AMENDED AND RESTATED CREDIT AGREEMENT

 

among

 

CENTURY RESORTS ALBERTA INC.

and

CENTURY CASINO CALGARY INC.

as Borrowers

 

and

 

BANK OF MONTREAL

as Lender

 

 

 

 

 

AUGUST 15, 2014

 

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TABLE OF CONTENTS

 

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THIS AMENDED AND RESTATED CREDIT AGREEMENT is made as of the 15th day of August, 2014.

AMONG:

CENTURY RESORTS ALBERTA INC. and CENTURY CASINO CALGARY INC.

as borrowers

 

- and -

 

BANK OF MONTREAL

as lender

WHEREAS, the Borrowers and the Lender are parties to the credit agreement dated as of April 11, 2012 (the "Prior Credit Agreement") pursuant to which the Lender thereunder made available to the Borrowers certain revolving and term credit facilities (such credit facilities under the Prior Credit Agreement being referred to as the "Prior Credit Facilities") on the terms and subject to the conditions set forth in the Prior Credit Agreement;

AND WHEREAS, the Lender has agreed to restructure the Prior Credit Facilities on the terms and subject to the conditions set forth in this Agreement;

NOW THEREFORE, in consideration of the premises and the mutual covenants herein contained, the parties to this Agreement hereby agree as follows:

In this Agreement:

"1214741" means 1214741 Alberta Ltd. and its successors and assigns.

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"Advance" means a borrowing by a Borrower by way of a Prime Rate Advance, US Base Rate Advance, a LIBOR Advance, a BA Advance, a Letter of Credit Advance, and includes deemed Advances and Conversions and Rollovers of existing Advances, and any reference relating to the amount of Advances shall mean the Equivalent Amount in Canadian Dollars of the sum of the principal amount of all outstanding Prime Rate Advances, US Base Rate Advances, LIBOR Advances plus the Face Amount of all outstanding Bankers' Acceptances and Letters of Credit and the principal amount outstanding under the Ancillary Facility.

"Affiliate" has the meaning set out in the Business Corporations Act (Alberta) as in effect on the date hereof.

"AGLC" means the Alberta Gaming and Liquor Commission and any other Governmental Authority that regulates or governs casino gaming in Alberta.

"Agreement", "hereof", "herein", "hereto", "hereunder" or similar expressions mean this Agreement and any Schedules hereto, as amended, supplemented, restated and replaced from time to time.

"Ancillary Facility" means a business MasterCard credit card facility to be made available to the Borrowers or a Borrower, up to the maximum aggregate principal amount of $100,000.  For greater certainty, the Ancillary Facility forms part of Credit A and amounts outstanding thereunder are Obligations of the Borrowers under Credit A.

"Applicable Laws" means, in relation to any Person, transaction or event:

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"Applicable Margin" means for any period set forth below, the per annum percentage set forth under such period in the table below:

 

Provided that upon the occurrence and during the continuance of a Default or an Event of Default, each Applicable Margin set forth above will increase by 2.0% per annum.

"Asset Disposition" means any sale, assignment, transfer, lease or other disposition of any of the present or future Property of a Consolidating Loan Party (including the sale of any of its Receivables).

"BA Advance" means the portion of an Advance affected by the acceptance of a Bankers' Acceptance by the Lender.

"BA Discount Proceeds" means, in respect of any Bankers' Acceptance, an amount (rounded to the nearest whole cent with one-half of one cent being rounded-up) determined as of the date of the applicable BA Advance, which is equal to:

Face Amount x Price

where "Face Amount" is the face amount of such Bankers' Acceptance and "Price" is equal to:

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where the "Rate" is the applicable BA Discount Rate expressed as a decimal on the date of the applicable BA Advance; the "Term" is the term of such Bankers' Acceptance expressed as a number of days; and the Price as so determined is rounded up or down to the fifth decimal place with .000005 being rounded-up.

"BA Discount Rate" means with respect to each Bankers' Acceptance accepted or to be accepted by the Lender, the fixed annual rate of interest announced from time to time by the Lender, as being the reference rate for computing the discount amount which would be applied on Canadian dollar bankers' acceptances accepted by the Lender in Canada to realize a net or discounted amount thereon, in an approximate amount and with a maturity date the same as the Bankers' Acceptances issued by a Borrower and accepted or to be accepted by the Lender.

"BA Stamping Fee Rate" means from time to time, in respect of an acceptance of a Bankers' Acceptance, the applicable percentage rate per annum indicated beside the reference to "BA Stamping Fee Rate" in the definition of "Applicable Margin".

"Bankers' Acceptance" means a non-interest bearing draft in Canadian Dollars drawn by a Borrower and accepted by the Lender pursuant to this Agreement.

"Bankers' Acceptance Stamping Fee" means the amount calculated by multiplying the Face Amount of a Bankers' Acceptance by the BA Stamping Fee Rate, and then multiplying the result by a fraction, the numerator of which is the number of days to elapse from and including the date of acceptance of such Bankers' Acceptance by the Lender up to but excluding the maturity date of such Bankers' Acceptance, and the denominator of which is 365.

"Borrowers" means collectively, CRAI and CCCI, and "Borrower" means either one of them.

"Branch of Account" means the branch of the Lender, located at First Canadian Centre, 340 – 7th Avenue S.W., Calgary, Alberta, T2P 0X4, or such other branch of the Lender as the Lender may from time to time designate by notice in writing to the Borrowers.

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"Business" means the business carried on by the Consolidating Loan Parties prior to the date hereof which includes the ownership and operation of Edmonton Casino, Calgary Casino and other casinos.

"Business Day" means:

"Calgary Casino" means the casino, restaurant and other ancillary businesses located at 1010 42nd Ave SE, in Calgary, Alberta, legally described as Plan 8368HA, Block 24, Plan 8121HN Block 4 and Plan 8121HN Block 4 the South 236.27 feet, and the lands leased by CCCI legally described as Plan 8368HA Block 26.

"Canadian Dollars", "Cdn. Dollars", "Cdn. $" and "$" mean lawful money of Canada.

"Capital Asset Acquisition" means an acquisition by a Consolidating Loan Party or by any of the Subsidiaries of a Consolidating Loan Party of Capital Assets;

"Capital Assets" means property or assets that would, in accordance with GAAP, be determined to be fixed or capital property or assets.

"Capital Expenditure Budget" means a budget of Capital Expenditures for a Fiscal Year, on a quarter to quarter basis, delivered to and approved by the Lender, as contemplated by Section 11.2(f).

"Capital Expenditures" means, for any period, any expenditures for a Capital Asset Acquisition and expenditures made for additions to or improvements to Capital Assets and Capital Leases and any Maintenance Capex expenditures.

"Capital Invoices" means invoices or other evidence acceptable to the Lender provided by a Borrower to the Lender evidencing the costs incurred or to be incurred in connection with Capital Expenditures to be financed using Credit C.

"Capital Lease" means any lease, license or similar transaction determined as a capital lease in accordance with GAAP, or any sale and lease back transaction or any other lease (whether a synthetic lease or otherwise) other than any lease that would in accordance with GAAP be determined to be an operating lease.

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"Cash Management" means the cash management services required by the Borrowers including without limitation the operation of all bank accounts and electronic funds transfers.

"Cash Taxes" means for any Person for any period, the amount of all Taxes (including federal and provincial income taxes) payable by such Person on its net taxable income for such period (which for greater certainty, does not include deferred Taxes).

"CCCI" means Century Casino Calgary Inc. and its successors and assigns.

"CCEG" means Century Casinos Europe GmbH operating in Canada under the trade name Century Casinos Europe LLC and its successors and assigns.

"CCEG Credit Agreement" means the credit agreement dated October 25, 2012 between CCEG, as lender, and UHA, as borrower, as amended by the amending agreement made effective September 30, 2013 and the second amendment made as of April 24, 2014, as the same may be amended, restated, replaced, supplemented or modified from time to time. 

"CCEG Security" means the following documents each dated October 30, 2012 unless otherwise indicated below:

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"Century Calgary Properties" means Century Calgary Properties Inc. and its successors and assigns.

"Century Casino" means Century Casinos, Inc. and its successors and assigns.

"Change Order" means any order submitted for approval to UHA by the contractor of the REC Project, pursuant to which the contractor proposes to change the design or specifications of all or a portion of the REC Project.

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"Closing Date" means the date on which all conditions precedent to this Agreement pursuant to Section 8.1 have been confirmed by the Lender to have been met.

"Collateral" means cash, a bank draft or a letter of credit issued by a chartered bank referred to in Schedule I of the Bank Act (Canada) which has shareholder equity of at least $10,000,000,000, all in a form satisfactory to the Lender, acting reasonably.

"Compliance Certificate" means the certificate required pursuant to Section 11.2, the form of which is attached hereto as Schedule A.

"Consolidated Total Assets" means, as of any date, the book value of the total assets of the Consolidating Loan Parties as determined on a Modified Consolidated Basis in accordance with GAAP.

"Consolidating Loan Parties" means the Borrowers, 1214741, Century Calgary Properties, the Material Subsidiaries and their successors and assigns.

"Constating Documents" means, (i) with respect to a corporation, its articles of incorporation, amalgamation or continuance or other similar documents and its by-laws, (ii) with respect to a partnership, its partnership agreement and its declaration or certificate of partnership, (iii) with respect to a trust, its declaration of trust, trust indenture or other similar document and (iv) with respect to any other Person which is an artificial body, the organization and governance documents of such Person, all as amended from time to time.

"Construction Lien Holdback Account" means an account established in accordance with Construction Lien Legislation into which the Construction Lien Holdback Amount is deposited.

"Construction Lien Holdback Amount" means an amount equal to (i) 10% of each Drawdown under Credit C, or (ii) such other amount as may be required from time to time by the Construction Lien Legislation or any Contracts relating to the construction of the REC Project that is to be deposited into the Construction Lien Holdback Account from the payment that would otherwise be made under a REC Project Construction Agreement.

"Construction Lien Legislation" means the Builders' Lien Act (Alberta), as amended or replaced from time to time.

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"Construction Management Contract" means the construction management contract between UHA and the contractor for the REC Project with respect to the performance by the contracts of the site management, administration and other technical services required for the REC Project.

"Construction Period" means with respect to the REC Project, the date upon which the Initial Drawdown Date occurs to the REC Project Construction Completion Date.

"Contingency Budget" means the contingency budget for the REC Project prepared by UHA and delivered to CRAI and the Lender that includes Cost Overruns and other REC Project Costs not included in the REC Project Construction Budget, as such contingency budget may be amended and revised with the consent of the Lender after consultation with the Quantity Surveyor.

"Contracts" means agreements, franchises, leases, licenses, privileges and other rights acquired from Persons.

"Conversion" means a conversion or deemed conversion of one type of Advance into another type of Advance, pursuant to this Agreement and "Converted" and "Convert" have corresponding meanings.

"Cost Overruns" means, in respect of the REC Project, the REC Project Costs which in the aggregate are in excess of the REC Project Costs set out in the REC Project Construction Budget in effect.

"CRAI" means Century Resorts Alberta Inc. and its successors and assigns.

"CRAI Loan" means the loans made by or to be made by CRAI (including by CCEG as the agent of CRAI) and/or CCEG to UHA in an aggregate amount not exceeding $24,000,000 as described in the CCEG Credit Agreement, to be funded partially by Drawdowns under: (i) Credit B following the Closing Date up to the maximum amount of $13,000,000; and (ii) Drawdowns under Credit C following the Closing Date up to the maximum amount of $11,000,000, in each case to be used by UHA for the construction and development of the REC Project.

"Credit A" has the meaning ascribed thereto in Section 2.1.

"Credit A Facility Limit" means: (i) the amount of $1,000,000, or (ii) such lesser amount after giving effect to the reductions of Credit A referred to in Section 0.

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"Credit A Maturity Date" means the earlier of: (i) the date that is the five year anniversary of the Closing Date; and (ii) the date the Obligations under this Agreement become due and payable as a result of the occurrence of an Event of Default.

"Credit B" has the meaning ascribed thereto in Section 3.1.

