  as Administrative Agent,
  Swing Line Lender, L/C Issuer and Lender

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Justin Lien

  
	
   

  	
   

  	
  Name:

  	
  Justin Lien

  
	
   

  	
   

  	
  Title:

  	
  Senior Vice President

  

 

[Amendment
No. 1 to First Lien Credit Agreement]

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