EXHIBIT 99.2
RE-RECORDED
** Recorder's Memo: This document is being rerecorded for clarification
purposes
AND WHEN RECORDED MAIL TO:
SKADDEN, ARPS, SLATE, MEAGHER & FLOM LLP
919 Third Avenue
New York, New York 10022
Attention: Wallace L. Schwartz, Esq.
================================================================================
(Space Above For Recorder's Use)
ALADDIN GAMING/BAZAAR/MUSIC
CONSTRUCTION, OPERATION AND RECIPROCAL
EASEMENT AGREEMENT
by and among
ALADDIN GAMING, LLC,
a Nevada limited-liability company
"Aladdin Gaming"
and
ALADDIN BAZAAR, LLC,
a Delaware limited liability company
"Bazaar Company"
and
ALADDIN MUSIC HOLDINGS, LLC
a Nevada limited-liability company
"Aladdin Music"
**RERERECORDED TO ATTACH THE CORRECT LEGAL DESCRIPTION FOR
GROUND LEASE**
***RERERERECORDED TO CLARIFY THE LEGAL DESCRIPTION***
TABLE OF CONTENTS
Page
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ARTICLE 1 DEFINITIONS ............................................................. 4
ARTICLE 2 EASEMENTS ............................................................... 22
2.1 Definitions and Conditions .............................................. 22
2.2 Easement: Automobile Parking, Vehicular and Pedestrian Access:
Emergency Egress ........................................................ 26
2.3 Easement: Utilities ..................................................... 27
2.4 Easement: Construction .................................................. 30
2.5 Easement: Maintenance of Common Structural Supports ..................... 32
2.6 Easement: Exterior and Accent Lights .................................... 33
2.7 Easement: Truck Loading Areas ........................................... 33
2.8 Easement: Encroachments ................................................. 34
2.9 Easement: Roof .......................................................... 35
2.10 Easement: Setbacks ...................................................... 35
2.11 Easement: General Integration, Maintenance and Development .............. 35
2.12 No Dedication of Easements .............................................. 36
2.13 Abandonment of Easements ................................................ 36
2.14 Granting of Easements to Utility Companies .............................. 36
2.15 Easement: Monorail ...................................................... 37
2.16 Easement: Signs ......................................................... 38
ARTICLE 3 CONSTRUCTION OF REDEVELOPED ALADDIN ..................................... 39
3.1 General Covenants and Background ........................................ 39
3.2 Workmanship ............................................................. 40
3.3 Coordination ............................................................ 41
3.4 Interference During Construction ........................................ 41
3.5 Optional Improvements and Music Hotel ................................... 41
3.6 Mechanic's Liens ........................................................ 43
3.7 Construction Bonds ...................................................... 43
3.8 Temporary Termination of Fire Service ................................... 43
3.9 Indemnity .............................................................. 44
3.10 Submittal of As-Built Plans and Record Drawings ......................... 44
3.11 Self-Help Cure of Construction Defaults ................................. 45
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ARTICLE 4 ALLOCABLE SHARES OF COMMON COSTS................................... 45
4.1 Payments .......................................................... 45
4.2 Resolution of Disputes ............................................ 47
4.3 Creation of Lien and Personal Obligation for Payment of Allocable
Shares ............................................................ 47
4.4 Adjustments to Allocable Share of Common Costs..................... 47
ARTICLE 5 CENTRAL ENERGY PLANT .............................................. 48
5.1 Construction of Central Energy Plant............................... 48
5.2 Purchase of Electricity, Chilled Water and Hot Water............... 48
5.3 Sale of Excess Electricity, Chilled Water and Hot Water............ 48
ARTICLE 6 FLOOR AREA, USE, AND OPERATION..................................... 49
6.1 Floor Area; First and Second Scheduled Opening Dates............... 49
6.2 Uses............................................................... 49
6.3 Limitation on Detrimental Characteristics.......................... 50
6.4 Operation.......................................................... 50
6.5 Gaming Activities ................................................. 53
6.6 Commercial Subdivision; Taxes and Assessments...................... 54
6.7 Adjacent Land...................................................... 55
ARTICLE 7 COVENANTS AGAINST WASTE............................................ 56
7.1 Waste.............................................................. 56
7.2 Hazardous Substances............................................... 56
ARTICLE 8 INDEMNIFICATION AND INSURANCE...................................... 56
8.1 Indemnity.......................................................... 56
8.2 General Liability Insurance........................................ 56
8.3 Property Insurance................................................. 57
8.4 Blanket Insurance.................................................. 57
8.5 Controlled Insurance Program....................................... 57
8.6 Mutual Release; Waiver of Subrogation.............................. 57
8.7 Named Insureds..................................................... 58
ARTICLE 9 REPAIR, MAINTENANCE, ALTERATIONS AND RESTORATION................... 58
9.1 Maintenance - Buildings............................................ 58
9.2 Maintenance - Common Parking Area.................................. 59
9.3 Alterations - Buildings and Common Area............................ 59
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9.4 Restoration of Buildings and/or Common Area........................ 61
9.5 Restoration of Improvements Not Covered by Section 9.4............. 61
9.6 Standards of Construction.......................................... 62
9.7 Licenses for Repairs, Maintenance, Alterations and Restoration..... 63
9.8 Clearing of Building Site.......................................... 64
9.9 Self-Help Cure of Maintenance and Restoration Defaults............. 64
9.10 Lien............................................................... 65
9.11 Article 9 Approvals................................................ 65
ARTICLE 10 FORCE MAJEURE...................................................... 65
10.1 Force Majeure...................................................... 65
10.2 Notice............................................................. 65
ARTICLE 11 DISCHARGE AND RELEASE.............................................. 66
11.1 Discharge on Transfer.............................................. 66
11.2 Discharge on Involuntary Transfer.................................. 66
11.3 Exceptions to Discharge............................................ 67
11.4 Discharge of Mortgagee............................................. 67
11.5 Aladdin Gaming Released From Operating Covenants................... 67
11.6 Bazaar Company Released from Operating Covenants................... 67
11.7 Aladdin Music Released from Operating Covenants.................... 67
11.8 Excuse and Release From Restoration Covenants...................... 68
11.9 No Waiver.......................................................... 68
ARTICLE 12 ARBITRATION........................................................ 69
12.1 Disputes Covered................................................... 69
12.2 Arbitration Procedures............................................. 69
ARTICLE 13 ATTORNEYS' FEES.................................................... 71
13.1 Prevailing Parry................................................... 71
ARTICLE 14 NOTICES............................................................ 72
14.1 Notices to Parties................................................. 72
ARTICLE 15 MORTGAGEE PROVISIONS............................................... 77
15.1 Mortgagee Notice................................................... 77
ARTICLE 16 AMENDMENT.......................................................... 78
16.1 Method and Effect of Amendment..................................... 78
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16.2 No Third Party Beneficiary......................................... 79
ARTICLE 17 TERMINATION OF REA................................................. 79
ARTICLE 18 EXERCISE OF APPROVAL RIGHTS........................................ 79
ARTICLE 19 EFFECTIVE DATE OF REA.............................................. 80
ARTICLE 20 MISCELLANEOUS...................................................... 81
20.1 Breach Shall Not Defeat Mortgage................................... 81
20.2 Breach Shall Not Permit Termination................................ 81
20.3 Captions........................................................... 81
20.4 Interpretation..................................................... 81
20.5 Governing Laws and Forum........................................... 81
20.6 Injunctive Relief.................................................. 82
20.7 No Partnership..................................................... 82
20.8 Not a Public Dedication............................................ 82
20.9 Payment on Default................................................. 82
20.10 Severability....................................................... 83
20.11 Successors......................................................... 83
20.12 Time of Essence.................................................... 83
20.13 Waiver of Default.................................................. 83
20.14 Rights Cumulative.................................................. 84
20.15 Counterparts....................................................... 84
20.16 Estoppel Certificates.............................................. 84
20.17 Limitation on Liability............................................ 85
20 18 Index.............................................................. 86
20.19 Compliance With Laws............................................... 86
20 20 Conflicts........................................................ 87
EXHIBIT "A-l" - LEGAL DESCRIPTION SITE.......................................... 95
EXHIBIT "A-2" - LEGAL DESCRIPTION GAMING SITE................................... 96
EXHIBIT "A-3' - LEGAL DESCRIPTION BAZAAR SITE................................... 97
EXHIBIT "A-4" - LEGAL DESCRIPTION ALADDIN MUSIC SITE............................ 98
EXHIBIT "A-5" - LEGAL DESCRIPTION UTILITY SITE.................................. 99
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EXHIBIT "A-6" - LEGAL DESCRIPTION OPTIONAL IMPROVEMENTS SITE............... 100
EXHIBIT "B" - SITE PLANS
EXHIBIT "C" - PLANS AND SPECIFICATIONS
SCHEDULE "I" - ALLOCABLE SHARE OF COMMON COSTS
SCHEDULE "II" - ALLOCABLE SHARE OF REAL ESTATE TAXES
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CONSTRUCTION, OPERATION AND RECIPROCAL EASEMENT AGREEMENT
(Aladdin Gaming/Bazaar/Music)
THIS CONSTRUCTION, OPERATION AND RECIPROCAL EASEMENT AGREEMENT (this
"REA") is made and entered into as of February 26, 1998, by and between ALADDIN
GAMING, LLC, a Nevada limited-liability company ("ALADDIN GAMING"), ALADDIN
BAZAAR, LLC, a Delaware limited liability company ("BAZAAR COMPANY"), and
ALADDIN MUSIC HOLDINGS, LLC, a Nevada limited-liability company ("ALADDIN
MUSIC").
