Document:

EX-10.1

 Exhibit 10.1 

EXECUTION VERSION 
  

			
	 CREDIT SUISSE SECURITIES (USA) LLC

Eleven Madison Avenue
 New York, NY
10010
	  	 CREDIT SUISSE AG

Eleven Madison Avenue
 New York, NY
10010

 CONFIDENTIAL 

July 19, 2014 
 AK Steel Holding Corporation

 AK Steel Corporation 
 9227 Centre Pointe Drive 

West Chester, Ohio 45069 
 Attention: Roger K. Newport 

PROJECT 711 

$730,000,000 Senior Unsecured Bridge Facility 

Commitment Letter 
 Ladies and Gentlemen:

 AK Steel Corporation (the “Borrower”) and AK Steel Holding Corporation (“Holdings” and,
together with the Borrower, “you”) have advised Credit Suisse AG (acting through such of its affiliates or branches as it deems appropriate, “CS”) and Credit Suisse Securities (USA) LLC (“CS
Securities” and, together with CS and their respective affiliates, “Credit Suisse”, “we” or “us”) that you intend to acquire (the
“Acquisition”) all of the units of membership interests of Severstal Dearborn, LLC, a Delaware limited liability company (the “Company”) from Severstal Columbus Holdings, LLC, a Delaware limited
liability company (the “Seller”) pursuant to that certain Membership Interest Purchase Agreement, dated July 18, 2014, among the Seller, Severstal US Holdings LLC, the Company and the Borrower (the
“Acquisition Agreement”), and in connection therewith pay fees and expenses incurred in connection with the Transactions (as defined below) (the “Transaction Costs”). You have further advised us that,
in connection therewith, Holdings or the Borrower will (i) seek to issue senior unsecured notes (the “Notes”) and shares of Holdings’ common stock (the “Stock”) generating aggregate proceeds
of $730,000,000 and (ii) to the extent the Borrower is unable to issue the Notes and/or the Stock on or prior to the Closing Date, borrow up to $730,000,000 in aggregate principal amount of senior unsecured loans under the senior unsecured
credit facility (the “Facility”) described in the Summary of Principal Terms and Conditions attached hereto as Exhibit A (the “Term Sheet”), as such amount may be reduced in accordance with
“Mandatory Prepayments and Commitment Reductions”. The foregoing transactions described in this paragraph are collectively referred to herein as the “Transactions”. Capitalized terms used but not defined herein have
the meaning assigned to such terms in the Term Sheet. 
 Commitment Letter 

 1. Commitments. 

In connection with the foregoing, CS (in such capacity, the “Initial Bridge Lender”) is pleased to advise you of its
commitment to provide the entire principal amount of the Facility, upon the terms and subject to the conditions set forth in this commitment letter (including the Term Sheet and other attachments hereto, this “Commitment
Letter”); provided that the amount of the Facility and the aggregate commitments with respect thereto shall be automatically reduced at any time on or after the date hereof as set forth in the section titled “Mandatory
Prepayments and Commitment Reductions” in the Term Sheet. 
 2. Titles and Roles. 

You hereby appoint (a) CS Securities to act, and CS Securities hereby agrees to act, as bookrunner and lead arranger for the Facility, and
(b) CS to act, and CS hereby agrees to act, as sole administrative agent for the Facility upon the terms and subject to the conditions set forth in this Commitment Letter. Each of CS Securities and CS, in such capacities, will perform the
duties and exercise the authority customarily performed and exercised by it in such roles. 
 You shall have the right (the
“Designation Right”), on or prior to the date that is 10 days after the date of this Commitment Letter, to appoint up to two additional lead arrangers and bookrunners and an unlimited number of additional managers, agents and
co-agents, and to confer other titles in respect of the Facility (any such agent, co-agent, co-arranger, manager or holder of another title, an “Additional Committing Lender”), in each case in a manner and with economics
determined by you; provided that (a) each Additional Committing Lender will assume a portion of the commitments of the Facility that is equal to the proportion of the applicable economics allocated to such Additional Committing Lender
(and the commitments of the Initial Bridge Lender with respect to such portion of the Facility will be reduced), (b) CS shall be entitled to no less than 60% of the economics of the Facility and (c) the economics allocated to each
Additional Committing Lender in respect of its commitment shall not exceed its percentage of the commitments hereunder. 
 CS Securities
will appear on the top left of the cover page of all marketing materials for the Facility and will hold the roles and responsibilities conventionally understood to be associated with such name placement. Except as set forth above, no other agents, co-agents, lead arrangers, co-arrangers, bookrunners, managers or co-managers will be appointed, no other titles will be awarded and no
compensation (other than that expressly contemplated by this Commitment Letter and the Fee Letters referred to below) will be paid in connection with the Facility unless you and we shall so agree. 

3. Syndication. 
 CS Securities reserves
the right prior to and/or after the execution of definitive documentation for the Facility, to syndicate all or a portion of CS’s commitment with respect to the Facility to a group of banks, financial institutions and other institutional
lenders (together with CS and the Additional Committing Lenders, the “Lenders”) identified by us in consultation with you, and you agree to provide CS Securities with a period of at least 10 consecutive business days
following receipt by CS Securities (which receipt CS Securities shall immediately acknowledge to the Borrower) of the information reasonably requested by CS Securities (on or prior to the date hereof) from the Borrower in order for CS Securities to
prepare the Information Materials (as defined below) to syndicate the Facility (provided that such period shall either (i) be completed, and the Closing Date shall have occurred, on or prior to August 15, 2014, (ii) commence on
or after September 2, 2014 and be completed, and the Closing Date shall have occurred, on or prior to November 21, 2014, (iii) commence on or after December 1, 2014 and be completed, and the Closing Date shall have occurred, on
or prior to December 19, 2014 or (iv) commence on or after January 5, 2015). We intend to commence syndication efforts promptly upon the execution of 

  
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this Commitment Letter, and you agree to actively assist us in completing a syndication that is reasonably satisfactory to us and you until the earliest of (x) the termination of the
syndication as determined by CS Securities, (y) the consummation of a Successful Syndication (as defined in the Facility Fee Letter), and (z) 60 days after the Closing Date (such period, the “Syndication Period”).
Such assistance shall include (a) your using commercially reasonable efforts to ensure that any syndication efforts benefit materially from your existing lending and investment banking relationships and the existing lending and investment
banking relationships of the Company, (b) direct contact between senior management, representatives and advisors of you (and, to the extent consistent with the Acquisition Agreement, your using commercially reasonable efforts to cause direct
contact between senior management, representatives and advisors of the Company) and the proposed Lenders at mutually agreed upon times and locations, (c) assistance by you (and, to the extent consistent with the Acquisition Agreement, your
using commercially reasonable efforts to cause the Company to assist) in the preparation of a Confidential Information Memorandum for the Facility and other customary marketing materials and presentations to be used in connection with the
syndication (the “Information Materials”), (d) your providing or causing to be provided a reasonably detailed business plan or projections of Holdings and its subsidiaries for the years 2014 through 2020 and for the
seven quarters beginning with the second quarter of 2014, in each case in form and substance satisfactory to CS Securities, (e) your ensuring (or, in the case of the Company and its subsidiaries, your using commercially reasonable efforts to
ensure that), during the Syndication Period, there shall be no other issues of debt securities or commercial bank or other credit facilities of Holdings, the Company or their respective subsidiaries being announced, offered, placed or arranged
(other than (i) the Notes, (ii) indebtedness permitted to be incurred under the Acquisition Agreement, (iii) any industrial revenue bonds, (iv) any mortgage, capitalized leases or purchase money financings, (v) any credit
extensions and commitments under the Existing Credit Agreement (including any amendment, restatement, modification, replacement or other refinancing thereof (provided, that any syndication thereof shall be in consultation with CS Securities)
that results in an increase to the commitments and outstanding loans thereunder by an aggregate principal amount not to exceed $600,000,000), (vi) any other revolving credit indebtedness incurred in the ordinary course of business of the
Company or Holdings and its subsidiaries for capital expenditures and working capital purposes and (vii) other indebtedness approved by CS Securities (collectively, the “Clear Markets Permitted Debt”)) without the prior
written consent of CS Securities, if such issuance, offering, placement or arrangement could reasonably be expected to impair the primary syndication of the Facility, (f) using your commercially reasonable efforts to procure prior to the launch
of the syndication a public corporate credit rating from Standard & Poor’s Ratings Service (“S&P”) and a public corporate family rating from Moody’s Investors Service, Inc.
(“Moody’s”), in each case with respect to the Borrower (but no specific rating in either case), and public ratings for each of the Facility (if requested by the Lenders or us) and the Notes (but no specific rating) from
each of S&P and Moody’s and (g) the hosting, with CS Securities, of a reasonable number of meetings of prospective Lenders at mutually agreed upon times and locations. Notwithstanding CS Securities’ right to syndicate the Facility
and receive commitments in respect thereof, but without limiting your obligation to assist with the syndication efforts as set forth herein (but subject to the provisions of Section 2 above), (i) CS shall not be relieved, released or
novated from its obligations hereunder (including its commitments hereunder) in connection with any syndication, assignment or participation of the Facility, including its commitments in respect thereof, until after the funding of the Facility on
the Closing Date has occurred, (ii) no assignment or novation shall become effective (as between you and us) with respect to all or any portion of CS’s commitment in respect of the Facility until the funding on the Closing Date and
(iii) CS’s commitments hereunder are not conditioned upon the Borrower’s compliance with the foregoing or the commencement, conduct or completion of the syndication of the Facility or the completion of a Successful Syndication. 

  
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 You agree, at the reasonable request of CS Securities, to assist in the preparation of a version of the
Information Materials to be used in connection with the syndication of the Facility, consisting exclusively of information and documentation that is either (a) publicly available (or contained in the prospectus or other offering memorandum for
the Notes) or (b) not material with respect to Holdings, the Company or their respective subsidiaries or any of their respective securities for purposes of foreign, United States Federal and state securities laws (all such Information Materials
being “Public Lender Information”). Any information and documentation that is not Public Lender Information is referred to herein as “Private Lender Information”. Before distribution of any Information
Materials, you agree to execute and deliver to CS Securities, (i) a customary letter in which you authorize distribution of the Information Materials to Lenders’ employees willing to receive Private Lender Information and (ii) a
separate customary letter in which you authorize distribution of Information Materials containing solely Public Lender Information and represent that such Information Materials do not contain any Private Lender Information, which letter shall in
each case include a customary “10b-5” representation. You further agree that each document to be disseminated by CS Securities to any Lender in connection with the Facility will, at the reasonable request of CS Securities, be identified by
you as either (A) containing Private Lender Information or (B) containing solely Public Lender Information. You acknowledge that the following documents contain solely Public Lender Information (unless you notify us promptly prior to their
intended distribution that any such document contains Private Lender Information): (1) drafts and final definitive documentation with respect to the Facility, including term sheets; (2) administrative materials prepared by Credit Suisse
for prospective Lenders (such as a lender meeting invitation, bank allocation, if any, and funding and closing memoranda); (3) notification of changes in the terms of the Facility; and (4) other materials (excluding the Projections (as
defined below)) intended for prospective Lenders after the initial distribution of Information Materials. 
 CS Securities will manage all
aspects of any syndication in consultation with you, including decisions as to the selection of institutions to be approached and when they will be approached, when their commitments will be accepted, which institutions will participate, the
allocation of the commitments among the Lenders, any naming rights and the amount and distribution of fees among the Lenders. To assist CS Securities in its syndication efforts, you agree promptly to prepare and provide (and to use commercially
reasonable efforts to cause the Company promptly to provide) to CS Securities all information with respect to Holdings, the Company and their respective subsidiaries, the Transactions and the other transactions contemplated hereby, including all
financial information, projections and other forward-looking information (collectively, the “Projections”), as CS Securities may reasonably request. 