"Credit B Facility Limit" means: (i) the amount of $24,050,000, or (ii) such lesser amount after giving effect to the reductions of Credit B referred to in Sections 3.3,  0,  0, and 6.5.

"Credit B Maturity Date" means the earlier of: (i) the date that is the five year anniversary of the Closing Date; and (ii) the date the Obligations under this Agreement become due and payable as a result of the occurrence of an Event of Default that has not been waived by the Lender.

"Credit B Reduction Date" means June 29, 2012 and the last Business Day of each subsequent calendar month.

"Credit B Scheduled Reduction" means with respect to (i) the Initial Credit B Drawdown, the Initial Credit B Drawdown Amount divided by 120, and (ii) a Subsequent Credit B Drawdown, the Subsequent Credit B Drawdown Amount divided by 120, and "Credit B Scheduled Reductions" means the aggregate of (i) and (ii) above on a Credit B Reduction Date.

"Credit C" has the meaning ascribed thereto in Section 4.1.

"Credit C Facility Limit" means: (i) the amount of $11,000,000, or (ii) such lesser amount after giving effect to the reductions of Credit C referred to in Section 0.

"Credit C Maturity Date" means the earlier of: (i) the date that is the five year anniversary of the Closing Date; and (ii) the date the Obligations under this Agreement become due and payable as a result of the occurrence of an Event of Default that has not been waived by the Lender.

"Credit C Reduction Date" means June 30, 2015 and the last Business Day of each subsequent calendar month.

"Credit C Scheduled Reduction" means with respect to (i) the Initial Credit C Drawdown, the Initial Credit C Drawdown Amount divided by 120, and (ii) a Subsequent Credit C Drawdown, the Subsequent Credit C Drawdown Amount divided by 120, and "Credit C Scheduled Reductions" means the aggregate of (i) and (ii) above on a Credit C Reduction Date.

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"Credit D" means the uncommitted treasury risk management facility made available to the Borrowers by a Hedge Provider pursuant to Section 5.1.

"Credit D Facility Limit" means an amount equal to $3,000,000 of Deemed Risk.

"Credit Documents" means this Agreement, the Security and all other documents delivered pursuant to this Agreement and the Security.

"Credits" means Credit A, Credit B, Credit C and Credit D and "Credit" means any one of the Credits.

"Currency Hedge Agreements" means all present and future agreements, whether in the form of an ISDA Master Agreement, a futures contract, a swap, a forward rate, currency exchange contract or otherwise, entered into for or in connection with a forward rate, currency swap or currency exchange and other similar currency-related transactions, which are designed to manage, mitigate or eliminate currency exchange rate risk.

"Deemed Risk" means, in respect of any Hedge Agreement in effect between or to be entered into by the Borrowers (or either of them) and a Hedge Provider at any time, an amount determined by a Hedge Provider (in its discretion) equal to its risk adjusted valuation of the Hedge Agreements entered into or to be entered into by the Borrowers (or either of them) and a Hedge Provider.

"Default" means an event or circumstance which, but for the requirement of the giving of notice, lapse of time, or both would constitute an "Event of Default".

"Designated Account" means, in respect of any Advance, the account or accounts maintained by a Borrower that such Borrower designates in its notice to the Lender requesting an Advance. As of the date hereof, the Designated Accounts for CRAI is Account No. 1995-494 (Cdn. $) and Account No. 4792-472 (US$) at Bank of Montreal's branch located at 10199 101 ST NW, Edmonton, Alberta T5J3Y4 and the Designated Account for CCCI is Account No. 1990-381 (Cdn.$) and Account No. 4875-134 (US$) at Bank of Montreal’s Branch of Account.

"Distribution" means:

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"Drawdown" means an Advance, other than a Rollover or a Conversion.

"Drawdown Date" means the date, which shall be a Business Day, of any Drawdown.

"Drawdown Notice" means a notice requesting a Drawdown hereunder substantially in the form annexed hereto as Schedule B.

"EBITDA" means, with respect to any period, the consolidated net income of the Consolidating Loan Parties for such period determined in accordance with GAAP (excluding non-cash income and expenses and extraordinary items), plus, to the extent deducted in determining such net income, the following:

For the purpose of this Agreement, where EBITDA is required to be determined for any twelve month period, EBITDA shall be equal to the aggregate of the EBITDA of the Consolidating Loan Parties for the most recently completed twelve months.

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"Edmonton Casino" means the casino, restaurant and other ancillary businesses located at 13103 Fort Road, in Edmonton, Alberta, legally described as Plan 9824748, Block 2, Lot 9.

"Encumbrance" means any mortgage, debenture, pledge, hypothec, lien, charge, assignment by way of security, title retention, consignment, lease, hypothecation, security interest or other security agreement or trust, right of set off that secures payment of any debt, liability or obligation or other arrangement having the effect of security for the payment of any debt, liability or obligation, and "Encumbrances", "Encumbrancer", "Encumber" and "Encumbered" shall have corresponding meanings.

"Equivalent Amount" means, where any amount expressed in any currency has to be converted or expressed in another currency, or where its equivalent in another currency has to be determined (or vice versa), the calculation is made at the mid-point spot rate announced or quoted by the Bank of Canada in accordance with its normal practices at or around noon on the previous Business Day for the relevant currency against the other currency (or vice versa).

"Event of Default" has the meaning ascribed thereto in Section 12.1.

"Exchange Rate" means, on any day, with respect to the exchange of one currency (the "First Currency") into another currency (the "Other Currency"), the exchange rate of the Lender at or about 12:00 noon (Toronto time) on that day, which the Lender quotes for the purchase of the First Currency with the Other Currency, or if such rate is not or has not yet been quoted on such day, the last preceding exchange rate of the Lender.

"Face Amount" means:

"Federal Funds Rate" means, for any day, the rate of interest per annum set forth in the weekly statistical release designated as H.15, or any successor publication, published by the U.S. Federal Reserve Board (including any such successor, the "H.15") for such day opposite the caption "Federal Funds (Effective)".  If on any relevant day such rate is not yet published in H.15, the rate for such day will be the rate of interest per annum set forth in the daily statistical release designated as the Composite 3:30 p.m. Quotations for U.S. Government Shares, or any successor publication, published by the Federal Reserve

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Board (including any successor, the "Composite 3:30 p.m. Quotations") for such day under the caption "Federal Funds Effective Rate".  If on any relevant day the appropriate rate per annum of such day is not yet published in either H.15 or the Composite 3:30 p.m. Quotations, the rate for such day will be the arithmetic mean of the rates per annum for the last transaction of overnight Federal Funds (such words to have the meaning generally given to them by money market brokers of recognized standing doing business in the United States of America) transactions received by the Lender from three major brokers of recognized standing, selected by the Lender.

"Financial Statements" means the financial statements of a Person as at a specified date and for the period then ended and shall include a balance sheet, statement of income and retained earnings, statement of cash flows and application of funds, together with comparative figures in each case (where a comparative period on an earlier statement exists), all prepared, maintained and stated on a consolidated basis, in accordance with GAAP applied consistently.

"First-Ranking Security Interest" in respect of any Property means an Encumbrance in such Property which is registered where necessary or where the Lender considers such registration desirable to record and perfect the Encumbrances contained therein and which ranks in priority to all other Encumbrances except for any Permitted Encumbrances which (without regard to this Agreement) have priority in accordance with Applicable Laws.

"Fiscal Quarter" means the three month period commencing on the first day of each Fiscal Year and each successive three (3) month period thereafter during such Fiscal Year.

"Fiscal Year" means the fiscal year of the Borrowers, in each case commencing on January 1 of each year and ending on December 31 of each year, or such other fiscal year of the Borrowers, as agreed to by the Lender.

"Fixed Charge Coverage Ratio" means at any time, the ratio of:

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"Funded Debt" means, with respect to any Person, without duplication:

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but excluding for greater certainty trade payables, deferred Taxes and accrued current liabilities that do not relate to any of the above.

"GAAP" means generally accepted accounting principles which are in effect from time to time in Canada, as published in the Handbook of the Canadian Institute of Chartered Accountants, applied on a consistent basis.

"Governmental Authority" means:

"Guarantee" means any guarantee or indemnity (other than by endorsement of negotiable instruments for collection or deposit in the ordinary course of business) in any manner of any part or all of a Funded Debt.

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"Guarantor" means Century Casino, 1214741, Century Calgary Properties, CCEG, each Material Subsidiary and each other Person which has provided or caused to be provided to the Lender the following (in each case in form and substance satisfactory to the Lender, acting reasonably): (i) a Guarantee; (ii) the other applicable Security listed in Section 7.6 and (iii) such other certificates, documents and legal opinions that the Lender may require, acting reasonably.

"Hazardous Materials" means any hazardous substance or any pollutant or contaminant, toxic or dangerous waste, substance or material, as defined in or regulated by any Applicable Law, regulation or governmental authority from time to time, including, without limitation, asbestos and polychlorinated biphenyls.

"Hedge Agreement" means a Currency Hedge Agreement or an Interest Rate Hedge Agreement entered into by the Borrowers (or either of them), with a Hedge Provider.

"Hedge Provider" means the Lender or an Affiliate of the Lender that enters into a Hedge Agreement with the Borrowers (or either of them).

"Hopewell Claim" means Action No. 1201 02650.

"Hostile Acquisition" means an unsolicited acquisition of the Shares of any Person that are publicly traded, or otherwise to facilitate, assist or participate in an acquisition of Shares of any Person that are publicly traded, where the board of directors or the equivalent of such Person, has not approved such acquisition nor recommended the approval of such acquisition to the holders of such Shares.

"HRA" means Horse Racing Alberta and any other Governmental Authority that regulates or governs horse racing in Alberta.

"Initial Credit B Drawdown" means the initial Drawdown under Credit B by a Borrower.

"Initial Credit B Drawdown Amount" means the principal amount of the Initial Credit B Drawdown.

"Initial Credit C Drawdown" means the initial Drawdown under Credit C by CRAI.

"Initial Credit C Drawdown Amount" means the principal amount of the Initial Credit C Drawdown.

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"Initial Drawdown Date" means the date of the Initial Credit C Drawdown under this Agreement.

"Interest Expense" means, with respect to any Person for any period, without duplication, interest expense of such Person calculated on a consolidated basis and in accordance with GAAP as the same would be set forth or reflected in a consolidated statement of earnings of such Person and, in any event and without limitation, shall include:

"Interest Payment Date" means, with respect to Prime Rate Advances and US Base Rate Advances, subject to Section 14.19, the last Business Day of each calendar month.

"Interest Rate Hedge Agreements" means all present and future agreements, whether in the form of an ISDA Master Agreement, a futures contract, a swap transaction, an interest rate option, a cap transaction, floor transaction, collar transaction or otherwise, which are designed to manage, mitigate or eliminate risks relating to interest rate fluctuations.

"Investment" means (a) any loan or other extension of credit (including the delivery of guarantees, indemnities or other financial assistance) or capital contribution (including a transfer of property) to, or acquisition of any Shares, bonds, notes, debentures or other securities of, any Person, (b) any deposit accounts and certificates of deposit maintained by a Person with a financial institution or other Person (other than deposit accounts and certificates of deposit maintained with the Lender), and (c) any purchase of any assets constituting all or part of a business unit from any Person; and "Invest" and "Invested" shall be construed accordingly.

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"ISDA Master Agreement" means the 1992 ISDA Master Agreement (Multi-Currency – Cross Border) or the 2002 ISDA Master Agreement, each as published by the International Swaps and Derivatives Association, Inc., each as amended or replaced from time to time and, where the context permits or requires, includes all schedules, supplements, annexes and confirmations attached thereto or incorporated therein, including without limitation, any credit support annex.

"Lender" means Bank of Montreal and its successors and permitted assigns.

"Letter of Credit" means a letter of credit (in a form acceptable to the Lender) in Canadian Dollars, issued by the Lender at the request and for the account of a Borrower pursuant to this Agreement.

"Letter of Credit Advance" means an Advance of credit under this Agreement by the issuance of a Letter of Credit by the Lender, at the request of a Borrower.