R E C I T A L S :
A. Aladdin Gaming is the owner of that certain real property
located at 3667 Las Vegas Boulevard South in Clark County, Nevada (the "COUNTY")
which is more particularly described on Exhibit "A-l" attached hereto (the
"SITE"). The Site is currently improved with certain improvements commonly known
as the "ALADDIN HOTEL AND CASINO" which are being, or will be, demolished and
redeveloped, pursuant to the terms of that certain Site Work Development and
Construction Agreement dated as of the date hereof, among Aladdin Holdings, LLC,
Aladdin Gaming and Bazaar Company (the "SITE WORK AGREEMENT"). A memorandum of
the Site Work Agreement shall be recorded in the Official Records of the County
immediately following the recordation of this REA. In addition to the demolition
contemplated by the Site Work Agreement, certain portions of the Site will be
prepared pursuant to the terms of the Site Work Agreement with various on-site
and off-site infrastructure improvements to permit the development of the
Redeveloped Aladdin (as hereinafter defined) described in this REA.
B. That portion of the Site not including the Bazaar Site, the
Aladdin Music Site, the Energy Site and the Optional Improvements Site (as such
terms are hereinafter defined) is more particularly described on Exhibit "A-2"
attached hereto (the "GAMING SITE"). Aladdin Gaming shall construct and/or
renovate on the Gaming Site the Aladdin Improvements (as hereinafter defined)
consisting of certain related and physically attached facilities, including a
hotel containing approximately 2600 rooms, an approximately 116,000 square foot
casino, a Theater for Performing Arts (as hereinafter defined), an area (the
"ALADDIN PARKING AREA") which shall consist of space for approximately 500 motor
vehicles, and truck docking and loading facilities which shall be located
beneath the hotel and casino, all as more particularly set forth on the Site
Plans and the Plans and Specifications (as such terms are hereinafter defined).
C. Aladdin Gaming has leased to Bazaar Company a portion of the
Site to permit the construction and operation by Bazaar Company of the Bazaar
Improvements (as hereinafter defined) pursuant to the terms of that certain
lease between Aladdin Gaming and Bazaar Company (the "BAZAAR LEASE"). A memo-
randum of the Bazaar Lease shall be recorded in the Official Records of the
County immediately prior to the recordation of this REA. That portion of the
Site subject to the Bazaar Lease and upon which the Bazaar Improvements will be
developed is more particularly described on Exhibit "A-3" attached hereto (the
"BAZAAR SITE").
D. Aladdin Gaming has leased to Aladdin Music a portion of the
Site pursuant to the terms of that certain lease between Aladdin Gaming and
Aladdin Music (the "MUSIC LEASE") to permit the construction and operation by
Aladdin Music of a second hotel and casino facility consisting of certain
related and physically attached facilities, including a hotel containing
approximately 1000 rooms and an approximately 50,000 square foot casino located
on the corner of Audrie Street and Harmon Avenue as more particularly described
herein below (the "MUSIC HOTEL"). A memorandum of the Music Lease shall be
recorded in the Official Records of the County immediately prior to the
recordation of this REA. That portion of the Site subject to the Music Lease and
upon which the Music Hotel will be developed is more particularly described on
Exhibit "A-4" attached hereto (the "ALADDIN MUSIC SITE").
E. Aladdin Gaming has leased to Energy Provider (as hereinafter
defined) a portion of the Site pursuant to the terms of that certain lease dated
as of December 3, 1997, between Aladdin Gaming and Energy Provider (the "ENERGY
LEASE"). Pursuant to the Energy Provider Agreement (as hereinafter defined),
Energy Provider is obligated to construct and operate a central energy plant
(the "CENTRAL ENERGY PLANT") for the cogeneration of electricity, the production
of chilled water and hot water, and the distribution of electricity, chilled
water and hot water to the Site. A memorandum of the Energy Lease shall be
recorded in the Official Records of the County immediately prior to the
recordation of this REA. That portion of the Site subject to the Energy Lease
and upon which the Central Energy Plant will be developed is more particularly
described on Exhibit "A-5" attached hereto (the "ENERGY SITE").
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F. Conditioned upon the due performance of the demolition and
infrastructure development described in the Site Work Agreement, Aladdin Gaming
and Bazaar Company are each obligated to construct certain improvements on the
Gaming Site and the Bazaar Site, respectively, pursuant to the terms of the Site
Work Agreement and this REA, as more particularly described on the Site Plans
and the Plans and Specifications (the "INITIAL PLANNED FLOOR AREA"). The
improvements required to be constructed by Bazaar Company on the Bazaar Site
pursuant to the terms of this REA shall be owned by Bazaar Company and are
hereinafter collectively referred to as the "BAZAAR IMPROVEMENTS". The
improvements required or permitted to be constructed and/or renovated by Aladdin
Gaming pursuant to the terms of this REA shall be owned by Aladdin Gaming and
are hereinafter referred to as the "ALADDIN IMPROVEMENTS". The Bazaar
Improvements, the Music Hotel, the Central Energy Plant and the Aladdin
Improvements are sometimes hereinafter collectively referred to as the
"REDEVELOPED ALADDIN". As more particularly described in this REA, while all of
the Bazaar Improvements are required to be constructed by Bazaar Company, only a
portion of the Aladdin Improvements are required to be constructed by Aladdin
Gaming. Construction of any Aladdin Improvements which are not required to be
constructed by Aladdin Gaming pursuant to this REA (the "OPTIONAL IMPROVEMENTS")
may be developed by the Aladdin Parties (as hereinafter defined), subject to the
terms and conditions of this REA.
G. The Bazaar Improvements consist of the "RETAIL FACILITY" and
the "COMMON PARKING AREA." The Retail Facility consists of approximately 726,000
square feet of Floor Area (including approximately 462,000 square feet of gross
leasable retail area) in the nature of an enclosed themed entertainment shopping
mall located at particular elevations of the Aladdin Improvements with various
vertical penetrations above and below such elevations, all as more particularly
described on the Site Plans and the Plans and Specifications. The Common Parking
Area consists of a multi-level parking structure for approximately 4,800 motor
vehicles adjacent to the Bazaar Improvements and surface-level parking
facilities for approximately 364 motor vehicles beneath and adjacent to the
Retail Facility, as more particularly described on the Site Plans and the Plans
and Specifications. The Common Parking Area does not include the Aladdin Parking
Area.
H. The Parties to this REA desire that the Redeveloped Aladdin be
improved and operated as a mixed-use project which is physically and
functionally integrated through, among other things, reciprocal easements for
parking and
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access, construction easements for development and renovation of the Redeveloped
Aladdin, and the adoption and observance of uniform standards of development,
operation and maintenance as set forth in this REA.
NOW, THEREFORE, in consideration of the foregoing, the covenants
contained herein, and for other and good and valuable consideration, the receipt
and sufficiency of which are hereby acknowledged, the Parties hereto hereby
agree as follows:
ARTICLE 1
DEFINITIONS
As used in this REA, references to "Recitals," "Articles," "Sections"
and "Exhibits" are references to corresponding portions of this REA. Listed
below are definitions for certain terms that are used in this REA with
particular meanings. Unless otherwise defined herein, capitalized terms used in
this REA shall have the meanings set forth in this Article 1. Unless otherwise
noted, a defined term shall include, where appropriate to the context, the noun
(singular and plural), verb and adjective forms of the terms.
Accounting Period. "ACCOUNTING PERIOD" shall mean any period beginning
on January 1 and ending on the next following December 31, except that the first
Accounting Period shall commence on the date hereof and shall end on the
following December 31, and the last Accounting Period shall end on the
Termination Date.
Adjacent Land. "ADJACENT LAND" is defined in Section 6.7.
Affiliate. "AFFILIATE" shall mean a Person that Controls, is directly
or indirectly Controlled by, or is under common ownership or Control with,
another Person. Notwithstanding the foregoing or any other provision of this REA
to the contrary, in no event shall any Party be considered to be an Affiliate of
any other Party or Affiliates thereof, notwithstanding the fact that Affiliates
of certain Parties hold a fifty percent (50%) membership interest in other
Parties.
Aladdin Gaming. "ALADDIN GAMING" shall initially mean Aladdin Gaming,
LLC, a Nevada limited-liability company, and upon a Transfer or
4
Involuntary Transfer of such Person's interest in the Site, "Aladdin Gaming"
shall mean such Person's Transferee.
Aladdin Hotel and Casino. "ALADDIN HOTEL AND CASINO" is defined in
Recital A.
Aladdin Improvements. "ALADDIN IMPROVEMENTS" is defined in Recital F
and includes the Buildings and Common Area improvements on the Gaming Site, as
more particularly set forth on the Site Plans and the Plans and Specifications,
including any present or future Construction or alteration of the Optional
Improvements, in accordance with the terms of this REA and the Site Work
Agreement, as the same may exist from time-to-time. Aladdin Improvements shall
not include any of the Aladdin Improvements that have been from time-to-time
razed or removed in accordance with the terms of this REA.
