EXHIBIT 10.02
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FIRST AMENDMENT TO
KEEP-WELL AGREEMENT
Dated as of March 30, 2001
(amending the Keep-Well Agreement
dated as of
February 26, 1998)
by
LONDON CLUBS INTERNATIONAL, PLC,
THE TRUST UNDER ARTICLE SIXTH UNDER
THE WILL OF SIGMUND SOMMER
ALADDIN BAZAAR HOLDINGS, LLC
and
ALADDIN HOLDINGS, LLC
as the Sponsors,
and
THE BANK OF NOVA SCOTIA,
as the Administrative Agent for various financial institutions
as the Lenders,
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FIRST AMENDMENT TO KEEP-WELL AGREEMENT
THIS FIRST AMENDMENT TO KEEP-WELL AGREEMENT (this "FIRST AMENDMENT TO
KEEP-WELL AGREEMENT") dated as of March 30, 2001, by and among LONDON CLUBS
INTERNATIONAL, PLC, a company registered in England and Wales under company
number 2862479 ("LCI"), THE TRUST UNDER ARTICLE SIXTH UNDER THE WILL OF
SIGMUND SOMMER (the "TRUST"), ALADDIN BAZAAR HOLDINGS, LLC a Nevada
limited-liability company ("ABH") and ALADDIN HOLDINGS, LLC, a Delaware
limited liability company ("AHL"); AHL, ABH, the Trust and LCI are
individually called a "SPONSOR" and collectively called the "SPONSORS") and
THE BANK OF NOVA SCOTIA, as administrative agent (together with any successor
thereto in such capacity, the "ADMINISTRATIVE AGENT") for the various
financial institutions as are or may become parties hereto (individually, a
"LENDER", and collectively, the "LENDERS".)
In consideration of the mutual agreements herein contained and other
good and valuable consideration, receipt of which is hereby acknowledged, the
parties hereto, intending to be legally bound, agree as follows:
W I T N E S S E T H
WHEREAS, pursuant to a Credit Agreement, dated as of February 26, 1998,
(together with that certain First Amendment to Credit Agreement dated as of
January 29, 1999, that certain Second Amendment to Credit Agreement dated as
of April 5, 1999, effective as of March 10, 1999, that certain Third
Amendment to Credit Agreement dated as of June 2, 2000, that certain Fourth
Amendment to Credit Agreement dated as of July 27, 2000, that certain Fifth
Amendment to Credit Agreement dated as of December 29, 2000 and that certain
Sixth Amendment to Credit Agreement (the "SIXTH AMENDMENT TO CREDIT
AGREEMENT") of even date herewith and all other amendments and other
modifications from time to time hereinafter made thereto, the "CREDIT
AGREEMENT"), among Aladdin Gaming, LLC, a Nevada limited-liability company
(the "BORROWER"), the Lenders and the Administrative Agent, Merrill Lynch
Capital Corporation, as the syndication agent (together with any successor
thereto in such capacity, the "SYNDICATION AGENT"), and CIBC Oppenheimer Corp.,
as the documentation agent (together with any successor thereto in such
capacity, the "DOCUMENTATION AGENT"), the Lenders have extended Commitments
to make Loans to the Borrower and to issue Letters of Credit for the account
of the Borrower; and
WHEREAS, the Borrower has requested the Lenders to enter into the Sixth
Amendment to Credit Agreement; and
WHEREAS, LCI, ABH, and AHL executed and delivered a Keep-Well Agreement
(the "KEEP-WELL AGREEMENT") in favor of the Lenders and the Administrative
Agent dated as of February 26, 1998 pursuant to which the LCI, ABH and AHL
agreed, INTER ALIA, to perform the obligations set forth in the Keep-Well
Agreement and certain subsidiaries of LCI (the "SUBSIDIARY GUARANTORS") have
agreed to fully and unconditionally guarantee the payment of LCI's
obligations under the Keep-Well Agreement pursuant to a guaranty agreement
dated February 26, 1998 (the "LCI SUBSIDIARY GUARANTY"); and
WHEREAS, the Trust executed and delivered a Joinder Agreement and
Consent (the "JOINDER AGREEMENT") in favor of the Lenders and the
Administrative Agent dated as of July 27, 2000 pursuant to which the Trust
agreed to become a Sponsor under the Keep-Well Agreement; and
WHEREAS, the Borrower has requested the Sponsors to enter into certain
amendments to the Keep-Well Agreement; and
WHEREAS, the Sponsors have duly authorized the execution, delivery and
performance of this First Amendment to Keep-Well Agreement and the Subsidiary
Guarantors have duly authorized the execution, delivery and performance of a
ratification, reaffirmation and consent agreement (the "RATIFICATION OF LCI
SUBSIDIARY GUARANTY") with respect to the Subsidiary Guaranty, an executed
counterpart of which is annexed hereto (the LCI Subsidiary Guaranty, together
with the Ratification of LCI Subsidiary Guaranty and all other amendments and
other modifications from time to time hereafter made thereto, the "SUBSIDIARY
GUARANTY"); and
WHEREAS, it is in the best interests of the Sponsors to execute this
First Amendment to Keep-Well Agreement and the Subsidiary Guarantors to
execute the Ratification of LCI Subsidiary Guaranty inasmuch as the Sponsors
and the Subsidiary Guarantors have and will continue to derive substantial
direct and indirect benefits from the Loans made to the Borrower by the
Lenders pursuant to the Credit Agreement; and
WHEREAS, each of the parties hereto is willing, on the terms and subject
to the conditions hereinafter set forth, to so amend the Keep-Well Agreement
upon the terms and conditions set forth below.