"Letter of Credit Rate" means from time to time for any Letter of Credit Advance, the applicable percentage rate per annum indicated beside the reference to "Letter of Credit Margin" in the definition of "Applicable Margin".

"Level I", "Level II", "Level III" and "Level IV" means, respectively, the period of time during which the corresponding Senior Funded Debt to EBITDA Ratio is as set forth in the table below and "Level" means any such time period:

 

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The Senior Funded Debt to EBITDA Ratio shall be determined thirty (30) days after the end of each Fiscal Quarter, from the Financial Statements of the Consolidating Loan Parties and any resulting change, whether an increase or a decrease, in the rate of any interest or fees payable hereunder shall be calculated and applied from and after the sixtieth (60th) day following the end of such Fiscal Quarter.  In the event that the Borrowers fail to deliver a Compliance Certificate for any Fiscal Quarter, Level IV shall be deemed to be applicable until such Compliance Certificate is delivered confirming that a different Level is applicable, after which time the applicable Level shall be applied. Any resulting change in the rate of any interest or fees payable hereunder in respect of Prime Rate Advances, US Base Rate Advances and Letter of Credit Advances shall be calculated and applied from and after the first date of the change in a Level, with respect to both outstanding and future Prime Rate Advances, U.S. Base Rate Advances and Letter of Credit Advances.  Interest and fees applicable to BA Advances and LIBOR Advances made after any such resulting change shall be calculated on the basis of the Applicable Margin in effect after such resulting change. The Lender and each Borrower acknowledge that as of the date hereof Level I is applicable.

"LIBOR Advance" means an Advance in US Dollars bearing interest based on the LIBOR Rate.

"LIBOR Period" means the period selected by a Borrower for a LIBOR Advance or the deemed period applicable to the LIBOR Advance under the terms of this Agreement which, in either case shall be one, two, three or six months or such other periods that may from time to time be agreed to by the Lenders, commencing on the Drawdown Date, the Rollover Date or the Conversion Date of such LIBOR Advance; provided however that:

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"LIBOR Rate" means, for any LIBOR Period and LIBOR Advance: (i) the rate which appears on the display designated as the British Bankers' Associations' Interest Settlement Rate as quoted on the relevant page of the Telerate Monitor (currently page 3750) for deposits in U.S. Dollars (for a period equal to or approximating to that LIBOR Period) at or about 11:00 a.m. (London, England time) on the day that is two Business Days preceding the first day of that LIBOR Period; or (ii) if that display is not then available for U.S. Dollars, the rate (expressed as a percentage rounded to the nearest 0.0001 percentage point) at which deposits in U.S. Dollars, in an amount comparable to LIBOR Advance, are offered by the Lender (for a period equal to or approximating to that LIBOR Period) to leading European banks in the London Interbank Market at or about 11:00 a.m. (London, England time) two Business Days preceding the first day of that LIBOR Period for delivery on the first day of that LIBOR Period.

"Loan Parties" means, collectively, the Borrowers and all Guarantors and "Loan Party" means any one of them.

"Maintenance Capex" means expenditures for the maintenance, repair, restoration or other preservation of the property or assets of a Person that are, in accordance with GAAP, classified as capital expenditures.

"Material Adverse Effect" means any such matter, event or circumstance that individually or in the aggregate could, in the opinion of the Lender, acting reasonably, be expected to have a material adverse effect on:

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"Material Subsidiary" means any Subsidiary of a Loan Party (other than Century Casino and CCEG) whose total assets constitute more than 10% of the Consolidated Total Assets of the Consolidating Loan Parties or whose total revenue in any consecutive twelve (12) month period constitutes more than 10% of the consolidated total revenue of the Consolidating Loan Parties for then preceding consecutive twelve (12) month period, or who has provided the Lender Material Subsidiary Security over all its present and future Property. 

"Material Subsidiary Security" means the guarantee and security documents described in Section 7.6 to be provided to the Lender by each Material Subsidiary.

"Modified Consolidated Basis" means the consolidation of financial results for the Borrowers, 1214741, Century Properties Calgary and the Material Subsidiaries.

"Net Proceeds" means any one or more of the following:

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"Obligations" means all of the present and future indebtedness, liabilities and obligations, direct or indirect, absolute or contingent, matured or unmatured of the Loan Parties owing to the Lender and the Hedge Providers under, pursuant to or in connection with the Credit Documents and the Hedge Agreements, including without limitation all principal, interest, fees, indemnities, costs and expenses owing by the Loan Parties thereunder.

"Outstanding Principal" means, at any time, the aggregate of: (a) the principal amount of all outstanding Prime Rate Advances, plus the Equivalent Amount in Cdn Dollars of the principal amounts outstanding of all US Base Rate Advances and LIBOR Advances; and amounts outstanding under the Ancillary Facility; (b) the Equivalent Amount in Cdn Dollars of the Face Amount in respect of outstanding Letters of Credit; and (c) the Face Amount of all outstanding BA Advances.

"Permits" means governmental licenses, authorizations, consents, registrations, exemptions, permits and other approvals required by Applicable Laws.

"Permitted Encumbrances" means, with respect to any Person, the following:

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provided that in each case where it is contesting any obligations, taxes or assessments as contemplated herein, such Encumbrances shall only be Permitted Encumbrances (A) if such Person establishes to the satisfaction of the Lender (acting reasonably) a sufficient reserve for, or if requested by the Lender, deposits with a court of competent jurisdiction or assessing authority, or to such other Person as is acceptable to the Lender, acting reasonably, sufficient funds for the total amount claimed to be secured by such Encumbrances, where the application of such reserve or funds would result in their discharge, and (B) for so long as such contestation effectively postpones the enforcement of the rights of the holder thereof.

"Permitted Investments" means (i) Investments in a Borrower or a wholly owned Subsidiary of a Consolidating Loan Party and if such Subsidiary is a Material Subsidiary, provided that such Material Subsidiary has granted to the Lender the Security and other documents required in accordance with Section 11.1(i), (ii) Investments in the REC Project in the nature of loans up to the maximum aggregate amount of $24,000,000 which, for greater certainty, includes the CRAI Loan (including the conversion of the CRAI Loan to Shares in UHA as contemplated in the CCEG Credit Agreement) and any purchase of Shares in UHA from any REC Project Shareholder; provided the Lender has received the Security documents in Subsections 7.6(l),  7.6(m),  Error! Reference source not found. and 7.6(n); and (iii) Investments in Capital Assets which are permitted in accordance with Section 0.

"Person" means any individual, sole proprietorship, corporation, company, partnership, unincorporated association, association, institution, entity, party, trust, joint venture, estate or other judicial entity or any governmental body.

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"Prime Rate" means the floating annual rate of interest established by the Lender from time to time as the reference rate of interest it uses to determine the interest rate it will charge for loans in Canadian Dollars to its customers in Canada and designated as its "Prime Rate".

"Prime Rate Advance" means an Advance in Canadian Dollars (including all amounts advanced to a Borrower by way of overdraft) bearing interest based on the Prime Rate Advance Rate and includes deemed Prime Rate Advances provided for in Sections 0 and 9.18.

"Prime Rate Advance Rate" means the per annum rate of interest equal to the Prime Rate plus, the percentage rate per annum indicated beside the reference to "Prime Rate Margin" in the definition of "Applicable Margin".

"Property" means, with respect to any Person, all or any portion of its undertaking, property and assets.

"Purchase Money Obligations" means any indebtedness incurred, assumed or owed by the Consolidating Loan Parties as all or part of, or incurred or assumed by the Consolidating Loan Parties to provide funds to pay all or part of the purchase price of any property or assets acquired by the Consolidating Loan Parties provided that:

"Purchase Money Security Interest" means an Encumbrance created by the Consolidating Loan Parties securing Purchase Money Obligations, provided that (i) such Encumbrance is created substantially simultaneously with the acquisition of such assets, (ii) such Encumbrance does not at any time encumber any property other than the property financed by such Purchase Money Obligations, (iii) the amount of Purchase Money Obligations secured thereby is not increased subsequent to such acquisition, and (iv) the principal amount of Purchase Money Obligations secured by any such Encumbrance at no time exceeds 100% of the original purchase price of such property at the time it was acquired, and in this definition, the term "acquisition" shall include, without limitation, a Capital Lease, the term "acquire" shall have a corresponding meaning.

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"Quantity Surveyor" means the independent project quantity surveyor retained to advise the Lender as to, among other things, the costs incurred with respect to the construction and repair of the REC Project and the costs to complete such construction or repairs of the REC Project or such other similar technical consultant retained by the Lender.

"REC Cash Flow Forecast" means the detailed cash flow projections provided by the UHA to CCEG and CRAI that outlines the anticipated inflows and outflows of cash over the course of the Construction Period.

"REC Landlord" means 1685258 Alberta Ltd. and its successors and assigns.

"REC Lands" means those lands located at or near Balzac, Alberta, legally described as:

Plan 1012410
Blocked 1
Lot 1
Excepting thereout all mines and minerals
Area: 21.04 hectares (51.99 acres) more or less)

And

Meridian 4 Range 29 Township 26
Section 10
The South half of Legal Subdivision 4
In the South West Quarter
Containing 8.09 hectares (20 acres) more or less
Excepting thereout:
PlanNumberHectares(Acres)more or less
Road071 61161.0142.50
Road071 61181.2092.99
Excepting thereout all mines and minerals and the right to work the same

"REC Project" means the 5/8 mile race track, racing entertainment centre (comprised of a multipurpose entertainment facility integrating live and simulcast horse racing and slot machine casino), with open-air connection to, and including, the grandstand containing dining and entertainment facilities, and all associated infrastructure including services, utilities, parking, road access, landscaping, barns, bleachers, paddock and conversion of existing shell building, to be constructed by UHA on the REC Lands.

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"REC Project Construction Agreements" means the contracts relating to the construction of the REC Project that are, in the opinion of the Lender material to the construction of the REC Project, in each case as the same may be amended, supplemented, modified, varied, restated or replaced from time to time.

"REC Project Construction Budget" means the construction budget for the REC Project delivered to and approved by the Lender and the Quantity Surveyor, which, among other things, specifically identifies all REC Project Hard Costs and all REC Project Soft Costs, as each such construction budget may be amended and revised with the consent of the Lender after consultation with Quantity Surveyor.

"REC Project Construction Completion Date" means, with respect to the REC Project, the date on which the construction of the REC Project is completed, as confirmed by the Quantity Surveyor, and fully opened to the public.

"REC Project Costs" means all costs and expenses (hard and soft) relating to the design, development, engineering, financing and construction of the REC Project, including, without limitation, relevant amounts that the Borrower is required to pay under the REC Project Construction Agreements (net of offsets, recoveries (including recoveries of any goods and services, sales, or similar tax) or other amounts reducing net costs) and also including, without limitation, but without duplication:

provided, however, that REC Project Costs do not include costs and expenses related to the operation of the REC Project following the REC Project Construction Completion Date.

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"REC Project EBITDA" means, with respect to any period following the earlier of: (i) June 1, 2015; and (ii) the REC Project Construction Completion Date, the consolidated net income of the REC Project Shareholders derived from the REC Project for such period determined in accordance with GAAP (excluding non-cash income and expenses and extraordinary items), plus, to the extent deducted in determining such net income, the following:

"REC Project Hard Costs" means, with respect to the REC Project, REC Project Costs which are not REC Project Soft Costs.

"REC Project Schedule" means the construction schedule for the REC Project, setting out in reasonable detail, satisfactory to the Quantity Surveyor and the Lender, acting reasonably, the timeline for the construction of the REC Project, against which major milestones will be measured, which REC Project Schedule may be amended periodically by the Quantity Surveyor, subject to the agreement of the Lender.

"REC Project Shareholders" means all Loan Parties who from time to time own Shares in UHA and "REC Project Shareholder" means any one of them. As of the date hereof, CCEG is the sole REC Project Shareholder and owns 15% of the issued and outstanding Shares of UHA.

"REC Project Soft Costs" means, with respect to the REC Project, REC Project Costs that relate to architectural and engineering costs, legal fees, Taxes, insurance, financing charges, and projected overhead which have been delineated as "Soft Costs" in the REC Project Construction Budget.

