AMENDMENT NO. 2 TO AND CONSENT UNDER
SECOND AMENDED AND RESTATED CREDIT AGREEMENT
THIS AMENDMENT NO. 2 TO AND CONSENT UNDER SECOND AMENDED AND
RESTATED CREDIT AGREEMENT (this "Amendment No. 2") is made this 29th day of
July, 1999 by and among PENN NATIONAL GAMING, INC., a Pennsylvania corporation
("Borrower"); FIRST UNION NATIONAL BANK, a national banking association (for
itself and in its capacity as agent hereunder, "Agent"); and the banks signatory
to this Amendment No. 2 (together with the Agent, each individually a "Bank" and
individually and collectively, the "Banks").
BACKGROUND
Borrower and Banks entered into a Second Amended and Restated
Credit Agreement dated January 28, 1999, as amended by Amendment No. 1 to Second
Amended and Restated Credit Agreement and Joinder of Subsidiary Guarantor dated
July 29, 1999 (as amended hereby and as may be further amended from time to
time, the "Credit Agreement") for the purposes of providing a revolving credit
facility, for the financing of a loan from Borrower to FR Park Racing L.P., the
refinancing of certain existing indebtedness of Borrower, the issuance of
letters of credit for the benefit of Borrower, and for the working capital needs
and general corporate purposes of the Borrower.
Borrower and Banks have agreed to make certain amendments to
the Credit Agreement as set forth herein and subject to the terms and conditions
hereof, and Banks have agreed to permit Borrower to enter into a Debt Service
Maintenance Agreement, for the benefit of Commerce Bank, N.A., to support the
extension of credit to FR Park Racing, L.P. and GS Park Racing, L.P. by Commerce
Bank, N.A.
In consideration of the foregoing and the promises and the agreements
hereinafter set forth, and intending to be legally bound hereby, the parties
hereto agree as follows: Definitions
(1) General Rule. Unless otherwise defined
herein, terms used herein which are defined
in the Credit Agreement shall have the
meanings assigned to them in the Credit
Agreement.
(1) Additional Definitions. The following definitions are hereby added to
Section 1 of the Credit Agreement to read in their
-------------------------------- entirety as follows: "Amendment No. 2" means
the Amendment No. 2 to and Consent under Second Amended and Restated Credit
Agreement by and among Borrowers and Banks dated July 29, 1999. "Amendment No. 2
Effective Date" means the date on which the conditions set forth in Paragraph 5
of Amendment No. 2 have been satisfied.
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"Debt Service Maintenance Agreement" means the Debt Service
Maintenance Agreement dated July 29, 1999 by Borrower in favor
of Commerce Bank, N.A., in the form annexed hereto.
i. Amendment to Section 8.05(x) of the Credit Agreement
(Advances, Investments and Loans). Section 8.05(x) of
the Credit Agreement is hereby amended and restated
to read in its entirety as follows:
(x)In the absence of a Default or an Event of Default and if
such payment shall not create a Default or an Event of
Default, on and after the date of the Transaction Conversion,
Borrower or a wholly-owned Subsidiary may: (i) maintain and
guaranty loans or investments in an aggregate amount no
greater than $23,000,000 in the New Jersey Joint Venture,
which such loans, guaranties and investments shall include the
$11,250,000 loan made in January, 1999, an equity contribution
of $250,000 made on the date of Amendment No. 2 and the
$11,500,000 loan support to Commerce Bank, N.A. pursuant to
the Debt Service Maintenance Agreement; it being agreed that,
so long as there is no Default or Event of Default in
existence and so long as no Default or Event of Default would
be caused thereby, Borrower and its Subsidiaries may make
payments under the Debt Service Maintenance Agreement in an
aggregate principal amount not exceeding $11,500,000, plus
costs and expenses as provided in the Debt Service Maintenance
Agreement; (ii) expend up to $1,150,000 per annum under
Borrower's several guaranty of one-half (1/2) of tenant's
obligations pursuant to that certain Lease Agreement dated
January 28, 1999 between Garden State Race Track, Inc., as
landlord and GS Park Racing, L.P., as tenant, for premises
known as the Garden State Race Track located in Camden, New
Jersey; (iii) expend up to $8,750,000 in connection with the
exercise of the Put (upon the exercise of the Put, the
guaranty referred to in Section 2(x)(ii) is terminated and of
no further force or effect); (iv) expend up to $5,000,000
under Borrower's Contingent Guaranty of the Contingent Notes
(as defined in the New Jersey Joint Venture Agreement); and
(v) expend up to $1,250,000 on transaction expenses related to
the New Jersey Joint Venture.
i. Debt Service Maintenance Agreement.