Aladdin Music. "ALADDIN MUSIC" shall initially mean Aladdin Music
Holdings, LLC, a Nevada limited-liability company, and upon a Transfer or
Involuntary Transfer of such Person's interest in the Site, "Aladdin Music"
shall mean such Person's Transferee.
Aladdin Music Site. "ALADDIN MUSIC SITE" is defined in Recital D.
Aladdin Parking Area. "ALADDIN PARKING AREA" is described in Recital B
and includes portions of the Gaming Site, as more particularly set forth on the
Site Plans and the Plans and Specifications.
Aladdin Parties. "ALADDIN PARTIES" shall mean Aladdin Gaming and/or its
Permitted Transferees.
Allocable Share of Common Costs. "ALLOCABLE SHARE OF COMMON COSTS"
shall mean that portion of each category of the Common Costs allocable to each
Tract on a monthly basis for each Accounting Period, subject to adjustment on an
annual basis AS provided in this REA. The Common Costs allocable to each Tract
shall also be subject to adjustment pursuant to the terms of Section 4.4 hereof
at such time as any Optional Improvements shall be developed by an Aladdin
Party, or a successor thereof. The Party responsible for maintaining and
operating the Common Area affected by an adjustment shall notify each Party of
such adjustment in accordance with Article 4 hereof. The initial Allocable Share
of Common Costs for each Tract shall be equal to the percentages and paid by the
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Parties set forth on Schedule "I" hereto for each such Tract, which amounts
shall be payable to Bazaar Company or Aladdin Gaming, as the case may be, as set
forth in this REA.
Allocable Share of Real Estate Taxes. "ALLOCABLE SHARE OF REAL ESTATE
TAXES" is defined in Section 6.6.
Annual Statement. "ANNUAL STATEMENT" is defined in Section 4.1(b).
Arbitrator. "ARBITRATOR" is defined in Section 12.2(a).
Attorneys' Fees. "ATTORNEYS' FEES" is defined in Article 13.
Bazaar Company. "BAZAAR COMPANY" shall initially mean Aladdin Bazaar,
LLC, a Delaware limited liability company, and upon a Transfer or Involuntary
Transfer of such Person's interest in the Site, "Bazaar Company" shall mean such
Person's Transferee.
Bazaar Improvements. "BAZAAR IMPROVEMENTS" is defined in Recital F and
includes the Buildings and Common Area improvements on the Bazaar Site, as more
particularly set forth on the Site Plans and the Plans and Specifications,
including any present or future Construction or alteration thereof in accordance
with the terms of this REA, as the same may exist from time to time. Bazaar
Improvements shall not include any of the Bazaar Improvements that have been
from time to time razed or removed in accordance with the terms of the Bazaar
Lease and this REA.
Bazaar Lease. "BAZAAR LEASE" is defined in Recital C.
Bazaar LLC Agreement. "BAZAAR LLC AGREEMENT" shall mean that Limited
Liability Company Agreement of Aladdin Bazaar, LLC dated as of September 3,
1997, as amended on October 16, 1997 and as thereafter amended from time to
time.
Bazaar Perimeter Areas. "BAZAAR PERIMETER AREAS" means the sidewalks,
landscaping, irrigation, lighting and similar areas to be maintained by Bazaar
Company, as more particularly set forth on the Site Plans and the Plans and
Specifications.
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Bazaar Site. "BAZAAR SITE" is defined in Recital C.
Budget. "BUDGET" is defined in Section 4. l(a).
Building. "BUILDING" shall mean all portions of the buildings and
improvements (including alterations or restorations) that exist or are
constructed from time to time on a Party's Tract.
Casino Perimeter Areas. "CASINO PERIMETER AREAS" means the sidewalks,
landscaping, irrigation, lighting and similar areas to be maintained by Aladdin
Gaming, as more particularly set forth on the Site Plans and the Plans and
Specifications.
Central Energy Plant "CENTRAL ENERGY PLANT" is defined in Recital E.
Cessation Right. "CESSATION RIGHT" is defined in Section 6.4(h).
Claim. "CLAIM" is defined in the definition of "Indemnify".
Commercial Subdivision. "COMMERCIAL SUBDIVISION" is defined in Section
6.6.
Common Area. "COMMON AREA" shall mean the Common Parking Area, Common
Area Utility Lines, the Bazaar Perimeter Areas, the Casino Perimeter Areas and
the Fire Command Center, all as more particularly set forth on the Site Plans
and the Plans and Specifications, subject to any restrictions set forth in this
REA. The Common Area, except the Common Parking Area, shall be maintained,
repaired, operated and restored by the Parties set forth on Schedule "I" hereto.
The Common Parking Area shall be maintained, repaired, operated and restored by
Bazaar Company pursuant to the Parking Use Agreement.
Common Area Utility Line. "COMMON AREA UTILITY LINE" is defined in
Section 2.1(e).
Common Area Work. "COMMON AREA WORK" is defined in Section 4.1.
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Common Costs. "COMMON COSTS" shall mean those expenses and costs which
arise in connection with the proper maintenance, repair and operation of the
Common Area (including administrative fees to the extent representative of
actual costs and expenses, but not profits, except as expressly provided in the
Parking Use Agreement) and which are to be shared between certain of the Parties
in accordance with their respective Allocable Share of Common Costs. Each Party
shall be responsible for, and Common Costs shall not include, the cost of
building, installing, maintaining and operating Buildings, except to the extent
the Parties hereto otherwise agree to include such costs as Common Costs. In no
event shall Common Costs include any of the following: (i) the cost of any
demolition or construction Work contemplated by the Site Work Agreement,
including but not limited to the cost of constructing the Initial Planned Floor
Area and the Optional Improvements; (ii) any costs specifically allocated to or
required to be paid by a Party pursuant to the Site Work Agreement, the Bazaar
Lease, the Music Lease, the Energy Lease, the Parking Use Agreement, this REA,
any environmental indemnity, or any other agreement between two or more Parties
hereto which specifically requires any such Party to bear a cost or expense
which might otherwise be considered a Common Cost; (iii) promotional costs and
activities; (iv) Construction, operation, maintenance, repair, replacement and
restoration of the Central Energy Plant; (v) costs imposed by the County or
other governmental authorities claiming jurisdiction over the Site which relate
to the use to which any individual Tract is put; (vi) depreciation and financing
costs attributable to any of the improvements comprising the Redeveloped
Aladdin; (vii) the continuing cost of complying with any requirements imposed by
the County or any other governmental authority in connection with the
realignment of Harmon Avenue and pedestrian bridges, which cost shall remain the
responsibility of Aladdin Gaming; (viii) the cost of special services, goods or
materials provided to or specific costs incurred for the account of specific
Parties, Occupants or Permittees rather than for the benefit of the Site as a
whole; (ix) amounts paid in respect of Common Costs to an Affiliate of an
Operator Party to the extent such amounts are in excess of amounts that would be
paid on a commercially reasonable basis to qualified third parties in respect of
such costs; (x) real estate and personal property taxes with respect to each
Tract and each Party (except for personal property taxes attributable to
personal property to the extent used in connection with the Common Area) (it
being understood, however, that the Parties shall be responsible for their
respective Allocable Share of Real Estate Taxes as provided herein); and (xi)
the cost of Construction of the Monorail (it being understood, however, that
such cost shall nonetheless be subject to equitable allocation among the Parties
as set forth in Section 2.15 hereof).
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Common Parking Area. "COMMON PARKING AREA" is referenced in Recital G
and shall mean that portion of the Bazaar Improvements located on the Bazaar
Site and designated on the Site Plans and the Plans and Specifications for the
shared use of the Redeveloped Aladdin in connection with the parking, passage,
and loading of motor vehicles and trucks, together with related improvements
which at any time are constructed in connection therewith, including but not
limited to roadways, pedestrian sidewalks, stairways, elevators, bridges,
landscaping light standards, directional signs, driveways and curbs, in each
case to the extent indicated on the Site Plans and the Plans and Specifications.
Construction. "CONSTRUCTION" is defined in Section 3.1.
Contracting Party. "CONTRACTING PARTY" is defined in Section 3.6.
Control. "CONTROL" shall mean ownership of a Person or Party in excess
of 50% and/or the power, exercisable jointly or severally, to manage and direct
a Person through the direct or indirect ownership of partnership interest,
stock, trust powers, or other beneficial interests and/or management or voting
rights. A "CHANGE OF CONTROL" shall mean that Control passes from one Person and
its Affiliates to another in a single transaction or a series of related
transactions.
Controlled Insurance Program. "CONTROLLED INSURANCE PROGRAM" is defined
and set forth in that certain Contract between Aladdin Gaming and Fluor Daniel,
Inc. for Design/Build Services dated as of December 4, 1997.
County. "COUNTY" is defined in Recital A.