4. Information. 
 You hereby represent and
warrant (with respect to written factual information relating to the Company and its subsidiaries, to your actual knowledge) that (a) all written factual information other than the Projections and information of a general economic or industry
nature (the “Information”) that has been or will be made available to Credit Suisse by or on behalf of you or any of your representatives is or will be, when furnished and when taken as a whole, correct in all material
respects and does not or will not, when furnished and when taken as a whole, contain any untrue statement of a material fact or omit to state a material fact necessary in order to make the statements contained therein not materially misleading in
light of the circumstances under which such statements are made and (b) the Projections that have been or will be made available to Credit Suisse by or on behalf of you or any of your representatives have been or will be prepared in good faith
based upon assumptions that are reasonable at the time made and at the time the related Projections are made available to Credit Suisse (it being 

  
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understood that such Projections are as to future events and are not to be viewed as facts and are subject to significant uncertainties and contingencies and that no assurance can be given that
any particular Projections will be realized). You agree that if at any time prior to the later of (i) the Closing Date and (ii) the last day of the Syndication Period, any of the representations in the preceding sentence would be incorrect
(to your actual knowledge with respect to Information and Projections relating to the Company and its subsidiaries), in any material respects if the Information and Projections were being furnished, and such representations were being made, at such
time, then you will promptly supplement the Information and the Projections so that such representations will be correct in all material respects under those circumstances. In arranging and syndicating the Facility, we will be entitled to use and
rely primarily on the Information and the Projections without responsibility for independent verification thereof. 
 5. Fees. 

As consideration for CS’s commitment hereunder, and our agreements to perform the services described herein, you agree to pay to CS
Securities and CS the fees set forth in this Commitment Letter, the Fee Letter dated the date hereof and delivered herewith with respect to the Facility (the “Facility Fee Letter”) and the Agent Fee Letter dated the date
hereof and delivered herewith with respect to the Facility (the “Agent Fee Letter” and, together with the Facility Fee Letter, the “Fee Letters”). 

6. Conditions Precedent. 
 CS’s
commitment hereunder, and our agreements to perform the services described herein, are subject solely to (a) there shall not have occurred any event, change or condition since December 31, 2013 that has had, or could reasonably be expected
to have, a Company Material Adverse Effect (as defined below), (b) the execution and delivery of definitive documentation with respect to the Facility on the terms set forth in the Term Sheet, and (c) the conditions set forth or referred
to in Exhibit B hereto. For purposes hereof, “Company Material Adverse Effect” means any change, effect, event, circumstance, condition, occurrence, state of facts or development that individually or in the aggregate, is
materially adverse to the business, assets, financial condition or results of operations of the Company and its Subsidiaries, taken as a whole; provided, however, that none of the following shall be deemed (either alone or in
combination) to constitute, and none of the following shall be taken into account in determining whether there has been, a Company Material Adverse Effect: (i) any adverse change attributable to the execution of the Acquisition Agreement, the
disclosure or consummation of the transactions contemplated by the Acquisition Agreement, the taking of any action contemplated thereby or the identity of Holdings, other than with respect to any matters contemplated by Section 2.04(c) of the
Acquisition Agreement, (ii) changes in, or effects arising from or relating to, general business or economic conditions affecting the industry in which the Company and its Subsidiaries operate, (iii) changes in, or effects arising from or
relating to, national or international political or social conditions, (iv) changes in, or effects arising from or relating to, financial, banking, or securities markets, (v) changes in, or effects arising from or relating to changes in
GAAP or Laws, (vi) changes or effects arising from or relating to any seasonal fluctuations in the business, (vii) any failure, in and of itself, of the Company and its Subsidiaries to achieve any projections, forecasts, estimates, plans,
predictions, performance metrics or operating statistics (but the event, circumstance or change underlying such failures shall not be excluded), or (vi) any action or inaction by Holdings; provided, however, that any such adverse
effect described in the preceding clauses (ii) through (vi) shall be excluded only to the extent that such adverse effect does not disproportionately adversely affect the Company and its Subsidiaries, taken as a whole, relative to other
Persons engaged in the industries in which the Company and its Subsidiaries operate. Capitalized terms in the definition of Company Material Adverse Effect and not defined herein have the meanings assigned to them in the Acquisition Agreement. There
shall be no conditions to closing and funding other than those expressly referred to in this Section 6. 

  
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 Notwithstanding anything in this Commitment Letter (including each of the exhibits hereto), the
Fee Letters or the definitive documentation or any other agreement or undertaking related to the Facility to the contrary, (a) the only representations the accuracy of which shall be a condition to the availability of the Facility on the
Closing Date shall be (i) such of the representations made by or on behalf of the Company and its subsidiaries in the Acquisition Agreement as are material to the interests of the Lenders, but only to the extent that you have (or an affiliate
of yours has) the right to terminate (or decline to perform) your (or its) obligations under the Acquisition Agreement as a result of a breach of such representations in the Acquisition Agreement (the “Acquisition Agreement
Representations”) and (ii) the Specified Representations (as defined below) and (b) the terms of the definitive documentation for the Facility shall be in a form such that they do not impair the availability of the Facility on
the Closing Date if the conditions set forth in this Section 6 are satisfied. For purposes hereof, “Specified Representations” means the representations and warranties set forth in the Term Sheet relating to corporate
existence, power and authority, due authorization, execution and delivery, in each case as they relate to the entering into and performance by the Borrower of the definitive documentation for the Facility, the enforceability of such documentation,
Federal Reserve margin regulations, the PATRIOT Act, laws applicable to sanctioned persons, the Foreign Corrupt Practices Act, the Investment Company Act, no conflicts between the definitive documentation for the Facility and the organization
documents of the Loan Parties, any agreement governing indebtedness of the Borrower in an aggregate principal amount greater than $50,000,000 (including the Amended and Restated Loan and Security Agreement, dated as of March 17, 2014, among the
Borrower, Bank of America, N.A., as agent, and the other parties thereto (the “Existing Credit Agreement”), the Notes (if any) and the Existing Notes) or applicable material law, status of the Facility and the guarantees
thereof as senior debt and solvency as of the Closing Date. 
 Each of the parties hereto agrees that this Commitment Letter is a binding
and enforceable agreement with respect to the subject matter contained herein, including an agreement to negotiate in good faith the Loan Documents by the parties hereto in a manner consistent with this Commitment Letter, it being understood and
agreed that the commitments provided hereunder and the funding of the Facility on the Closing Date are subject solely to the conditions precedent set forth in this Section 6 and in Exhibit B to this Commitment Letter. The parties hereto agree
to use good faith efforts to negotiate and finalize the Loan Documents reasonably in advance of the anticipated Closing Date and (if requested by the Borrower) to execute the Loan Documents by the anticipated Closing Date. 

7. Indemnification; Expenses. 
 You agree
(a) to indemnify and hold harmless Credit Suisse and its officers, directors, employees, agents, advisors, representatives, controlling persons, members and successors and assigns (each, an “Indemnified Person”) from and
against any and all losses, claims, damages, liabilities and reasonable and documented out-of-pocket expenses, joint or several, to which any such Indemnified Person may become subject arising out of or in connection with this Commitment Letter, the
Fee Letters, the Transactions, the Facility or any related transaction or any claim, litigation, investigation or proceeding relating to any of the foregoing, regardless of whether any such Indemnified Person is a party thereto (and regardless of
whether such matter is initiated by a third party or by Holdings, the Company or any of their respective affiliates or 

  
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equity holders), and to reimburse each such Indemnified Person promptly following written request therefor for any reasonable and documented out-of-pocket legal or other expenses incurred in
connection with investigating or defending any of the foregoing (limited, in the case of legal fees and expenses, to one firm of primary counsel to such Indemnified Persons taken as a whole (and, in the case of any conflict of interest, one firm of
additional counsel to each similarly affected group of Indemnified Persons, taken as a whole), one firm of special counsel for each applicable jurisdiction and one firm of local counsel in each applicable jurisdiction (and, in the case of any
conflict of interest, one firm of additional local counsel to each similarly affected group of Indemnified Persons, taken as a whole)); provided that the foregoing indemnity will not, as to any Indemnified Person, apply to losses, claims,
damages, liabilities or expenses to the extent (i) they are found in a final, non-appealable judgment of a court of competent jurisdiction to have resulted from the bad faith, willful misconduct or gross negligence of such Indemnified Person or
its controlled affiliates, controlling persons, directors, officers or employees, or, in the case of persons acting at such Indemnified Person’s direction, its advisors, agents or representatives (each, a “Related
Person”), or such Indemnified Person’s or Related Party’s material breach of this Commitment Letter without the fault of you or your affiliates or (ii) they arise out of any dispute solely among Indemnified Persons (other
than (x) claims against Credit Suisse in its capacity as administrative agent or lead arranger under the Facility and (y) claims arising out of any act or omission on the part of you or your affiliates), (b) to reimburse Credit Suisse
from time to time, upon presentation of a summary statement, for all reasonable and documented out-of-pocket expenses (including, but not limited to, expenses of Credit Suisse’s due diligence investigation, consultants’ fees, syndication
expenses, travel expenses and fees, and disbursements and other charges of counsel) (limited, in the case of legal fees and expenses, to one firm of primary counsel to such Indemnified Persons taken as a whole (and, in the case of any conflict of
interest, one firm of additional counsel to each similarly affected group of Indemnified Persons, taken as a whole), one firm of special counsel for each applicable jurisdiction and one firm of local counsel in each applicable jurisdiction (and, in
the case of any conflict of interest, one firm of additional local counsel to each similarly affected group of Indemnified Persons, taken as a whole)), incurred in connection with the Facility and the preparation and negotiation of this Commitment
Letter, the Fee Letters, the definitive documentation for the Facility and any ancillary documents and security arrangements in connection therewith and (c) to reimburse Credit Suisse from time to time, upon presentation of a summary statement,
for all reasonable and documented out-of-pocket expenses (including, but not limited to, consultants’ fees, travel expenses and fees, and disbursements and other charges of counsel (limited, in the case of legal fees and expenses, to one firm
of primary counsel to such Indemnified Persons taken as a whole (and, in the case of any conflict of interest, one firm of additional counsel to each similarly affected group of Indemnified Persons, taken as a whole), one firm of special counsel for
each applicable jurisdiction and one firm of local counsel in each applicable jurisdiction (and, in the case of any conflict of interest, one firm of additional local counsel to each similarly affected group of Indemnified Persons, taken as a
whole)), incurred in connection with the enforcement of this Commitment Letter, the Fee Letters, the definitive documentation for the Facility and any ancillary documents and security agreements in connection therewith. You agree that,
notwithstanding any other provision of this Commitment Letter, no Indemnified Person shall have any liability (whether direct or indirect, in contract or tort or otherwise) to you or your subsidiaries or affiliates or to your or their respective
equity holders or creditors or any other person arising out of, related to or in connection with any aspect of the Transaction, except to the extent of direct, as opposed to special, indirect, consequential or punitive, damages determined in a
final, non-appealable judgment by a court of competent jurisdiction to have resulted from such Indemnified Person’s or its Related Party’s bad faith, gross negligence or willful misconduct or from such Indemnified Person’s or Related
Party’s material breach of this Commitment Letter without the fault of you or your affiliates. 