The Borrower's execution of the Debt Service Maintenance
Agreement is prohibited by Section 8.16 of the Credit
Agreement. Nonetheless, Banks hereby consent to Borrower's
execution of the Debt Service Maintenance Agreement.
(1) Borrower hereby covenants and agrees that it will not agree to any
amendment or modification from the terms of the Debt Service
Maintenance Agreement on the date hereof without the consent of the
Agent, such consent not to be unreasonably withheld or delayed.
i. Representations and Warranties. Borrowers hereby represent and warrant
to Banks as follows:
(1) Representations. The representations and warranties set forth in Section 6
of the Credit Agreement are true and correct in all material respects as
of the date hereof; there is no Event of Default or Default under the
Credit Agreement, as amended hereby; and there has been no material
adverse change in the financial condition or business of Borrower or any
Subsidiary from the date on which Borrower last delivered financial
statements to Banks.
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(1) Power and Authority. Borrower and each Subsidiary has the power and
authority under the laws of each of their states of ----------------------------
incorporation or formation and under their articles or certificates of
incorporation and bylaws or other formation documents or other formation
documents to enter into and perform this Amendment No. 2 and the other documents
and agreements required hereunder (collectively, the "Amendment Documents"); all
actions (corporate or otherwise) necessary or appropriate for the execution and
performance by Borrower and each Subsidiary of the Amendment Documents have been
taken; and the Amendment Documents and the Credit Agreement, as amended, each
constitute the valid and binding obligations of Borrower and each Subsidiary,
enforceable in accordance with their respective terms.
(1) No Violations of Law or Agreements. The making and performance of the
Amendment Documents by Borrower and each Subsidiary
------------------------------------------- will not (i) violate any provisions
of any law or regulation, federal, state or local, or the articles or
certificates of incorporation or bylaws or other formation documents of any
Borrower or Subsidiary or (ii) result in any breach or violation of, or
constitute a default or require the obtaining of any consent under, any
agreement or instrument by which any Borrower or Subsidiary or its property may
be bound. i. Conditions to Effectiveness of Amendment. This Amendment No. 2
shall be effective upon Agent's receipt of the following documents, each in form
and substance satisfactory to Agent: (1) Amendment No. 2. This Amendment No. 2
duly executed by Borrower, Agent and Banks. ------------------------
(1) Debt Service Maintenance Agreement. An executed copy of the Debt
Service Maintenance Agreement. ----------------------------------
(1) Other Documents. Such additional documents as Agent may reasonably
request. ---------------
i. Affirmations. Borrower hereby: (i) affirms all the
provisions of the Credit Agreement, Security
Agreement, Pledge Agreement and Contribution and
Indemnification Agreement, as amended by this
Amendment No. 2, and (ii) agrees that the terms and
conditions of the Credit Agreement, Security
Agreement, Pledge Agreement and Contribution and
Indemnification Agreement shall continue in full
force and effect as supplemented and amended hereby.
i. Miscellaneous.
(1) Borrower agrees to pay or reimburse Agent
for all reasonable fees and expenses
(including without limitation reasonable
fees and expenses of counsel) incurred by
Agent in connection with the preparation,
execution and delivery of this Amendment No.
2.
(1) This Amendment No. 2 shall be governed by and construed in accordance
with the laws of the Commonwealth of Pennsylvania. 135 (1) All terms and
provisions of this Amendment No. 2 shall be for the benefit of and be binding
upon and enforceable by the respective successors and assigns of the parties
hereto.
(1) This Amendment No. 2 may be executed in any number of counterparts with
the same effect as if all the signatures on such counterparts appeared on one
document and each such counterpart shall be deemed an original.
