Common use of Springing Covenants and Liens Clause in Contracts

Springing Covenants and Liens. 17.4.5.1 If at any time prior to the Guaranty Covenant Termination Date, Lease Guarantor either (i) guaranties all or any portion of any Opco First Lien Debt (any such guaranty, an “Opco Debt Guaranty”), and the obligations under any such Opco Debt Guaranty are at any time secured by any property directly owned by CEC or any Springing Lien Subsidiary of CEC or (ii) causes all or any portion of the obligations under the Opco First Lien Debt to be at any time secured by any property directly owned by CEC or any Springing Lien Subsidiary of CEC (any and all such property in clauses (i) and (ii), “Lease/Debt Guaranty Collateral”), then, in each such instance and for so long as any such Opco Debt Guaranty or Lease/Debt Guaranty Collateral is outstanding, Lease Guarantor shall, and shall cause any and all other grantors of Lease/Debt Guaranty Collateral to grant, in the same security agreement documenting the grant of a security interest in the Lease/Debt Guaranty Collateral in favor of the Opco First Lien Debt (an “Opco First Lien Debt Security Interest”), to Landlord a lien (a “Lease Guaranty Security Interest”) on all Lease/Debt Guaranty Collateral, which Lease Guaranty Security Interest shall secure all obligations of Lease Guarantor under the Lease Guaranty and shall rank pari passu with the Opco First Lien Debt Security Interest; provided that if the Lease/Debt Guaranty Collateral is limited solely to a pledge of Lease Guarantor’s or any other such grantor’s equity interest in CEOC, then neither Lease Guarantor nor any other such grantor shall be required to grant a Lease Guaranty Security Interest. Any Lease Guaranty Security Interest granted pursuant to this Section 17.4.5 shall be automatically released upon the earlier of (i) the Guaranty Covenant Termination Date and (ii) the release of the respective Opco First Lien Debt Security Interest (unless such release occurs in connection with a refinancing of the applicable Opco First Lien Debt with a Non-Third Party Financing, in which case such Lease Guaranty Security Interest shall be automatically released upon the repayment or refinancing (other than with other Non-Third Party Financing) of such Non-Third Party Financing). Any Lease Guaranty Security Interest shall be a “silent” security interest, and Landlord shall have no voting, enforcement or default-related rights with respect to such security interest unless and until the earlier of (x) the occurrence of a Lease Guarantor Event of Default and (y) the occurrence of any event that would permit the holders of the applicable Opco First Lien Debt to take enforcement actions in respect of such Opco First Lien Debt Security Interest, at which time Landlord shall be permitted to exercise all rights available to a secured creditor with respect to the Lease/Debt Guaranty Collateral, including all rights available to any holder of an Opco First Lien Debt Security Interest. Lease Guarantor shall cause the beneficiaries of any Opco First Lien Debt Security Interest to enter into and become bound by an intercreditor agreement that is consistent with this provision and that is reasonably acceptable to Lease Guarantor and Landlord and containing, among other things, provisions governing the pari passu nature of any Opco First Lien Debt Security Interest and Lease Guaranty Security Interest, and the “waterfall” by which any proceeds of, or collections on, the Lease/Debt Guaranty Collateral will be distributed on an equal and ratable basis as between the beneficiaries of any Opco First Lien Debt Security Interest and Lease Guaranty Security Interest.