  
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 8. Sharing Information; Absence of Fiduciary Relationship; Affiliate Activities. 

You acknowledge that Credit Suisse may be providing debt financing, equity capital or other services (including financial advisory services) to
other companies in respect of which you may have conflicting interests regarding the transactions described herein or otherwise; provided, that Credit Suisse shall not arrange or provide (or contemplate to arrange or provide) any form of
acquisition financing to other potential purchasers of the Company at any time prior to the abandonment by you of your proposed acquisition of the Company or the termination of the Acquisition Agreement). Consistent with Credit Suisse’s policy
to hold in confidence the affairs of its customers, Credit Suisse will not furnish confidential information obtained from you by virtue of the transactions contemplated by this Commitment Letter or our other relationships with you to other
companies. You also acknowledge that we do not have any obligation to use in connection with the transactions contemplated by this Commitment Letter, or to furnish to you, confidential information obtained by us from other companies. 

You further acknowledge and agree that (a) no fiduciary, advisory or agency relationship between you and Credit Suisse is intended to be
or has been created in respect of any of the transactions contemplated by this Commitment Letter, irrespective of whether Credit Suisse has advised or is advising you on other matters, (b) Credit Suisse, on the one hand, and you, on the other
hand, have an arm’s-length business relationship that does not directly or indirectly give rise to, nor do you rely on, any fiduciary duty on the part of Credit Suisse, (c) you are capable of evaluating and understanding, and you
understand and accept, the terms, risks and conditions of the transactions contemplated by this Commitment Letter, (d) you have been advised that Credit Suisse is engaged in a broad range of transactions that may involve interests that differ
from your interests and that Credit Suisse has no obligation to disclose such interests and transactions to you by virtue of any fiduciary, advisory or agency relationship and (e) you waive, to the fullest extent permitted by law, any claims
you may have against Credit Suisse for breach of fiduciary duty or alleged breach of fiduciary duty and agree that Credit Suisse shall have no liability (whether direct or indirect) to you in respect of such a fiduciary duty claim or to any person
asserting a fiduciary duty claim on behalf of or in right of you, including your equity holders, employees or creditors. Additionally, you acknowledge and agree that Credit Suisse is not advising you as to any legal, tax, investment, accounting or
regulatory matters in any jurisdiction (including, without limitation, with respect to any consents needed in connection with the transactions contemplated hereby). You shall consult with your own advisors concerning such matters and shall be
responsible for making your own independent investigation and appraisal of the transactions contemplated hereby (including, without limitation, with respect to any consents needed in connection therewith), and Credit Suisse shall have no
responsibility or liability to you with respect thereto. Any review by Credit Suisse of Holdings, the Borrower, the Company, the Transactions, the other transactions contemplated hereby or other matters relating to such transactions will be
performed solely for the benefit of Credit Suisse and shall not be on behalf of you or any of your affiliates. 
 You further acknowledge
that Credit Suisse is a full-service securities firm engaged in securities trading and brokerage activities as well as providing investment banking and other financial services. In the ordinary course of business, Credit Suisse may provide
investment banking and other financial services to, and/or acquire, hold or sell, for its own accounts and the accounts of customers, equity, debt and other securities and financial instruments (including bank loans and other obligations) of you,
the Company and other companies with which you or the Company may have commercial or other relationships. With respect to any securities and/or financial instruments so held by Credit Suisse or any of its customers, all rights in respect of such
securities and financial instruments, including any voting rights, will be exercised by the holder of the rights, in its sole discretion. 

  
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 9. Assignments; Amendments; Governing Law, Etc. 

This Commitment Letter shall not be assignable by you without the prior written consent of CS and CS Securities (and any attempted assignment
without such consent shall be null and void), is intended to be solely for the benefit of the parties hereto (and Indemnified Persons), and is not intended to confer any benefits upon, or create any rights in favor of, any person other than the
parties hereto (and Indemnified Persons). Notwithstanding anything to the contrary herein (including in Section 3 hereof), CS may, with your consent, assign its commitment hereunder to one or more prospective Lenders, provided that prior
to funding of the Facility, CS shall not be released from any portion of its commitment hereunder so assigned (except assignments to Additional Committing Lenders pursuant to Section 2 above). Any and all obligations of, and services to be
provided by, CS Securities or CS hereunder (including, without limitation, CS’s commitment) may be performed and any and all rights of CS Securities or CS hereunder may be exercised by or through any of their respective affiliates or branches
and, in connection with such performance or exercise, CS Securities and CS may exchange with such affiliates or branches information concerning you and your affiliates that may be the subject of the transactions contemplated hereby and, to the
extent so employed, such affiliates and branches shall be entitled to the benefits afforded to CS Securities and CS hereunder. This Commitment Letter may not be amended or any provision hereof waived or modified except by an instrument in writing
signed by CS Securities, CS and you. This Commitment Letter may be executed in any number of counterparts, each of which shall be an original and all of which, when taken together, shall constitute one agreement. Delivery of an executed counterpart
of a signature page of this Commitment Letter by facsimile or other electronic transmission shall be effective as delivery of a manually executed counterpart hereof. Section headings used herein are for convenience of reference only, are not part of
this Commitment Letter and are not to affect the construction of, or to be taken into consideration in interpreting, this Commitment Letter. You acknowledge that information and documents relating to the Facility may be transmitted through SyndTrak,
IntraLinks, the Internet, e-mail or similar electronic transmission systems, and that Credit Suisse shall not be liable for any damages arising from the unauthorized use by others of information or documents transmitted in such manner.
Notwithstanding anything in Section 12 to the contrary, Credit Suisse may place advertisements in financial and other newspapers and periodicals or on a home page or similar place for dissemination of information on the Internet or World Wide
Web as it may choose, and circulate similar promotional materials, after the closing of the Transactions in the form of a “tombstone” or otherwise describing the names of you and your affiliates (or any of them), and the amount, type and
closing date of such Transactions, all at Credit Suisse’s expense. This Commitment Letter and the Fee Letters supersede all prior understandings, whether written or oral, between us with respect to the Facility. Your obligations hereunder and
under the Fee Letters shall be joint and several. THIS COMMITMENT LETTER AND ANY CLAIM, CONTROVERSY OR DISPUTE ARISING UNDER OR RELATED TO THIS COMMITMENT LETTER (INCLUDING, WITHOUT LIMITATION, ANY CLAIMS SOUNDING IN CONTRACT LAW OR TORT LAW
ARISING OUT OF THE SUBJECT MATTER HEREOF) SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK; PROVIDED, THAT, NOTWITHSTANDING THE PRECEDING SENTENCE AND THE GOVERNING LAW PROVISIONS OF
THIS COMMITMENT LETTER AND THE FEE LETTERS, IT IS UNDERSTOOD AND AGREED THAT (A) THE INTERPRETATION OF THE DEFINITION OF “COMPANY MATERIAL ADVERSE EFFECT” (AND WHETHER OR NOT A COMPANY MATERIAL ADVERSE EFFECT HAS OCCURRED),
(B) THE  

  
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DETERMINATION OF THE ACCURACY OF ANY ACQUISITION AGREEMENT REPRESENTATION AND WHETHER AS A RESULT OF ANY INACCURACY THEREOF YOU HAVE (OR AN AFFILIATE OF YOURS HAS) THE RIGHT TO TERMINATE (OR
DECLINE TO PERFORM) YOUR (OR ITS) OBLIGATIONS UNDER THE ACQUISITION AGREEMENT AND (C) THE DETERMINATION OF WHETHER THE ACQUISITION HAS BEEN CONSUMMATED IN ACCORDANCE WITH THE TERMS OF THE ACQUISITION AGREEMENT AND, IN ANY CASE, CLAIMS OR
DISPUTES ARISING OUT OF ANY SUCH INTERPRETATION OR DETERMINATION OR ANY ASPECT THEREOF, IN EACH CASE, SHALL BE GOVERNED BY, AND CONSTRUED AND INTERPRETED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF DELAWARE, REGARDLESS OF THE LAWS THAT MIGHT
OTHERWISE GOVERN UNDER APPLICABLE PRINCIPLES OF CONFLICTS OF LAWS THEREOF. 
 10. Jurisdiction. 

Each of the parties hereto hereby irrevocably and unconditionally (a) submits, for itself and its property, to the exclusive jurisdiction
of any New York State court or Federal court of the United States of America sitting in the Borough of Manhattan in New York City, and any appellate court from any thereof, in any suit, action or proceeding arising out of or relating to this
Commitment Letter, the Fee Letters or the transactions contemplated hereby or thereby, and agrees that all claims in respect of any such suit, action or proceeding may be heard and determined only in such New York State court or, to the extent
permitted by law, in such Federal court; provided that suit for the recognition or enforcement of any judgment obtained in any such New York State or Federal court may be brought in any other court of competent jurisdiction, (b) waives,
to the fullest extent it may legally and effectively do so, any objection which it may now or hereafter have to the laying of venue of any suit, action or proceeding arising out of or relating to this Commitment Letter, the Fee Letters or the
transactions contemplated hereby or thereby in any New York State court or in any such Federal court, (c) waives, to the fullest extent permitted by law, the defense of an inconvenient forum to the maintenance of such suit, action or
proceeding in any such court and (d) agrees that a final judgment in any such suit, action or proceeding shall be conclusive and may be enforced in other jurisdictions by suit on the judgment or in any other manner provided by law. Service of
any process, summons, notice or document by registered mail addressed to you at the address above shall be effective service of process against you for any suit, action or proceeding brought in any such court. 

11. Waiver of Jury Trial. 
 EACH OF THE
PARTIES HERETO IRREVOCABLY WAIVES THE RIGHT TO TRIAL BY JURY IN ANY SUIT, ACTION, PROCEEDING, CLAIM OR COUNTERCLAIM BROUGHT BY OR ON BEHALF OF ANY PARTY RELATED TO OR ARISING OUT OF THIS COMMITMENT LETTER, THE FEE LETTERS OR THE PERFORMANCE OF
SERVICES HEREUNDER OR THEREUNDER. 
 12. Confidentiality. 