Cure. At such time as a Party is in Default and has received a demand
for the correction of such Default, such Party and its Mortgagee shall be
permitted thirty (30) days or such other amount of time specified herein within
which to render remedial performance sufficient to correct said Default, which
correction of said Default shall be referred to herein as "Cure." At its
election, the Party serving a notice of Default may also serve a demand for the
correction of such Default either concurrently with or subsequent to service of
the notice of Default, which demand shall specify the nature of the Default and
the precise duty or obligation under this REA alleged to have been breached.
Except as provided elsewhere in this REA to the contrary, whenever a Default is
not capable of Cure within the specified period, a Defaulting Party (or its
Mortgagee) shall be deemed
9
to have Cured the Default if it shall have commenced Cure within the specified
time period and shall have prosecuted the Cure continuously and diligently
thereafter to completion.
Default. "DEFAULT" shall mean a Party's breach of any of its covenants
or obligations set forth in this REA. A notice of Default may be accompanied or
followed by service of a demand for the correction of such Default. A party in
Default is sometimes referred to herein as a "DEFAULTING PARTY."
Demolition Work. "DEMOLITION WORK" shall mean portions of the Site
which may be demolished, razed and removed and which is more particularly
described in Article II of the Site Work Agreement.
Demand. "DEMAND" is defined in Section 12.2(a) hereof.
Demanding Party. "DEMANDING PARTY" is defined in Section 12.2(a)
hereof.
Discharge. "DISCHARGE" shall mean the full relief and exoneration from
any personal liability or responsibility of a Transferor, Mortgagor or Mortgagee
for performance of, granting of or compliance with all easements, covenants,
duties and obligations accruing and arising under this REA in connection with a
Party's possession of its Tract, which shall occur from and after the effective
date of the following: (a) with respect to a Transferor, a Transfer, as more
fully described in Section 11.1; (b) with respect to a Mortgagor, an Involuntary
Transfer, as more fully described in Section 11.2; and (c) with respect to a
Mortgagee, a Transfer by such Mortgagee after acquiring title to a Tract (or
portion thereof) in an Involuntary Transfer, as more fully described in Section
11.4.
DPW Agreement. "DPW AGREEMENT" shall mean that certain Aladdin Hotel &
Casino Agreement between Aladdin Holdings, LLC and the County, dated March 18,
1997.
Energy Provider. "ENERGY PROVIDER" shall mean Northwind Aladdin, LLC, a
Nevada limited-liability company, and upon a Transfer or Involuntary Transfer of
such Person's interest in the Site, "Energy Provider" shall mean such Person's
Transferee.
10
Energy Provider Agreement. "ENERGY PROVIDER AGREEMENT" is defined in
Section 2.1(f).
Energy Provider Utility Line. "ENERGY PROVIDER UTILITY LINE" is defined
in Section 2.1.
Energy Site. "ENERGY SITE" is defined in Recital E.
Estimated Cost Statement. "ESTIMATED COST STATEMENT" is defined in
Section 4.1.
Event of Default. "EVENT OF DEFAULT" shall mean a Default beyond
applicable notice and period for Cure.
Excuse. "EXCUSE" shall mean the occurrence of an event of either (a)
force majeure pursuant to Article 10 that interferes with a Party's ability to
perform its obligations under this REA, or (b) the Default of another Party with
respect to its restoration covenants given in Article 9 to the extent that such
Default interferes with a non-Defaulting Party's ability to perform its
obligations under this REA and which Default shall, pursuant to Section 11.8(a),
result in the temporary relief of the non-Defaulting Party from its duty to
restore under Article 9, for so long as such force majeure event continues or
such Defaulting Party has not Cured its Default.
Final Completion Deadline. "FINAL COMPLETION DEADLINE" is defined in
the Energy Provider Agreement.
Fire Command Center. "FIRE COMMAND CENTER" shall mean that certain fire
command center for the Site and all facilities in connection therewith, as more
particularly set forth on me Site Plans and the Plans and Specifications, to be
maintained by Aladdin Gaming or Bazaar Company, as such Parties shall mutually
determine.
First Scheduled Opening Date. "FIRST SCHEDULED OPENING DATE" shall mean
that date by which the Redeveloped Aladdin, except for the Music Hotel, is
scheduled to be first opened for business to the public, as more particularly
set forth in the Site Work Agreement.
11
Floor Area. "FLOOR AREA" shall mean the aggregate, as established from
time to time by the Project Architect/Engineer, of the actual number of square
feet of floor space on all floors in any Building, whether or not roofed or
occupied or leased, excluding non-leasable areas such as equipment rooms,
subterranean areas, balconies and mezzanines, management offices, and the like,
but only to the extent the same are not actually leased or leasable, measured
from the exterior faces or exterior lines of the exterior walls (including
basement walls) and from the center line (as opposed to exterior face) of the
party and interior common walls. Estimates of the initial Floor Areas,
including, with respect to the Gaming Site and the Bazaar Site, the Initial
Planned Floor Area, are set forth on the Site Plans and the Plans and
Specifications, which estimates shall be adjusted from time to time as the
Redeveloped Aladdin is constructed and improved.
Gaming Authority: Gaming Activity: Gaming Facility: Gaming Laws.
"GAMING AUTHORITY" shall mean the Nevada Gaming Commission, the Nevada State
Gaming Control Board, the Clark County Liquor and Gaming License Board, any
agency or authority operating under the Nevada Gaming Control Act, and any other
agency or authority of the State of Nevada regulating Gaming Activities. "GAMING
LAWS" shall mean any statute, regulation, rule, mandate, opinion or similar
authority promulgated by a Gaming Authority. "GAMING ACTIVITY" shall mean any
use, operation, business or other activity which requires a license, approval,
authorization, registration or a finding of suitability from any Gaming
Authority. "GAMING FACILITY" shall mean a facility or facilities devoted
substantially to lodging, entertainment and the operation of Gaming Activities
open to the public at large, which facility and Gaming Activities are similar in
type to the majority of the hotel casinos located on the Las Vegas Strip. A
Gaming Facility may be associated with or included within or be a part of
another business operated in conjunction with the Gaming Facility including but
not limited to a hotel, hotel resort complex, amusement or theme ride parks,
retail center, and/or entertainment venues.
Gaming Equipment. "GAMING EQUIPMENT" is defined in Section 6.5(c).
Gaming Site. "GAMING SITE" is defined in Recital B.
Grantee. "GRANTEE" is defined in Section 2.1(b).
Grantor. "GRANTOR" is defined in Section 2.1(a).
12
Hazardous Substances. "HAZARDOUS SUBSTANCES" means and includes the
following, including mixtures thereof: any hazardous substance, pollutant,
contaminant, waste, by-product or constituent regulated under NRS Ch. 459, NRS
Sections 618.750-618.850, NRS Section 477.045, as amended, or any other federal,
state or local laws and regulations as amended or hereafter enacted regulating
hazardous or toxic substances or wastes, petroleum pollutant or waste or similar
substances, including, but not limited to. as defined in the Comprehensive
Environmental Response, Liability and Compensation Act, 42 U.S.C. 9601 et seq.,
as amended, the Federal Water Pollution Control Act, 33 U.S.C. Sections 1251, et
seq., Hazardous Materials Transportation Act, 49 U.S.C. Sections 1801, et seq.,
Resource Conservation and Recovery Act, 42 U.S.C. Sections 6901, et seq., Safe
Drinking Water Act, 42 U.S.C. Sections 3000(f, et seq., Clean Air Act, 42 U.S.C:
Sections 7401, et seq., and United States Department of Transportation Hazardous
Materials Table, 49 C.F.R. 172.101, Chapters 444, 445A, 445B, 590 or 618 of NRS;
pesticides regulated under the Federal Insecticides, Fungicide, and Rodenticide
Act, 7 U.S.C. Section 136 et seq.; asbestos and asbestos-containing materials,
PCBs and other substances regulated under the Toxic Substances Control Act, 15
U.S.C. Section 2601 et seq.; source material, special nuclear material,
by-product material and any other radioactive materials or radioactive wastes,
however produced, regulated under the Atomic Energy Act or the Nuclear Waste
Police Act; chemicals subject to the OSHA Hazard Communication Standard, 29
C.F.R. 1910.1200 et seq.; and industrial process and pollution control wastes
whether or not hazardous within the meaning of the Resource Conservation and
Recovery Act, 42 U.S.C. 6901 et seq. References to statutory authority in this
definition shall be deemed to refer to such authority as such may be amended
from time to time.
In. "IN" is defined in Section 2.1(c).
Indemnify. "INDEMNIFY" shall mean the obligation of a Party
("INDEMNITOR") to indemnify, hold harmless, protect and defend, with counsel
reasonably acceptable to the Person receiving such indemnity ("INDEMNITY"),
including such Person's Affiliates and their respective officers, directors,
partners, members, landlords, agents, servants and employees (individually and
collectively, "INDEMNITEE") from and against all losses, claims, actions, liens,
proceedings, liabilities, damages (excluding consequential and punitive
damages), costs and/or expenses (including the Indemnitee's reasonable
Attorneys' Fees) (collectively, a "CLAIM") resulting from the death of or injury
to any Person or the physical or economic damage to or loss of any property
arising out of the Indemnitor's duties
13
or conduct specified in this REA. Such term shall also include the requirement
that the Indemnitee give the Indemnitor notice of any suit or proceeding
entitling the Indemnitee to indemnification pursuant to this REA. Failure to
give such notice shall not, however, in any manner negate or invalidate the
obligation to provide such indemnity, except to the extent the Indemnitor is
actually prejudiced thereby. No Party shall be obligated to Indemnify another
Party to the extent the Claim underlying the Indemnitee's request for Indemnity
(a) results from the negligence or intentional wrongdoing of the Indemnitee
without the negligence of the Indemnitor, or (b) results from such willful,
intentional or wanton acts or omissions of the Indemnitee as shall constitute an
"occurrence" excluded from coverage under standard comprehensive public
liability and property damage insurance policies as they may exist from time to
time.