"Remaining REC Project Costs" means at any time, the REC Project Costs remaining to be paid (including any holdback amount) in order to complete the construction of the REC Project.

"Requirement of Law" means, as to any Person, any law, treaty, regulation, ordinance, decree, judgment, order or similar requirement made or issued under sovereign or statutory authority and applicable to or binding upon that Person, or to which that Person or any of its Property is subject.

"Receivable" means an account receivable owing to the Consolidating Loan Parties from the sale of goods or the provision of services to its customers.

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"Responsible Officer" means the chief executive officer, president, any executive vice-president, the chief financial officer, any vice-president, treasurer or other officer.

"Rollover" means a rollover of a BA Advance into another BA Advance, or a LIBOR Advance into another LIBOR Advance, or a rollover of a Letter of Credit Advance into another Letter of Credit Advance as permitted hereby and "Rolled Over" has a corresponding meaning.

"Section" means the designated section of this Agreement.

"Security" means the guarantees and security held from time to time by the Lender, securing or intended to secure payment and performance of the Obligations, including without limitation the guarantees and security described in Section 7.6.

"Senior Funded Debt" means, with respect to the Consolidating Loan Parties, the Funded Debt of the Consolidating Loan Parties, excluding Funded Debt of the Consolidating Loan Parties that has been subordinated and postponed to the payment and performance of the Obligations of the Loan Parties to the Lender, pursuant to a postponement and subordination agreement in form and substance satisfactory to the Lender, acting reasonably.

"Senior Funded Debt to EBITDA Ratio" means at any time, the ratio of:

"Shareholders' Equity" means, at any time, the aggregate of the shareholders' equity in the Borrowers, as shown on the consolidated Financial Statements of the Borrowers plus the amount of unsecured Funded Debt incurred by the Borrowers from time to time that has been subordinated and postponed to the payment and performance of the Obligations of the Consolidating Loan Parties to the Lender, pursuant to a subordination agreement in form and substance satisfactory to the Lender, acting reasonably.

"Shares" means shares in the capital stock of any corporation or other ownership interests in a partnership or other Person including without limitation, shares, units or interests which carry a residual right to participate in the earnings of such corporation, partnership or other Person or, upon the liquidation or winding up of such corporation, partnership or other Person, to share in its assets.

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"Sources and Uses of Funds Statement" means a statement setting out the total REC Project Cost of the REC Project (including without limitation REC Project Hard Costs and REC Project Soft Costs) expected to be incurred as of the Initial Drawdown Date for the REC Project and the sources of funds to be used to pay such REC Project Costs.

"Standby Fee" means the fee payable to the Lender on the undrawn portion of Credit A and Credit B, as provided in Section 7.4.

"Standby Fee Rate" means from time to time, the applicable percentage rate per annum indicated beside the reference to "Standby Fee Rate" in the definition of "Applicable Margin.

"Structuring Fee" means the structuring fee in the amount of $55,000 previously earned by the Lender and payable to the Lender in accordance with Section 0 herein.

"Subsequent Credit B Drawdown" means a Drawdown under Credit B by a Borrower, after the Initial Credit B Drawdown.

"Subsequent Credit B Drawdown Amount" means the amount of each Subsequent Credit B Drawdown.

"Subsequent Credit C Drawdown" means a Drawdown under Credit C by a Borrower, after the Initial Credit C Drawdown.

"Subsequent Credit C Drawdown Amount" means the amount of each Subsequent Credit C Drawdown.

"Subsidiary" means, as to any Person, another Person in which such Person and/or one or more of its Subsidiaries owns or controls, directly or indirectly, sufficient voting Shares to enable it or them (as a group) to ordinarily elect a majority of the directors (or Persons performing similar functions) of such entity, and any partnership or trust, if more than a 50% interest in the profits or capital thereof is owned by such Person and/or by or in conjunction with one or more of its Subsidiaries.  Unless the context otherwise clearly requires, any reference herein to a "Subsidiary" is a reference to a Subsidiary of the Consolidating Loan Parties.

"Taxes" means all taxes, levies, imposts, stamp taxes, duties, deductions, withholdings and similar impositions payable, levied, collected, withheld or assessed as of the date of this Agreement or at any time in the future under the laws of Canada or any political subdivision thereof, and "Tax" shall have a corresponding meaning.

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"UHA" means United Horsemen of Alberta Inc. and its successors and assigns.

"UHA Documents" means the CCEG Credit Agreement and the CCEG Security, as such documents may be amended, restated, replaced, supplemented or modified from time to time.

"UHA Groundlease" means the ground lease agreement dated October 1, 2012 between the REC Landlord, as landlord, and UHA, as tenant, as amended by the September 30, 2013 amending agreement and as amended, restated, replaced, supplemented or modified from time to time.

"UHA Non-Pledgors" means, collectively, the following shareholders of UHA:

"UHA Pledges" means, collectively, the share pledge agreements each dated September 25, 2012, October 25, 2012 or April 25, 2014 provided by the UHA Pledgors in favour of CCEG as part of the CCEG Security and, "UHA Pledge" means any one of them.

"UHA Pledgors" means, collectively, the following shareholders of UHA:

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"Unfinanced Capital Expenditures" at any time, means, the Capital Expenditures incurred by the Consolidating Loan Parties (on a consolidated basis) for the previous twelve month period, less the principal amount of all Advances under Credit B used to pay for such Capital Expenditures as at the end of such twelve month period and any Capital Expenditures funded by operating or Capital Leases.  In no event shall Unfinanced Capital Expenditures be less than zero for Financial Covenant calculation purposes under this Agreement.

"US Base Rate" means, on any day, the floating annual rate of interest equal to the greater of:

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"US Base Rate Advance" means the portion of an Advance made available by the Lender to a Borrower pursuant to Section 9.2 and outstanding from time to time, which is denominated in US Dollars and on which such Borrower has agreed to pay interest in accordance with Section 7.2, and includes deemed US Base Rate Advances provided for in Sections 0 and 9.22.

"US Dollars" and the symbol "US$" each means lawful money of the United States of America.

Where any representation, warranty or other provision of this Agreement is qualified by reference to the knowledge of the Borrowers, after reasonable inquiry, it shall be deemed to refer to the actual knowledge of the Chief Financial Officer (or other senior officer performing the equivalent duties and responsibilities) of Century Casino after having made such inquiries of those Responsible Officers of the Borrowers, and, if as a result of the actual knowledge of such Responsible Officers after having made such inquiries, there is an issue or matter known that would reasonably require advice from professional advisors, the professional advisors of the Borrowers likely to have knowledge of the relevant subject matter.

Each accounting term used in this Agreement has the meaning assigned to it under GAAP unless otherwise defined herein and reference to any balance sheet item or income statement item means such item as computed from the applicable statement prepared in accordance with GAAP.  All Financial Statements required to be delivered hereunder shall be made and prepared in accordance with GAAP consistently applied throughout the periods involved.

Schedule A-Form of Compliance Certificate

Schedule B-Form of Drawdown Notice

Schedule C-Closing Date Litigation

Schedule D-Disclosure Schedule

Schedule EPermitted Encumbrances

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Upon and subject to the terms and conditions of this Agreement, the Lender agrees to provide a revolving credit ("Credit A") for the use of the Borrowers in the maximum aggregate amount of the Credit A Facility Limit.  At the option of a Borrower, Credit A may be used by such Borrower by requesting: (i) Prime Rate Advances from the Lender or by maintaining an overdraft in a Designated Account; and/or (ii) US Base Rate Advances from the Lender; and/or (iii) Letter of Credit Advances from the Lender.  The Lender agrees to provide the Ancillary Facility to the Borrowers up to the maximum aggregate amount of $100,000 (with individual credit limits of up to $30,000), which for greater certainty shall form part of Credit A.

 

The principal amount of any Advance under Credit A that is repaid may, subject to the terms of this Agreement, be reborrowed (up to the Credit A Facility Limit) from time to time.  Credit A is a revolving committed facility and Drawdowns shall, subject to the provisions of this Agreement, be made available to the Borrowers by the Lender until the Credit A Maturity Date.

Credit A shall only be used for general corporate purposes of the Borrowers and their Affiliates, including, without limitation: (i) to pay the fees, costs and expenses relating to the Credits and the preparation, negotiation and settlement of this Agreement, the Security and the other Credit Documents; (ii) for ongoing working capital requirements; and (iii) for Letter of Credit requirements of AGLC and other Governmental Authorities.

Upon and subject to the terms and conditions of this Agreement, Lender agrees to provide a committed, non-revolving, reducing term credit ("Credit B") for the use of the Borrowers in the amount of the Credit B Facility Limit.  At the option of a Borrower, Credit B may be used by such Borrower by requesting: (i) Prime Rate Advances from the Lender; (ii) US Base Rate Advances from the Lender; (iii) BA Advances from the Lender and/or (iv) LIBOR Advances from the Lender.

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Credit B is a committed non-revolving, reducing term credit and the principal amount of Drawdowns under Credit B that is repaid from time to time may not be reborrowed.

Subject to the provisions of this Agreement, Credit B shall only be used and shall only be made available to the Borrowers: (i) for working capital or general corporate purposes of either Borrower or any of their Affiliates, available by way of multiple draws by a Borrower from time to time following the Closing Date; or (ii) to facilitate the CRAI Loan up to the maximum amount of $13,000,000, available by way of multiple draws by CRAI from time to time following the Closing Date.

Upon and subject to the terms and conditions of this Agreement, the Lender agrees to provide a committed, revolving, reducing term credit ("Credit C") for the use of the Borrowers in the amount of the Credit C Facility Limit.  At the option of a Borrower, Credit C may be used by such Borrower by requesting: (i) Prime Rate Advances from the Lender; and/or (ii) BA Advances from the Lender.

Credit C is a committed revolving term credit and the principal amount of Drawdowns under Credit C that is repaid from time to time may be reborrowed.

Subject to the provisions of this Agreement, Credit C shall only be used and shall only be made available to the Borrowers as follows:

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The Lender or an Affiliate of the Lender, as a Hedge Provider, may, in its sole discretion, make available to the Borrowers (or either of them), interest rate hedges and currency exchange hedges with a maximum Deemed Risk equal to the Credit D Facility Limit ("Credit D").  Credit D shall be used by the Borrowers for the purpose of hedging interest rate risk or currency exchange rate risk.  The Borrowers may utilize Credit D by entering into Hedge Agreements with a Hedge Provider from time to time (subject to availability) upon such terms and conditions as may be offered by such Hedge Provider from time to time, but the maximum term of any Interest Rate Hedge Agreement shall in no event exceed 5 years and the maximum term of any Currency Hedge Agreement shall in no event exceed 12 months. If the maximum Deemed Risk at any time exceeds the Credit D Facility Limit, the Borrowers shall, within ten (10) Business Days, take such steps as are required to reduce the maximum Deemed Risk to an amount less than the Credit D Facility Limit.

Prior to engaging in any Hedge Agreements under Credit D, each Borrower shall first execute and deliver to such Hedge Provider an ISDA Master Agreement, and such other documentation as each Hedge Provider may require, for any such transactions, the terms of which are not inconsistent with this Agreement and which provide that this Agreement is a Credit Support Document as defined therein.  For greater certainty, the obligations of the Borrowers under Credit D shall be secured by the Security on a pari passu basis and shall rank pari passu with all Obligations under the other Credits.

The Borrowers shall pay all principal, interest and other amounts arising under the Ancillary Facility in accordance with the provisions of the MasterCard account agreement entered into by the Borrowers and the Lender from time to time.

On the Credit A Maturity Date, the Credit B Maturity Date and the Credit C Maturity Date, the Borrowers shall repay in full all Obligations which are then outstanding under Credit A, Credit B and Credit C, respectively.

The Borrowers shall repay in full all Obligations under each Hedge Agreement entered into under Credit D on the contract maturity of such Hedge Agreement or as otherwise specified in such Hedge Agreement.