This Commitment Letter is delivered to you on the understanding that neither this Commitment Letter nor the Fee Letters nor any of their terms
or substance, nor the activities of Credit Suisse pursuant hereto, shall be disclosed, directly or indirectly, to any other person except (a) to your officers, directors, members, partners, employees, attorneys, accountants, agents and advisors
on a confidential and need-to-know basis, (b) as required by applicable law or compulsory legal, regulatory or administrative process (in which case you agree, to the extent 

  
 Commitment Letter 

 
 10 

 
permitted by applicable law, rule or regulation, to inform us promptly thereof prior to such disclosure), (c) you may disclose this Commitment Letter and the contents hereof (but not
the Fee Letters or the contents thereof other than the existence thereof and the contents thereof as part of projections, pro forma information and a generic disclosure of aggregate sources and uses to the extent customary in marketing materials and
other required filings) (i) to the Company and the Seller and their respective officers, directors, members, partners, stockholders, employees, attorneys, accountants, agents and advisors on a confidential and need-to-know basis and
(ii) in any prospectus or other offering memorandum relating to the Notes, in any syndication or other marketing material relating to the Facility or in connection with any public filing requirement, (d) you may disclose the Fee Letters
redacted in a manner reasonably satisfactory to Credit Suisse to the Company and the Seller and their respective officers, directors, members, partners, employees, attorneys, accountants, agents and advisors on a confidential and need-to-know basis,
(e) to actual or potential Additional Committing Lenders on a confidential basis, (f) the Term Sheet may be disclosed on a confidential basis to actual or potential Lenders and to any rating agency in connection with the Transactions, the
Facility and the Notes and (g) to the extent that such information becomes publicly available other than by reason of disclosure by you in violation of this paragraph. 

We will treat as confidential all confidential information provided to us by or on behalf of you hereunder; provided that nothing
herein shall prevent us from disclosing any such information (a) pursuant to the order of any court or administrative agency or in any pending legal, regulatory or administrative proceeding, or otherwise as required by applicable law or
compulsory legal, regulatory or administrative process (in which case we agree, to the extent permitted by applicable law, rule or regulation, to inform you promptly thereof prior to disclosure thereof), (b) upon the request or demand of any
regulatory authority having jurisdiction over us, (c) to the extent that such information becomes publicly available other than by reason of disclosure by us in violation of this paragraph, (d) to our affiliates and to our and their
respective employees, legal counsel, accountants, independent auditors, advisors and other experts or agents who are informed of the confidential nature of such information and on a need-to-know basis, (e) to actual or potential assignees,
participants or derivative investors in the Facility who agree to be bound by the terms of this paragraph or substantially similar confidentiality provisions, (f) to the extent permitted by Section 9 or (g) for purposes of
establishing a “due diligence” defense. This paragraph shall automatically terminate and be superseded by the confidentiality provisions in the definitive documentation for the Facility upon the execution and delivery of such documentation
and in any event shall terminate on the first anniversary of the date hereof. 
 Notwithstanding anything herein to the contrary, any party
to this Commitment Letter (and any employee, representative or other agent of such party) may disclose to any and all persons, without limitation of any kind, the tax treatment and tax structure of the transactions contemplated by this Commitment
Letter and the Fee Letters and all materials of any kind (including opinions or other tax analyses) that are provided to it relating to such tax treatment and tax structure, except that (i) tax treatment and tax structure shall not include the
identity of any existing or future party (or any affiliate of such party) to this Commitment Letter or the Fee Letters and (ii) no party shall disclose any information relating to such tax treatment and tax structure to the extent nondisclosure
is reasonably necessary in order to comply with applicable securities laws. For this purpose, the tax treatment of the transactions contemplated by this Commitment Letter and the Fee Letters is the purported or claimed U.S. Federal income tax
treatment of such transactions and the tax structure of such transactions is any fact that may be relevant to understanding the purported or claimed U.S. Federal income tax treatment of such transactions. 

  
 Commitment Letter 

 
 11 

 13. Surviving Provisions. 

The compensation, reimbursement, indemnification, confidentiality, syndication, jurisdiction, governing law and waiver of jury trial provisions
contained herein and in the Fee Letters and the provisions of Section 8 of this Commitment Letter shall remain in full force and effect regardless of whether definitive financing documentation shall be executed and delivered and (other than in
the case of the syndication provisions) notwithstanding the termination of this Commitment Letter or CS’s commitment hereunder and our agreements to perform the services described herein. 

14. PATRIOT Act Notification. 
 Credit
Suisse hereby notifies you that, pursuant to the requirements of the USA PATRIOT Act, Title III of Pub. L. 107-56 (signed into law October 26, 2001) (the “PATRIOT Act”), Credit Suisse and each Lender is required to
obtain, verify and record information that identifies the Borrower and each guarantor, which information includes the name, address, tax identification number and other information regarding the Borrower and each guarantor that will allow Credit
Suisse or such Lender to identify the Borrower and each guarantor in accordance with the PATRIOT Act. This notice is given in accordance with the requirements of the PATRIOT Act and is effective as to Credit Suisse and each Lender. You hereby
acknowledge and agree that Credit Suisse shall be permitted to share any or all such information with the Lenders. 
 15. Acceptance and Termination.

 If the foregoing correctly sets forth our agreement with you, please indicate your acceptance of the terms of this Commitment Letter and
of the Fee Letters by returning to us executed counterparts hereof and of the Fee Letters not later than 5:00 p.m., New York City time, on July 25, 2014. CS’s offer hereunder, and our agreements to perform the services described
herein, will expire automatically and without further action or notice and without further obligation to you at such time in the event that Credit Suisse has not received such executed counterparts in accordance with the immediately preceding
sentence. This Commitment Letter will become a binding commitment on CS only after it has been duly executed and delivered by you in accordance with the first sentence of this Section 15. In the event that the Closing Date does not occur on or
before 5:00 p.m., New York City time, on April 18, 2015 (or such earlier date on which the Acquisition Agreement terminates or either party thereto publicly announces its intention not to proceed with the Acquisition), then this Commitment
Letter and CS’s commitment hereunder, and our agreements to perform the services described herein, shall automatically terminate without further action or notice and without further obligation to you unless Credit Suisse shall, in its
discretion, agree in writing to an extension. 
 [Remainder of this page intentionally left blank] 

  
 Commitment Letter 

 
 12 

 Credit Suisse is pleased to have been given the opportunity to assist you in connection with the
financing for the Acquisition. 
  

			
	Very truly yours,
	
	CREDIT SUISSE SECURITIES (USA) LLC
		
	By	 	 /s/ Adam Forchheimer

		 	Name: Adam Forchheimer
		 	Title: Authorized Signatory
	
	CREDIT SUISSE AG, CAYMAN ISLANDS BRANCH
		
	By	 	 /s/ Michael Spaight

		 	Name: Michael Spaight
		 	Title: Authorized Signatory
		
	By	 	 /s/ Whitney Gaston

		 	Name: Whitney Gaston
		 	Title: Authorized Signatory

  

			
	Accepted and agreed to as of the date first above written:
	
	AK STEEL HOLDING CORPORATION
		
	By	 	 /s/ Roger K. Newport

		 	Name: Roger K. Newport
		 	Title: SVP, Finance and CFO
	
	AK STEEL CORPORATION
		
	By	 	 /s/ Roger K. Newport

		 	Name: Roger K. Newport
		 	Title: SVP, Finance and CFO

  
 Commitment Letter 

 
 13 

 EXHIBIT A 

CONFIDENTIAL 
 PROJECT 711 

$730,000,000 Senior Unsecured Bridge Facility 

Summary of Principal Terms and Conditions1 

 

			
	Borrower:	  	AK Steel Corporation, a Delaware corporation (the “Borrower”).
		
	Agent:	  	Credit Suisse AG, acting through one or more of its branches or affiliates (“CS”), will act as sole administrative agent (in such capacity, the “Agent”) for a syndicate of banks,
financial institutions and other institutional lenders (together with CS and the Additional Committing Lenders, the “Lenders”), and will perform the duties customarily associated with such role.
		
	Bookrunner and Lead Arranger:	  	Credit Suisse Securities (USA) LLC will act as bookrunner and lead arranger for the Facility described below (collectively, in such capacities, the “Arranger”), and will perform the duties customarily
associated with such roles.
		
	Syndication Agent:	  	At the option of the Arranger, one financial institution identified by the Arranger and reasonably acceptable to the Borrower (in such capacity, the “Syndication Agent”).
		
	Documentation Agent:	  	At the option of the Arranger, one financial institution identified by the Arranger and reasonably acceptable to the Borrower (in such capacity, the “Documentation Agent”).
		
	Facility:	  	Senior unsecured bridge loans (the “Loans”) in an aggregate principal amount of $730,000,000 (the “Facility”) minus the sum of (a) Net Cash Proceeds (as defined below) received
by the Borrower from the issuance of any Notes on or prior to the date of the funding of the Facility (the “Closing Date”) and (b) Net Cash Proceeds received by the Borrower in connection with the issuance of any
Stock.
		
	Purpose:	  	The proceeds of the Loans will be used by the Borrower on the Closing Date, together with cash on hand and the Net Cash Proceeds from the issuance of Notes (if any) and the issuance of Stock (if any), solely (a) to pay the
purchase price of the Acquisition (the “Acquisition Consideration”) and (b) to pay the Transaction Costs.

  

	1 	All capitalized terms used but not defined herein have the meanings given to them in the Commitment Letter to which this term sheet is attached. 

  
 Term Sheet 

 

			
	Availability:	  	The Facility must be drawn in a single drawing on the Closing Date. Amounts borrowed under the Facility that are repaid or prepaid may not be reborrowed.
		
	Ranking:	  	The Loans will constitute senior indebtedness of the Borrower and will rank pari passu in right of payment with the Borrower’s other senior indebtedness, including the Existing Credit Agreement.
		
	Guarantees:	  	All obligations of the Borrower under the Facility will be unconditionally guaranteed (the “Guarantees”) by AK Steel Holding Corporation (“Holdings”) and each wholly owned domestic
restricted subsidiary of the Borrower, limited to any subsidiary that is a guarantor under the Existing Credit Agreement or the Existing Notes (such guarantors, together with the Borrower, collectively the “Loan Parties”).
“Existing Notes” means the Borrower’s (i) 7.625% Senior Notes due 2020, (ii) 8.750% Senior Secured Notes due 2018, (iii) 8.375% Senior Notes due 2022 (the “2022 Notes”) and (iv) 5.00% Exchangeable
Senior Notes due 2019.
		
	Security:	  	None.
		
	Interest Rates:	  	Interest for the first three-month period commencing on the Closing Date shall be equal to Adjusted LIBOR (as defined below) plus 675 basis points (the “Initial Margin”). Three months after the Closing Date
and at the end of each three month period thereafter, the spread over Adjusted LIBOR shall be increased by 50 basis points (the Initial Margin plus each 50 basis point increase described above, the “Applicable Margin”).
“Adjusted LIBOR” means the London interbank offered rate for U.S. dollars (for a three-month interest period), which will at all times include statutory reserves and shall be deemed to be not less than 1.00% per
annum.
		