Index. "INDEX" is defined in Section 20.18.
Infrastructure Improvements. "INFRASTRUCTURE IMPROVEMENTS"
means those off-site and on-site infrastructure improvements depicted on the
Site Plans and the Plans and Specifications and installed, made, constructed,
restored or relocated by the Aladdin Parties in order to prepare the Site for
the development and construction of the Redeveloped Aladdin, and for ongoing
operation as required by the DPW Agreement and the County, including, without
limitation, grading, pad preparation, streets, roadways, driveways, walkways,
sidewalks, curbs, bridges, turning lanes, traffic control devices, traffic
signals, traffic mitigation measures, water drainage and flood control
mitigation measures, street lights, driveway and walkway lights, Building lights
(including lighting and ceilings that are underneath the Retail Facility),
signage, landscaping, pedestrian bridges, tunnels and overpasses (whenever
constructed) and preparation for the installation of utilities.
Initial Planned Floor Area. "INITIAL PLANNED FLOOR AREA" is
referred to in Recital F and shall mean the Floor Area that Aladdin Gaming is
required to construct on the Gaming Site and Bazaar Company is required to
construct on the Bazaar Site, respectively, pursuant to the Site Work Agreement
and this REA. The Initial Planned Floor Area for the Bazaar Improvements and the
required portion of the Aladdin Improvements is more particularly set forth on
the Site Plans and the Plans and Specifications for the Bazaar Improvements and
the Aladdin Improvements, respectively.
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Involuntary Transfer. "INVOLUNTARY TRANSFER" shall mean the
conveyance or reversion of fee or leasehold title to a Tract (or portion
thereof) from a Mortgagor ("INVOLUNTARY TRANSFEROR") to a Mortgagee
("INVOLUNTARY TRANSFEREE") resulting from the judicial or nonjudicial
foreclosure of the Mortgage or the grant of a deed in lieu of such foreclosure;
provided, however, in the event of such an Involuntary Transfer, the Involuntary
Transferor shall be conclusively deemed to have assigned all of its rights,
powers, title and interest in its Tract and this REA to the Involuntary
Transferee, who shall be conclusively deemed to have assumed all of the
Involuntary Transferor's covenants and obligations thereunder accruing from and
after such Involuntary Transfer.
Licensee. "LICENSEE" is defined in Section 9.7.
Liened Party. The term "LIENED PARTY" is defined in Section
3.6.
Monorail. "MONORAIL" is defined in Section 2.15.
Mortgage; Mortgagor; Mortgagee. "MORTGAGE" shall mean an
indenture of mortgage or a deed of trust encumbering all or a portion of the
interest of a Party ("MORTGAGOR") in its Tract. "MORTGAGEE" shall mean either
the trustee and beneficiary/mortgagee, individually or collectively as
appropriate, under a Mortgage.
Music Hotel. "MUSIC HOTEL" is defined in Recital D.
Music Lease. "MUSIC LEASE" is defined in Recital D.
Name. "NAME" shall exclusively mean, with respect to Aladdin
Gaming, "Aladdin Hotel and Casino" or such other name as Aladdin Gaming may
designate in lieu thereof in the future, as to which Bazaar Company and Aladdin
Music shall have the right to reasonably approve, which approval shall not be
unreasonably withheld; with respect to Bazaar Company, "Desert Passage at
Aladdin" or such other name as Bazaar Company may designate in lieu thereof in
the future, as to which Aladdin Gaming and Aladdin Music shall have the right to
reasonably approve, which approval shall not be unreasonably withheld; and, with
respect to Aladdin Music, "Sound Asylum Hotel" or such other name as Aladdin
Music may designate in lieu thereof in the future, as to which Aladdin Gaming
and Bazaar Company shall have the right to reasonably approve, which approval
shall not be unreasonably withheld.
15
Non-Demanding Party. "NON-DEMANDING PARTY" is defined in
Section 12.2(a) hereof.
NRS. "NRS" shall mean Nevada Revised Statutes.
Occupant. "OCCUPANT" shall mean the Parties hereto and any
Person from time to time entitled to use and occupy Floor Area under any lease,
sublease, deed or other instrument or arrangement.
Operator Party. "OPERATOR PARTY" is defined in Section 4.1.
Optional Improvements. "OPTIONAL IMPROVEMENTS" is referred to
in Recital F and shall mean the office tower and/or time share facilities that
are permitted to be developed by the Aladdin Parties pursuant to this REA on
that portion of the Site more particularly described on Exhibit "A-6" attached
hereto (the "OPTIONAL IMPROVEMENTS SITE"), in all instances to the extent
permitted by applicable law.
Optional Improvements Site. "OPTIONAL IMPROVEMENTS SITE" is
defined in the definition of Optional Improvements.
Parking Use Agreement. "PARKING USE AGREEMENT" shall mean that
certain Common Parking Area Use Agreement dated as of the date hereof by and
between Bazaar Company and Aladdin Gaming. A memorandum of the Parking Use
Agreement shall be recorded in the Official Records of the County immediately
following the recordation of this REA.
Party. "PARTY" shall mean each of the following: Aladdin
Gaming, Bazaar Company, Aladdin Music, Energy Provider, the owner or lessee of
any portion of the Site conveyed by or leased from Aladdin Gaming for the
purposes of developing the Optional Improvements and, upon a Transfer or
Involuntary Transfer, any of their respective Transferees or Involuntary
Transferees (as the case may be), subject to the provisions of this Section with
respect to Transfers or Involuntary Transfers of partial interests in a Tract.
Following a Transfer or Involuntary Transfer, the Transferor or Involuntary
Transferor shall no longer be a Party; provided, however, that the easements,
conditions, covenants, obligations and restrictions of this REA shall be binding
and enforceable by any Party against any Transferor with respect to those time
periods during which such Transferor was a Party. A Mortgagee shall not be
deemed to be the Party with respect to a
16
Tract so long as the Mortgagor, as the applicable Party, retains the entire
possessory interest in such Tract except that if a Mortgagor conveys a Tract to
a Mortgagee upon the occurrence of a judicial or nonjudicial foreclosure or the
grant of a deed in lieu of foreclosure, then the Mortgagee shall become a Party,
although such Mortgagee shall not be liable for the acts or omissions of the
Transferor. Notwithstanding the foregoing, any such Mortgagee shall not be
deemed a Party unless and until said Mortgagee takes title to the Transferor's
interest in the subject Tract or is deemed to be a Mortgagee in possession
pursuant to applicable law.
A Transferee or Involuntary Transferee of any of the following
partial interests shall not be treated as a separate Party hereunder (but shall
nonetheless be subject to the terms of this REA), unless such Person is
designated in writing as the sole Party with respect to such Tract by all such
Persons owning a partial interest in such Tract:
(a) Any partial, subdivided interest in a
Party's Tract whether by parcelization, condominiumization or
otherwise, except in connection with the Commercial Subdivision;
(b) Any partial, undivided interest in all of a
Party's Tract or Tracts, such as an interest held in joint tenancy,
tenancy-in-common or as a life estate;
(c) Any partial, undivided interest, legal or
equitable, in the assets of any Party that is a Person other than an
individual, which interest is not an interest in the Party's Tract,
such as a beneficial interest in a Party which is a trust but not
including the shareholders and/or bondholders of a Party that is a
corporation; and
(d) Any lease, sublease, easement or license
(excluding the Bazaar Lease, the Music Lease and the Energy Lease)
affecting all or a portion of a Tract.
Only one Person for each Tract may be designated as a Party. In the event that
the Persons owning such partial interests fail to designate a Person as the
Party, the acts of the Person who was the Party prior to the Transfer or
Involuntary Transfer (whether or not such Party retains any interest in the
Tract or Tracts in question) shall be binding on all Persons having an interest
or right in said Tract or Tracts, until such time as written notice of such
designation is given and recorded in the
17
office of the County Recorder of the County and a copy thereof is served on the
Parties in accordance with Article 14.
Perimeter Access Areas. "PERIMETER ACCESS AREAS" means those
areas on a Party's Tract adjacent to a Party's Building between exterior
Building faces and the exterior boundary lines of the Site, including sidewalks,
stairs, escalators, elevators, people movers, monorails and all other surface
improvements relating to ingress and egress within said areas.
Permittee. "PERMITTEE" shall mean any Party or Occupant and
its respective officers, directors, employees, partners, members, agents,
contractors, customers, visitors, invitees, subtenants, licensees and
concessionaires.
Person. "PERSON" shall mean an individual, fiduciary,
partnership, limited liability company, firm, association and corporation, or
any other form of business or government entity.