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The Borrowers may, at any time, upon giving at least three (3) Business Days' prior written notice to the Lender, permanently reduce, in whole or in part, any portion of Credit A, Credit B or Credit C.  Any such reduction will be in a minimum amount of $100,000 in the case of Credit A or $1,000,000 in the case of Credit B and Credit C.  The amount referred to in (i) of the definition of Credit A Facility Limit, Credit B Facility Limit and/or Credit C Facility Limit (as applicable) shall be reduced by an amount equal to the amount of Credit A, Credit B or Credit C (as applicable) cancelled or reduced.  Any such reduction of the Credit A Facility Limit, the Credit B Facility Limit or Credit C Facility Limit shall only be effective if on or prior to the last day of such three (3) Business Day notice period, the Borrowers have:

Any such notice of cancellation is irrevocable and the amount of the applicable Credit so cancelled and reduced may not be reinstated hereunder.  For clarity, the Borrowers may not by reason of any such reduction or cancellation contemplated by this Section pay:

Any repayments under this Section in respect to Credit B and Credit C shall be applied in inverse order of maturity of Credit B and Credit C, as applicable.

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Drawdowns under Credit B from time to time shall be amortized over a ten (10) year period.  Outstanding Principal under Credit B shall be payable by the Borrowers to the Lender on the first Credit B Reduction Date and on each Credit B Reduction Date thereafter in an aggregate amount equal to the Credit B Scheduled Reductions.  Credit B Scheduled Reductions paid by the Borrowers (or either of them) to the Lender may not be re-borrowed by the Borrowers. On each such Credit B Reduction Date, the amount referred to in (i) of the definition of Credit B Facility Limit shall be reduced by the amount of the Credit B Scheduled Reduction.

With respect to the Outstanding Principal under Credit C, until June 30, 2015, the Borrowers shall only be obligated to pay monthly interest payments in respect of such Outstanding Principal. Outstanding Principal under Credit C shall be payable by the Borrowers to the Lender on the first Credit C Reduction Date and on each Credit C Reduction Date thereafter in an aggregate amount equal to the Credit C Scheduled Reductions. Drawdowns under Credit C from time to time shall be amortized over a ten (10) year period.  Credit C Scheduled Reductions paid by the Borrowers (or either of them) to the Lender may be re-borrowed by the Borrowers.

At any time any of the Obligations under Credit B and Credit C are outstanding, the Borrowers shall make additional payments of Outstanding Principal under Credit B and then to Credit C to the Lender, as follows:

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The amount referred to in (i) of the definition of Credit B Facility Limit shall be reduced by the amount of Outstanding Principal under Credit B paid by the Borrowers to the Lender under this Section 6.5.

The Outstanding Principal under Credit A, Credit B and Credit C shall be repaid by the Borrowers such that the aggregate Outstanding Principal under Credit A, Credit B or Credit C does not at any time exceed the Credit A Facility Limit, Credit B Facility Limit and the Credit C Facility Limit, respectively.

Each Borrower shall pay: (i) interest in arrears on each Interest Payment Date on each Prime Rate Advance made to such Borrower at a rate per annum equal to the applicable Prime Rate Advance Rate. Such interest shall be calculated monthly in arrears and be payable on each Interest Payment Date for the calendar month immediately prior to the Interest Payment Date and shall be calculated on the basis of the actual number of days elapsed in a year of 365 or 366 days (as applicable).  A change in the Prime Rate will simultaneously cause a corresponding change in the interest payable for a Prime Rate Advance, and a change in the Applicable Margin will cause a change in the interest payable as provided for in the definition of "Applicable Margin"; (ii) fees and interest on amounts outstanding under the Ancillary Facility at the rate per annum from time to time advised to the Borrowers by the Lender pursuant to the MasterCard account agreements, in accordance with the provisions of such account agreements, and (iii) fees on Letter of Credit Advances made at the request of such Borrower at a rate per annum equal to the Letter of Credit Rate on the Face Amount of such Letter of Credit, as provided for in Section 9.17.  Such fees shall be calculated quarterly in arrears and be payable on the last day of each calendar quarter for such calendar quarter and shall be calculated on the basis of the actual number of days elapsed in a year of 365 or 366 days (as applicable). 

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A change in the Applicable Margin will cause a change in the Letter of Credit fees payable as provided for in the definition of "Applicable Margin". Each Borrower shall pay the applicable Bankers' Acceptance Stamping Fee at the time of each BA Advance requested by such Borrower.  The Bankers' Acceptance Stamping Fee shall be calculated at the applicable BA Stamping Fee Rate, based on a year of 365 days.

Each Borrower shall pay to the Lender interest on each Interest Payment Date on each US Base Rate Advance made to such Borrower at a rate per annum equal to the US Base Rate plus the Applicable Margin.  Such interest shall be calculated monthly in arrears and be payable on each Interest Payment Date for the calendar month immediately prior to the Interest Payment Date and shall be calculated on the basis of the actual number of days elapsed in a year of 365 or 366 days (as applicable).  A change in the US Base Rate will simultaneously cause a corresponding change in the interest payable for a US Base Rate Advance, and a change in the Applicable Margin will cause a change in the interest payable as provided for in the definition "Applicable Margin". 

Each Borrower shall pay to the Lender interest on each LIBOR Advance made to such Borrower at a rate per three hundred sixty (360) day period equal to the LIBOR Rate, plus the Applicable Margin. A change in the Applicable Margin will cause a change in the interest payable as provided for in the definition of "Applicable Margin". Such interest shall be payable on the last day of the applicable LIBOR Period, or, if the LIBOR Period is longer than three (3) months, every three (3) months and on the last day of the applicable LIBOR period. All interest shall accrue from day to day and shall be payable in arrears for the actual number of days elapsed from and including the date of Advance or the previous date on which interest was payable, as the case may be, to but excluding the date on which interest is payable, or the last day of the LIBOR Period, as the case may be, both before and after maturity, demand, default and judgment, with interest on overdue principal and interest at the rate provided for in this Agreement payable on demand.  The principal and overdue interest with respect to a LIBOR Advance, upon the expiry of the LIBOR Period applicable to such LIBOR Advance, shall bear interest, payable on demand, calculated at the rates applicable to principal and overdue interest (as the case may be) with respect to US Base Rate Advances.

The Borrowers shall pay to the Lender a standby fee calculated at the rate per annum (based on a year of 365 or 366 days, as applicable) equal to the Standby Fee Rate, for the period from and after the date of this Agreement, on the aggregate average daily undrawn balance of Credit A, Credit B and Credit C.  The Standby Fees shall be calculated daily and payable by the Borrowers quarterly in arrears on the first Business Day after the end of each calendar quarter.

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The Borrowers shall pay to the Lender the Structuring Fee on or before the Initial Drawdown Date.

The Borrowers shall and shall cause each other Consolidating Loan Party to execute and deliver the following security to the Lender from time to time:

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The Security listed above shall be in form and substance satisfactory to the Lender, acting reasonably.

The Lender shall, at the Borrowers' expense, register, file or record the Security in all offices where such registration, filing or recording is necessary or of advantage to the creation, perfection and preserving of the Encumbrances created by the Security.

The obligation of the Lender under this Agreement to make the initial Advance is subject to and conditional upon the following (unless otherwise waived by the Lender, in its sole discretion):

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The obligation of the Lender to provide the Borrower with any Drawdown under Credit B with respect to the REC Project or Credit C is subject to and conditional upon the following (unless otherwise waived by the Lender, in its sole discretion):

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The obligation of the Lender to make any Advance (including the initial Advance) is subject to the conditions precedent that:

The foregoing conditions precedent shall not apply to any deemed Advance contemplated pursuant to Sections 9.10 and 9.18.

The conditions in Sections 8.1,  8.2 and 8.3 are inserted for the sole benefit of the Lender and may be waived by the Lender, in whole or in part (in its sole discretion and with or without terms or conditions) in respect of any Advance.

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Subject to the other provisions of this Agreement, upon timely fulfillment of all applicable conditions as set forth in this Agreement, the Lender will make the requested amount of Prime Rate Advance available to the applicable Borrower on the Drawdown Date requested by such Borrower, as applicable, by crediting such amount to the Designated Account maintained by such Borrower at the Branch of Account, or in the case of the initial Drawdown by the Lender forwarding the amount of such Advance to the solicitors to the Borrowers or the Lender, upon such trust conditions as the Lender may reasonably require. Prime Rate Advances shall also be available under Credit A by a Borrower maintaining an overdraft in a Canadian Dollar Designated Account. Each Prime Rate Advance under Credit B shall be in a minimum amount of $500,000 and in whole multiples of $100,000 thereafter. The Borrowers shall pay interest to the Lender at such address as the Lender designates from time to time on all such Prime Rate Advances outstanding from time to time hereunder at the applicable rate of interest specified in Section 7.1. Interest on each Prime Rate Advance shall be calculated daily and payable monthly on each Interest Payment Date on the basis of the actual number of days in the applicable year.  All interest shall accrue from day to day and shall be payable in arrears for the actual number of days elapsed from and including the date of Advance or the previous date on which interest was payable, as the case may be, to but excluding the date on which interest is payable, both before and after demand, maturity, default and judgment, with interest on overdue interest at the rate applicable to Prime Rate Advance Rate plus two percent (2%) per annum and payable on demand.

Subject to the other provisions of this Agreement, upon timely fulfillment of all applicable conditions as set forth in this Agreement, the Lender will make the requested amount of a US Base Rate Advance available to the applicable Borrower on the Drawdown Date requested by such Borrower by crediting such amount to a Designated Account maintained by such Borrower.  US Base Rate Advances shall also be available under Credit A by a Borrower maintaining an overdraft in a US Dollar Designated Account.  Each US Base Rate Advance under Credit B shall be in a minimum amount of US$500,000 and in whole multiples of US$100,000 thereafter.

The indebtedness of the Borrowers resulting from Advances made by the Lender shall be evidenced by records maintained by the Lender.  The records maintained by the Lender shall constitute, in the absence of manifest error, conclusive evidence of the indebtedness of the Borrowers to the Lender and all details relating thereto.  The failure of the Lender to correctly record any such amount or date shall not, however, adversely affect the obligation of the Borrowers to pay amounts due hereunder to the Lender in accordance with this Agreement.

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Notwithstanding the foregoing, the Lender may, but shall not be obligated to, request the Borrowers to execute and deliver from time to time promissory notes as may be required by the Lender and in form and substance satisfactory to the Lender as further evidence of the indebtedness of the Borrowers to the Lender.

Subject to the other terms of this Agreement, a Borrower may from time to time Convert all or any part of the outstanding amount of any Advance made to it into another form of Advance.

Each Borrower shall give the Lender irrevocable written notice, in the form of a Drawdown Notice, of any request for any Drawdown, any Rollover or any Conversion of any Advance under a Credit requested by it. Each Borrower will provide the Lender with at least three (3) Business Days notice of its request for a BA Advance, a Letter of Credit Advance or a LIBOR Advance.  In the event a Borrower fails to give three (3) Business Days prior notice to the Lender of a conversion of a Prime Rate Advance to a BA Advance, the Lender may decline to accept Bankers' Acceptances requested within this three (3) Business Day period.

Notice shall be given on the day of any Prime Rate Advance, provided however, Prime Rate Advances under Credit A, may be made by way of overdraft in a Borrower's Designated Account, without any notice.  Any permanent reduction of a Credit shall only be effective on three (3) Business Days' notice as required by Section 0.

Notices in respect of the Credits shall be given not later than 10:00 a.m. (Calgary time) on the date for notice.  Payments (other than those being made solely from the proceeds of Rollovers and Conversions) must be made prior to 10:00 a.m. (Calgary time) on the date for payment.  If a notice or payment is not given or made by those times, it shall be deemed to have been given or made on the next Business Day, unless the Lender agrees, in its sole discretion, to accept a notice or payment at a later time as being effective on the date it is given or made.

To facilitate the acceptance of drafts hereunder, each Borrower hereby appoints the Lender, acting by the commercial paper clerk (the "Attorney") for the time being at the Lender's main branch in Toronto, Ontario (the "Branch of Account"), the attorney of such Borrower:

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provided that such acts in each case are to be undertaken by the Lender in accordance with instructions given to the Lender by such Borrower as provided in this Section 9.6.