NOW, THEREFORE, in consideration of the agreements contained herein, the
parties hereto agree as follow:
ARTICLE I
AMENDMENT
SECTION 1.1. AMENDMENTS. The parties hereto hereby agree that provided
each of the Sponsors has delivered an opinion of counsel which conforms to
the requirements of CLAUSE (h) OF SECTION 3.1 and which expressly provides, in
relevant part, that no approval is required under
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the "GECC FACILITIES AGREEMENT" (as defined in the Second Amendment to Credit
Agreement), the "GECC INTERCREDITOR AGREEMENT" (as defined in the Second
Amendment to Credit Agreement) or the "DISCOUNT NOTE INDENTURE" (as defined
in the Credit Agreement; each capitalized term not otherwise defined herein
shall have the meaning ascribed to such term in the Credit Agreement) for the
amendments set forth below, the following amendments shall be made to the
Keep-Well Agreement.
The definition of "Keep-Well Termination Date" set forth in SECTION 1 of
the Keep-Well Agreement shall be deleted in its entirety and the following
definition of "KEEP-WELL TERMINATION DATE" shall be substituted in its place:
"`KEEP-WELL TERMINATION DATE' shall mean the earliest of (i)
the day on which full and indefeasible payment of the
Obligations of the Borrower under the Credit Agreement has
been made to reduce the Commitments of the Lenders thereunder
to $145,000,000 or less, (ii) the last day of the period of
six consecutive fiscal quarters from and after the Conversion
Date during which the Borrower shall have satisfied each of
the financial covenants set forth in the Credit Agreement
(without giving effect to the Sixth Amendment to Credit
Agreement or to any other amendment of the Credit Agreement
which became effective prior to the date of the Sixth
Amendment to Credit Agreement or to any payments to or
investments by the Sponsors in or for the benefit of the
Borrower), (iii) the date on which both of the following shall
have been satisfied: (a) construction of the Aladdin Hotel and
Casino and renovation of the Theater has been completed in
accordance with all terms of the Credit Agreement and (b) the
Commitments and the aggregate outstanding principal amount of
the Obligations under the Credit Agreement shall have been
reduced to an amount not in excess of the amount specified for
such date on SCHEDULE 1 hereto, (iv) the date on which the
Sponsors shall have made full payment of the Accelerated
Payment Amount described under SECTION 4 below or (v) in the
case of LCI only, the date on which it shall have made full
payment of the Accelerated Payment Amount described under
SECTION 13 below."
The definition of "KEEP-WELL REDUCTION DATE" set forth in SECTION 1 of
the Keep-Well Agreement shall be deleted in its entirety and the following
definition of "KEEP-WELL REDUCTION DATE" shall be substituted in its place:
"`KEEP-WELL REDUCTION DATE' shall mean March 31, 2002.'"
SCHEDULE 4 to the Keep-Well Agreement shall be amended by replacing the
phrase "ABH Ownership: 50% Member" which appears under the heading entitled
"ABH's Subsidiaries" with the phrase: "ABH Ownership: 35.36%".