Plans and Specifications. "PLANS AND SPECIFICATIONS" shall
mean all drawings, plans and specifications prepared by or for a Party which
describe and show the labor, materials, equipment, fixtures and furnishings
necessary for the construction of the improvements on a Party's Tract and which
are or will be identified on Exhibit "C" attached hereto and made a part hereof,
as the same may be modified from time to time pursuant to this REA.
Prevailing Party. "PREVAILING PARTY" is defined in Article 13.
Project Architect/Engineer. "PROJECT ARCHITECT/ENGINEER" shall
mean ADP/FD of Nevada, Inc. with respect to architectural and engineering
matters relating to the Demolition Work, the Site Work, the Aladdin Improvements
and the shell of the Bazaar Improvements, who shall be retained by Aladdin
Gaming, or such other architect(s) or engineer(s) duly licensed to practice in
the State of Nevada as may from time to time be selected by Aladdin Gaming and,
with respect to the shell of the Bazaar Improvements, approved by Bazaar Company
(which approval shall not be unreasonably withheld and shall be deemed granted
if not denied within fifteen (15) days of a request therefor). "PROJECT
ARCHITECT/ENGINEER" shall mean RTKL Associates, Inc. with respect to
architectural and engineering matters relating to the construction of the
interior of the shell of the Bazaar Improvements, who shall be retained by
Bazaar Company, or such other architect(s) or engineer(s) duly licensed to
practice in the State of Nevada as
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may from time to time be selected by Bazaar Company. "PROJECT
ARCHITECT/ENGINEER" shall mean ADP/FD of Nevada, Inc. with respect to
architectural and engineering matters relating to the construction of the Common
Parking Area, who shall be retained by Bazaar Company, or such other
architect(s) or engineer(s) duly licensed to practice in the State of Nevada as
may from time to time be selected by Bazaar Company and approved by Aladdin
Gaming (which approval shall not be unreasonably withheld and shall be deemed
granted if not denied within fifteen (15) days of a request therefor). "PROJECT
ARCHITECT/ENGINEER" shall mean, with respect to architectural and engineering
matters relating to the construction of the Music Hotel, ADP/FD of Nevada, Inc.,
who shall be retained by Aladdin Music, or such other architect(s) or
engineer(s) duly licensed to practice in the State of Nevada as may from time to
time be selected by Aladdin Music and approved by Aladdin Gaming (which approval
shall not be unreasonably withheld and shall be deemed granted if not denied
within fifteen (15) days of a request therefor). "PROJECT ARCHITECT/ENGINEER"
shall mean, with respect to architectural and engineering matters relating to
the Construction of the Central Energy Plant, such architect(s) or engineer(s)
duly licensed to practice in the State of Nevada selected by Energy Provider in
accordance with the Energy Provider Agreement.
Project Contractor. "PROJECT CONTRACTOR" shall mean Fluor
Daniel, Inc., the contractor to be retained by Aladdin Gaming with respect to
the Construction of the Initial Planned Floor Area of the Aladdin Improvements
and a portion of the shell of the Bazaar Improvements, and by Bazaar Company for
the balance of the Retail Facility and the Common Parking Area, or such other
contractor(s) duly licensed to practice in the State of Nevada as may from time
to time be designated by Bazaar Company with respect to the Bazaar Improvements
(provided that such other contractor is reasonably approved by Aladdin Gaming
within fifteen (15) days after request therefor and Aladdin Gaming's failure to
respond shall be deemed approval) and/or by Aladdin Gaming with respect to the
Aladdin Improvements (provided that such other contractor is reasonably approved
by Bazaar Company within fifteen (15) days after request therefor and Bazaar
Company's failure to respond shall be deemed approval). "PROJECT CONTRACTOR"
shall mean, with respect to the Construction of the Music Hotel, such
contractor(s) duly licensed to practice in the State of Nevada as may from time
to time be designated by Aladdin Music (provided that such contractor is
reasonably approved by Aladdin Gaming within fifteen (15) days after request
therefor and Aladdin Gaming's failure to respond shall be deemed approval).
"PROJECT CONTRACTOR" shall mean, with respect to the Construction of the Central
Energy Plant, such contractor(s) duly licensed to practice in the State of
Nevada as may from time to
19
time be designated by Energy Provider in accordance with the Energy Provider
Agreement.
Quality of Development and Planning for the Aladdin
Improvements. "QUALITY OF DEVELOPMENT AND PLANNING FOR THE ALADDIN IMPROVEMENTS"
shall mean that the standard of quality of development for the Aladdin
Improvements (as of the First Scheduled Opening Date) shall be equal to or
better than the general quality (as of the date of this REA) of the Mirage,
including but not limited to interior finish, theming and attraction package,
and standard hotel room, with a higher percentage of suites and king parlors.
Such standards are intended to attract as a primary target the upper middle
market segment, with an ambiance equal to or better than Bally's and Mirage.
Upon the First Scheduled Opening Date, the Aladdin Hotel and Casino is intended
to be one of the top five hotels on the Las Vegas strip, taking into
consideration for such purposes the hotels existing and/or announced as of the
date hereof in terms of market segment, average daily room rate and overall
ambiance and market perception. Bazaar Company acknowledges that such standards
are not intended to be a guaranty of the economic performance of the Aladdin
Improvements or the Redeveloped Aladdin and no Party shall have any liability
with respect to such economic performance. Bazaar Company shall have reasonable
approval of the Quality of Development and Planning for the Aladdin
Improvements, and in its exercise of such approval shall take into account,
among other things, the quality of vehicular traffic and pedestrian circulation,
ingress and egress, and the contractors, plans, drawings and construction
schedule relating to the foregoing. Bazaar Company's approval of the Plans and
Specifications shall be deemed approval of the Quality of Development and
Planning for the Aladdin Improvements with respect to the Construction covered
by such Plans and Specifications.
Redeveloped Aladdin. "REDEVELOPED ALADDIN" is defined in
Recital F.
Release. "RELEASE" shall mean that a specified easement,
covenant and/or restriction under this REA, as both a Party's personal
obligation and one running with the Party's Tract, shall have been terminated
with respect to obligations accruing from and after those events described, and
in the manner set forth, in Article 11.
Released Party. "RELEASED PARTY" is defined in Section
11.7(b).
20
Retail Facility. "RETAIL FACILITY" is defined in Recital G.
Second Scheduled Opening Date. "SECOND SCHEDULED OPENING DATE"
shall mean that date by which the Music Hotel is scheduled to be first opened
for business to the public, which shall mean that (a) all certificates of
occupancy for the Music Hotel shall have been issued by the County, and (b) all
design and construction work in the casino area of the Music Hotel has been
completed and the casino is fully operational and guest rooms are ready to be
occupied by guests. The Second Scheduled Opening Date shall in no event be later
than the later of (i) six (6) months after the First Scheduled Opening Date and
(ii) November 1, 2000.
Separate Utility Line. "SEPARATE UTILITY LINE" is defined in
Section 2.l(d).
Site. "SITE" is defined in Recital A.
Site Plans. "SITE PLANS" shall mean those certain drawings,
plans, specifications and criteria with respect to the development of the
Redeveloped Aladdin on the Site which are identified on Exhibit "B" attached
hereto and made a part hereof, as the same may be modified from time to time in
accordance with this REA.
Site Work. "SITE WORK" shall mean all Infrastructure
Improvements, as well as the installation and construction of all above-and
below-ground footings, girders, columns, braces, load-bearing walls, foundations
and standard structural support elements necessary for the construction,
support, structural integrity, enclosure and operation of Buildings and other
improvements constituting the Redeveloped Aladdin except for the Music Hotel and
the Central Energy Plant, and any replacement, substitution or modification
thereof, all of which shall be designed, installed and constructed by an Aladdin
Party or Parties, at its or their sole cost and expense, subject only to the
Site Work Contribution defined and set forth in Section 4.5 of the Site Work
Agreement.
Site Work Agreement. "SITE WORK AGREEMENT" is defined in
Recital A.
Suit. "SUIT" is defined in Article 13.
21
Termination Date. "TERMINATION DATE" shall mean the date on
which this REA shall terminate, pursuant to the terms and provisions of Article
17.
Theater for Performing Arts. "THEATER FOR PERFORMING ARTS"
shall mean that portion of the Aladdin Improvements designated as such on the
Site Plans and the Plans and Specifications, which shall be leased to Aladdin
Music pursuant to the terms of the Theater Lease.
Theater Lease. "THEATER LEASE" shall mean that certain lease
of the Theater for Performing Arts to be entered into between Aladdin Gaming, as
lessor, and Aladdin Music, as lessee.
Tract. "TRACT" shall initially mean the land and/or air space
comprising the Bazaar Site, the Gaming Site, the Aladdin Music Site, the Energy
Site or the Optional Improvements Site, as applicable, together with the
Buildings, Common Area and all other improvements of a Party now or hereafter
located thereon. If at any time hereafter there is a Transfer of a Tract, then
the Tract so transferred shall be deemed a separate Tract and the Person
acquiring or leasing such Tract shall be deemed a Party hereunder, subject to
the terms set forth herein; provided, however, that no parcelization or
subdivision of a Tract (other than the Commercial Subdivision), or lease or
license of space within the Redeveloped Aladdin by a Party shall alone be deemed
to create a new Tract.