Instructions to the Lender relating to the execution, completion, discount and/or deposit by the Lender on behalf of a Borrower of drafts which a Borrower wishes to submit to the Lender for acceptance by the Lender shall be communicated by such Borrower in writing at the Branch of Account with the delivery by such Borrower of a Drawdown Notice pursuant to this Agreement and shall specify the following information:

(b)a Canadian Dollar amount, which shall be the aggregate face amount of the drafts to be accepted by the Lender in respect of a particular BA Advance;

The communication in writing by a Borrower to the Lender of the instructions referred to above shall constitute the authorization and instruction of such Borrower to the Lender to complete and execute drafts in accordance with such information as set out above and the request of such Borrower to the Lender to accept such drafts and deposit the same with the "clearing house" against payment as set out in the instructions.  Each Borrower acknowledges that the Lender shall not be obligated to accept any such drafts except in accordance with the provisions of this Agreement.  The Lender shall be and it is hereby authorized to act on behalf of each Borrower upon and in compliance with instructions communicated to the Lender as provided herein if the Lender reasonably believes them to be genuine.

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Each Borrower agrees to indemnify the Lender and its directors, officers, employees, affiliates and agents and to hold it and them harmless from and against any loss, liability, expense or claim of any kind or nature whatsoever incurred by any of them as a result of any action or inaction in any way relating to or arising out of this power of attorney or the acts contemplated hereby including the deposit of any draft with the "clearing house"; provided that this indemnity shall not apply to any such loss, liability, expense or claim which results from the gross negligence or wilful misconduct of the Lender or any of its directors, officers, employees, affiliates or agents.

This power of attorney may be revoked by the Borrowers at any time upon not less than five (5) Business Days' written notice served upon the Lender at the address set out in this Agreement, provided that (i) it may be replaced with another power of attorney forthwith in accordance with the requirements of the Lender; and (ii) no such revocation shall reduce, limit or otherwise affect the obligations of the Borrowers in respect of any draft executed, completed, discounted and/or deposited in accordance herewith prior to the time at which such revocation becomes effective.  This power of attorney may be terminated by the Lender at any time upon not less than five (5) Business Days' written notice to the Borrowers.  Any revocation or termination of this power of attorney shall not affect the rights of the Lender and the obligations of the Borrowers with respect to the indemnities of the Borrowers above stated.

This power of attorney is in addition to and not in substitution for any agreement to which the Lender and the Borrowers (or either of them) are parties.

If this power of attorney is revoked or terminated, to facilitate the acceptance of Bankers' Acceptances hereunder, the Borrowers shall from time to time as required by the Lender, provide the Lender with an appropriate number of executed drafts drawn in blank by the Borrowers in the form prescribed by the Lender.  Each Borrower may, at its option, execute any draft by the facsimile signatures of any two (2) of its authorized signing officers, and each Borrower and the Lender are hereby authorized to accept or pay, as the case may be, any draft of such Borrower which purports to bear such facsimile signatures notwithstanding that any such individual has ceased to be an authorized signing officer of such Borrower.  Any such draft or Bankers' Acceptance so executed and completed or executed and completed pursuant to the power of attorney shall be as valid as if he or she were an authorized signing officer of such Borrower at the date of issue of such Bankers' Acceptance.  Any such draft or Bankers' Acceptance may be dealt with by the Lender to all intents and purposes and shall bind each Borrower as if duly signed in each signing officer's own handwriting and issued by such Borrower, and each Borrower shall hold the Lender harmless and indemnified against all loss, costs, damages and expenses arising out of the payment or negotiation of any such draft or Bankers' Acceptance resulting from such drafts not having been duly signed other than any loss, costs, damages or expenses arising out of the gross negligence or willful misconduct of the Lender.

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The Lender shall not be liable for any failure to accept a Bankers' Acceptance as required hereunder if the cause of such failure, in whole or in part, is due to the revocation or termination of the power of attorney or the failure of the Borrowers to provide executed drafts to the Lender on a timely basis.

The receipt by the Lender of a request for an Advance by way of Bankers' Acceptances shall be the Lender's sufficient authority to complete and sign, and the Lender shall, subject to the terms and conditions of this Agreement, complete and sign (as applicable) such drafts in accordance with such request, and the drafts so completed and signed (as applicable) shall thereupon be deemed to have been presented for acceptance.

Each Advance of Bankers' Acceptances shall be in an aggregate amount of not less than $1,000,000 and in whole multiples of $500,000 thereafter.  Each Bankers' Acceptance shall have a term which is not less than 30 days nor more than 180 days after the date of acceptance of the draft by the Lender, but no Bankers' Acceptance may mature on a date which is not a Business Day or on a date which is past the then current Credit B Maturity Date.  The face amount at maturity of a Bankers' Acceptance may be Rolled Over as a Bankers' Acceptance or Converted into another form of Advance permitted by this Agreement in accordance with Section 9.4.

Provided that all other provisions of this Agreement relating to Advances have been met or satisfied on the applicable Drawdown Date, the Lender shall accept the drafts referred to in the applicable Drawdown Notice and shall discount the Bankers' Acceptances in the market or fund the Bankers' Acceptances at the applicable BA Discount Rate.  Each Borrower hereby authorizes the Lender to complete, sign, stamp, hold, sell, rediscount or otherwise dispose of all Bankers' Acceptances accepted by it in accordance with the instructions provided by such Borrower hereunder or pursuant to the power of attorney referred to in Section 9.6.  The Lender shall then transfer to a Designated Account immediately available Cdn. Dollars in an aggregate amount equal to  the BA Discount Proceeds of all Bankers' Acceptances accepted by it on such Drawdown Date (net of the applicable Bankers' Acceptance Stamping Fee which is payable by such Borrower to the Lender in respect of such Bankers' Acceptances).

The Borrowers shall provide for the payment to the Lender at the Branch of Account for the account of the Lender of the full Face Amount of each Bankers' Acceptance issued at its request on the earlier of (i) its date of maturity and (ii) the date on which notice is given to the Borrowers pursuant to Section 12.2.

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Except for amounts which are paid from the proceeds of Rollovers of a Bankers' Acceptance or other Advance or Conversion hereunder, any amount which the Lender pays to any third party on or after the date of maturity of a Bankers' Acceptance in satisfaction thereof or which is owing to the Lender by a Borrower in respect of such Bankers' Acceptance on or after the date of maturity of a Bankers' Acceptance shall be deemed to be a Prime Rate Advance to such Borrower under this Agreement.  Interest shall be payable on such Prime Rate Advances in accordance with the terms applicable to Prime Rate Advances.

Neither Borrower shall claim from the Lender or any other Person any days of grace for the payment at maturity of any Bankers' Acceptances presented and accepted by the Lender pursuant to this Agreement.  Each Borrower waives any defence to payment which might otherwise exist if for any reason a Bankers' Acceptance shall be held by the Lender in its own right at the maturity thereof, and the doctrine of merger shall not apply to any Bankers' Acceptance that is at any time held by the Lender in its own right.

Any executed drafts to be used as Bankers' Acceptances which are delivered to the Lender shall be held in safekeeping with the same degree of care as if they were such Lender's own property, and shall be kept at the place at which such drafts are ordinarily held by the Lender.

The Borrowers hereby indemnify and hold the Lender harmless from any reasonable loss or expense with respect to any Bankers' Acceptance dealt with by the Lender in accordance with the provisions hereof, but shall not be obliged to indemnify the Lender for any loss or expense caused by the gross negligence or wilful misconduct of the Lender.

The obligations of the Borrowers with respect to Bankers' Acceptances under this Agreement shall be unconditional and irrevocable, and shall be paid strictly in accordance with the terms of this Agreement under all circumstances, including, without limitation, the following circumstances:

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Subject to any other written agreement between the Borrowers and the Lender, if a Borrower requests that the Lender complete incomplete drafts pursuant to telephone instructions, such instructions are at the risk of such Borrower until confirmed in writing and the Lender shall not have any liability for any failure to carry out the same, wholly or in part, or for any error or omissions in such instructions or the interpretation or execution thereof by the Lender.

Upon timely fulfillment of all applicable conditions as set forth in this Agreement, but subject to the limitations in Section 9.18, the Lender agrees to issue on any Business Day for the account of a Borrower under Credit A, Letters of Credit.

The Borrowers shall pay to the Lender fees calculated in accordance with Section 7.1 and payable quarterly in advance on the date of issuance of each Letter of Credit and on the first day of each subsequent calendar quarter on which such Letter of Credit remains outstanding.  If the Face Amount of a Letter of Credit is reduced (either through presentment for payment or with the consent of the beneficiary thereof) or if the Letter of Credit is cancelled, subject to the Lender receiving a minimum amount of $100 (or such other minimum amount that the Lender may from time to time advise the Borrowers as the minimum fee that the Bank generally requires from its customer with respect to letters of credit issued) for each Letter of Credit issued by it, the portion of such fee that has been paid for the remaining term of the Letter of Credit and for the amount of such reduction or cancellation shall be refunded or returned to the Borrowers.

The following provisions shall apply to Letter of Credit Advances:

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Subject to the other provisions of this Agreement, upon timely fulfillment of all applicable conditions as set forth in this Agreement, the Lender will make the requested amount of a LIBOR Advance available to the applicable Borrower on the Drawdown Date requested by such Borrower by crediting such amount to the Designated Account maintained by such Borrower. Each LIBOR Advance shall be in a minimum amount of US$1,000,000 and in whole multiples of US$500,000 thereafter.  The Borrowers shall pay interest to the Lender at such address as the Lender designates from time to time on all such LIBOR Advances outstanding from time to time hereunder at the applicable rate of interest specified in Section 7.3.  All interest shall accrue from day to day both before and after demand, maturity, default and judgment, with interest on overdue interest at the rate applicable to the US Base Rate plus the Applicable Margin and two percent (2%) per annum and payable on demand.

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A Borrower may select, by irrevocable notice to the Lender hereunder for LIBOR Advances the LIBOR Period to apply to any particular LIBOR Advance.  Such Borrower shall from time to time select and give notice to the Lender of the LIBOR Period for a LIBOR Advance which shall commence upon the making of the LIBOR Advance or at the expiry of any outstanding LIBOR Period applicable to a LIBOR Advance that is the subject of a Rollover.  If a Borrower fails to select and give the Lender, notice of a LIBOR Period for a LIBOR Advance in accordance with Section 9.5 any such LIBOR Advance shall be converted to a US Base Rate Advance, on the last day of the LIBOR Period applicable to such LIBOR Advance.

If the early termination of any LIBOR Advance is required hereunder, the Borrowers will pay to the Lender all expenses and out-of-pocket costs incurred by the Lender as a result of the early termination of the LIBOR Advance, including expenses and out-of-pocket costs incurred due to early redemption of offsetting deposits.  If, in the sole discretion of the Lender, acting reasonably, any such early termination cannot be affected, the LIBOR Advance will not be terminated and the applicable Borrower will continue to pay interest to the Lender, at the rate per annum applicable to such LIBOR Advance for the remainder of the applicable LIBOR Period.  A written statement of the Lender as to the aggregate amount of such expenses and out of pocket costs will be prima facie evidence of the amount thereof.

If at any time the Lender determines, acting reasonably, (which determination shall be conclusive and binding on the Borrowers) that:

then upon at least three (3) Business Days' written notice by the Lender to the Borrowers,

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Each Borrower represents and warrants to the Lender on its own behalf and for and on behalf of each other and each other Consolidating Loan Party that:

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there are no agreements, waivers or other arrangements providing for an extension of time with respect to the filing of any tax return or the payment of any Taxes or remittances described above; there are no actions or proceedings being taken by Canada Customs and Revenue Agency or any other Governmental Authority to enforce the payment of any Taxes or remittances described above and it has no knowledge of any such actions or proceedings being contemplated by such authorities; and

Unless expressly stated to be made as of a specific date, the representations and warranties made in this Agreement shall survive the execution of this Agreement and all other Credit Documents, and shall be deemed to be repeated as of the date of each Advance and as of the date of delivery of each Compliance Certificate, subject to modifications made by the Borrowers to the Lender in writing and accepted by the Lender.  The Lender shall be deemed to have relied upon such representations and warranties at each such time as a condition of making an Advance hereunder or continuing to extend the Credits hereunder.