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ARTICLE II
CERTAIN CONFIRMATIONS
SECTION 2.1. CONFIRMATION BY THE SPONSORS. The Sponsors acknowledge and
agree that the Borrower is obligated to perform its covenants under Section
7.2.4 of the Credit Agreement commencing with the fiscal quarter which ended
on December 31, 2000 whether or not the Sixth Amendment to Credit Agreement
becomes effective in accordance with the terms thereof. The Sponsors agree
that, except for the adjustment of the covenant levels in Section 7.2.4 of
the Credit Agreement as set forth in the Sixth Amendment to Credit Agreement,
their obligations under the Keep-Well Agreement are not amended, modified or
affected by any amendment, modification or waiver of any provision of the
Credit Agreement after the Closing Date.
SECTION 2.2. CONFIRMATION BY THE ADMINISTRATIVE AGENT. The Borrower has
advised the Sponsors and the Administrative Agent that the Borrower does not
expect to comply with the Minimum Fixed Charge Coverage Ratio specified in
the Credit Agreement (without giving effect to any amendment of the Credit
Agreement after the Closing Date) for the period commencing on August 18,
2000 and ending on December 31, 2000 (the "YEAR 2000 OPERATING PERIOD").
Based upon the Borrower's projections for the Year 2000 Operating Period, the
Sponsors expect to make a Cash Equity Contribution to the Borrower in the
amount of U.S. $12,000,000 (the "PROJECTED CASH EQUITY CONTRIBUTION") which,
when added to the Borrower's EBITDA for the Year 2000 Operating Period, will
result in the Borrower being in compliance with the Minimum Fixed Charge
Coverage Ratio for the Year 2000 Operating Period. On January 31, 2001, LCI
made a Cash Equity Contribution to the Borrower in the amount of U.S.
$5,000,000 as a partial funding the Projected Cash Equity Contribution. the
Sponsors and the Administrative Agent agree that such $5,000,000 partial
funding by LCI will be applied against LCI's obligations under the Keep-Well
Agreement and will be deemed to be a payment made by LCI pursuant to the
Keep-Well Agreement and not pursuant to the Completion Guaranty.
ARTICLE III
CONDITIONS PRECEDENT AND COVENANT
SECTION 3.1. CONDITIONS TO EFFECTIVENESS. The amendments in SECTION 1.1
shall become effective on the date (the "EFFECTIVE DATE") on which each of
the following conditions precedent shall have been satisfied.
(a) EXECUTION OF DOCUMENTS. The Administrative Agent shall have
received counterparts of (i) this First Amendment to Keep-Well
Agreement executed by an Authorized Representative of the parties
hereto, (ii) the Ratification of LCI Subsidiary Guaranty executed by
the Authorized Representatives of the Subsidiary Guarantors and LCI,
(iii) the Sixth Amendment to Credit Agreement executed by Authorized
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Representatives of the Borrower and the Administrative Agent and the
Required Lenders together with all documents required thereby and (iv)
all documentation required by SECTION 5.1 of the Sixth Amendment to
Credit Agreement.
(b) SIXTH AMENDMENT TO CREDIT AGREEMENT. The Sixth Amendment to
Credit Agreement shall become effective in accordance with its terms.
(c) INCUMBENCY, ETC. The Administrative Agent shall have received
(with copies for each Lender) a certificate, dated as of the Effective
Date, of an Authorized Representative of each Sponsor certifying.
(i) as to the incumbency and signatures of the Person or
Persons authorized to execute and deliver this First Amendment to
Keep-Well Agreement and any instruments or agreements required
hereunder.
(ii) as to an attached copy of one or more resolutions or
other authorizations of the Sponsors certified by the Authorized
Representative of each such Sponsor as being in full force and
effect on the date hereof, authorizing the execution, delivery
and performance of this First Amendment to Keep-Well Agreement
and any instruments or agreements required hereunder, and
(iii) that the Organizational Documents of such Sponsor have
not been modified since the date on which they were last
delivered to the Administrative Agent.
upon which certificate the Administrative Agent and the Lenders
(collectively, the "FINANCING PARTIES") may conclusively rely until
the Administration Agent has received a further certificate of an
Authorized Representative of such Sponsor cancelling or amending such
prior certificate.
(c) FEES. All reasonable fees and costs and expenses of Mayer,
Brown & Platt and other professionals employed by the Administrative
Agent and all other reasonable expenses of the Administrative Agent
in connection with the negotiation, execution and delivery of this
First Amendment to Keep-Well Agreement and the transactions
contemplated herein shall have been paid in full.
