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Release And Assumption Agreement Dated 12/31/1998

This is an actual contract between Lakes Entertainment and Hilton Hotels.
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RELEASE AND ASSUMPTION AGREEMENT


This RELEASE AND ASSUMPTION AGREEMENT (the "Agreement") dated as of December 31, 1998, among Hibernia National Bank ("Bank"), the Coushatta Tribe of Louisiana (the "Tribe"), the Coushatta Tribe of Louisiana Building Authority (the "Authority"), Grand Casinos of Louisiana, Inc. -- Coushatta ("GCI"), Grand Casinos, Inc. ("Grand"), Lakes Gaming, Inc., a Minnesota corporation and a subsidiary of Grand ("Lakes") and Grand Casinos of Louisiana, LLC-Coushatta, a Minnesota limited liability company and a subsidiary of Lakes ("GCI LLC").


WITNESSETH:


WHEREAS, Bank, entered into that certain Commercial Loan Agreement dated May 1, 1997 (the "Hotel Loan Agreement") under the terms of which the Bank agreed to loan to the Tribe and the Authority up to $25,000,000.00 (the "Hotel Loan") to be used to construct and furnish a hotel facility, to purchase new gaming equipment, and to make certain renovations, all as more fully set forth therein;


WHEREAS, in connection with the Hotel Loan, Grand and GCI executed in favor of the Bank that certain Commercial Guaranty Agreement dated May 1, 1997 (the "Hotel Loan Guaranty") under the terms of which Grand and GCI guaranteed up to the maximum sum of $25,000,000.00 of the Hotel Loan Obligations (herein defined);


WHEREAS, in connection with the Hotel Loan Agreement, Grand and GCI executed the Hotel Loan Subordination Agreements (herein defined);


WHEREAS, the Bank and the Tribe entered into that certain Commercial Loan Agreement dated December 17, 1997 (the "First Equipment Loan Agreement"), under the terms of which the Bank agreed to loan to the Tribe up to $6,000,000.00 (the "First Equipment Loan") to purchase new gaming equipment and other assets;


WHEREAS, in connection with the First Equipment Loan Agreement, Grand and GCI executed the First Equipment Loan Subordination Agreements (herein defined);


WHEREAS, in connection with the Hotel Loan and the First Equipment Loan, the Bank, GCI and Grand entered into that certain Intercreditor Agreement dated as of February 4, 1998 (the "First Intercreditor Agreement");


WHEREAS, the Bank and the Tribe entered into that certain Commercial Loan Agreement dated as of December 18, 1998 (the "Second Equipment Loan Agreement"), under the terms of which the Bank agreed to loan to the Tribe up to $15,000,000.00 (the "Second Equipment Loan") to purchase new gaming equipment and other assets and to sometime before September 30, 1999, refinance the First Equipment Loan;


WHEREAS, in connection with the Second Equipment Loan Agreement, Grand and GCI executed the Second Equipment Loan Subordination Agreements (herein defined);


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WHEREAS, in connection with the Hotel Loan, the First Equipment Loan and the Second Equipment Loan, the Bank, GCI and Grand entered into that certain Second Intercreditor Agreement dated as of December 18, 1998 (the "Second Intercreditor Agreement");


WHEREAS, capitalized terms used herein shall have the meanings ascribed thereto in the Second Intercreditor Agreement unless otherwise defined herein;


WHEREAS, pursuant to that certain Merger Agreement dated June 30, 1998 (the "Merger Agreement") among Grand, Lakes, Hilton Hotels Corporation, a Delaware corporation ("Hilton"), Park Place Entertainment Corporation , a Delaware corporation and a subsidiary of Hilton ("Park Place"), Gaming Acquisition Corporation, a Minnesota corporation and a subsidiary of Park Place (the "Merger Subsidiary"), such parties intend to cause the following transactions to occur effective as of closing on December 31,1998 (collectively, the "Grand Transactions"):


(a) all right, title, interest, duties and obligations of Grand and GCI in, to and under: (i) the Management Agreement (as defined in the Hotel Loan Agreement), (ii) the Indemnity Agreement, (iii) the Indemnity Collateral Documents, and (iv) any other security agreements, mortgages, deeds of trust, contracts, agreements, instruments and documents of whatever nature between or among the Tribe and/or the Authority and either or both of Grand and/or GCI, including, without limitation, any debts, liabilities or other obligations owing by the Tribe and/or the Authority to either or both of Grand and/or GCI, shall be forever and absolutely assigned to and assumed by Lakes or GCI LLC, as applicable (the "Assignment Transaction");


(b) GCI shall merge with and into Lakes, with Lakes remaining as the surviving entity (the "GCI-Lakes Merger");


(c) Hilton will spin-off 100% of the capital stock of Park Place to its public shareholders;


(d) Grand will spin-off 100% of the capital stock of Lakes to its public shareholders; and


(e) the Merger Subsidiary shall merge with and into Grand, with Grand remaining as the surviving entity (the "Park Place-Grand Merger");


WHEREAS, the Tribe has consented to the Grand Transactions and Grand, GCI, Lakes and GCI LLC are also requesting the consent of the Bank to the Grand Transactions and to amend the Loan Documents (herein defined) as set forth herein, including without limitation, the release of GCI from and assumption by GCI LLC of all obligations of GCI to the Bank under the applicable Loan Documents to which it is a party; and


WHEREAS, the Bank is willing to grant such consent pursuant to the terms and conditions set forth herein.


NOW, THEREFORE, in consideration of the foregoing, the Bank, the Tribe, the Authority, GCI, Grand, Lakes and GCI LLC agree as follows:


SECTION 1. CONSENT AND WAIVER. The Bank hereby consents to the Grand Transactions (as described hereinabove) and waives any and all provisions (including, without limitation, any change in control provisions) contained in the Loan Documents that would restrict or otherwise give rise to an event of default under the Loan Documents on account of the Grand Transactions. As used herein the term


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"Loan Documents" shall individually or collectively, as the context may require, mean the First Equipment Loan Agreement, the First Equipment Loan Collateral Documents, the First Equipment Loan Subordination Agreements, the Second Equipment Loan Agreements, the Second Equipment Loan Collateral Documents, the Second Equipment Loan Subordination Agreement, the Hotel Loan Agreement, the Hotel L
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