Transfer; Transferor; Transferee. "TRANSFER" shall mean any
voluntary transaction in which a Person ("TRANSFEROR") shall sell, lease,
transfer or assign, other than for security purposes, all or substantially all
of its interest in its Tract together with all of its rights under this REA to a
Person or Persons ("TRANSFEREE") who shall expressly assume, by a duly executed
and acknowledged written instrument in recordable form served on all Parties in
accordance with Article 14, all of such Transferor's covenants, duties and
obligations under this REA. Neither the execution of space leases with Occupants
demising space in the Retail Facility, nor execution of the Parking Use
Agreement shall be deemed a Transfer by Bazaar Company.
Utility Lease. "UTILITY LEASE" is defined in Recital E.
Utility Lines. "UTILITY LINES" is defined in Section 2.3(a).
22
Work. "WORK" is defined in Section 9.6.
ARTICLE 2
EASEMENTS
2.1 Definitions and Conditions. In this Article 2, each
holder of an interest in a Tract grants to the holder(s) of an interest in every
other Tract certain easements, subject to the terms and conditions contained
herein. As used in this Article 2, the following definitions, terms and
conditions shall apply:
(a) "GRANTOR" shall mean the Party granting an
easement in this REA. An easement granted herein shall bind the Grantor and its
successors and assigns, together with all Persons joining in, consenting to or
subordinating to this REA, but only with respect to their respective interests
in the Grantor's Tract, or portion thereof, each of which interest or portion
shall be a servient tenement burdened with the easement, provided that where
only a portion of the Tract or interest is bound and burdened by the easement,
only that portion shall be deemed to be the servient tenement.
(b) "GRANTEE" shall mean the Party (and its
successors and assigns) as to the Tract, or portion thereof, that is the
dominant tenement benefitted by the easement. An easement granted in this
Article 2 shall benefit only the dominant tenement (provided that where only a
portion of the Tract is so benefitted, only that portion shall be deemed to be
the dominant tenement) and Grantee with respect to its interest therein, except
Grantee may permit its Permitees from time to time to use such easement;
however, such permission shall in no way authorize use of the easement in excess
of that set forth in this REA.
(c) The word "IN" with respect to an easement
granted "in" a particular Tract shall mean, as the context may require, "in,"
"to," "on," "over," "through," "across," "upon" and/or "under."
(d) "SEPARATE UTILITY LINE" shall mean a utility
line, connection or facility that does not constitute a Common Area Utility Line
or a Energy Provider Utility Line, or the portions thereof which extend into a
particular Tract from a particular point of delivery, installed for the sole and
exclusive use
23
and benefit of any Buildings or Tracts comprising the Redeveloped Aladdin for
the transmission of electrical power, heating, ventilation and air conditioning,
natural gas, steam, chilled water, hot water, domestic water, fire protection
water, storm drain, sanitary sewer, telephone service, cable television service,
and other telecommunication services, which lines, connections or facilities
shall be installed and maintained by the Party benefitting therefrom at such
Party's sole cost and expense.
(e) "COMMON AREA UTILITY LINE" shall mean a
utility line, connection or facility, or the portions thereof that extend to a
particular point of delivery to a particular Tract, installed for the common use
and benefit of all Buildings and Tracts comprising the Redeveloped Aladdin for
the transmission of domestic water, fire protection water, storm drainage and
sanitary sewage, which lines, connections or facilities Aladdin Gaming shall be
responsible for installing pursuant to the Site Work Agreement. The Common Area
Utility Lines will constitute Common Areas and will initially be as set forth on
the Site Plans and the Plans and Specifications.
(f) "ENERGY PROVIDER UTILITY LINE" shall mean a
utility line, connection or facility, or the portions thereof that extend to a
particular point of delivery to a particular Tract, installed for the common use
and benefit of all Buildings and Tracts comprising the Redeveloped Aladdin for
the transmission of chilled water, hot water and/or electricity, which lines,
connections or facilities shall be installed and maintained by Energy Provider
pursuant to (i) the Energy Lease, (ii) that certain Development Agreement
between Aladdin Gaming and Energy Provider dated as of December 3, 1997, (iii)
that certain Guaranty dated as of December 3, 1997 by Unicom Corporation to and
for the benefit of Aladdin Gaming, (iv) those certain Energy Service Agreements
to be entered into between Energy Provider and the other Parties and (v) that
certain Coordination Agreement to be entered into among Aladdin Gaming, Bazaar
Company and Aladdin Music ((i) through (v) collectively, the "ENERGY PROVIDER
AGREEMENT").
(g) All easements granted in this REA are
appurtenant and not in gross. Unless provided otherwise herein, all easements
are nonexclusive, irrevocable and shall terminate on the Termination Date.
Notwithstanding anything to the contrary contained herein, no easement shall be
deemed to be granted and/or no easement shall be permitted to be used, if or
while the grant or use of such easement, as applicable, would violate any law,
statute or regulation of the County or any other governmental authority claiming
jurisdiction over the Site.
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(h) All easements granted hereunder shall exist
by virtue of this REA, without the necessity of confirmation by any
other document. Likewise, upon the termination of any easement (in
whole or in part) by expiration or Release, the same shall be deemed to
have been terminated without the necessity of confirmation by any other
document. However, at the request of any other Party, each Party shall
execute and acknowledge a document memorializing the continued
existence (including the location and any conditions thereon) or the
termination (in whole or in part) of any easement, provided each Party
approves the form and substance of such document pursuant to Article
18. Moreover, the Parties hereby agree to cooperate with each other to
terminate or modify easements affecting the Site as of the date hereof
to the extent necessary to effect the intentions of the Parties under
this REA, which cooperation shall include, but not be limited to, the
execution and recordation of documents that implement such terminations
and/or modifications.
(i) No grant of easement pursuant to this
Article 2 shall impose any greater obligation on any Party to construct
or maintain its Buildings other than as expressly provided in this REA.
(j) In its sole and absolute discretion, Grantee
shall elect whether to exercise its right to use any easement granted
to it. Except for easements granted pursuant to Sections 2.2, 2.7, 2.8,
2.11 and 2.14, prior to Grantee's entry onto Grantor's Tract in
exercise of its easement rights, Grantee shall first obtain Grantor's
consent to Grantee's proposed location, methods and schedule for such
exercise, which consent shall not be unreasonably withheld or delayed,
except as otherwise provided herein. Should Grantee elect to exercise
any such easement right, Grantee covenants to use the easement with due
care so as not to damage, injure or disturb any Person, any Party's
Tract or any Party's operation of its business and Buildings. Further,
Grantee covenants to construct, maintain, repair, operate, and restore
and/or remove, at Grantee's sole cost and expense (except as provided
in Section 2.3 with respect to the cost of Grantor relocating a utility
easement), any facilities and improvements Grantee shall have installed
in Grantor's Tract in connection with such use; provided, however,
Grantee may elect at any time to discontinue its use of such easement,
in which event Grantee (i) shall remove or, at Grantor's request,
abandon all facilities and improvements previously installed in
connection with such use, (ii) shall repair any damage to Grantor's
Tract in connection therewith as required by Section 2.1(k) below and
(iii) thereafter shall be Discharged from all further duties whatsoever
with respect thereto.
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(k) Grantee shall Indemnify Grantor and shall
repair at Grantee's sole cost and expense the servient tenement in
connection with Grantee's exercise of any of its easement rights.
Without limiting the foregoing, Grantee shall repair, to such condition
as existed prior to Grantee's exercise of such rights, all portions of
the surface area or Buildings of the servient tenement that Grantee or
its agents may have excavated, damaged or otherwise disturbed in
exercising its easement rights.
(l) Each Party covenants and agrees that its
exercise of the easements granted herein shall not unreasonably
interrupt or unreasonably interfere with the Construction and/or
business operations conducted by any other Party at the Redeveloped
Aladdin and that its exercise of the easements granted herein shall be
in a manner so as to avoid (i) causing any increase in the cost of
Construction on any other Party's Tract or any part thereof, (ii)
interfering unreasonably with any Construction Work being performed on
any other Party's Tract, or any part thereof, or (iii) interfering
unreasonably with the use, occupancy or enjoyment of any other Party's
Tract, or any part thereof, by any other Permittee. Any use of such
easements by Grantee, and Grantor's obligations in connection
therewith, are subject to the provisions of Article 3 hereof.
(m) Each Party covenants and agrees that its
exercise of the right to relocate easements granted herein shall not
unreasonably interrupt or unreasonably interfere with the Construction
and/or business operations conducted by the Grantor of such easement on
its Tract.
(n) Each Party reserves the right to close off
such portions of its Tract for such reasonable periods of time as may
be legally necessary, in the reasonable opinion of its attorney, to
prevent the acquisition of prescriptive rights by any Person or a
dedication for a public purpose; provided, however, that prior to
closing off any such portion of its Tract, as herein provided, such
Party shall notify the other Parties of its intention so to do and
shall coordinate such closing with the other Parties so that there
shall be no unreasonable interference with the operation of the
Redeveloped Aladdin.
2.2 Easement: Automobile Parking. Vehicular and
Pedestrian Access: Emergency Egress.