		  	Notwithstanding anything to the contrary set forth above, at no time shall the per annum interest rate on the Loans, the Extended Term Loans (as defined below) or the Exchange Notes (as defined below) exceed the Total Cap (as
defined in the Facility Fee Letter). Upon the occurrence of a Demand Failure Event (as defined in the Facility Fee Letter), the outstanding Loans will automatically and immediately accrue interest at the Total Cap and be subject to the call
protection provisions of the Exchange Notes (and the Conversion Fee (as defined in the Facility Fee Letter) shall be immediately due and payable).

  
 Term Sheet 

A-2 

			
	Interest Payments:	  	Interest on the Loans will be payable in cash, quarterly in arrears. Calculation of interest shall be on the basis of the actual number of days elapsed over a 360-day year.
		
	Default Rate:	  	 At any time an event of default exists as a result of the Borrower’s failure to make any payment in respect of the Facility, such
overdue amount shall bear interest at 2.0% per annum above the rate otherwise applicable thereto.
  

Notwithstanding anything to the contrary set forth herein, in no event shall any cap or limit on the yield or interest rate payable with respect to the Loans,
Extended Term Loans or Exchange Notes affect the payment in cash of any default rate of interest in respect of any Loans, Extended Term Loans or Exchange Notes.

		
	Conversion and Maturity:	  	 On the first anniversary of the Closing Date (the “Conversion Date”), any Loan that has not been previously repaid in
full will be automatically converted into a senior term loan (each an “Extended Term Loan”) due on the date that is seven years after the Closing Date (or, if earlier, 90 days prior to the maturity date of the 2022 Notes if
any such notes are outstanding at that time) (the “Maturity Date”). At any time on or after the Conversion Date, at the option of the applicable Lender, the Extended Term Loans may be exchanged in whole or in part for senior
exchange notes (the “Exchange Notes”) having an equal principal amount; provided that the Borrower may defer the first issuance of Exchange Notes until such time as the Borrower shall have received requests to issue at
least $150 million in aggregate principal amount of Exchange Notes.
  
 The Extended Term
Loans will be governed by the provisions of the Loan Documents (as defined below) and will have the same terms as the Loans except as expressly set forth on Annex I hereto. The Exchange Notes will be issued pursuant to an indenture that will have
the terms set forth on Annex II hereto.

		
	Mandatory Prepayments and Commitment Reductions:	  	The Loans shall be prepaid with (and, prior to the Closing Date, the commitment under the Facility, pursuant to the Commitment Letter and the Loan Documents, shall be automatically and permanently reduced by), subject to certain
exceptions to be agreed upon, (i) the Net Cash Proceeds from the issuance, offering or placement of any debt obligations (other than (i) any Clear Markets Permitted Debt (except to the extent the proceeds thereof are applied to pay
the

  
 Term Sheet 

A-3 

			
		  	 purchase price of the Acquisition or to pay the Transaction Costs) and (ii) other indebtedness in an aggregate principal amount not to exceed
$50,000,000 (such indebtedness set forth in clauses (i) and (ii), collectively, the “Permitted Debt”)) or publicly offered equity securities by Holdings or any of its subsidiaries; provided that in the event that any
Lender that committed to provide a portion of the Loans pursuant to the Commitment Letter (each, an “Initial Bridge Lender”) or any of its affiliates purchases debt securities from Holdings or its subsidiaries pursuant to a
“securities offering” under the Facility Fee Letter at an issue price above the level at which such Initial Bridge Lender or affiliate has determined such debt securities can be resold at the time of such purchase by such Initial Bridge
Lender or affiliate to a bona fide third party that is not a Lender under the Facility or an affiliate thereof or a participant in the Facility at such time (and notifies the Borrower thereof), the Net Cash Proceeds received by Holdings and its
subsidiaries in respect of such debt securities may, at the option of such Initial Bridge Lender or affiliate, be applied first to prepay the Loans of such Initial Bridge Lender or affiliate (provided that if there is more than one such
Initial Bridge Lender or affiliate then such Net Cash Proceeds will be applied pro rata to prepay the Loans of all such Initial Bridge Lenders or affiliates in proportion to such Initial Bridge Lenders’ or affiliates’ principal
amount of debt securities purchased from Holdings or its subsidiaries) prior to being applied to prepay the Loans held by other Lenders; and (ii) the Net Cash Proceeds from any non-ordinary course asset sales by Holdings or any of its
subsidiaries (including proceeds from the issuance of equity securities of Holdings and any of its subsidiaries), other than asset sales having Net Cash Proceeds up to $50,000,000 in the aggregate. The Borrower will also be required to offer to
prepay the Loans following the occurrence of a Change of Control (to be defined) at 100% of the outstanding principal amount thereof (plus all accrued and unpaid interest thereon).

 
 “Net Cash Proceeds” means:

 
 (a) with respect to any asset sale, the aggregate amount of all cash (which term, for the
purpose of this definition, shall include cash equivalents) proceeds (including any cash proceeds received by way of deferred payment of principal pursuant to a note or installment receivable or purchase price adjustment or otherwise, but only as
and when received) actually received in respect of such asset sale, including property

  
 Term Sheet 

A-4 

			
		  	 insurance or condemnation proceeds paid on account of any loss of any property or assets, net of (1) all reasonable attorneys’ fees,
accountants’ fees, brokerage, consultant and other customary fees and commissions, title and recording tax expenses and other reasonable fees and expenses incurred in connection therewith, (2) all taxes paid or reasonably estimated to be
payable as a result thereof, (3) all payments made, and all installment payments required to be made, with respect to any obligation (A) that is secured by any assets subject to such asset sale, in accordance with the terms of any lien upon such
assets, or (B) that must by its terms, or in order to obtain a necessary consent to such asset sale, or by applicable law, be repaid (including pursuant to any mandatory prepayment or redemption requirement) out of the proceeds from such asset sale,
(4) all distributions and other payments required to be made to minority interest holders in subsidiaries or joint ventures as a result of such asset sale, or to any other person (other than Holdings or any of its subsidiaries) owning a beneficial
interest in the assets disposed of in such asset sale, and (5) the amount of any reserves established by Holdings or any of its subsidiaries in accordance with GAAP to fund purchase price or similar adjustments, indemnities or liabilities,
contingent or otherwise, reasonably estimated to be payable in connection with such asset sale (provided that to the extent and at the time any such amounts are released from such reserve, such amounts shall constitute Net Cash Proceeds),
provided that such Net Cash Proceeds of asset sales shall not include insurance and condemnation proceeds to the extent reinvested (or committed to be reinvested) in other assets used or useful in the business of Holdings or any of its
subsidiaries (including any investments and acquisitions) within 12 months of receipt of such proceeds or, if so committed within such period, reinvested within 6 months thereafter; and

 
 (b) with respect to any equity issuance or debt incurrence, the aggregate amount of all
cash proceeds actually received in respect of such equity issuance or debt incurrence, net of reasonable fees, expenses, costs, underwriting discounts and commissions incurred in connection therewith and net of taxes paid or reasonably estimated by
the Borrower to be payable as a result thereof.

		
	Voluntary Prepayments:	  	The Loans may be prepaid, in whole or in part, at par plus accrued and unpaid interest upon not less than 3 business days’ prior written notice, at the option of the Borrower at any
time.

  
 Term Sheet 

A-5 

			
	Credit Documentation	  	The definitive documentation for the Facility (the “Loan Documents”) shall be substantially consistent with the Commitment Letter (including this Term Sheet), shall contain only those conditions, mandatory
prepayments, representations, warranties, affirmative and negative covenants, events of default and other provisions expressly specified in the Commitment Letter (including all Exhibits and Annexes thereto), and shall otherwise be substantially
consistent with the indentures for the Existing Notes (modified as appropriate for a bridge credit agreement format), subject to Section 4 of the Facility Fee Letter); provided that, the only conditions to the availability of the Facility on
the Closing Date shall be those expressly set forth in Section 6 of the Commitment Letter and Exhibit B.
		
	Representations and Warranties:	  	The Loan Documents will contain solely the following representations and warranties relating to Holdings, the Borrower and its subsidiaries (in each case, substantially consistent with the corresponding provisions of the Existing
Credit Agreement): organization and qualification; power and authority; no conflicts; no consents; enforceability; capital structure; corporate names; locations; title to properties; financial statements; no material adverse change; surety
obligations; taxes, brokers, intellectual property; governmental approvals; compliance with laws; compliance with environmental laws; burdensome contracts; litigation; no defaults; ERISA; trade relations; labor relations; Investment Company Act;
non-regulated entity status; margin stock; sanctions; and complete disclosure; and also: the PATRIOT Act; the Foreign Corrupt Practices Act; status of the Facility and the guarantees thereof as senior debt and solvency as of the Closing
Date.
		
	Conditions Precedent to Borrowing:	  	The borrowing under the Facility will be subject solely to the conditions precedent set forth in Section 6 of the Commitment Letter and Exhibit B to the Commitment Letter.
		
	Covenants:	  	The Loan Documents will contain covenants that are substantially consistent with the indentures for the Existing Notes, subject to Section 4 of the Facility Fee Letter, which in the case of negative covenants, will be
incurrence-based covenants and in no event will contain any financial maintenance covenants; provided that prior to the Conversion Date, there will be debt, lien and restricted payments covenants applicable to the Loans that shall be more
restrictive than those customary for publicly traded high-yield securities and those applicable to the Extended Term Loans and the Exchange Notes in a manner to be reasonably agreed.

  
 Term Sheet 

A-6 

			
	Events of Default:	  	Limited to the following (subject, where appropriate, to thresholds and grace periods to be agreed upon): nonpayment of principal, interest or other amounts; violation of covenants; incorrectness of representations and warranties in
any material respect; cross default with respect to payments at maturity and cross acceleration; bankruptcy; material judgments; or actual or asserted invalidity of Guarantees.
		
	Unrestricted Subsidiaries:	  	The Loan Documents will contain provisions pursuant to which, subject to limitations to be agreed (including customary limitations on investments, loans, advances and guarantees) the Borrower will be permitted to designate any
subsequently acquired or organized subsidiary as an “unrestricted subsidiary” and subsequently re-designate such unrestricted subsidiary as a restricted subsidiary; provided that no unrestricted subsidiary designated as a restricted
subsidiary may subsequently be designated as an unrestricted subsidiary; provided further that no unrestricted subsidiary shall be a restricted subsidiary under the Existing Credit Agreement, the Existing Notes or any other indebtedness.
Unrestricted subsidiaries will not be subject to the affirmative or negative covenants or events of default and other provisions of the Loan Documents.
		
	Voting:	  	Amendments and waivers of the Loan Documents will require the approval of Lenders holding more than 50% of the aggregate principal amount of the commitments or Loans, except that the consent of (a) each affected Lender shall be
required with respect to (i) increases in the commitment of such Lender, (ii) reductions or forgiveness of principal, interest or fees payable to such Lender, (iii) extensions of the Conversion Date or final maturity of such Lender’s
Loans or of the date for payment to such Lender of any interest or fees, (iv) changes that impose any additional restriction on such Lender’s ability to assign any of its rights or obligations and (b) each Lender shall be required with respect
to (i) modifications to certain provisions requiring the pro rata treatment of Lenders, (ii) modification to voting requirements or percentages, and (iii) releases of all or substantially all of the value of the Guarantees.
		
