Document:

Exhibit
4.26

FOURTH
AMENDMENT TO LOAN AND SECURITY AGREEMENT AND CONSENT

This FOURTH AMENDMENT TO
LOAN AND SECURITY AGREEMENT AND CONSENT (this “Amendment”) is entered
into as of December 22, 2006, among DIAMOND JO, LLC (formerly
known as Peninsula Gaming Company, LLC), a Delaware limited liability company (“DJL”),
THE OLD EVANGELINE DOWNS, L.L.C., a
Louisiana limited liability company (“OED”, and together with DJL,
referred to hereinafter each individually as a “Borrower”, and
individually and collectively, as “Borrowers”), the Lenders (as defined
in the hereinafter defined Loan Agreement) signatories hereto, and WELLS FARGO FOOTHILL, INC., a California corporation, as the
arranger and agent for the Lenders (“Agent”).

W I T N E
S S E T H:

WHEREAS, Borrowers,
Agent, and the Lenders are parties to that certain Loan and Security Agreement
dated as of June 16, 2004, as amended by that certain First Amendment to Loan
and Security Agreement dated as of November 10, 2004, that certain Second
Amendment to Loan and Security Agreement dated as of July 12, 2005, and that
certain Third Amendment to Loan and Security Agreement and Consent dated as of
December 6, 2006 (the “Third Amendment”), and as supplemented by that
certain Borrower Supplement No. 1 dated as of May 13, 2005 (as amended and
supplemented and as otherwise amended, restated, supplemented or otherwise
modified from time to time, the “Loan Agreement”; capitalized terms used
herein and not otherwise defined herein shall have the meanings ascribed to
such terms in the Loan Agreement), pursuant to which the Lender Group has
agreed to make the Term Loan, Advances and other extensions of credit to
Borrowers from time to time pursuant to the terms and conditions thereof and
the other Loan Documents;

WHEREAS, Borrowers have
requested that the Lenders, notwithstanding the provisions of Sections
7.2,  Liens, and 7.4, Disposal
of Assets, of the Loan Agreement, agree to permit DJL to (a) lease of that
certain building forming part of the Ice Harbor Facility known as the “Portside
Building” to the Dubuque County Historical Society (the “Historical Society”)
or its designee and (b) transfer ownership of the Diamond Jo Vessels to the
Historical Society or its designee, as more fully described in that certain
Offer to Purchase Real Estate, Acceptance and Lease dated September 27, 2006
(the “Offer Letter”), between DJL and the Historical Society (such lease
and transfer and the other related transactions described in the Offer Letter,
collectively, the “Ice Harbor Transaction”), and the Lenders are willing
to consent to the Ice Harbor Transaction on the terms and conditions provided
herein;

WHEREAS, Borrowers have
further requested that the Lenders, notwithstanding the provisions of Section
7.20(b), Capital Expenditures, of the Loan Agreement, agree to permit
DJL to make, in addition to the capital expenditures permitted by Sections
7.20(b)(i) and 7.20(b)(ii) of the Loan Agreement and the Third Amendment,
capital expenditures in an aggregate amount not to exceed $55,000,000 for the
Dubuque Casino Project (as defined in Section 2 of this Amendment), and the
Lenders are willing to agree to the requested consent on the terms and
conditions provided herein;

WHEREAS, Borrowers
further requested that certain terms and conditions of the Loan Agreement be
amended, and the Lender Group and, by their respective acknowledgment hereof,
Guarantors have agreed to the requested amendments on the terms and conditions
provided herein;

NOW THEREFORE, in
consideration of the foregoing premises and other good and valuable
consideration, the receipt and sufficiency of which are hereby acknowledged,
the parties hereto hereby agree as follows:

1.             Consent.  (a) The Lenders hereby consent to the Ice
Harbor Transaction, so long as:

(i)            no Default or Event
of Default has occurred and is continuing or would result as a consequence
thereof;

(ii)           Agent receives, on
or prior to the date hereof, a true and correct copy of the Offer Letter and
the Lease (as defined in the Offer Letter), duly executed by the parties
thereto and in form and substance satisfactory to Agent, such documents to be
deemed satisfactory to Agent if such documents are in the form presented to
Agent on November 15, 2006; and

(iii)          DJL shall obtain
ownership of the Expansion Tract (as defined in the Offer Letter) as described
in the Offer Letter pursuant to instruments, agreements and documents in form
and substance reasonably satisfactory to Agent, and Agent shall have received,
within 10 days of the date on which DJL obtains ownership of the Expansion
Tract (or such later time to which Agent agrees in its sole and absolute
discretion):

(A)          true and correct copies of such
instruments, agreements and documents, duly executed by the parties thereto and
accompanied by a certificate of an Authorized Person of Borrowers so stating,

(B)           all executed agreements, instruments
and other documents required by Section 4.4 of the Loan Agreement, and all
Mortgage Policies, to create, perfect and insure Liens in favor of Agent on the
Expansion Tract, in form and substance reasonably satisfactory to Agent,

(C)           opinions of DJL’s counsel (including
Iowa counsel), in form and substance reasonably satisfactory to Agent, and

(D)          a Subordination of Mortgage with
respect to the Indenture Trustee’s Mortgage (as defined in the Indenture) on
the Expansion Tract, duly executed by the Indenture Trustee.

(b)           The Lenders hereby
consent to the making by DJL of capital expenditures, in addition to the
capital expenditures permitted by Sections 7.20(b)(i) and 7.20(b)(ii) of the Loan
Agreement and the Third Amendment, in an aggregate amount not to exceed
$5,000,000  for the Dubuque Casino Project prior
to the acquisition by DJL of the Expansion Tract, so long

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as no Default or
Event of Default has occurred and is continuing or would result as a
consequence thereof.