(d) SATISFACTORY LEGAL FORM. Each Financing Party and its counsel
shall have received all information, approvals, opinions, documents
or instruments as each Financing Party or its counsel may have
reasonably requested, and all documents executed or submitted
pursuant hereto by or on behalf of each Sponsor shall be satisfactory
in form and substance to each Financing Party and its counsel.
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(e) DEFAULT. After giving effect to the Sixth Amendment to Credit
Agreement the following statements shall be true and correct: (i) to
the best knowledge of each Sponsor, no act or condition exists which,
with the giving of notice or passage of time would constitute a
"DEFAULT" or "EVENT OF DEFAULT" (as defined in the Credit Agreement,
the GECC Facilities Agreement and Discount Note Indenture)
has occurred and is continuing as of the date hereof and (ii) no
material adverse change in (A) the financial condition, business,
property, prospects or ability of the Sponsor or the Borrower to
perform in all material respects its respective obligations under any
Operative Document or any of the documents evidencing and securing
the FF&E Financing to which it is a party or (B) the financial
condition, business, property, prospects and ability of any other
Aladdin Party or, to the best knowledge of such Sponsor, LCNI to
perform in all material respects its obligations under any Operative
Document to which it is a party has occurred since the Closing Date.
(f) CONSENTS AND APPROVALS. All approvals and consents required to
be taken, given or obtained, as the case may be, by or from any
Governmental Instrumentality or another Person, or by or from any
trustee (including, without limitation, GECC and the Discount Note
Indenture Trustee) or holder of any indebtedness or obligation of the
Borrower or the Sponsor, that are necessary or, in the reasonable
opinion of the Administrative Agent, advisable in connection with the
execution, delivery and performance of this First Amendment to
Keep-Well Agreement by all parties hereto, shall have been taken,
given or obtained, as the case may be, shall be in full force and
effect and the time for appeal with respect to any thereof shall have
expired (or, if an appeal shall be been taken, the same shall have
been dismissed) and shall not be subject to any pending proceedings
or appeals (administrative, judicial or otherwise) and shall be in
form and substance satisfactory to the Administrative Agent.
(g) DELIVERY OF FIRST AMENDMENT TO KEEP-WELL AGREEMENT. The
Sponsor shall have delivered this First Amendment to Keep-Well
Agreement to all Persons entitled thereto under the Operative
Documents to receive delivery hereof.
(h) OPINIONS. The Administrative Agent shall have received such
opinions of counsel as it deems necessary, dated as of the Effective
Date and addressed to the Administrative Agent and the Lenders which
shall be in form and substance satisfactory to the Administrative
Agent.
ARTICLE IV
REPRESENTATIONS AND WARRANTIES
In order to induce each Financing Party to enter into this First
Amendment to Keep-Well Agreement, each Sponsor, as to itself, reaffirms, as
of the Effective Date, its representations and warranties contained in the
Keep-Well Agreement (as amended by this First Amendment to
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Keep-Well Agreement) and additionally represents and warrants, as to itself,
unto each Financing Party as set forth in this ARTICLE IV.
SECTION 4.1. DUE AUTHORIZATION, NON-CONTRAVENTION, ETC. The execution,
delivery and performance by each Sponsor of this First Amendment to Keep-Well
Agreement and each other document executed or to be executed by it in
connection with this First Amendment to Keep-Well Agreement are within such
Sponsor's powers, have been duly authorized by all necessary action, and do
not
(a) contravene such Sponsor's Organizational Documents;
(b) contravene any contractual restriction binding on or
affecting such Sponsor;
(c) contravene any court decree or order or Legal Requirement
binding on or affecting such Sponsor, or
(d) result in, or require the creation or imposition of, any
Lien on any of such Sponsor's properties except as expressly
contemplated by the Operative Documents,
and the Financing Parties may conclusively rely on such representation and
warranty.
SECTION 4.2. GOVERNMENT APPROVAL, REGULATION, ETC. No authorization or
approval or other action by, and no notice to or filing with, any
governmental authority or regulatory body or other Person is required for the
due execution, delivery or performance by the Sponsor of this First Amendment
to Keep-Well Agreement or any other document to be executed by it in
connection with this First Amendment to Keep-Well Agreement.