	Cost and Yield Protection:	  	Usual for facilities and transactions of this type, including customary tax gross-up provisions (including but not limited to provisions relating to Dodd-Frank and Basel
III).

  
 Term Sheet 

A-7 

			
	Assignments and Participations:	  	 Each Lender will be permitted to make assignments in minimum amounts to be agreed; provided, however, that, prior to the Conversion
Date, so long as no payment or bankruptcy event of default or Demand Failure Event exists, the consent of the Borrower (not to be unreasonably withheld, delayed or conditioned) shall be required with respect to any assignment if, after giving effect
thereto, the Arranger and its affiliates would hold, in the aggregate, less than a majority of the outstanding Loans or commitments with respect thereto.
  

The Lenders will be permitted to sell participations in Loans without restriction. Voting rights of participants shall be limited to matters in respect of
(a) reductions or forgiveness of principal, interest or fees payable to such participant, (b) extensions of the Conversion Date or final maturity of, or date for payment of interest or fees on, the Loans in which such participant
participates and (c) releases of all or substantially all of the value of the Guarantees.

		
	Expenses and Indemnification:	  	The Borrower will indemnify the Arranger, the Agent, the Syndication Agent, the Documentation Agent, the Lenders, their respective affiliates, successors and assigns and the officers, directors, employees, agents, advisors,
controlling persons and members of each of the foregoing (each, an “Indemnified Person”) and hold them harmless from and against all reasonable and documented out-of-pocket costs and expenses (including reasonable fees,
disbursements and other charges of counsel (limited, in the case of legal fees and expenses, to one firm of primary counsel to such Indemnified Persons taken as a whole (and, in the case of any conflict of interest, one firm of additional counsel to
each similarly affected group of Indemnified Persons, taken as a whole), one firm of special counsel for each applicable jurisdiction and one firm of local counsel in each applicable jurisdiction (and, in the case of any conflict of interest, one
firm of additional local counsel to each similarly affected group of Indemnified Persons, taken as a whole)) and liabilities of such Indemnified Person arising out of or relating to any claim or any litigation or other proceeding (regardless of
whether such Indemnified Person is a party thereto and regardless of whether such matter is initiated by a third party or by the Borrower, the Company or any of their respective affiliates or equity holders) that relates to the Transactions,
including the financing contemplated

  
 Term Sheet 

A-8 

			
		  	hereby, the Acquisition or any transactions connected therewith; provided that no Indemnified Person will be indemnified for any cost, expense or liability to the extent (i) determined in the final, non-appealable judgment of
a court of competent jurisdiction to have resulted from the bad faith, willful misconduct or gross negligence of such Indemnified Person or its controlled affiliates, controlling persons, directors, officers, employees or, in the case of persons
acting at such Indemnified Person’s direction, its advisors, agents or representatives (each, a “Related Person”), or (ii) they arise out of any dispute solely among Indemnified Persons (other than (x) claims against the
Agent or the Arranger in its capacity as such and (y) claims arising out of any act or omission on the part of any Loan Party or its affiliates). In addition, the Borrower shall pay (a) all reasonable and documented out-of-pocket expenses
(including, without limitation, reasonable fees, disbursements and other charges of counsel (limited, in the case of legal fees and expenses, to one firm of primary counsel to such Indemnified Persons taken as a whole (and, in the case of any
conflict of interest, one firm of additional counsel to each similarly affected group of Indemnified Persons, taken as a whole), one firm of special counsel for each applicable jurisdiction and one firm of local counsel in each applicable
jurisdiction (and, in the case of any conflict of interest, one firm of additional local counsel to each similarly affected group of Indemnified Persons, taken as a whole)) of the Arranger, the Agent, the Syndication Agent and the Documentation
Agent in connection with the syndication of the Facility, the preparation and administration of the definitive documentation and amendments, modifications and waivers thereto and (b) all reasonable and documented out-of-pocket expenses (including,
without limitation, fees, disbursements and other charges of counsel (limited, in the case of legal fees and expenses, to one firm of primary counsel to such Indemnified Persons taken as a whole (and, in the case of any conflict of interest, one
firm of additional counsel to each similarly affected group of Indemnified Persons, taken as a whole), one firm of special counsel for each applicable jurisdiction and one firm of local counsel in each applicable jurisdiction (and, in the case of
any conflict of interest, one firm of additional local counsel to each similarly affected group of Indemnified Persons, taken as a whole)) of the Arranger, the Agent, the Syndication Agent, the Documentation Agent and the Lenders for enforcement
costs and documentary taxes associated with the Facility.
		
	Governing Law and Forum:	  	New York.
		
	Counsel to the Agent and the Arranger:	  	Davis Polk & Wardwell LLP.

  
 Term Sheet 

A-9 

 ANNEX I 

to Exhibit A 
 Extended Term
Loans 
  

			
	Maturity:	  	The Extended Term Loans will mature on the date that is seven years after the Closing Date (or, if earlier, 90 days prior to the maturity date of the 2022 Notes if any such notes are outstanding at that time).
		
	Interest Rate:	  	The Extended Term Loans will bear interest at an interest rate per annum equal to the Total Cap. Interest shall be payable on the last day of each fiscal quarter of the Borrower and on the Maturity Date, in each case payable in
arrears and computed on the basis of a 360-day year.
		
	Guarantees:	  	Same as the Loans.
		
	Security:	  	None.
		
	Covenants and Events of Default:	  	Upon and after the Conversion Date, the covenants, events of default and mandatory prepayments applicable to the Exchange Notes will also be applicable to the Extended Term Loans.

  
 Term Sheet 

 ANNEX II 

to Exhibit A 
 Exchange Notes

  

			
	Issuer:	  	The Borrower, in its capacity as the issuer of the Exchange Notes (the “Issuer”).
		
	Issue:	  	The Exchange Notes will be issued under an indenture capable of being qualified under the Trust Indenture Act of 1939, as amended.
		
	Maturity:	  	The Exchange Notes will mature on the date that is seven years after the Closing Date (or, if earlier, 90 days prior to the maturity date of the 2022 Notes if any such notes are outstanding at that time).
		
	Interest Rate:	  	The Exchange Notes will bear interest at a fixed rate equal to the Total Cap.
		
	Optional Redemption:	  	The Exchange Notes will be non-callable until the third anniversary of the Closing Date (subject to customary “equity clawback” provisions). Thereafter, each Exchange Note will be callable at par plus accrued interest plus
a premium equal to 50% of the coupon on such Exchange Note, which premium shall decline ratably on each yearly anniversary of the Closing Date to zero on the date that is one year prior to the maturity of the Exchange Notes.
		
	 Offer to Repurchase upon a
 Change of
Control:
	  	The Issuer will be required to offer to repurchase the Exchange Notes following the occurrence of a Change of Control (to be defined) at 101% of the outstanding principal amount thereof (plus all accrued and unpaid interest
thereon).
		
	Defeasance Provisions:	  	Consistent with the 2022 Notes.
		
	Modification:	  	Consistent with the 2022 Notes.
		
	Registration Rights:	  	The Issuer will (unless a Shelf Registration Statement (as defined below) covering such Exchange Notes is already effective and available) use commercially reasonable efforts to file within 60 days after the date of each issuance of
Exchange Notes (each, an “Issue Date”), and will use commercially reasonable efforts to cause to become effective as soon thereafter as practicable, a shelf registration statement with respect to such Exchange Notes (a
“Shelf Registration Statement”) and/or a registration statement relating to a Registered Exchange Offer (as defined below). If a Shelf Registration Statement is filed, the Issuer will
keep

  
 Term Sheet 

			
		  	 such registration statement effective and available (subject to customary exceptions) until the later of two years after the issue of such
Exchange Notes and the date it is no longer needed to permit unrestricted resales of Exchange Notes.
  

If within 120 days from an Issue Date, a Shelf Registration Statement for the applicable Exchange Notes has not been declared effective or the Issuer has not
effected an exchange offer (a “Registered Exchange Offer”) whereby the Issuer has offered registered notes having terms identical to such Exchange Notes (the “Substitute Notes”) in exchange for all
such Exchange Notes (it being understood that a Shelf Registration Statement is required to be made available in respect of Exchange Notes, the holders of which could not receive Substitute Notes through the Registered Exchange Offer that, in the
opinion of counsel to the Lenders, would be freely saleable by such holders without registration or requirement for delivery of a current prospectus under the Securities Act of 1933, as amended (other than a prospectus delivery requirement imposed
on a broker-dealer who is exchanging Exchange Notes acquired for its own account as a result of market making or other trading activities)), then the Issuer will pay liquidated damages of 0.50% per annum on the principal amount of Exchange
Notes outstanding to holders thereof who are, or would be, unable to freely transfer Exchange Notes from and including the 121st day after such Issue Date (the “Default Registration Date”) to but excluding the earlier of the
effective date of such Shelf Registration Statement or the date of consummation of such Registered Exchange Offer. Such liquidated damages shall increase by 0.50% per annum on the date that is 90 days after the Default Registration Date and
each 90-day anniversary thereof, up to a maximum of 2.0% per annum. The Issuer will also pay such liquidated damages for any period of time (subject to customary exceptions) following the effectiveness of a Shelf Registration Statement that
such Shelf Registration Statement is not available for resales thereunder. All accrued liquidated damages will be paid in arrears on each quarterly interest payment date.

		
	Covenants:	  	Based on the 2022 Notes, subject to Section 4 of the Facility Fee Letter.
		
	Events of Default:	  	Based on the 2022 Notes, subject to Section 4 of the Facility Fee Letter.

  
 Term Sheet 

A-II-2 

 EXHIBIT B 

PROJECT 711 

$730,000,000 Senior Unsecured Bridge Facility 

Summary of Additional Conditions Precedent2 

The borrowing under the Facility shall be subject to the following additional conditions precedent: 

1. The Acquisition and the other Transactions shall be consummated substantially concurrently with the closing under the Facility on the terms
and conditions described in the Acquisition Agreement (without any amendment, modification or waiver thereof by the Borrower or any consent thereunder by the Borrower which is materially adverse to the Lenders or the Arranger without the prior
written consent of the Agent, such consent not to be unreasonably withheld, delayed or conditioned (it being understood and agreed that any (a) decrease in the Acquisition Consideration (except to the extent such reduction is applied
dollar-for-dollar to reduce the Facility), (b) increase in the Acquisition Consideration (provided, that any increase in the Acquisition Consideration of up to 10% shall not be deemed to be materially adverse to the Lenders or the
Arranger) or (c) amendment or waiver of any provision of the Acquisition Agreement of which the Arranger or the Lenders are specifically identified as third-party beneficiaries as of the date hereof, shall in each case be deemed to be a
modification which is materially adverse to the Lenders). The Acquisition Agreement (including all schedules and exhibits thereto) shall be reasonably satisfactory to the Agent; provided that the Agent agrees that the Acquisition Agreement
delivered to it on July 19, 2014 at 6:14 a.m. EDT and marked “EXECUTION VERSION” is satisfactory to it. 
 2. After
giving effect to the Transactions and the other transactions contemplated hereby, Holdings and its subsidiaries shall have outstanding no indebtedness or preferred stock other than (a) the loans and other extensions of credit under the Existing
Credit Agreement and the Existing Notes, (b) the Notes and/or the Loans, (c) other indebtedness existing on the date hereof and (d) any other Permitted Debt. 