(c)           The Lenders hereby
further consent to the making by DJL of capital expenditures, in addition to
the capital expenditures permitted by Sections 7.20(b)(i) and 7.20(b)(ii) of
the Loan Agreement, the Third Amendment and Section 1(b) this Amendment, in an
aggregate amount not to exceed, together with the capital expenditures
permitted by Section 1(b) of this Amendment, $55,000,000  for
the Dubuque Casino Project, so long as no Default or Event of Default has
occurred and is continuing or would result as a consequence thereof.

2.             Amendments
to the Loan Agreement.

(a)           Section 1.1 of the
Loan Agreement, Definitions, is hereby modified and amended by deleting
the definitions of “Fee Letter”, “Gaming Property”, “Ice
Harbor Facility” and “Maximum Revolver Amount” in their respective
entirety from such Section and inserting in lieu thereof, respectively, the
following:

““Fee Letter”
means that certain second amended and restated fee letter, dated as of December
22, 2006, between Borrowers and Agent, in form and substance satisfactory to
Agent.

“Gaming Property”
or “Gaming Properties” means one or more of the foregoing:  (a) the Diamond Jo Vessels; (b) the casino
and racetrack located in Opelousas, St. Landry Parish, Louisiana; (c) the
Dubuque Casino Project, in each case, so long as it is owned by Borrowers or a
Restricted Subsidiary; and (d) any other gaming facility or gaming operation
owned and controlled or to be owned and controlled after the Closing Date by
Borrowers or a Restricted Subsidiary and that contains, or that based upon a
plan approved by the applicable Borrower’s Managers will contain upon the
completion of the construction or development thereof, an aggregate of at least
500 slot machines or other gaming devices, provided, in each case, that the
property and assets (other than Excluded Assets) of such Gaming Property
constitute Collateral.

“Ice Harbor Facility”
means the Diamond Jo Vessels (or either of them), the Dubuque Casino, the Real
Property relating to the foregoing, including, without limitation, the
Expansion Tract, and the Lease.

“Maximum Revolver
Amount” means $65,000,000.”

(b)           Section 1.1 of the
Loan Agreement, Definitions, is hereby further modified and amended by
amending and restating clause (h) of the definition of “Permitted
Dispositions” in its entirety as follows:

“(h) so long as no Event
of Default has occurred and is then continuing, dispositions of assets (other
than, without the prior written consent of Agent (in its sole and absolute
discretion), FF&E Collateral) with an aggregate fair market value not to
exceed $2,000,000 during the term of this Agreement”

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(c)           Section 1.1 of the
Loan Agreement, Definitions, is hereby further modified and amended by
adding the following definition thereto in the appropriate alphabetical order:

““Dubuque Casino”
means that certain moored barge facility (as that term is defined under Iowa
Code Section 99F.1(17) and Iowa Administrative Code Section 491-5.6) to be used
as a gaming and casino facility and to be constructed by DJL on Real Property
that is part of the Ice Harbor Facility.”

“Dubuque Casino
Project” means the project to design, develop, construct, equip and operate
the Dubuque Casino.

“Expansion Tract”
means that certain 2.4 acre tract of property located in Dubuque, Iowa within
the “Ice Harbor” and contiguous to Real Property owned by DJL, which tract DJL
has agreed to purchase from the Dubuque County Historical Society pursuant to
the terms of the Offer Letter.

“Offer Letter”
means that certain Offer to Purchase Real Estate, Acceptance and Lease, dated
September 27, 2006, between DJL and the Dubuque County Historical Society.”

(d)           Section 2.1 of the
Loan Agreement, Advances, is hereby modified and amended by amending and
restating subsection (b) of such Section in its entirety as follows:

“(b)         Anything to the contrary in this Section
2.1 notwithstanding, Agent shall have the right to establish reserves in
such amounts, and with respect to such matters, as Agent in its Permitted
Discretion shall deem necessary or appropriate, against the Borrowing Base,
including reserves with respect to (i) sums that Borrowers are required to pay
(such as taxes, assessments, insurance premiums, or, in the case of leased
assets, rents or other amounts payable under such leases) and has failed to pay
under any Section of this Agreement or any other Loan Document, and (ii)
amounts owing by Borrowers or their Subsidiaries to any Person to the extent
secured by a Lien on, or trust over, any of the Collateral (other than any
existing Permitted Lien set forth on Schedule P-1 which is specifically
identified thereon as entitled to have priority over the Agent’s Liens), which
Lien or trust, in the Permitted Discretion of Agent, likely would have a
priority superior to the Agent’s Liens (such as Liens or trusts in favor of
landlords, warehousemen, carriers, mechanics (including, without limitation,
any Liens in favor of mechanics or subcontractors arising in connection with
the Racino Project, the OED Hotel Project or the Dubuque Casino Project),
materialmen, laborers, or suppliers, or Liens or trusts for ad valorem, excise,
sales, or other taxes where given priority under applicable law) in and to such
item of the Collateral.”

(e)           Section 5.1 of the
Loan Agreement, No Encumbrances, is hereby modified and amended by
amending and restating such Section in its entirety as follows:

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“5.1        No Encumbrances.  Each Borrower and its Subsidiaries has good
and indefeasible title to their personal property assets and good and
marketable title to their Real Property, including the Diamond Jo Vessels and
the Real Property comprising the Racino Project, the Ice Harbor Facility (other
than the Dubuque Casino), and, upon the commencement thereof, the OED Hotel
Project and the Dubuque Casino Project, in each case free and clear of Liens
except for Permitted Liens and except for defects in title that do not
interfere in any material respect with its ability to conduct its business or
to utilize such property for its intended purpose.”