(1) Except as expressly set forth herein,
neither the execution, delivery and
performance of this Amendment No. 2, the
Bank's consent or waiver set forth herein,
nor anything contained herein shall be
construed as or shall operate as a consent
to or waiver of any further provision of, or
any right, power or remedy of Banks under
the Credit Agreement and the agreements and
documents executed in connection therewith.
The consent and waiver granted hereby is
limited to the matters set forth herein.
IN WITNESS WHEREOF, the undersigned have executed this
Amendment No. 2 the day and year first above written.
PENN NATIONAL GAMING, INC.
By: /s/Xxxxxx X. Ippolito__
Name: Xxxxxx X. Xxxxxxxx
Title: Chief Financial Officer/Secretary/Treasurer
FIRST UNION NATIONAL BANK, as Agent
By: _/s/Xxxx Eagleson__________
Name: Xxxx Xxxxxxxx
Title: Vice President
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SUMMIT BANK
By: _/s/Xxxx Balciar__________
Name: Xxxx Xxxxxxx
Title: Vice President
Accepted and Agreed:
MOUNTAINVIEW THOROUGHBRED
RACING ASSOCIATION, as a Subsidiary
Guarantor
By: __/s/Xxxxxx X. Ippolito________
Name: Xxxxxx X. Xxxxxxxx
Title: Secretary/Treasurer
PENNSYLVANIA NATIONAL TURF
CLUB, INC., as a Subsidiary Guarantor
By: _/s/Xxxxxx X. Ippolito____
Name: Xxxxxx X. Xxxxxxxx
Title: Secretary/Treasurer
PENN NATIONAL SPEEDWAY,
INC., as a Subsidiary Guarantor
By: _/s/Xxxxxx X. Ippolito____
Name: Xxxxxx X. Xxxxxxxx
Title: Secretary
STERLING AVIATION, INC.,
as a Subsidiary Guarantor
By: _/s/Xxxxxx X. Ippolito____
Name: Xxxxxx X. Xxxxxxxx
Title: Secretary/Treasurer
PENN NATIONAL HOLDING
COMPANY, as a Subsidiary
Guarantor
By: _/s/Xxxxxx X. Ippolito___
Name: Xxxxxx X. Xxxxxxxx
Title: Secretary/Treasurer
000
XXXX XXXXXXXX XXXXXX XX XXXX
XXXXXXXX, INC., as a Subsidiary Guarantor
By: _/s/Xxxxxx X. Ippolito__
Name: Xxxxxx X. Xxxxxxxx
Title: Secretary/Treasurer
PNGI POCONO, INC.,
as a Subsidiary Guarantor
By: _/s/Xxxxxx X. Ippolito__
Name: Xxxxxx X. Xxxxxxxx
Title: Secretary/Treasurer
TENNESSEE DOWNS, INC.,
as a Subsidiary Guarantor
By: _/s/Xxxxxx X. Ippolito__
Name: Xxxxxx X. Xxxxxxxx
Title: Secretary
THE DOWNS RACING, INC.,
as a Subsidiary Guarantor
By: _/s/Xxxxxx X. Xxxxxxxxx
Name: Xxxxxx X. Xxxxxxxxx
Title: President
NORTHEAST CONCESSIONS, INC.,
as a Subsidiary Guarantor
By: __/s/Xxxxxx X. Xxxxxxxx
Name: Xxxxxx X. Xxxxxxxx
Title: Vice President
BACKSIDE, INC.,
as a Subsidiary Guarantor
By: _/s/Xxxxxx X. Ippolito_
Name: Xxxxxx X. Xxxxxxxx
Title:Assistant Secretary
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MILL CREEK LAND, INC.,
as a Subsidiary Guarantor
By: _/s/Xxxxxx X. Ippolito_
Name: Xxxxxx X. Xxxxxxxx
Title: Assistant Secretary
XXXXXX BARRE XXXXX, INC.,
as a Subsidiary Guarantor
By: _/s/Xxxxxx X. Xxxxxxx
Name: Xxxxxx X. Xxxxxxx
Title: President
PENN NATIONAL GSFR, INC.,
as a Subsidiary Guarantor
By: _/s/Xxxxxx X. Ippolito____
Name: Xxxxxx X. Xxxxxxxx
Title: Secretary/Treasurer
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