3. The Agent shall have received (a) U.S. GAAP audited consolidated balance sheets and related statements of income, stockholders’
equity and cash flows of Holdings and the Company for the 2011, 2012 and 2013 fiscal years (and, to the extent available, the related unaudited consolidating financial statements) and each subsequent fiscal year ended at least 90 days before the
Closing Date and (b) U.S. GAAP unaudited consolidated and (to the extent available) consolidating balance sheets and related statements of income, stockholders’ equity and cash flows of Holdings and the Company for each subsequent fiscal
quarter ended at least 45 days before the Closing Date; provided, that the filing of such financial statements on Form 10-K or Form 10-Q by Holdings shall satisfy the foregoing condition with respect to Holdings only. 

4. The Agent shall have received a pro forma consolidated balance sheet and related pro forma consolidated statements of income and cash flows
of Holdings as of and for the twelve-month period ending on the last day of the most recently completed four-fiscal quarter period for which financial statements have been delivered pursuant to paragraph 3 above, prepared after giving effect to the
Transactions as if the Transactions had occurred as of such date (in the case of such balance sheet) or at the beginning of such period (in the case of such other financial statements). 

 

	2 	All capitalized terms used but not defined herein have the meanings given to them in the Commitment Letter to which this Exhibit B is attached, including Exhibits A thereto. 

  
 Summary of Additional
Conditions Precedent 

 5. The Agent shall have received a certificate from the chief financial officer (or other officer
with reasonably equivalent duties) of Holdings, substantially in the form of Annex I to this Exhibit B, certifying that Holdings and its subsidiaries, on a consolidated basis after giving effect to the Transactions and the other transactions
contemplated hereby, are solvent. The Agent shall have received customary opinions of counsel to the Borrower and the Guarantors (which shall cover, among other things, authority, legality, validity, binding effect and enforceability of the
documents for the Facility, and non-contravention consistent, with the Specified Representations) and customary corporate resolutions, good standing certificates, officer’s incumbency certificates and a borrowing notice. 

6. (a) One or more investment banks satisfactory to Credit Suisse (collectively, the “Investment Bank”) shall have been
engaged to publicly sell or privately place the Notes and Stock, and Credit Suisse and the Investment Bank each shall have received, (i) a complete printed preliminary offering document (an “Offering Document”) suitable
(A) for use in a customary “high-yield road show”, in case of the Notes, and (B) for an equity offering, in case of the Stock, which contains all information (including all audited financial statements, all unaudited financial
statements (which shall have been reviewed as provided in the procedures specified by the Public Company Accounting Oversight Board in AU 722) and all appropriate pro forma financial statements prepared in accordance with generally accepted
accounting principles in the United States and prepared in accordance with Regulation S-X under the Securities Act of 1933, as amended), and all other data that the Securities and Exchange Commission
would require in a registered offering of the Notes, the Stock, or, in each case, are customarily included in Offering Documents of such type, and (ii) a customary comfort letter (which shall also provide “negative assurance” comfort)
that is customary in the context of a transaction where the most recent financial statements are not more than 135 days old) from the independent accountants for the Borrower and the Company (and any other accountant to the extent financial
statements audited or reviewed by such accountants are or would be included in any Offering Document) and (b) the Investment Bank shall have been afforded a period of at least 10 consecutive business days following receipt of an Offering
Document including the information described in clause (a) to seek to place the Notes and the Stock with qualified purchasers thereof (provided that such period shall either (i) be completed, and the Closing Date shall have
occurred, on or prior to August 15, 2014, (ii) commence on or after September 2, 2014 and be completed, and the Closing Date shall have occurred, on or prior to November 21, 2014, (iii) commence on or after December 1,
2014 and be completed, and the Closing Date shall have occurred, on or prior to December 19, 2014 or (iv) commence on or after January 5, 2015). 

7. To the extent requested at least ten (10) business days prior to the Closing Date, the Agent shall have received, at least five
business days prior to the Closing Date, all documentation and other information required by regulatory authorities under applicable “know your customer” and anti-money laundering rules and regulations, including, without limitation, the
PATRIOT Act. 
 8. All fees due to the Agents, the Arranger and the Lenders shall have been paid, and all expenses to be paid or reimbursed
to the Agents and the Arranger, in each case that are required to be paid on or prior to the Closing Date pursuant to the terms of the Commitment Letter or the Fee Letters, that have been invoiced at least two business days prior to the Closing Date
shall have been paid (which amounts may be offset against the proceeds of the Facility). 
 9. The Acquisition Agreement Representations and
the Specified Representations shall be true and correct on the Closing Date. 

  
 Summary of Additional
Conditions Precedent 
 2 

 ANNEX I TO 

EXHIBIT B 
 FORM OF SOLVENCY
CERTIFICATE 
 [•][•], 20[•] 

This Solvency Certificate is being executed and delivered pursuant to Section [•] of that certain [•]1 (the “Credit Agreement”; the terms defined therein being used herein as therein defined). 

I, [•], the [Chief Financial Officer/equivalent officer] of Holdings, in such capacity and not in an individual capacity,
hereby certify as follows: 
  

	1.	I am generally familiar with the businesses and assets of Holdings and its subsidiaries, taken as a whole, and am duly authorized to execute this Solvency Certificate on behalf of Holdings pursuant to the Credit
Agreement; and 

  

	2.	As of the date hereof and after giving effect to the Transactions and the incurrence of the indebtedness and obligations being incurred in connection with the Credit Agreement and the Transactions, that, (i) the
sum of the debt (including contingent liabilities) of Holdings and its subsidiaries, taken as a whole, does not exceed the fair value of the present assets of Holdings and its subsidiaries, taken as a whole; (ii) the capital of Holdings and its
subsidiaries, taken as a whole, is not unreasonably small in relation to the business of Holdings or its subsidiaries, taken as a whole, contemplated as of the date hereof; (iii) Holdings and the Borrower have assets with a present fair
saleable value not less than the amount that will be required to pay their debts and other liabilities as they become absolute and matured; and (iv) Holdings and its subsidiaries, taken as a whole, do not intend to incur, or believe that they
will incur, debts (including current obligations and contingent liabilities) beyond their ability to pay such debt as they mature in the ordinary course of business. For the purposes hereof, the amount of any contingent liability at any time shall
be computed as the amount that, in light of all of the facts and circumstances existing at such time, represents the amount that can reasonably be expected to become an actual or matured liability. 

[Remainder of page intentionally left blank] 

 

	1 	Describe Credit Agreement. 

  
 Form of Solvency
Certificate 

 ANNEX I TO 

EXHIBIT B 
  

 IN WITNESS WHEREOF, I have executed this Solvency Certificate on the date first written
above. 
  

			
	 By:
	 	 
	 Name: [•]

	 Title: [Chief Financial Officer or equivalent officer]

  
 Form of Solvency
CertificateExhibit 10.1

 

SECOND AMENDMENT TO

FIRST LIEN CREDIT AGREEMENT

 

THIS SECOND AMENDMENT TO FIRST LIEN CREDIT AGREEMENT (this “Amendment”), dated as of June 30, 2014 (the “Effective Date”), is entered into by and among FULL HOUSE RESORTS, INC., a Delaware corporation (the “Borrower”); each of the undersigned financial institutions (collectively, the “Lenders”); and CAPITAL ONE, NATIONAL ASSOCIATION (“Capital One”), as administrative agent for the Lenders (in such capacity, the “Administrative Agent”), as L/C Issuer and as Swing Line Lender (as such terms are defined in the Credit Agreement referenced below).

 

RECITALS

 

A.           The Borrower, Administrative Agent and Lenders have executed a First Lien Credit Agreement, dated as of June 29, 2012 (as amended, the “Credit Agreement”) providing for a Revolving Loan in the maximum aggregate principal amount of $5,000,000, a Term Loan in the original principal amount of $50,000,000, a Term Loan (Hotel) in the maximum principal amount of $10,000,000 and a Swing Line Loan in the maximum principal amount of $1,000,000.  Capitalized terms used herein and not otherwise defined herein shall have the meanings defined in the Credit Agreement.

 

B.           The Borrower has also requested that certain of the financial covenants be modified; the Administrative Agent and Lenders are willing to accept such requests on the terms and conditions set forth below.

 

I.           AMENDMENTS TO CREDIT AGREEMENT

 

NOW, THEREFORE, in consideration of the above Recitals and the mutual covenants herein contained, the parties hereto hereby agree as follows:

 

1.             Section 1.01 (Definitions) of the Credit Agreement is hereby amended to modify the following definitions:

 

“Adjusted EBITDA” shall mean, for any four fiscal quarter period, (a) Net Income for such period, plus (b) to the extent deducted in determining Net Income of the Borrower Parties for such period, the sum of the following for such period (without duplication): (i) Interest Expense, (ii) provisions for income taxes, (iii) depreciation and amortization expenses, (iv) extraordinary losses (including non-cash impairment charges), (v) stock compensation expense, (vi) acquisition costs related to the Fitz Casino in Tunica, Mississippi that are required to be expensed in accordance with GAAP for any fiscal quarter in fiscal year 2014 in an aggregate amount not to exceed $325,000; and (vii) costs related to the Borrower’s S-1 2014 Registration Statement filing that are required to be expensed in accordance with GAAP for any quarter in fiscal year 2014 in an aggregate amount not to exceed $650,000, minus (c) to the extent added in determining Net Income of the Borrower Parties for such period, extraordinary gains, minus (d) the portion of Net Income for such period attributable to any Joint Venture or any other Person (other than a Subsidiary) in which any Borrower Party has ownership interest, except to the extent that any such Net Income has been actually received by such Borrower Party in the form of cash dividends or distributions.

 
 
    	  

    	 

    
 

 

Pro forma credit shall be given for an Acquired Person’s Adjusted EBITDA as if owned on the first day of the applicable period; companies (or identifiable business units or divisions) sold, transferred or otherwise disposed of during any period will be treated as if not owned during the entire applicable period.

 

Pro forma credit for the Indiana gaming tax reductions shall be also be given for the following periods in the amounts indicated:  for the four fiscal quarters ending June 30, 2014, $2,500,000; for the four fiscal quarters ending September 30, 2014, $1,875,000; for the four fiscal quarters ending December 31, 2014, $1,250,000; and for the four fiscal quarters ending March 31, 2015, $625,000.

 

   *     *     *     *     *

 

“Fixed Charges” shall mean, for any four fiscal quarter period, the sum, for the Borrower Parties (determined on a consolidated basis without duplication), of the following items: (a) interest, fees, charges and related expenses for such period actually paid in cash, (b) Rent Expense for such period, (c) scheduled principal payments of Indebtedness actually paid in cash during such period, including any optional prepayments made during a prior period that reduce otherwise scheduled principal payments for such period, and (d) the portion of payments under Capital Leases that should be treated as payment of principal in accordance with GAAP scheduled to be paid during such period.”