(f)            Section 5 of the
Loan Agreement, Representations and Warranties, is hereby modified and
amended by adding the following to the end of such Section:

“5.23      Dubuque Casino Project.  The Dubuque Casino will not be a vessel or
other seagoing vehicle subject to registration with, or regulation by, the
State of Iowa, the United States or any similar Governmental Authority.”

(g)           Section 6.2 of the
Loan Agreement, Reporting, is hereby modified and amended by amending
and restating subsection (a) of such Section in its entirety as follows:

“(a) a detailed itemized
report reflecting the prior months and year-to-date revenues from the Diamond
Jo Vessels, any Gaming Vessels, the Dubuque Casino, the racetrack, off-track
betting parlors (including video poker revenues) and out-of-state satellite
operations,”

(h)           Section 6.2 of the
Loan Agreement, Reporting, is hereby further modified and amended by
adding the following subsection (c) to such Section in the appropriate
alphabetical location:

“(c) a detailed itemized
report showing actual and estimated construction costs and a statement
reflecting the construction related costs incurred or reasonably expected to be
incurred by Borrowers in connection with the OED Hotel Project and the Dubuque
Casino Project prior to or through the construction completion date and any
variances thereof,”

(i)            Section 6.3 of the
Loan Agreement, Financial Statements, Reports, Certificates, is hereby
modified and amended by adding the following subsection (g) to such Section in
the appropriate alphabetical location:

“(g)         as soon as any Borrower has knowledge
that the construction of the OED Hotel or the Dubuque Casino cannot be
completed, or has knowledge that such Borrower cannot meet its obligations
under any construction documents, notice thereof and a statement of the curative
action that Borrowers propose to take with respect thereto,”

(j)            Section 6.3 of the
Loan Agreement, Financial Statements, Reports, Certificates, is hereby
further modified and amended by amending and restating subsection (h) of such
Section in its entirety as follows:

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“(h)         as soon as any Borrower has knowledge
thereof, notice of any proposed legislation or administrative action
specifically affecting any Borrower’s or any Subsidiary of a Borrower’s gaming
activities, the Racino Project, the Ice Harbor Facility, the Dubuque Casino
Project or the OED Hotel Project submitted to the floor for business before any
Governmental Authority in the state of Louisiana or Iowa (including the state
legislature or any committee thereof),”

(k)           Section 6 of the Loan
Agreement, Affirmative Covenants, is hereby modified and amended by
adding the following to the end of such Section:

“6.22      Diamond Jo Vessels
Transfer.  In the event
DJL transfers the Diamond Jo Vessels pursuant to the Offer Letter, (a) the
instruments, agreements and documents evidencing such transfer shall be in form
and substance reasonably satisfactory to Agent, true and correct copies of
which shall have been provided to Agent, and Agent shall have received a
certificate of an Authorized Person of Borrowers so stating, (b) at the time of
such transfer, the Dubuque Casino Project shall be operating and (c) if Agent
and Lenders are asked to release their Liens on the Diamond Jo Vessels, Agent
shall have received evidence, in form and substance reasonably satisfactory to
Agent, of the release of the Diamond Jo Vessels from the Security Documents (as
defined in the Indenture), prior to the release by Agent and Lenders of their
Liens.  Lenders authorize Agent to release
any and all Liens held by Agent pursuant to the Loan Documents against the
Diamond Jo Vessels upon the completion of the transfer of the Diamond Jo
Vessels pursuant to the Offer Letter and Agent’s receipt of the items described
in the immediately preceding sentence. 
Agent and Lenders acknowledge that, upon the completion of the transfer
of the Diamond Jo Vessels pursuant to the Offer Letter and Agent’s receipt of
the items described in the immediately preceding sentence, neither Agent nor
Lenders shall have a continuing right or interest in the Diamond Jo Vessels.”

(l)            Section 7.1 of the
Loan Agreement, Indebtedness, is hereby modified and amended by amending
and restating subsection (c) of such Section in its entirety as follows:

“(c)         Indebtedness represented by Capitalized
Lease Obligations or Purchase Money Obligations; provided, that (i) neither OED
nor DJL shall in any way be or become obligated with respect to any such
Indebtedness incurred in connection with the Worth County Project, (ii) no
Advances hereunder are utilized for the purchase or lease of FF&E financed
with such Indebtedness, and (iii) the aggregate principal amount of such
Indebtedness outstanding at any time does not exceed an amount equal to
$7,500,000 times the number of Gaming Properties owned and controlled by any of
the Borrowers or their respective Restricted Subsidiaries on the date of
incurrence of such Indebtedness;”

(m)          Section 7.1 of the
Loan Agreement, Indebtedness, is hereby modified and amended by amending
and restating subsection (g) of such Section in its entirety as follows:

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“(g)         Indebtedness outstanding under (i) the
Senior Note Documents in an aggregate principal amount outstanding not to
exceed $255,000,000 at any time and (ii) the OED Note Documents in an aggregate
principal amount outstanding not to exceed $6,910,000 at anytime;”

(n)           Section 7.4 of the
Loan Agreement, Disposal of Assets, is hereby modified and amended by
amending and restating subsection (a) of such Section in its entirety as
follows:

