Bridge Loan Agreement - Bank of America

BRIDGE LOAN AGREEMENT

This Bridge Loan Agreement dated as of March 28, 2003, is between Bank of America, N.A. (the " Bank" ) and Coast Hotels and Casinos, Inc. (the " Borrower" ) with reference to the following facts:

A. The Borrower has heretofore entered into an Amended and Restated Loan Agreement dated as of September 16, 1999 with a syndicate of lenders for which Bank of America, N.A., serves as Administrative Agent (as heretofore amended, the " Syndicated Credit" ).

B. The Borrower has indicated that it will seek to refinance the Syndicated Credit during the period prior to June 30, 2003.

C. Pending the proposed refinancing, the Borrower has requested that the Bank provide the interim credit facilities described herein.

NOW, THEREFORE, the parties hereto hereby agree as follows:

1. LINE OF CREDIT AMOUNT AND TERMS

1.1 Line of Credit Amount.
(a) During the availability period described below, the Bank will provide a revolving line of credit to the Borrower (the " Facility" ). The amount of the line of credit (the " Commitment" ) is Twenty Million Dollars ($20,000,000).
(b) This is a revolving line of credit. During the availability period, the Borrower may repay principal amounts and reborrow them.
(c) The Borrower agrees not to permit the principal balance outstanding to exceed the Commitment. If the Borrower exceeds this limit, the Borrower will immediately pay the excess to the Bank upon the Bank' s demand.


1.2 Availability Period . The line of credit is available upon the fulfillment of the conditions precedent set forth in Section 5.1 and 5.2 of this Agreement between the date of this Agreement and the earliest of the following dates (the " Expiration Date" ):

(a) the date which is ninety days following the date of execution of this Agreement;

(b) the date upon which the Syndicated Credit is hereafter amended to extend its maturity or to change the amount thereof;

(c) the date upon which the Syndicated Credit is refinanced with another credit facility or terminated; or

(d) any or such earlier date as the availability may terminate as provided in this Agreement.

1.3 Repayment Terms.
(a) Unless the LIBOR Rate described in Section 2.1 of this Agreement is unavailable (or the Bank otherwise reasonably consents) each loan made pursuant to this Agreement shall bear interest at the LIBOR Rate (determined for each loan by the Bank in respect of interest periods selected by the Borrower) plus 3.5% per annum. Any principal amount bearing interest in respect of the LIBOR Rate is referred to as a " Portion." Any interest period for any Portion shall expire no later than the Expiration Date

(b) In the event that the LIBOR Rate is unavailable, then interest will be calculated with reference to the Prime Rate at a rate equal to the Bank' s Prime Rate plus 2.5% per annum. The Borrower will pay interest in respect of any loan bearing interest with reference to the Prime Rate on the first day of each calendar month and upon payment in full of any principal outstanding under this line of credit.
(c) The Prime Rate is the rate of interest publicly announced from time to time by the Bank as its Prime Rate. The Prime Rate is set by the Bank based on various factors, including the Bank' s costs and desired return, general economic conditions and other factors, and is used as a reference point for pricing some loans. The Bank may price loans to its customers at, above, or below the Prime Rate. Any change in the Prime Rate shall take effect at the opening of business on the day specified in the public announcement of a change in the Bank' s Prime Rate.
(d) The Borrower will repay in full all principal and any unpaid interest or other charges outstanding under this line of credit no later than the Expiration Date.
2. LIBOR PROVISIONS


2.1 LIBOR Rate. The election of LIBOR Rates shall be subject to the following terms and requirements:
(a) The interest period during which the LIBOR Rate will be in effect will be one, two or three weeks, or one month, as selected by the Borrower. The first day of the interest period must be a day other than a Saturday or a Sunday on which the Bank is open for business in New York and London and dealing in offshore dollars (a " LIBOR Banking Day" ). The last day of the interest period and the actual number of days during the interest period will be determined by the Bank using the practices of the London inter-bank market.
(b) Each LIBOR Rate Portion will be for an amount not less than One Hundred Thousand Dollars ($100,000).
(c) Upon the occurrence of an Event of Default, the Bank may terminate the availability of the LIBOR Rate. If the Borrower fails to select a new interest rate in respect of any expiring LIBOR Portion, the Bank may convert the expiring Portion to a Prime Rate based Borrowing or may select a new interest period for the Borrower.
(d) The " LIBOR Rate" means the interest rate determined by the following formula, rounded upward to the nearest 1/100 of one percent. (All amounts in the calculation will be determined by the Bank as of the first day of the interest period.)
LIBOR Rate = London Inter-Bank Offered Rate
(1.00 - Reserve Percentage)

Where,
(i) " London Inter-Bank Offered Rate" means the interest rate at which the Bank' s London Banking Center, London, Great Britain, would offer U.S. dollar deposits for the applicable interest period to other major banks in the London inter-bank market at approximately 11:00 a.m. London time two (2) London Banking Days before the commencement of the interest period. A " London Banking Day" is a day on which the Bank' s London Banking Center is open for business and dealing in offshore dollars.
(ii) " Reserve Percentage" means the total of the maximum reserve percentages for determining the reserves to be maintained by member banks of the Federal Reserve System for Eurocurrency Liabilities, as defined in Federal Reserve Board Regulation D, rounded upward to the nearest 1/100 of one percent. The percentage will be expressed as a decimal, and will include, but not be limited to, marginal, emergency, supplemental, special, and other reserve percentages.