 

Notwithstanding the foregoing, principal amounts prepaid on the Term Loan during the fiscal quarter ending December 31, 2013 in the aggregate principal amount of $8,750,000, which were paid on behalf of the principal payments due on January 1, 2014 and each quarterly principal payment thereafter through and including the principal payment due July 1, 2015, shall be excluded from Fixed Charges for those fiscal quarter periods ending March 31, 2014 through September 30, 2015.

 

*     *     *     *     *

 

“Total Debt” shall mean , as of any date of determination, without duplication (a) the aggregate principal amount of Indebtedness of the Borrower Parties outstanding on such date, in an amount that would be reflected on a balance sheet prepared as of such date on a consolidated basis in accordance with GAAP consisting of Indebtedness for borrowed money, obligations of the Borrower Parties as lessee under or with respect to Capital Leases (excluding Indebtedness or Capital Leases in an aggregate principal amount not to exceed $9,000,000 incurred to construct a hotel adjacent to Rising Star Casino), debt obligations evidenced by promissory notes or similar instruments plus (b) obligations with respect to letters of credit, whether drawn or undrawn, contingent or otherwise; provided that Total Debt shall not include Indebtedness in respect of Unrestricted Subsidiaries.

 

    	- 2 -

    	 

    
 

 

2.             Sections 2.01(g)(iii) (Loan Facilities, Scheduled Payments; Schedule Principal Payments – Term Loans); 2.01(h)(iii) (Loan Facilities, Term Loan (Hotel)), 2.04(b)(ii) (Amount Limitations, Commitment Reductions, Etc.; Mandatory Reductions of Commitments), and 2.05(c) (Fees;  Commitment Fees) of the Credit Agreement are hereby amended to substitute March 31, 2015 for December 31, 2014, and April 1, 2015 for January 1, 2015.

 

3.             Section 5.03 (Financial Covenants) of the Credit Agreement is hereby amended to read as follows:

 

 5.03           Financial Covenants.  So long as any Loan or L/C Obligation remains unpaid, or any other Obligation remains unpaid, or any portion of any Commitment remains in force, the Borrower will comply, and will cause compliance, with the following financial covenants, unless the Required Lenders shall otherwise consent in writing:

 

 (a)            Total Leverage Ratio.  The Borrower shall not permit the Total Leverage Ratio as of the last day of any fiscal quarter to be greater than the ratio set forth opposite the applicable period below:

 

	
Applicable Period

	 	
Maximum Total Leverage Ratio

	 
	
June 30, 2014 through and including 

September 29, 2014

	 	
          4.75 to 1.00

	 
	 	 	 	 
	September 30, 2014 through and 

including December 30, 2014	 	          5.50 to 1.00	 
	 	 	 	 
	December 31, 2014 through and 

including June 29,  2015	 	          5.50 to 1.00	 
	 	 	 	 
	
June 30, 2015 through and including 

September 29, 2015

	 	
          4.75 to 1.00

	 
	 	 	 	 
	September 30, 2015 through and 

including December 30, 2015	 	          4.50 to 1:00	 
	 	 	 	 
	December 31, 2015 through and 

including March 30, 2016	 	          4.25 to 1.00	 
	 	 	 	 
	
March 31, 2016 and thereafter

	 	
          4.25 to 1.00

	 

 

    	- 3 -

    	 

    
 

 

(b)            First Lien Leverage Ratio.  The Borrower shall not permit the First Lien Leverage Ratio as of the last day of any fiscal quarter to be greater than the ratio set forth opposite the applicable period below:

 

	
Applicable 

Period

	 	 	
Maximum First 

Lien Leverage 

Ratio

	 
	
June 30, 2014 through and including 

September 29, 2014

	 	 	
          3.50 to 1.00

	 
	 	 	 	 	 
	September 30, 2014 through and 

including December 30, 2014	 	 	          3.50 to 1.00	 
	 	 	 	 	 
	December 31, 2014 through and 

including June 29,  2015	 	 	          4.00 to 1.00	 
	 	 	 	 	 
	
June 30, 2015 through and including 

September 29, 2015

	 	 	
          3.50 to 1.00

	 
	 	 	 	 	 
	September 30, 2015 through and 

including December 30, 2015	 	 	          3.25 to 1:00	 
	 	 	 	 	 
	December 31, 2015 through and 

including March 30, 2016	 	 	          3.00 to 1.00	 
	 	 	 	 	 
	
March 31, 2016 and thereafter

	 	 	
          3.00 to 1.00

	 

 

(c)            Fixed Charge Coverage Ratio.  The Borrower shall not permit the Fixed Charge Coverage Ratio as of the last day of any fiscal quarter to be less than 1.10 to 1.00.

 

(d)            Capital Expenditures.  The Borrower shall not permit the aggregate amount of Capital Expenditures made by the Loan Parties in any fiscal year (i) to exceed 5% of total revenues for the immediately preceding year or (ii) to be less than 1.5% of the total revenues for the immediately preceding fiscal year; provided, that the foregoing shall not include or limit (x) capital expenditures in an aggregate amount not to exceed $17,500,000 to construct a hotel adjacent to the Silver Slipper Casino or (y) for the avoidance of doubt, the acquisition of Capital Assets in connection with Capital Lease obligations in an aggregate principal amount not to exceed $9,000,000 incurred to construct a hotel adjacent to the Rising Star Casino.

 

4.             Except as specifically amended hereby, all of the remaining terms and conditions of the Credit Agreement shall remain in full force and effect.

 

II.           MISCELLANEOUS

 

1.             Representations and Warranties.  Borrower represents to the Administrative Agent and the Lenders as follows:

 

 (a)            The representations and warranties of the Loan Parties set forth in Article IV of the Credit Agreement and in the other Credit Documents are true and correct in all material respects (except to the extent that such representation and warranty is qualified by materiality, in which case such representation and warranty must be true in all respects) as if made on such date (except for representations and warranties expressly made as of a specified date, which shall be true and correct in all material respects (except to the extent that such representation and warranty is qualified by materiality, in which case such representation and warranty must be true in all respects) as of such date);

 

    	- 4 -

    	 

    
 

 

(b)            No Default has occurred and is continuing; and

 

(c)            No material adverse change in the business, operations, condition (financial or otherwise), assets or liabilities (whether actual or contingent) of the Borrower Parties taken as a whole has occurred since March 31, 2014.

 

2.             Conditions Precedent.  As conditions precedent to the execution and delivery by the Agent and the Lenders of this Amendment, (i) the Borrower shall have paid or caused to be paid all costs and expenses incurred by the Agent and the Lenders through the date hereof and (ii) the Agent and the Lenders shall have received the following, all of which shall be in form and substance satisfactory to the Agent and in sufficient counterparts:

 

(a)            Duly executed counterparts of this Amendment signed by all of the Loan Parties.

 

(b)            Acknowledgment of First Lien Guarantors to this Amendment.

 

(c)            Acknowledgment of Second Lien Lenders to this Amendment, and execution of Amendment No. 2 to Second Lien Credit Agreement to be consistent with this Amendment.

 

(d)            Flood hazard determination certificates for Silver Slipper Casino property, if required by Administrative Agent.

 

(e)            Such other documents as the Agent may have reasonably requested.

 

(f)            Certificate of Borrower stating that (i) all material consents necessary or advisable in connection with the transactions contemplated by this Amendment, including the consent of the Indiana Gaming Commission, have been obtained, (ii) all of the foregoing conditions precedent have been satisfied and (iii) the Effective Date has occurred; provided that if such certificate is not received by August 31, 2014 (unless such date is extended by the Administrative Agent), this Amendment shall become null and void.

 

3.             Counterparts.  This Amendment may be executed in any number of identical counterparts, any set of which signed by all the parties hereto shall be deemed to constitute a complete, executed original for all purposes.  Transmission by facsimile, “pdf” or similar electronic copy of an executed counterpart of this Credit Agreement shall be deemed to constitute due and sufficient delivery of such counterpart.  Any party hereto may request an original counterpart of any party delivering such electronic counterpart.

 

4.             Effective Date.  Upon the satisfaction of the conditions precedent set forth in Section 2 of this Article II, this Amendment shall become effective as of the Effective Date (defined above).

 

    	- 5 -

    	 

    
 

 

IN WITNESS WHEREOF, the Borrower, the Lenders, the Administrative Agent, the L/C Issuer and the Swing Line Lender have caused this Agreement to be executed as of the day and year first above written.

	 	 	 	 	 	 	 
	
BORROWER:

	 	
FULL HOUSE RESORTS, INC.,

	 	 	
a Delaware corporation

	 	 	 	 	 	 	 
	 	 	By:	/s/ Andre M. Hilliou	 
	 	 	Name: 	Andre M. Hilliou	 
	 	 	Title: 	Andre M. Hilliou, CEO	 
	 	 	 	 	 	 	 

    	- 6 -

    	 

    
 

 

	 	 	 	 	 	 	 
	

ADMINISTRATIVE AGENT,

COLLATERAL TRUSTEE, L/C

ISSUER. SWING LINE LENDER

AND LENDER:

	 	CAPITAL ONE, NATIONAL ASSOCIATION,
	 	 	 	 	 	 	 
	 	 	 	 	 	 	 
	 	 	By:	/s/ Ross S. Wales	 
	 	 	Name: 	Ross S. Wales	 
	 	 	Title: 	Sr. Vice President	 
	 	 	 	 	 	 	 

    	- 7 -

    	 

    
 

 

	 	 	 	 	 	 	 
	
LENDERS:

	 	
NEVADA STATE BANK

	 	 	 	 	 	 	 
	 	 	 	 	 	 	 
	 	 	By:	/s/ Jamie Gazza	 
	 	 	Name: 	Jamie Gazza	 
	 	 	Title: 	Vice President	 
	 	 	 	 	 	 	 

    	- 8 -

    	 

    
 

 

	 	 	 	 	 	 	 
	
 

	 	

FIRST TENNESSEE BANK

NATIONAL ASSOCIATION

	 	 	 	 	 	 	 
	 	 	 	 	 	 	 
	 	 	By:	/s/ Sharon Shipley	 
	 	 	Name: 	Sharon Shipley	 
	 	 	Title: 	Vice President	 
	 	 	 	 	 	 	 

    	- 9 -

    	 

    
 

 

	 	 	 	 	 	 	 
	
 

	 	

TRUSTMARK NATIONAL BANK

	 	 	 	 	 	 	 
	 	 	 	 	 	 	 
	 	 	By:	/s/ Craig E. Sosebee	 
	 	 	Name: 	Craig E. Sosebee	 
	 	 	Title: 	First Vice President	 
	 	 	 	 	 	 	 

    	- 10 -

    	 

    
 

 

	 	 	 	 	 	 	 
	
 

	 	

BANK OF NEVADA

	 	 	 	 	 	 	 
	 	 	 	 	 	 	 
	 	 	By:	/s/ Doron Joseph	 
	 	 	Name: 	Doron Joseph	 
	 	 	Title: 	Sr. Vice President	 
	 	 	 	 	 	 	 

 
    	- 11 -

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