This Completion Guaranty is made as of December 22, 2003 by Station Casinos, Inc., a Nevada corporation (“Station”), GCR Gaming, LLC, a Nevada limited liability company (“GCR Gaming”), and GV Ranch Station, Inc., a Nevada corporation (“GV Ranch Station”), jointly and severally in favor of Bank of America, N.A., as Administrative Agent for the benefit of the Lenders under the Amended and Restated Loan Agreement described below. Station, GCR Gaming and GV Ranch Station are each referred to herein as a “Completion Guarantor” and collectively, as “Completion Guarantors”. Capitalized terms used but not defined herein shall have the meanings defined for those terms in the Loan Agreement described below.
A. Pursuant to the Amended and Restated Loan Agreement (as amended, supplemented or otherwise modified from time to time, the “Loan Agreement”) of even date herewith by and among Green Valley Ranch Gaming, LLC, a Nevada limited liability company (“Borrower”), the lenders from time to time parties thereto (each a “Lender” and collectively, the “Lenders”), and Bank of America, N.A., as Administrative Agent, the Lenders have agreed to extend certain credit facilities to Borrower.
B. A portion of the proceeds of the credit facilities provided under the Loan Agreement will be used to construct a new approximately 300 room hotel tower, spa improvements and meeting and convention space at the Green Valley Ranch Casino.
C. The obligations of GCR Gaming and GV Ranch Station hereunder shall be secured by the Member Pledge Agreement referred to in the Loan Agreement. As of the date hereof, the obligations of Station hereunder are unsecured.
D. This Completion Guaranty is the “Completion Guaranty” referred to in the Loan Agreement and one of the Loan Documents described therein.
E. The Administrative Agent and the Lenders acknowledge that the Completion Guaranty dated as of September 18, 2001, and issued by the Completion Guarantors in connection with the prior Loan Agreement, of even date herewith, has been discharged.
NOW, THEREFORE, in order to induce the Lenders to extend credit facilities to Borrower under the Loan Agreement, and for other good and valuable consideration, the receipt and adequacy of which are hereby acknowledged, Completion Guarantors hereby jointly and severally agree as follows:
1. Completion Guaranty and Agreement.
Completion Guarantors hereby, jointly and severally, irrevocably and unconditionally guarantee that the Completion Guarantors shall complete or cause to be completed in accordance with Section 4.2 the construction of the Project in material conformity with the Construction Plans (in each case as the same exist as of the Closing Date and with such changes thereto as are permitted by the Loan Agreement), free and clear of material defects and Liens or claims for Liens for material supplied or labor
or services performed in connection therewith, except for Permitted Encumbrances and Permitted Rights of Others and Liens permitted under Section 6.8 of the Loan Agreement (i.e., the Project is “Physically Complete”) and the opening of the Project for business to accommodate patrons and hotel guests (i.e., the Project is “Legally Open”), in each case in accordance with the Construction Budget and the Construction Timetable (as in effect on the date hereof and with such changes thereto as are permitted pursuant to the terms of the Loan Agreement).
Without limitation on the foregoing:
(a) if as of any date the total cost of construction, design, and development of the Project (and of all other costs contemplated by the Construction Budget) theretofore expended exceeds $115,000,000 (the “Budgeted Cost”), Completion Guarantors shall each make (or cause to be made), within five Business Days following demand by the Administrative Agent, Cash Equity Contributions to Borrower in an aggregate amount which is equal to the greater of (i) the Estimated Completion Amount, or (ii) unless the Project is then Physically Complete, the amount of such excess. As used herein, the “Estimated Completion Amount” is the amount (as determined by the Administrative Agent in its sole discretion after consultation with CSG) equal to the sum of (y) the amount by which the actual completion cost (or theretofore expended amounts) for each line item in the Construction Budget has been exceeded (net of any savings on any completed line items), plus, without duplication, (z) to the extent that Loans are not then available under the Loan Agreement, the remaining unexpended amount of the Construction Budget; and
(b) the Completion Guarantors agree that to the extent that the Borrower lacks sufficient cash resources to pay the same when due, they shall immediately pay in cash all costs of construction, design, and development of the Project which are in excess of the Budgeted Cost.
2. Payment Provisions in the Event of Bankruptcy.