SECTION 4.3. VALIDITY, ETC. This First Amendment to Keep-Well Agreement
constitutes the legal, valid and binding obligations of the Sponsors
enforceable in accordance with their respective terms, except as such
enforceability may be limited by applicable bankruptcy, insolvency or similar
laws affecting the enforcement of creditors rights generally and by general
principles of equity.
SECTION 4.4. LIMITATION. Except as expressly provided hereby, all of the
representations, warranties, terms, covenants and conditions of the Keep-Well
Agreement and each other Operative Document shall remain unamended and
unwaived and shall continue to be, and shall remain, in full force and effect
in accordance with their respective terms. The amendments and modifications
set forth herein shall be limited precisely as provided for herein, and shall
not be deemed to be a waiver of, amendment or modification of any other term
or provision of the Keep-Well Agreement or other Instrument referred to
therein or herein, or of any transaction or further or future action on the
part of the Borrower or any other Person which would require the consent of
the Agents, the Lenders, GECC or the Discount Note Indenture Trustee.
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SECTION 4.5. OFFSETS AND DEFENSES. The Sponsors have no offsets or
defenses to their obligations under the Loan Documents to which they are a
party and no claims or counterclaims against any of the Agents or the Lenders.
ARTICLE V
MISCELLANEOUS PROVISIONS
SECTION 5.1 RATIFICATION OF AND REFERENCES TO THE CREDIT AGREEMENT. This
First Amendment to Keep-Well Agreement shall be deemed to be amendment to the
Keep-Well Agreement and the Keep-Well Agreement, as amended by this First
Amendment to Keep-Well Agreement, shall continue in full force and effect and
is hereby ratified, approved and confirmed in each and every respect. All
references to the Keep-Well Agreement in any other document, instrument,
agreement or writing shall hereafter be deemed to refer to the Keep-Well
Agreement, as amended by this First Amendment to Keep-Well Agreement.
SECTION 5.2. HEADINGS. The various headings of this First Amendment to
Keep-Well Agreement are inserted for convenience only and shall not affect
the meaning or interpretation of this First Amendment to Keep-Well Agreement
or any provisions hereof.
SECTION 5.3 APPLICABLE LAW. THIS FIRST AMENDMENT TO KEEP-WELL AGREEMENT
AND THE RIGHTS AND OBLIGATIONS OF THE PARTIES UNDER THIS FIRST AMENDMENT TO
KEEP-WELL AGREEMENT SHALL BE GOVERNED BY, AND CONSTRUED AND INTERPRETED IN
ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK, INCLUDING SECTION 5-1401
OF THE NEW YORK GENERAL OBLIGATIONS LAW, BUT EXCLUDING ALL OTHER CHOICE OF
LAW AND CONFLICTS OF LAW RULES OF SUCH STATE.
SECTION 5.4. CROSS-REFERENCES. References in this First Amendment to
Keep-Well Agreement to any Article or Section are, unless otherwise
specified, to such Article or Section of this First Amendment to Keep-Well
Agreement.
SECTION 5.5. OPERATIVE DOCUMENT. This First Amendment to Keep-Well
Agreement is a Loan Document executed pursuant to the Credit Agreement and
shall (unless otherwise expressly indicated therein) be construed,
administered and applied in accordance with the terms and provisions of the
Credit Agreement.
SECTION 5.6. SUCCESSORS AND ASSIGNS. This First Amendment to Keep-Well
Agreement shall be binding upon and inure to the benefit of the parties
hereto and their respective successors and assigns.
SECTION 5.7. COUNTERPARTS. This First Amendment to Keep-Well Agreement
may be executed by the parties hereto in any number of counterparts and on
separate counterparts, each of which shall be an original but all of which
together shall constitute one and the same instrument.
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IN WITNESS WHEREOF, the parties hereto have executed this First
Amendment to Keep-Well Agreement as of the day and year first above written.
ALADDIN BAZAAR HOLDINGS, LLC
By:
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Name:
Title:
ALADDIN HOLDINGS, LLC
By:
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Name:
Title:
THE TRUST UNDER ARTICLE SIXTH
UNDER THE WILL OF SIGMUND SOMMER
By:
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Name:
Title: Trustee
By:
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Name:
Title: Trustee
LONDON CLUBS INTERNATIONAL PLC
By:
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Name:
Title:
THE BANK OF NOVA SCOTIA, as the
Administrative Agent
By:
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Name:
Title: