AMENDMENT NO. 1 TO SECOND
AMENDED AND RESTATED CREDIT AGREEMENT AND
JOINDER OF SUBSIDIARY GUARANTOR
THIS AMENDMENT NO. 1 TO SECOND AMENDED AND RESTATED CREDIT
AGREEMENT AND JOINDER OF SUBSIDIARY GUARANTOR (this "Amendment No. 1") is made
this __ 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"); the banks signatory to this Amendment No. 1 (together with the Agent,
each individually a "Bank" and individually and collectively, the "Banks") and
PENN NATIONAL GSFR, INC., a Delaware corporation.
BACKGROUND
Borrower and Banks entered into a Second Amended and Restated
Credit Agreement dated January 28, 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 add a newly-created
Subsidiary of Borrower as a Subsidiary Guarantor and to make certain amendments
to the Credit Agreement as set forth herein and subject to the terms and
conditions hereof.
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: i. 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 10.01 of the
Credit Agreement to read in -------------------------------- their entirety as
follows: "Amendment No. 1" means the Amendment No. 1 to Second Amended and
Restated Credit Agreement and Joinder of Subsidiary Guarantor by and among
Borrowers and Banks dated July __, 1999. "Amendment No. 1 Effective Date" means
the date on which the conditions set forth in Paragraph 7 of Amendment No. 1
have been satisfied.
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i. Amendment to Section 2.02 of the Credit Agreement (Maximum Letter of
Credit Outstandings). Section 2.02 of the
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Credit Agreement is hereby amended and restated to read in its entirety as
follows:
2.02 Maximum Letter of Credit Outstandings; Final
Maturities. Notwithstanding anything to the contrary contained
in this Agreement, (i) no Letter of Credit shall be issued the
Stated Amount of which, when added to the Letter of Credit
Outstandings (exclusive of Unpaid Drawings which are repaid on
the date of, and prior to the issuance of, the respective
Letter of Credit) at such time would exceed either (x)
$3,500,000 or (y) when added to the aggregate principal amount
of all Loans then outstanding, an amount equal to the Total
Commitment at such time and (ii) each Letter of Credit shall
by its terms terminate on or before the earlier of (x) the
date which occurs 12 months after the date of the issuance
thereof (although any such Letter of Credit may be extendible
for successive periods of up to 12 months, but not beyond the
third Business Day prior to the Final Maturity Date, on terms
acceptable to the Issuing Bank) and (y) three Business Days
prior to the Final Maturity Date.
i. Amendment to Section 3.01(b) of the Credit Agreement
(Fees). Section 3.01(b) of the Credit Agreement is
hereby amended and restated to read in its entirety
as follows:
(b) The Borrower agrees to pay to the Agent for
distribution to each Bank (based on each such Bank's
respective Percentage) a fee in respect of each Letter of
Credit issued hereunder (the "Letter of Credit Fee") for the
period from and including the date of issuance of such Letter
of Credit to and including the date of termination or
expiration of such Letter of Credit, computed at a rate per
annum equal to one-half of the Eurodollar Spread on the daily
Stated Amount of such Letter of Credit. Accrued Letter of
Credit Fees shall be due and payable quarterly in arrears on
each Quarterly Payment Date and on the first day after the
termination of the Total Commitment upon which no Letters of
Credit remain outstanding.
i. Amendment to Section 7.06(b) of the Credit Agreement (Compliance with
Environmental Laws). Section 7.06(b) of the Credit Agreement is hereby
amended and restated to read in its entirety as follows:
(b) Borrower shall deliver to Agent on or before
August 31, 1999 a copy of a Phase I environmental report with
respect to the Williamsport, Pennsylvania and Chambersburg,
Pennsylvania
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properties and each Additional Mortgaged Property in form and
substance satisfactory to Required Banks and prepared by a
qualified environmental professional acceptable to Required
Banks, together with any additional environmental assessments
of such properties deemed necessary by Required Banks by a
qualified environmental professional acceptable to Required
Banks, and Borrower shall and shall cause its Subsidiaries to
take such reasonable actions as may be recommended in any
Phase I or other environmental assessment to Required Banks'
reasonable satisfaction. Required Banks reserve the right at
any time or from time to time to request that Borrower or its
Subsidiaries take any such reasonable actions as may be
recommended in any Phase I or other environmental assessment.
i. Joinder of New Subsidiary Guarantor. Penn National GSFR, Inc., a Delaware
corporation ("GSFR"), is a newly-formed indirect subsidiary of Borrower. GSFR is
hereby made a Subsidiary Guarantor under the Subsidiary Guaranty, and in
furtherance thereof:
(1) GSFR hereby expressly agrees that it shall be bound by all terms and
conditions of the Subsidiary Guaranty, including without limitation the
representations, warranties and covenants in Sections 11 and 12 thereof, and
shall be liable, jointly and severally with all other Subsidiary Guarantors, for
all Guaranteed Obligations (as defined in the Subsidiary Guaranty).