“(a)         Make any sale, lease, exchange, or
other disposition, in one or a series of related transactions, of the OED
Hotel, or of all or any portion of the assets of Borrowers that compose the Ice
Harbor Facility, the Dubuque Casino Project or the Racino Project (in each
case, other than a sale or other disposition that is a Permitted Disposition);”

(o)           Section 7.4 of the
Loan Agreement, Disposal of Assets, is hereby further modified and
amended by amending and restating the introduction to subsection (b) of such
Section in its entirety as follows:

“Make any Asset
Sale other than Permitted Dispositions; provided, however, that
an Asset Sale (other than a Permitted Disposition, an Asset Sale of the OED
Hotel, an Asset Sale comprised of any assets that compose the Ice Harbor
Facility, the Dubuque Casino Project or the Racino Project or, to the extent
not otherwise covered in the foregoing, an Asset Sale of any FF&E
Collateral) may be made if:”

(p)           Section 8 of the
Loan Agreement, Events of Default, is hereby modified and amended by
amending and restating Section 8.16 of such Section in its entirety as follows:

“8.16.     If any Governmental Authority (including
the Louisiana state legislature) restricts the ability of any Borrower to
operate, or restricts, limits or prohibits any Borrower from operating, its
gaming business as conducted on the Closing Date or as otherwise permitted by
Agent, and such restriction, limit or prohibition results in a Material Adverse
Change;”

(q)           Section 8 of the
Loan Agreement, Events of Default, is hereby further modified and
amended by adding the following Section 8.17 to such Section in the appropriate
numerical location:

“8.17.     If Agent fails to receive evidence of (a)
on or prior to June 30, 2008, the completion of at least 50% of the
construction of the Dubuque Casino and (b) on or prior to December 31, 2008,
the completion of 100% of the construction of the Dubuque Casino;”

(r)            Schedules C-1, Commitments,
and 5.5, Locations of Equipment, to the Loan Agreement are hereby
modified and amended by replacing such Schedules with the corresponding
Schedules attached hereto.

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3.             No Other
Amendments or Waivers.  Except in
connection with the amendments and the consent set forth above, the execution,
delivery and effectiveness of this Amendment shall not operate as an amendment
of any right, power or remedy of Agent or the Lenders under the Loan Agreement
or any of the other Loan Documents, nor constitute a waiver of any provision of
the Loan Agreement or any of the other Loan Documents.  Except for the amendments set forth above,
the text of the Loan Agreement and all other Loan Documents shall remain
unchanged and in full force and effect and Borrowers hereby ratify and confirm
their respective obligations thereunder. 
This Amendment shall not constitute a modification of the Loan Agreement
or any of the other Loan Documents or a course of dealing with Agent or the
Lenders at variance with the Loan Agreement or the other Loan Documents such as
to require further notice by Agent or the Lenders to require strict compliance
with the terms of the Loan Agreement and the other Loan Documents in the
future, except as expressly set forth herein. 
Borrowers acknowledge and expressly agree that Agent and the Lenders
reserve the right to, and do in fact, require strict compliance with all terms
and provisions of the Loan Agreement and the other Loan Documents, as amended
herein.  Borrowers have no knowledge of
any challenge to Agent’s or any Lender’s claims arising under the Loan
Documents, or to the effectiveness of the Loan Documents.

4.             Conditions
Precedent to Effectiveness.  

(a)           Section 1(b) of this
Amendment shall become effective as of the date hereof when, and only when,
Agent shall have received, in form and substance satisfactory to Agent,
counterparts of this Amendment duly executed and delivered by Borrowers, Agent
and the Required Lenders.

(b)           Section 2(m) of this
Amendment shall become effective as of the date hereof when, and only when,
Agent shall have received, in form and substance satisfactory to Agent:

(i)            counterparts of
this Amendment duly executed and delivered by Borrowers, Agent and the Required
Lenders;

(ii)           true and correct
copies of that certain Purchase Agreement executed in connection with the
issuance by Parent, DJL, and OED Capital of notes in the aggregate principal
amount of $22,000,000  under the
Indenture, together with all other instruments, agreements and documents
executed and/or delivered in connection therewith, each duly executed by the
parties thereto, and Agent shall have received a certificate of an Authorized
Person of Parent so stating; and

(iii)          evidence in form
and substance satisfactory to Agent that Borrowers shall have received all
licenses (including the Gaming Licenses), approvals or evidence of other
actions required by any Governmental Authority, including the Louisiana
Regulatory Authorities and the Iowa Gaming Authorities, in connection with, to
the extent such licenses, approvals or evidence of other actions are so
required, the incurrence of additional Indebtedness under the Senior Note
Documents.

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(c)           The remainder of
this Amendment shall become effective as of the date hereof when, and only
when, Agent shall have received, in form and substance satisfactory to Agent:

(i)            counterparts of
this Amendment duly executed and delivered by Borrowers, Agent and the Required
Lenders;

(ii)           the amended and
restated fee letter among Borrowers and Agent, duly executed and delivered by
Borrowers and Agent;

(iii)          updated Schedules
C-1 and 5.5 of the Loan Agreement;

(iv)          evidence that all
conditions to the effectiveness of the consent to the Ice Harbor Transaction
set forth in Section 1(a) of this Amendment shall have been satisfied;

(v)           amendments, each in
form and substance satisfactory to Agent, modifying and amending the Diamond Jo
Ship Mortgage and the Mortgages;

(vi)          a Subordination of
Mortgage and a Subordination of Preferred Fleet Mortgage duly executed by the
Indenture Trustee for each Mortgage (as defined in the Indenture)  in place on the date of the Loan Agreement;