(e) The Borrower shall irrevocably request a LIBOR Rate Portion no later than 12:00 noon Las Vegas local time on the LIBOR Banking Day preceding the day on which the London Inter-Bank Offered Rate will be set, as specified above. For example, if there are no intervening holidays or weekend days in any of the relevant locations, the request must be made at least three days before the LIBOR Rate takes effect.
(f) The Bank will have no obligation to accept an election for a LIBOR Rate Portion if any of the following described events has occurred and is continuing:
(i) Dollar deposits in the principal amount, and for periods equal to the interest period, of a LIBOR Rate Portion are not available in the London inter-bank market; or
(ii) the LIBOR Rate does not accurately reflect the cost of a LIBOR Rate Portion.
(g) Each prepayment of a LIBOR Rate Portion, whether voluntary, by reason of acceleration or otherwise, will be accompanied by the amount of accrued interest on the amount prepaid and a prepayment fee as described below. A " prepayment" is a payment of an amount on a date earlier than the scheduled payment date for such amount as required by this Agreement.
(h) The prepayment fee shall be in an amount sufficient to compensate the Bank for any loss, cost or expense incurred by it as a result of the prepayment, including any loss or expense arising from the liquidation or reemployment of funds obtained by it to maintain such Portion or from fees payable to terminate the deposits from which such funds were obtained. The Borrower shall also pay any customary administrative fees charged by the Bank in connection with the foregoing. For purposes of this paragraph, the Bank shall be deemed to have funded each Portion by a matching deposit or other borrowing in the applicable interbank market, whether or not such Portion was in fact so funded.
3. FEES AND EXPENSES


3.1 Commitment Fees . During the Availability Period, Borrower shall pay to the Bank a commitment fee equal to .375% of the Commitment times the average daily amount of the unused portion of the Commitment. Commitment fees shall be payable monthly in arrears on the last day of each month, on the date of any termination of the Commitment and on the Expiration Date.

3.2 Expenses . The Borrower agrees to reimburse the Bank for reasonable expenses incurred to pay filing, recording and search fees, appraisal fees, title report fees, documentation and similar fees.

3.3 Reimbursement Costs.
(a) The Borrower agrees to reimburse the Bank for any expenses it incurs in the preparation of this Agreement and any agreement or instrument required by this Agreement. Expenses include, but are not limited to, reasonable attorneys' fees, including any allocated costs of the Bank' s in-house counsel to the extent permitted by applicable law.
(b) The Borrower agrees to reimburse the Bank for the cost of periodic field examinations of the Borrower' s books and records, at such intervals as the Bank may reasonably require. The actions described in this paragraph may be performed by employees of the Bank or by independent appraisers.
4. DISBURSEMENTS, PAYMENTS AND COSTS


4.1 Disbursements and Payments.
(a) Each payment by the Borrower will be made in immediately available funds by direct debit to the Borrower' s deposit account or by mail to the address shown on the Borrower' s statement or at one of the Bank' s banking centers in the United States.

(b) Each disbursement by the Bank and each payment by the Borrower will be evidenced by records kept by the Bank. In addition, the Bank may, at its discretion, require the Borrower to sign one or more promissory notes.


4.2 Telephone and Telefax Authorization.
(a) The Bank may honor telephone or telefax instructions for advances or repayments given, or purported to be given, by any one of the individuals authorized to sign loan agreements on behalf of the Borrower, or any other individual designated by any one of such authorized signers.
(b) Advances will be deposited in and repayments will be withdrawn from the Borrower' s account number 000990114837 (Coast Hotels & Casinos Inc. dba The Orleans Hotel & Casino Operating Account), or such other of the Borrower' s accounts with the Bank as designated in writing by the Borrower.
(c) The Borrower will indemnify and hold the Bank harmless from all liability, loss, and costs in connection with any act resulting from telephone or telefax instructions the Bank reasonably believes are made by any individual authorized by the Borrower to give such instructions. This paragraph will survive this Agreement' s termination, and will benefit the Bank and its officers, employees, and agents.


4.3 Direct Debit.
(a) The Borrower agrees that interest and principal payments and any fees will be deducted automatically on the due date from the Borrower' s account number 000990114837, or such other of the Borrower' s accounts with the Bank as designated in writing by the Borrower.
(b) The Borrower will maintain sufficient funds in the account on the dates the Bank enters debits authorized by this Agreement. If there are insufficient funds in the account on the date the Bank enters any debit authorized by this Agreement, the Bank ...