During the term of this Agreement, each Borrower covenants and agrees for and on behalf of itself and each other Consolidating Loan Party that each Consolidating Loan Party shall:

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and immediately provide to the Lender and the Quantity Surveyor, a copy of such proposed Change Order;

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During the term of this Agreement, each Borrower shall:

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During the term of this Agreement, each Borrower covenants and agrees for and on behalf of itself and the other Consolidating Loan Parties without the prior written consent of the Lender (such consent not to be unreasonably withheld or delayed), the Consolidating Loan Parties shall not:

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Each Borrower covenants and agrees for and on behalf of itself and each of the other Consolidating Loan Parties that at all times it shall:

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Each of the following events shall constitute an "Event of Default":

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and such petition, application or proceeding shall continue undismissed or unstayed and in effect, for a period of ten (10) days after the institution thereof, provided that if an order, decree or judgment which is not stayed has been granted (whether or not entered or subject to appeal) against the Loan Party thereunder, as applicable, in the interim, such grace period shall cease to apply; or

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If any Default or Event of Default occurs and for so long as it continues, the Lender shall not be under any further obligation to make an Advance under any of Credit A, Credit B or Credit C and upon the occurrence of an Event of Default, the Lender may give notice to the Borrowers declaring all or any of the Obligations under the Credits to be forthwith due and payable, whereupon the Obligations shall become and be forthwith due and payable without presentment, demand, protest or further notice of any kind, all of which are hereby expressly waived by each Borrower; provided however, the Lender shall be deemed to give such notice to the Borrowers immediately upon the occurrence of an Event of Default described in Section 12.1(g) or 12.1(h).

Immediately upon the making of a declaration referred to in Section 12.2 (or the deemed making of such declaration), the Borrowers shall, without necessity of further act or evidence, be and become thereby unconditionally obligated to deposit forthwith with the Lender Collateral equal to the Face Amount of all Bankers' Acceptances and Letters of Credit then outstanding and issued by the Lender and the Borrowers hereby unconditionally jointly and severally promise and agree to deposit with the Lender immediately upon such declaration Collateral in such amount.  Each Borrower authorizes the Lender to debit its account with the amount required to provide cash collateral for such Bankers' Acceptances and Letters of Credit, notwithstanding that such Bankers' Acceptances may be held by the Lender in its own right at maturity or that no draw has yet been made under a Letter of Credit.  Any amounts deposited hereunder shall bear interest for the Borrowers' account at the rates of the Lender as may be applicable in respect of other deposits of similar amounts for similar terms.  Amounts paid to the Lender pursuant to such a declaration (or deemed declaration) in respect of

Bankers' Acceptances and Letters of Credit shall be applied against the obligation of the Borrowers to pay amounts then or thereafter payable under Bankers' Acceptances and Letters of Credit at the times amounts become payable under or in respect thereof, as the case may be and any amounts remaining shall be held by the Lender as security for the payment and performance of all remaining outstanding Obligations.

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Upon the making of a declaration (or the deemed making of such declaration) contemplated by Section 12.2, the Security shall become immediately enforceable and the Lender may take such action or proceedings as the Lender in its sole discretion deems expedient to enforce the same, all without any additional notice, presentment, demand, protest or other formality, all of which are hereby expressly waived by each Borrower.

The Lender shall not be under any obligation to the Borrowers or any other Person to realize any collateral or enforce the Security or any part thereof or to allow any collateral to be sold, dealt with or otherwise disposed of.  The Lender shall not be responsible or liable to the Borrowers or any other Person for any loss or damage upon the realization or enforcement of, the failure to realize or enforce any collateral or any part thereof or the failure to allow any collateral to be sold, dealt with or otherwise disposed of or for any act or omission on their respective parts or on the part of any director, officer, agent, servant or adviser in connection with any of the foregoing, except that the Lender will be responsible or liable for any loss or damage arising from the willful misconduct or gross negligence of the Lender in enforcing the Security.

If after the Lender makes a declaration contemplated by Section 12.2 (or after such declaration is deemed to be made) the Borrowers have failed to perform any of their covenants or agreements in the Credit Documents, the Lender, may, but shall be under no obligation to perform any such covenants or agreements in any manner deemed fit by the Lender without thereby waiving any rights to enforce the Credit Documents.  The reasonable expenses (including any legal costs) paid by the Lender in respect of the foregoing shall be added to and become part of the Obligations and shall be secured by the Security.

No Person dealing with the Lender or any agent of the Lender shall be concerned to inquire whether the Security has become enforceable, or whether the powers which the Lender is purporting to exercise have been exercisable, or whether any Obligations remain outstanding upon the security thereof, or as to the necessity or expediency of the stipulations and conditions subject to which any sale shall be made, or otherwise as to the propriety or regularity of any sale or other disposition or any other dealing with the collateral charged by such Security or any part thereof.

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The rights and remedies of the Lender under the Credit Documents are cumulative and are in addition to and not in substitution for any rights or remedies provided by law.  Any single or partial exercise by the Lender of any right or remedy for a default or breach of any term, covenant, condition or agreement herein contained shall not be deemed to be a waiver of or to alter, affect, or prejudice any other right or remedy or other rights or remedies to which the Lender may be lawfully entitled for the same default or breach.  Any waiver by the Lender of the strict observance, performance or compliance with any term, covenant, condition or agreement herein contained, and any indulgence granted by the Lender shall be deemed not to be a waiver of any subsequent default.

In addition to and not in limitation of any rights now or hereafter granted under Applicable Laws, the Lender may at any time and from time to time without notice to either Borrower or any other Person, any notice being expressly waived by each Borrower, set-off, combine accounts and compensate and apply any and all deposits, general or special, time or demand, provisional or final, matured or unmatured, in any currency, and any other indebtedness at any time owing by the Lender to or for the credit of or the account of a Borrower, against and on account of the Obligations notwithstanding that any of them are contingent or unmatured.  When applying a deposit or other amount owing to the Lender in a currency that is different than the currency of the Obligations, the Lender will convert the deposit or other amount using the Exchange Rate in effect at the time of such conversion.

The Credit Documents shall be binding upon and enure to the benefit of the Lender, each Borrower, each Guarantor and their successors and assigns. Neither Borrower (or the Guarantors) shall be entitled to assign any rights or obligations with respect to this Agreement or any of the other Credit Documents to any third party without the prior written consent of the Lender.  The Lender shall have the right to assign its collective rights and obligations under this Agreement in whole or in a minimum amount of $5,000,000 (the "Lender Assignment") with the consent of the Borrowers, not to be unreasonably withheld or delayed; provided however, if a Default or Event of Default has occurred and is then continuing, no consent of either Borrower will be required hereunder to any such Lender Assignment.

The headings of the Articles and Sections and the Table of Contents are inserted for convenience of reference only and shall not affect the construction or interpretation of this Agreement.

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All capitalized terms used in any of the Credit Documents (other than this Agreement) which are defined in this Agreement shall have the meaning defined herein unless otherwise defined in the other document.

Any provision of this Agreement which is or becomes prohibited or unenforceable in any relevant jurisdiction shall not invalidate or impair the remaining provisions hereof which shall be deemed severable from such prohibited or unenforceable provision and any such prohibition or unenforceability in any such jurisdiction shall not invalidate or render unenforceable such provision in any other jurisdiction.  Should this Agreement fail to provide for any relevant matter, the validity, legality or enforceability of this Agreement shall not hereby be affected.

Unless the context otherwise requires, words importing the singular number shall include the plural and vice versa, words importing any gender include all genders and references to agreements and other contractual instruments shall be deemed to include all present or future amendments, supplements, restatements or replacements thereof or thereto.  References to statutes, regulations and other Applicable Laws shall be deemed to include such statutes, regulations and other Applicable Laws as amended, supplemented and replaced from time to time.

The words "include", "includes" and "including" shall be deemed to be followed by the phrase "without limitation".  The word "will" shall be construed to have the same meaning and effect as the word "shall".  Unless the context requires otherwise:

Whenever the delivery of a certificate is a condition precedent to the taking of any action by the Lender hereunder, the truth and accuracy of the facts and the diligent and good faith determination of the opinions stated in such certificate shall in each case be conditions precedent to the right of the applicable Borrower to have such action taken, and any certificate executed by a Borrower shall be deemed to represent and warrant that the facts stated in such certificate are true and accurate.

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No amendment, supplement or waiver of any provision of the Credit Documents, nor any consent to any departure by a Loan Party therefrom, shall in any event be effective unless it is in writing, makes express reference to the provision affected thereby and is signed by the Lender, the Borrowers and if applicable, the appropriate Loan Party and then such waiver or consent shall be effective only in the specific instance and for the specific purpose for which given.  No waiver or act or omission of the Lender shall extend to or be taken in any manner whatsoever to affect any subsequent breach by a Loan Party of any provision of the Credit Documents or the rights resulting therefrom.

Each of the Credit Documents shall be conclusively deemed to be a contract made under, and shall for all purposes be governed by and construed in accordance with, the laws of the Province of Alberta and the laws of Canada applicable in Alberta.  Each party to this Agreement hereby irrevocably and unconditionally attorns to the non-exclusive jurisdiction of the courts of Alberta and all courts competent to hear appeals therefrom.

In the event of any conflict between the terms of this Agreement and the terms of any other Credit Document, the provisions of this Agreement shall govern to the extent necessary to remove the conflict.  Provided however, a conflict shall not be deemed to occur if one Credit Document provides for a matter and another Credit Document does not.

The designation of an Encumbrance as a Permitted Encumbrance is not, and shall not be deemed to be, an acknowledgment by the Lender that the Encumbrance shall have priority over the Security.

All payments made hereunder shall be made in the currency in respect of which the obligation requiring such payment arose.  Unless otherwise noted, all amounts expressed in this Agreement in terms of money refer to Canadian Dollars.

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Except as otherwise expressly provided in this Agreement, wherever this Agreement contemplates or requires the calculation of the equivalent in Canadian Dollars or US Dollars of an amount expressed in another, the calculation shall be made on the basis of the Exchange Rate at the effective date of the calculation.

All statements, reports, certificates, opinions, appraisals and other documents or information required to be furnished to the Lender by the Borrowers (or either of them) or a Subsidiary under this Agreement shall be supplied without cost to the Lender.  The Borrowers shall pay on demand all reasonable out of pocket costs and expenses of the Lender (including, without limitation, long distance telephone and courier charges and the reasonable fees and expenses of counsel for the Lender), incurred in connection with (i) the preparation, execution, delivery, administration, periodic review, modification or amendment of the Credit Documents; (ii) any enforcement of the Credit Documents; (iii) obtaining advice as to the rights and responsibilities of the Lender in connection with the Credits and the Credit Documents; (iv) reviewing, inspecting and appraising the collateral that is the subject of the Security in connection with the enforcement of its rights under the Security; (v) the repayment, prepayment or Conversion (whether by acceleration or otherwise) of a LIBOR Advance on a date other than the stated maturity thereof; and (vi) other matters relating to the Credits, or either of them.  Such costs and expenses shall be payable whether or not an Advance is made under this Agreement.

Each Borrower shall indemnify the Lender against any liability, obligation, loss or expense which it may sustain or incur as a consequence of (i) any representation or warranty made by a Consolidating Loan Party which was incorrect at the time it was made or deemed to have been made, (ii) a default by a Loan Party in the payment of any sum due from it (irrespective of whether an Advance is deemed to be made to the Borrowers to pay the amount that the Borrowers have failed to pay), including, but not limited to, all sums (whether in respect of principal, interest, or any other amount) paid or payable to lenders of funds borrowed by the Lender in order to fund the amount of any such unpaid amount to the extent the Lender is not reimbursed pursuant to any other provisions of this Agreement, (iii) the failure of the Borrowers (or either of them) to complete any Advance or make any payment after notice therefore has been given under this Agreement, and (iv) any other default by any Loan Party under any Credit Document.  A certificate of the Lender as to the amount of any such loss or expense shall be conclusive evidence as to the amount thereof, in the absence of manifest error.