(vii)         a letter duly
executed by the Indenture Trustee with respect to the Maximum Credit Facility
Amount (as defined in the Intercreditor Agreement);

(viii)        opinions of
Borrowers’ and Guarantors’ counsel (including, without limitation, admiralty
counsel, real estate counsel and regulatory counsel) in form and substance
satisfactory to Agent, such opinions to include (i) that the increase in the
Maximum Revolver Amount is permitted to be made under the Indenture and that
such increase constitutes Credit Facility Indebtedness (as defined in the
Intercreditor Agreement) and (ii) regulatory opinions as to the due issuance
and valid existence of Borrowers’ Gaming Licenses;

(ix)           evidence in form
and substance satisfactory to Agent that Borrowers shall have received all
licenses (including the Gaming Licenses), approvals or evidence of other
actions required by any Governmental Authority, including the Louisiana
Regulatory Authorities and the Iowa Gaming Authorities, in connection with (i)
the execution and delivery by Borrowers of this Amendment and (ii) to the extent
such licenses, approvals or evidence of other actions are so required, the
consummation of the transactions contemplated in the Offer Letter;

(x)            a detailed budget
on construction costs relating to the Dubuque Casino Project, in form and
substance reasonably satisfactory to Agent; and

(xi)           such other
information, documents, instruments or approvals as Agent or Agent’s counsel
may reasonably require.

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5.             Representations
and Warranties of Borrowers.  In
consideration of the execution and delivery of this Amendment by Agent and the
Lenders, each Borrower hereby represents and warrants in favor of Agent and the
Lenders as follows:

(a)           as to each Borrower,
the execution, delivery, and performance by such Borrower of this Amendment
have been duly authorized by all necessary action on the part of such Borrower;

(b)           as to each Borrower,
the execution, delivery, and performance by such Borrower of this Amendment do
not and will not (i) violate any provision of federal, state, or local law or
regulation applicable to any Borrower, the Governing Documents of any Borrower,
or any order, judgment, or decree of any court or other Governmental Authority
binding on any Borrower, (ii) conflict with, result in a breach of, or
constitute (with due notice or lapse of time or both) a default under any
material contractual obligation of any Borrower (including any of the Senior
Note Documents), (iii) result in or require the creation or imposition of any
Lien of any nature whatsoever upon any properties or assets of any Borrower,
other than Permitted Liens, or (iv) require any approval of any Borrower’s
members or shareholders or any approval or consent of any Person under any
material contractual obligation of any Borrower;

(c)           the execution,
delivery, and performance by such Borrower of this Amendment do not and will
not require any registration with, consent or approval of, notice to, or other
action with or by, any Governmental Authority or other Person, other than any
consent or approval that has been obtained and remains in full force and
effect;

(d)           as to each Borrower,
the Loan Documents to which such Borrower is a party (including, without
limitation, the Loan Agreement, this Amendment and all other documents
contemplated hereby), when executed and delivered by such Borrower, will be the
legally valid and binding obligations of such Borrower, enforceable against
such Borrower in accordance with their respective terms, except as enforcement
may be limited by equitable principles or by bankruptcy, insolvency,
reorganization, moratorium, or similar laws relating to or limiting creditors’
rights generally;

(e)           no Default or Event
of Default exists under the Loan Agreement or the other Loan Documents;

(f)            as of the date
hereof, all representations and warranties of Borrowers set forth in the Loan
Agreement and the other Loan Documents are true, correct and complete in all
material respects, except to the extent such representation or warranty
expressly relates to an earlier date (in which case such statement was true and
correct on and as of such earlier date); and

(g)           the Ice Harbor
Transaction is permitted under the Indenture.

6.             Counterparts.  This Amendment may be executed in multiple
counterparts, each of which shall be deemed to be an original and all of which,
taken together, shall constitute one and the same agreement.  In proving this Amendment in any judicial
proceedings, it shall not be necessary to produce or account for more than one
such counterpart signed by the party against whom such enforcement is
sought.  Any signatures delivered by a
party by facsimile

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transmission or by
e-mail transmission of an adobe file format document (also known as a PDF file)
shall be deemed an original signature hereto.

7.             Reference to and
Effect on the Loan Documents.  Upon
the effectiveness of this Amendment, on and after the date hereof, each
reference in the Loan Agreement to “this Agreement,” “hereunder,” “hereof” or
words of like import referring to the Loan Agreement, and each reference in the
other Loan Documents to “the Loan Agreement” “thereunder,” “thereof” or words
of like import referring to the Loan Agreement, shall mean and be a reference
to the Loan Agreement as amended hereby.

8.             Affirmation of
Guaranty.  By executing this
Amendment, each Guarantor hereby acknowledges, consents and agrees that all of
its obligations and liability under the Guaranty to which it is a party remain
in full force and effect, and that the execution and delivery of this Amendment
and any and all documents executed in connection herewith shall not alter,
amend, reduce or modify its obligations and liability under such Guaranty or
any of the other Loan Documents to which it is a party.

9.             Costs, Expenses
and Taxes.  Borrowers agree, jointly
and severally, to pay on demand all costs and expenses in connection with the
preparation, execution, and delivery of this Amendment and the other
instruments and documents to be delivered hereunder, including, without
limitation, the fees and out-of-pocket expenses of counsel for Agent with
respect thereto and with respect to advising Agent as to its rights and
responsibilities hereunder and thereunder. 
In addition, Borrowers agree, jointly and severally, to pay any and all
stamp and other taxes payable or determined to be payable in connection with
the execution and delivery of this Amendment and the other instruments and
documents to be delivered hereunder, and agree to save Agent and the Lenders
harmless from and against any and all liabilities with respect to or resulting
from any delay in paying or omission to pay such taxes.  Borrowers hereby acknowledge and agree that
Agent may, without prior notice to Borrowers, charge such costs and fees to
Borrowers’ Loan Account pursuant to Section 2.6(d) of the Loan Agreement.

10.           Section Titles.  The section titles contained in this
Amendment are included for the sake of convenience only, shall be without
substantive meaning or content of any kind whatsoever, and are not a part of
the agreement between the parties.

11.           Entire Agreement.  This Amendment and the other Loan Documents
constitute the entire agreement and understanding between the parties hereto
with respect to the transactions contemplated hereby and thereby and supersede
all prior negotiations, understandings and agreements between such parties with
respect to such transactions.

12.           GOVERNING LAW.  THE VALIDITY, INTERPRETATION AND ENFORCEMENT
OF THIS AMENDMENT SHALL BE GOVERNED BY THE LAWS OF THE STATE OF NEW YORK.

13.           Loan Document.  This Amendment shall be deemed to be a Loan
Document for all purposes.

[Remainder of page
intentionally left blank.]

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

	
  BORROWERS:

  	
  DIAMOND JO, LLC, a Delaware
  limited liability company

  	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  	
   

  
	
   

  	
  Title:

  	
   

  	
   

  	
   

  
	
   

  	
  THE OLD EVANGELINE DOWNS,
  L.L.C.,

  	
   

  	
   

  
	
   

  	
  a Louisiana limited liability company

  	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  	
   

  
	
   

  	
  Title:

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  AGENT AND LENDERS:

  	
  WELLS FARGO FOOTHILL, INC.,

  	
   

  	
   

  
	
   

  	
  a California corporation, as Agent and as a Lender

  	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  	
   

  
	
   

  	
  Title:

  	
   

  	
   

  	
   

  
	
   

  	
  D.B. ZWIRN SPECIAL
  OPPORTUNITIES FUND, L.P. (formerly known as
  Highbridge/Zwirn Special Opportunities Fund, L.P.) a Delaware limited
  partnership, as a Lender

  	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
  D.B. Zwirn Partners,
  LLC, its General Partner

  	
   

  
	
   

  	
   

  	
  By:

  	
  Zwirn Holdings, LLC,
  its Managing Member

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
  Title:

  	
   

  	
   

  
									

 

[Signatures continue on following page.]

[Signatures continued from
previous page.]

	
  ACKNOWLEDGED AND

  	
   

  	
   

  
	
  AGREED:

  	
   

  	
   

  
	
  GUARANTORS:
  

  	
  PENINSULA GAMING, LLC, a
  Delaware limited liability company 

  
	
   

  	
  By:

  	
   

  
	
   

  	
  Title:

  	
   

  
	
   

  	
  PENINSULA GAMING CORP. (formerly
  known  as The Old Evangeline Downs Capital
  Corp.), a Delaware corporation

  
	
   

  	
  By:

  	
   

  
	
   

  	
  Title:

  	
   

  

 

SCHEDULE C-1

COMMITMENTS

 

	
   

  	
   

  	
  Revolver 

  	
   

  	
  Term Loan 

  	
   

  	
  Total 

  	
   

  
	
  Lender

  	
   

  	
  Commitment

  	
   

  	
  Commitment

  	
   

  	
  Commitment

  	
   

  
	
  Wells Fargo Foothill,
  Inc.

  	
   

  	
  $

  	
  51,000,000

  	
   

  	
  $

  	
  10,083,333.34

  	
   

  	
  $

  	
  61,083,333.34

  	
   

  
	
  D.B. Zwirn
  Special Opportunities Fund, L.P.

  	
   

  	
  $

  	
  14,000,000

  	
   

  	
  $

  	
  4,583,333.34

  	
   

  	
  $

  	
  18,583,333.34

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  All Lenders

  	
   

  	
  $

  	
  65,000,000

  	
   

  	
  $

  	
  14,666,666.68

  	
   

  	
  $

  	
  79,666,666.68Exhibit
10.56

AMENDED
AND RESTATED OPERATOR’S AGREEMENT

This Operator’s
Agreement (“Agreement”) is made and entered into by and between the Worth
County Development Authority, an Iowa not-for-profit corporation (the “WCDA”)
and Diamond Jo Worth L.L.C., an Iowa Limited Liability Company (“Diamond Jo”)
as of the 5th day of November, 2004.

WHEREAS, the WCDA
is an Iowa non-profit corporation, with its principal place of business in
Worth County, Iowa, which corporation intends to apply for a license to be granted
by the Iowa Racing and Gaming Commission (“the IRGC”) for a gaming facility,
and

WHEREAS, Diamond
Jo wishes to enter into an Agreement with the WCDA as the operator of such
gaming facility pursuant to the rules and regulations of the IRGC.

NOW THEREFORE, for
and in consideration of the mutual covenants herein contained, it is agreed as
follows:

1.             The parties agree to jointly submit
an application to the IRGC (the “Application”) for a license pursuant to which
they will operate a gaming facility in Worth County, Iowa.

2.             This agreement shall commence on
the date of its execution (the “Commencement Date”) and terminate on March 31,
2015, unless terminated earlier pursuant to paragraph 12 below; provided, however,
that so long as Diamond Jo has substantially complied with this Agreement and
the IRGC rules and the parties gaming license is renewed and/or in effect, Diamond
Jo is hereby granted the right to renew this Agreement for succeeding three
year periods, the last of which shall terminate on the last date for licensed
gaming as approved by Worth County voters pursuant to Chapter 99F of the Code
of Iowa.

3.             Diamond Jo as operator, shall be
responsible for the payment of the initial application fees, all annual
licensing fees as required by the IRGC, the payment of all premiums or any additional
fees required by the IRGC and all gaming taxes under the provisions of Iowa
Code Chapter 99F and its regulations and any amendments thereto, all of which
are required in order to maintain a gaming license.

4.             Diamond Jo agrees to provide WCDA
with all necessary accounting information required by the IRGC to calculate the
adjusted gross receipts (which, for the purposes of this Agreement, shall be
the same calculation/formula used to determine the gaming taxes as assessed
pursuant to Iowa Code Chapter 99F). 
Diamond Jo shall comply with all reasonable requests of the WCDA and/or
the IRGC, or any other regulatory body of competent jurisdiction to determine
the extent of the gaming tax or any fee required under this Agreement, and
further agrees to make any payments required in a timely fashion.

5.

A.            Upon issuance of a gaming license by
the IRGC and commencing on the commencement of operations (and continuing for
the term of this Agreement), Diamond Jo shall

pay a fee to the WCDA
equal to 5.76% of each week’s adjusted gross receipts (as defined in Section
99F.1(1) of the Iowa Code),  this fee
shall include and be in lieu of any fee which might be imposed by a city under
99F.10(3) of the Iowa Code.  The payments
hereunder shall be made by 12:00 Noon on Friday following the completion of
each calendar week.

B.            From said sums, the WCDA shall be
responsible for all distributions required by Iowa Code Section 99F.5,
Subsection 1, all of its administrative costs (other than initial application
costs), the annual DCI investigation of its board members as required, all
legal expenses, salaries, and all related costs associated with the administration
of its license.  Diamond Jo agrees to
continue to advance WCDA $5,000 each month until commencement of operations, at
which time Diamond Jo shall receive a credit for any amounts so advanced to the
WCDA.

C.            Diamond Jo covenants and agrees to
be responsible for the payment of all regulatory charges as required by the
IRGC.  Diamond Jo shall provide, at its
expense, all necessary accounting and documentation to establish to the
reasonable satisfaction of the WCDA, Worth county and the IRGC, the computation
of the fees set forth above.

D.            In the event the wagering tax
charged by the State of Iowa under 99F.11 of the code of Iowa is increased
above its current top bracket rate of 22% of the adjusted gross receipts, Diamond
Jo shall be entitled to a prorated credit against payments due under this
Agreement equal to the amount of such increased by any legislation tax payable
to the state less any operational cost savings attributable to such
legislation.

6.             Diamond Jo agrees to design,
construct, operate and manage a casino with no less than 700 gaming
positions.  diamond Jo shall design and construct
an approved body of water of sufficient size to meet IRGC requirements.  Diamond Jo commits to construct a two phase,
100 room hotel development, subject to obtaining a third party equity
investment proposal acceptable to Diamond Jo (and if necessary, the successful
completion of an intrastate securities offering) with commencement of
construction as soon as is commercially reasonable under the circumstance.

7.             Diamond Jo agrees to hold the WCDA
harmless and to defend it from any and all claims arising out of Diamond Jo’s
operation of the gaming facility and any related activity of Diamond Jo
required by this Agreement, city and county ordinances, or stat or federal
statues, and all regulations promulgated thereunder.  Diamond Jo shall be responsible for the payment
of all legal expenses incurred by the WCDA in defense of any such claim, and
all costs attributable thereto including payments of any settlements, damage
awards and interest thereon.  Diamond Jo
shall not be responsible for any acts or omissions of the WCDA, and the
indemnity shall not apply thereto.

8.             The WCDA agrees with Diamond Jo
that it will not enter into any agreements with any operators, and will. not
make application to the IRGC for any operator, to operate a gaming facility within
Worth County without first obtaining the written consent of Diamond Jo which
may be withheld by Diamond Jo for any reason in Diamond Jo’s sole and absolute
discretion.  In addition, the WCDA agrees
to take all reasonable steps available to the

 2
 

WCDA to prevent any other
operator or excursion boat gambling license holder form conducting, operations within
Worth County without the written prior permission of Diamond Jo.

9.             It is agreed that this Agreement is
intended to comply with and is subject to all the rules and regulations of the
IRGC, the ordinances of Worth County, and the laws of the State of Iowa and of
the United States of America.  The terms
of this Agreement are subject to amendment to comply with any of said
requirements or any changes in any laws or regulations.  In the event that nay provision of this
Agreement is determined to be invalid by a court of competent jurisdiction, the
remaining provisions of this agreement shall remain in full force and effect.

10.           Diamond Jo agrees that it will provide,
at its expense, within the time requirement set forth by the regulations of the
IRGC, all necessary audits of financial transactions and conditions of the
operations conducted by Diamond Jo, as well as audits of the financial
transactions and conditions of Diamond Jo’s total operations as required by the
rules and regulations of the IRGC.

11.           Diamond Jo and the WCDA do hereby
agree and covenant with each other to comply with the terms of Iowa Code,
Section 99F, all chapters of the Iowa Code, the U.S. Federal Code, all City
ordinances of Worth County, and any and all regulations promulgated pursuant to
any such law as duly adopted.  Both
parties represent an covenant with each other that they will cooperate with
each other on public relations and marketing issued as appropriate and take all
other reasonable actions in order to achieve their mutual goals.

12.           In the event either Diamond Jo or the
WCDA is deemed by the other or the IRGC not to be in compliance with the terms
of this Agreement, the non-breaching party or the IRGC shall be entitled to
specific performance of the terms of this Agreement.  Further, the parties agree that in the event
of any operational default, the defaulting party shall be required to cure such
default to the satisfaction of the IRGC. 
In the event said party does not cure the default to the satisfaction of
the IRGC, then the non-defaulting party may, at its option, after obtaining
written approval from the IRGC and giving the other party thirty (30) days
written notice and opportunity to cure, declare this Agreement terminated.  This Agreement may be terminated by Diamond
Jo if the parties are not issued a license by the IRGC on or before January 1,
2005, upon giving WCDA thirty (30) days written notice and opportunity to cure,
upon the occurrences of any of the following event:

1.             Loss or suspension for more than
thirty (30) days of gaming, liquor or any governmental license required to
operate a gaming facility;

2.             Material breach of Diamond Jo’s obligations
under this Agreement;

3.             Absence of an operation gaming
facility by Diamond Jo in Worth County for more than thirty (30) days in any
twelve-month period;

 3
 

If by reason of Force Majeure (as hereinafter defined) either party is
unable to carry out, either in whole or in part, its obligations herein
contained, that party shall not be deemed in default and its obligations shall
be suspended so long as such inability continues, provided that it shall use
commercially reasonable efforts to perform its obligations.  “Force Majeure”
shall mean acts of God, winds; hurricanes, tornadoes; fires; epidemic; landslides;
earthquakes; floods; strikes; lockouts or other industrial disturbances; acts
of public enemies, acts, failures to act or orders of any kind of governmental authorities,
action in their regulatory or judicial capacity, which are unrelated to the
performance of Diamond Jo; insurrections, military action; war, whether or not
it is declared; sabotage; riots; civil disturbances; explosions; or any cause
or event, not reasonably within the control of either party, which precludes
that party from carrying out, in whole or in part, its obligations under this
Agreement.  However, Force
Majeure shall not excuse payment of Diamond Jo’s obligations under paragraph
5.A. for the first four weeks of such occurrence; further, in the event that there
is no operational gaming facilities by Diamond Jo in Worth County for more than
six consecutive months at any time or a total of nine months during the term of
this Agreement, Diamond Jo’s obligations herein shall no longer be excused.

13.           Diamond Jo agrees to provide the WCDA
financial performance reports of Diamond Jo’s operations on a monthly basis.

14.           This Agreement embodies the entire
agreement between the parties and may be amended or supplemented only by and
instrument in writing executed by the party against whom the enforcement is
sought.

15.           All representations, warranties and
indemnities set forth in this Agreement shall survive the execution hereof.

16.           This Agreement may be executed in a
number of identical counterparts, and is so executed, each such counterpart is
deemed an original for all purposes, and all such counterparts shall collectively
constitute on agreement.

17.           This Agreement binds the parties
hereto and inures to the benefit of their respective heirs, personal representatives,
successors or assigns.

18.           In addition to the acts and deeds
recited in this Agreement and contemplated herein, the parties hereto shall
execute any and all additional agreements as may be necessary to consummate the
transactions contemplated by this Agreement and to fulfill the intentions of
this Agreement.

19.           Time is of the essence of this
Agreement and each and every provision contained herein.

20.           In the event a dispute arises between
the parties, hereto, each party shall be responsible for paying its own
attorney’s fees and court costs, if any, incurred in connection with such
dispute.

 4
 

21.           If and in the event of a dispute
arising hereunder, venue is vested in the Iowa District Court for Worth county,
or in any Federal District Court in Iowa which has jurisdiction.  Diamond Jo acknowledges that it has negotiated
in agreement in Worth County, Iowa, and has made numerous business contacts and
entered into agreements relating to matters sufficient to confer jurisdiction
on the Iowa District Court in and for Worth County.

22.           The parties hereto represent to each
other that each has the full right, power and authority to enter into this
Agreement and to fully perform its obligations. 
the person executing this Agreement warrant and represent that each has
the authority to execute in the capacity stated and to bind the parties hereto.

23.           If, and in the event, any provision
of this Agreement is determined to be invalid for any reason, it shall be severed
and all other provisions not determined invalid shall continue with full force
and effect.

24.           No failure by either party hereto, at
any time, to require the performance by the other of any terms of this
Agreement, shall in any way affect the right of either party to enforce such
terms, nor shall any waiver, by either party of any terms hereof be taken or
held to be a waiver of any other provisions of this Agreement.  No waiver of any term or provision of this
Agreement shall be effective unless the same is in writing, signed by the
parties hereto.

25.           This Agreement is entered into in the
State of Iowa and shall be construed in accordance therewith, and all of the
rights and obligations hereunder shall be determined in accordance with the laws
of the State of Iowa.  This Agreement is
expressly subject tot the consent of the IRGC and Diamond Jo’s lenders.

This Agreement is
signed and entered into as of the day and year first above written.

	
  DIAMOND JO WORTH, L.L.C.

  	
   

  
	
   

  	
   

  	
   

  
	
  By

  	
   /s/ Natalie Schramm

  	
   

  
	
   

  	
   

  	
   

  
	
  WORTH COUNTY DEVELOPMENT AUTHORITY

  
	
   

  	
   

  
	
  By

  	
   /s/ Steven C Miller Jr

  	
   

  

.

 

 5

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