(1) GSFR hereby expressly agrees that it shall be bound by all terms and
conditions of the Security Agreement, including without limitation the
representations, warranties and covenants set forth in Articles II, III, IV, V
and VI thereof. GSFR hereby grants to Agent, for the benefit of Banks, a
security interest in all the Collateral (as defined in the Security Agreement)
owned by GSFR and any part thereof as security for the payment of all
Obligations (as defined in the Security Agreement).
(1) GSFR hereby expressly agrees that it shall be bound by all the terms and
conditions of the Pledge Agreement, including without limitation the
representations, warranties and covenants set forth in Section 16 thereof. GSFR
hereby pledges to Agent, for the benefit of Banks, a security interest in all
the Collateral (as defined in the Pledge Agreement) owned by GSFR and any part
thereof as security for the payment of all Obligations (as defined in the Pledge
Agreement). Penn National Holding Company, as evidenced by its signature below,
hereby acknowledges and agrees that the shares it owns of GSFR constitute
Collateral (as defined in the Pledge Agreement) and are pledged to Agent, for
the benefit of Banks, thereunder and hereunder. (1) GSFR hereby expressly agrees
that it shall be bound by all the terms and conditions of the Contribution and
Indemnification Agreement, as if it were a Credit Party (as defined in the
Contribution and Indemnification Agreement) and original signatory thereto.
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(1) Schedule V and Schedule VI to the Credit Agreement, Schedule 2 to the
Security Agreement and Annexes A and B to the Pledge Agreement are hereby
amended and restated in their entirety as set forth on Exhibit A attached hereto
to reflect changes since January 28, 1999.
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, including as applied to GSFR as a Subsidiary; 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.
(1) Power and Authority. Borrower and each Subsidiary (including GSFR) 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. 1 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 (including GSFR) 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 (including GSFR), 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
------------------------------------------- (including GSFR) 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 (including GSFR) 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
(including GSFR) or its property may be bound.
i. Conditions to Effectiveness of Amendment. This Amendment No. 1 shall be
effective upon Agent's receipt of the following documents, each in form and
substance satisfactory to Agent:
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(1) Amendment No. 1. This Amendment No. 1 duly executed by Borrower, Agent,
Banks, and GSFR.
------------------------
(1) Opinion of Counsel to GSFR. An opinion letter from counsel to GSFR in
form and substance satisfactory to Agent. --------------------------
(1) Certificate of Good Standing. A certificate of good standing dated as
of a recent date for GSFR in the jurisdiction ---------------------------- of
its formation.
(1) Secretary's Certificate. A certificate from the secretary of GSFR
attaching: (1) the articles of incorporation ----------------------- and bylaws
of GSFR; (2) resolutions from the board of directors of GSFR authorizing the
execution by GSFR of this Amendment No. 1; and (3) an incumbency certificate.
(1) UCC-1 Financing Statements. Executed UCC-1 financing statement to be
filed against GSFR in those jurisdictions -------------------------- required by
Agent.
(1) Pledged Intercompany Notes. Delivery to Agent of pledged intercompany
notes from or for the benefit of GSFR. --------------------------
Stock Certificate. Delivery to Agent of the stock
certificate(s) of GSFR.
(1) Lien Searches against GSFR. As soon as available, lien searches
agreement GSFR in such locations as Agent shall --------------------------
reasonably request. (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. 1, 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.
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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. 1. (1) This Amendment No. 1 shall
be governed by and construed in accordance with the laws of the Commonwealth of
Pennsylvania. (1) All terms and provisions of this Amendment No. 1 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. 1 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. 1, nor anything contained herein
shall be construed as or shall operate as a consent to or waiver of any
provision of, or any right, power or remedy of Banks under the Credit Agreement
and the agreements and documents executed in connection therewith.
IN WITNESS WHEREOF, the undersigned have executed this
Amendment No. 1 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/Treaurer
PENN NATIONAL GSFR, INC., as a Subsidiary Guarantor
By: _/s/Xxxxxx X. Ippolito_
Name: Xxxxxx X. Xxxxxxxx
Title: Secretary/Treasurer
[EXECUTIONS CONTINUED]
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FIRST UNION NATIONAL BANK, as Agent
By: Xxxx Eagleson______________
Name: Xxxx Xxxxxxxx
Title: Vice President
SUMMIT BANK
By: _/s/Xxxx Balciar__________
Name: Xxxx Xxxxxxx
Title: Vice Prsident
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
[EXECUTIONS CONTINUED]
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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
PENN NATIONAL GAMING OF WEST
VIRGINIA, 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. Xxxxxxxx _
Name: Xxxxxx X. Xxxxxxxx
Title: Secretary/Treasurer
[EXECUTIONS CONTINUED]
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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. Ippolito_
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
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. Abraham__
Name: Xxxxxx X. Xxxxxxx
Title: President
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