In addition, each Borrower shall indemnify the Lender and its directors, officers, employees and representatives (the "Indemnified Parties") from and against any and all actions, proceedings, claims, losses, damages, liabilities, expenses and obligations of any kind that may be incurred by or asserted against any of them as a result of or in connection with the making of any Advance hereunder and the Lender taking, holding and enforcing the Security, other than arising from the gross negligence or wilful misconduct of the Lender or any other Indemnified Party.  Whenever any such claim shall arise, the Indemnified Party shall promptly notify the Borrowers of the claim and, when known, the facts constituting the basis for such claim, and if known, the amount or an estimate of the amount of the claim.  The failure of an Indemnified Party to give notice of a claim promptly shall not adversely affect the Indemnified Party's rights to indemnity hereunder unless such failure adversely effects the Borrowers' position in respect of such claim.

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The Agreements in this Section shall survive the termination of this Agreement and repayment of the Obligations.

All payments to be made by a Borrower and its respective Subsidiaries pursuant to the Credit Documents are to be made without set-off, compensation or counterclaim, free and clear of and without deduction for or on account of any Tax, including but not limited to withholding taxes, except for Taxes on the overall net income of the Lender (such taxes applicable to the overall net income of the Lender are herein referred to as "Excluded Taxes").  If any Tax, other than Excluded Taxes, is deducted or withheld from any payments under the Credit Documents each Borrower and its Material Subsidiaries shall promptly remit to the Lender in the currency in which such payment was made, the equivalent of the amount of Tax so deducted or withheld together with the relevant receipt addressed to the Lender.  If a Borrower or any other Loan Party is prevented by operation of law or otherwise from paying, causing to be paid or remitting such Tax, the interest or other amount payable under the Credit Documents will be increased to such rates as are necessary to yield and remit to the Lender the principal sum advanced or made available together with interest at the rates specified in the Credit Documents after provision for payment of such Tax.  If following the making of any payment by a Borrower or other Loan Party, as applicable, under this Section 14.11, the Lender is granted a credit against or refund in respect of any Tax payable by it in respect of such Taxes to which such payment by such Borrower or such other Loan Party relates that the Lender would not have received had the Borrowers or such other Loan Party not made the payment, the Lender shall (subject to such Borrower having paid the relevant amount) to the extent that it is satisfied that it can do so without prejudice to the retention of the amount of such credit or refund, reimburse such Borrower or such other Loan Party such amount as the Lender shall certify to be the proportion of such credit or refund as will leave the Lender, after such reimbursement in no worse or better position than it would have been in if the relevant Taxes had not been imposed, or the relevant Taxes had not been deducted or withheld in respect of the payment by such Borrower or such Material Subsidiary as aforesaid.  The Lender shall, at the Borrowers' request and cost, file such documentation and do such commercially reasonably things as may be necessary to obtain such credit or refund, but the Lender shall not be obligated to disclose any information to the Borrowers or any other Person concerning its income or taxes that is not otherwise publicly available.

If a Borrower or any other Loan Party makes any payment under this Section for the account of the Lender, the Lender shall take reasonable steps to minimize the net amount payable by such Borrower or such other Loan Party under this Section, but the Lender shall not be obliged to disclose any information to the Borrowers or such other Loan Party concerning its income or taxes that is not otherwise publicly available.

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If the introduction of or any change in or in the interpretation of, or any change in its application to a Borrower or the Lender of, any law or any regulation or guideline from any central bank or other governmental authority (whether or not having the force of law), including but not limited to any reserve or special deposit requirement or any Taxes or exemption from any tax or any capital requirement (each of the foregoing events shall be referred to as a "Change in Law"), has, due to the compliance by the Lender therewith, the effect, directly or indirectly, of (i) increasing the cost to the Lender of performing its obligations hereunder; (ii) reducing any amount received or receivable by the Lender hereunder or its effective return hereunder or on its capital; or (iii) causing the Lender to make any payment or to forego any return based on any amount received

or receivable by the Lender hereunder, then upon demand from time to time the Borrowers shall pay such amount as shall compensate the Lender for any such cost, reduction, payment or foregone return that is not fully offset by an increase in the applicable interest rate or rates or fees hereunder (collectively, the "Additional Compensation"). Any certificate of the Lender in respect of the foregoing will be conclusive evidence of the Additional Compensation owing by the Borrowers to the Lender, except for manifest error.  The Lender shall use reasonable commercial efforts to minimize any and all increased costs contemplated by this Section 0. 

If a Borrower fails to pay any amount payable hereunder (other than principal, interest thereon or interest upon interest which is payable as otherwise provided in this Agreement) on the due date, such Borrower shall, on demand pay interest on such overdue amount to the Lender from and including such due date up to but excluding the date of actual payment, both before and after demand, default or judgment, at a rate of interest per annum equal to the Prime Rate Advance Rate then applicable to Prime Rate Advances plus two (2) percent per annum, calculated daily and compounded monthly.

Notice to be given under the Credit Documents shall, except as otherwise specifically provided, be in writing addressed to the party for whom it is intended and, unless the law deems a particular notice to be received earlier, a notice shall not be deemed received until actual receipt by the other party of an original of such notice or a facsimile thereof if sent by facsimile transmission.  The addresses of the parties hereto for the purposes hereof shall be the addresses specified beside their respective signatures to this Agreement, or such other mailing or facsimile addresses as each party from to time may notify the other as aforesaid.

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For the purposes of "promotional marketing", the Borrowers authorize and consent to the reproduction, disclosure and use by the Lender and its counsel of their names, identifying logos and information regarding the Facilities (other than the fees and interest rate applicable to the Facilities) to enable the Lender and its counsel to publish deal announcements and promotional "tombstones".  Each Borrower acknowledges and agrees that the Lender and its counsel shall be entitled to determine, in its discretion, whether to use such information, that no compensation will be payable by the Lender or its counsel in connection therewith, and that neither the Lender nor its counsel shall have any liability whatsoever to the Borrowers, any other Loan Party or any of their respective employees, officers, directors, Affiliates or shareholders in obtaining and lawfully using such information as contemplated herein.

Time shall be of the essence in this Agreement.

Each of the Borrowers shall, at the request of the Lender do all such further acts and execute and deliver all such further documents as may, in the reasonable opinion of the Lender, be necessary or desirable in order to fully perform and carry out the purpose and intent of the Credit Documents.

Except as otherwise provided herein, this Agreement shall remain in full force and effect until the payment and performance in full of all of the Obligations and the termination of this Agreement.

Whenever any payment or performance under the Credit Documents would otherwise be due on a day other than a Business Day, such payment shall be made on the following Business Day, provided that interest and fees (as applicable) shall continue to accrue and be payable until the applicable payment or performance has been completed.

In this Agreement, each rate of interest which is calculated with reference to a period (the "deemed interest period") that is less than the actual number of days in the calendar year of calculation is, for the purposes of the Interest Act (Canada), equivalent to a rate based on a calendar year calculated by multiplying such rate of interest by the actual number of days in the calendar year of calculation and dividing by the number of days in the deemed interest period.

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Each Borrower covenants and agrees with the Lender that, in the case of any judicial or other proceeding to enforce the rights and remedies of the Lender under the Credit Documents (or any part thereof), judgment may be rendered against any Loan Party in favour of the Lender, for any amount owing by them under all or any of the Credit Documents (or for which any  Loan Party may be liable thereunder after the application to the payment thereof of the proceeds of any sale of any of the property, assets or undertaking of the such Loan Party).  The covenants of the Borrowers to pay interest at the rate provided for in this Agreement shall not merge in any such judgment and such judgment shall bear interest at the Prime Rate Advance Rate plus 2.0% per annum until such judgment and all Obligations of the Borrowers to the Lender under the Credit Documents have been paid in full.

Each Borrower acknowledges that, pursuant to the Proceeds of Crime (Money Laundering) and Terrorist Financing Act (Canada) and other applicable anti-money laundering, anti-terrorist financing, government sanction and "know your client" Applicable Laws (collectively, including any guidelines or orders thereunder, the "AML Legislation"), the Lender may be required to obtain, verify and record information regarding the Consolidating Loan Parties and their Subsidiaries (or any of them), their respective directors and signing officers and the transactions contemplated herein. Each Borrower shall promptly: (i) provide all such information, including supporting documentation and other evidence, as may be reasonably requested by the Lender, or any prospective assignee of the Lender, in order to comply with any AML Legislation, whether now or hereafter in existence; and (ii) notify the Lender of such information of any changes thereto.  The Borrowers acknowledge and agree that the Credits are for the use by the Borrowers and will be used by the Borrowers, only for the purposes set out herein.

The Obligations owing to the Lender and the Hedge Providers by each Borrower hereunder and under all of the other Credit Documents shall be jointly and severally binding on the Borrowers.

This Agreement may be executed in any number of counterparts, each of which when executed and delivered shall be deemed to be an original, and such counterparts together shall constitute one and the same agreement.  For the purposes of this Section, the delivery of a facsimile copy of an executed counterpart of this Agreement shall be deemed to be valid execution and delivery of this Agreement, but the party delivering a facsimile copy shall deliver an original copy of this Agreement as soon as possible after delivering the facsimile copy.

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This Agreement constitutes the entire agreement between the parties hereto concerning the matters addressed in this Agreement, and cancel and supersede any prior agreements, undertakings, declarations or representations, written or verbal, in respect thereof.

This Agreement amends and restates the Prior Credit Agreement without in any way affecting the rights or obligations of any party which may have accrued as of the date hereof pursuant to the provisions of such agreement prior to their amendment hereby, and all indebtedness, liabilities and obligations of the Borrowers to the Lender under the Prior Credit Agreement, including, without limitation, all Advances outstanding under the Prior Credit Facilities as of the date of this Agreement and all accrued and unpaid interest and fees thereon, shall be construed as Obligations of the Borrowers to the Lender under this Agreement. The Lender confirms that as of August 6, 2014, the outstanding Advances under: (i) Credit A is $414,389.29; and (ii) Credit B is $10,713,332.67, inclusive of all accrued and unpaid interest and fees thereon up to and including such date.

Each Borrower hereby acknowledges and agrees that the Security previously delivered by it to the Lender remains in full force and effect, enforceable against it in accordance with their respective terms and shall continue to secure the payment and performance of the Obligations and for clarity, the Security and the fixed and floating charges created therein shall survive and continue to charge the assets originally charged thereunder from and after the date of this Agreement to secure the Obligations.

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Signature page to the Century Resorts Alberta Inc. and Century Casino Calgary Inc. Amended and Restated Credit Agreement

 

Address For Notice

Century Resorts Alberta, Inc.

455 E. Pikes Peak Ave. #210

Colorado Springs, CO 80903

Attention:

Facsimile:

 

CENTURY RESORTS ALBERTA INC., as Borrower

 

By: /s/ Margaret Stapleton

Name: Margaret Peggy Stapleton

Title: Director

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Signature page to the Century Resorts Alberta Inc. and Century Casino Calgary Inc. Amended and Restated Credit Agreement

 

Address For Notice

Century Resorts Calgary, Inc.

455 E. Pikes Peak Ave. #210

Colorado Springs, CO 80903

Attention:

Facsimile:

 

CENTURY CASINO CALGARY INC., as Borrower

 

By: /s/ Margaret Stapleton

Name: Margaret Peggy Stapleton

Title: Director

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Signature page to the Century Resorts Alberta Inc. and Century Casino Calgary Inc. Amended and Restated Credit Agreement

 

Address For Notice

Bank of Montreal

9th Floor, First Canadian Centre

340 – 7th Avenue S.W.

Calgary, Alberta, T2P 0X4,

Attention:  Senior Manager

 

BANK OF MONTREAL, as Lender

 

By: /s/ Ken Lo

Name: Ken Lo

Title: Director, BMO CFD - Prairies