(a) Each Party hereto as to its ownership or
leasehold interest in its Tract, as applicable, as Grantor, hereby
grants to each other Party
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hereto as to its respective ownership or leasehold interest in its
Tract, as applicable, as Grantee, for use by Grantee and Grantee's
Permittees, a non-exclusive easement in such respective portions of the
Common Area and Perimeter Access Areas of Grantor's Tract as have been
identified on the Site Plans and the Plans and Specifications, or may
be set aside, maintained and authorized under this REA for pedestrian
and vehicular ingress and egress to and from Grantee's Tract.
(b) Bazaar Company, as to its ownership or
leasehold interest in its Tract, as applicable, as Grantor, hereby
grants to each other Party hereto as to its respective ownership or
leasehold interest in its Tract, as applicable, as Grantee, for use by
Grantee and Grantee's Permittees, a non-exclusive easement in such
respective portions of the Common Parking Area of Grantor's Tract as
have been identified on the Site Plans and the Plans and
Specifications, or may be set aside, maintained and authorized under
this REA for passage and parking of vehicles. Bazaar Company, as
Grantor, shall at all times provide Grantee access to the Common
Parking Area. Each Grantee's use of the vehicular parking easement
granted in this Section 2.2, and the Construction, maintenance,
operation and/or restoration of the Common Parking Area by, and the
other rights and obligations in connection therewith of, Bazaar Company
are subject to the provisions of the Parking Use Agreement.
(c) Each Party hereto shall have the
non-exclusive easement to use the exit stairways and walkways shown on
the Site Plans and the Plans and Specifications for emergency egress
purposes only, provided that in the event of construction, repair,
demolition, casualty or similar circumstances one or more alternate
means of egress may be provided.
(d) Each Grantor hereby reserves the right to
eject or cause to be ejected from its Tract any Person who is not
authorized, empowered or privileged to use such Tract under this REA.
(e) Bazaar Company, as Grantor, hereby grants to
Aladdin Gaming as to its ownership interest in its Tract, as Grantee,
for use by Grantee and its employees, a non-exclusive easement in such
respective portions of Grantor's Tract as has been designated on the
Site Plans and the Plans and Specifications (and as otherwise may be,
set aside, maintained and authorized under this REA) for the pedestrian
access and passage by Grantee and its employees from the Common Parking
Area through the service corridor of the Retail Facility and to the
Gaming Site.
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2.3 Easement: Utilities.
(a) Each Party hereto as to its ownership or
leasehold interest in its Tract, as applicable, as Grantor, hereby
grants to each of the other Parties hereto as to its ownership or
leasehold interest in its Tract, as applicable, as Grantee, an easement
in the Common Area of Grantor's Tract and in Buildings to the extent
reflected on the Plans and Specifications for the Initial Planned Floor
Area or as may be reasonably required, for the installation, operation,
flow, passage, use, maintenance, repair, replacement, relocation,
restoration and/or removal of Separate Utility Lines, Energy Provider
Utility Lines and Common Area Utility Lines (collectively, "UTILITY
LINES"). All Utility Lines, whether or not installed and/or relocated
pursuant to the easements granted herein, shall be placed underground
or within a structure reasonably approved by Grantor. The location (or
relocation) of all easements granted by the Parties in this Section 2.3
shall be subject to the prior approval of the Grantor, which approval
shall not be unreasonably withheld; provided, however, any Utility
Lines shown on the Plans and Specifications which have been approved by
Bazaar Company or Aladdin Gaming, as applicable, pursuant to the
provisions of the Bazaar Lease or the Site Work Agreement, or approved
by Aladdin Gaming pursuant to the Energy Provider Agreement, shall not
require separate approval by the Grantor pursuant to the provisions of
this REA.
(b) The Grantee of any of the Separate Utility
Line easements shall be responsible as between the Grantor and Grantee
thereof for the installation, maintenance, repair, restoration,
relocation and/or removal of all such Separate Utility Lines installed
pursuant to such grant. Grantee shall give Grantor at least fifteen
(15) days written notice prior to Grantee's installation, maintenance,
repair, restoration, relocation and/or removal of any such Separate
Utility Line; provided, however, in the case of an emergency, Grantee
may perform or cause to be performed any such Work (i) immediately
after giving Grantor such advance written notice as is practicable
under the circumstances, or (ii) immediately and without advance notice
if the reasonably expected delay to be incurred by giving advance
notice would unreasonably jeopardize persons or property; provided,
further, however, that in the event of emergency Work permitted to be
conducted without advance notice pursuant to clause (ii) above, Grantee
shall give Grantor notice thereof as soon as practicable thereafter.
Grantee shall perform all such Work without cost or expense to Grantor
and in such a manner as to cause minimal disturbance to Grantor's and
other Person's use of the Redeveloped Aladdin as may be practicable
under the circumstances.
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(c) All Energy Provider Utility Lines shall be
installed, maintained, repaired, restored, relocated and/or removed by
Energy Provider. Energy Provider shall give the other Parties at least
fifteen (15) days written notice prior to Energy Provider's
installation, maintenance, repair, restoration, relocation and/or
removal of any such Energy Provider Utility Lines; provided, however,
that in the case of an emergency, Energy Provider may perform or cause
to be performed any such Work (i) immediately after giving the other
Parties such advance written notice as is practicable under the
circumstances, or (ii) immediately and without advance notice if the
reasonably expected delay to be incurred by giving advance notice would
unreasonably jeopardize persons or property; provided, further,
however, that in the event of emergency Work permitted to be conducted
without advance notice pursuant to clause (ii) above, Energy Provider
shall give the Parties notice thereof as soon as practicable
thereafter. Energy Provider shall use its reasonable efforts to perform
all such Work in such a manner as to cause minimal disturbance to the
use, operation, development and construction of the Redeveloped
Aladdin as may be practicable under the circumstances. The cost of such
Work shall be payable to Energy Provider by the other Parties pursuant
to the Energy Provider Agreement.
(d) All Common Area Utility Lines shall be
initially Constructed and installed by Aladdin Gaming pursuant to the
Site Work Agreement. Thereafter, all Common Area Utility Lines shall
be maintained, repaired, restored, relocated and/or removed by the
Operator Party. The Operator Party shall give the other Parties at
least fifteen (15) days written notice prior to the Operator Party's
relocation, removal or, if such may result in the temporary cessation
of service, maintenance of any such Common Area Utility Lines;
provided, however, that in the case of an emergency, the Operator Party
may perform or cause to be performed any such Work (i) immediately
after giving the other Parties such advance written notice as is
practicable under the circumstances, or (ii) immediately and without
advance notice if the reasonably expected delay to be incurred by
giving advance notice would unreasonably jeopardize persons or
property; provided, further, however, that in the event of emergency
Work permitted to be conducted without advance notice pursuant to
clause (ii) above, the Operator Party shall give the Parties notice
thereof as soon as practicable thereafter. The Operator Party shall
use its reasonable efforts to perform all such Work in such a manner as
to cause minimal disturbance to the use, operation, development and
construction of the Redeveloped Aladdin as may be practicable under the
circumstances. The cost of such Work shall be payable to the Operator
Party by the other Parties pursuant to the Allocable Share of Common
Costs.
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(e) The Grantor of any utility easement granted
under this Section 2.3 shall have the right to relocate the same on its
Tract at any time; provided that Grantor shall give Grantee thirty (30)
days prior written notice thereof; and provided further, that such
relocation (i) shall not interfere with or diminish the utility
services to Grantee, (ii) shall not reduce or unreasonably impair the
usefulness or function of such easements, (iii) shall not be relocated
other than underground or within a structure reasonably approved by
Grantee; and (iv) shall be performed at Grantor's sole cost and expense
and without cost or expense to Grantee, including any increased cost of
maintenance caused by such relocation. Notwithstanding clauses (i) and
(ii) above, temporary interferences with and diminution in such
services shall be permitted if they occur upon prior written notice and
during Grantee's non-peak business hours and Grantor promptly
reimburses Grantee for all of Grantee's direct cost, expense and loss
(excluding, in the absence of Grantor's negligence, any consequential
damages) resulting from such interferences and/or diminution in such
services. Notwithstanding anything to the contrary set forth in this
Section 2.3(e), any relocation of any utility easement permitted to be
effected by a Grantor shall be subject to the reasonable approval of
any non-Grantee Party (except Energy Provider) if said relocation would
have a material and detrimental effect on such non-Grantee Party's
ownership, construction, leasing, financing, operation or restoration
of its Tract.
(f) The Grantee of any utility easement granted
under this Section 2.3 shall have the right to relocate the same on
Grantor's Tract at any time, subject to the reasonable approval of
Grantor; provided that Grantee shall give Grantor thirty (30) days
prior written notice thereof; and provided further, that such
relocation (i) shall not interfere with or diminish the utility
services to Grantor, (ii) shall not reduce or unreasonably impair the
usefulness or function of Grantor easements or the business conducted
by Grantor on Grantor's Tract, (iii) shall not be relocated other than
underground or within a structure reasonably approved by Grantor; and
(iv) shall be performed at Grantee's sole cost and expense and without
cost or expense to Grantor, including any increased cost of maintenance
caused by such relocation. Notwithstanding clauses (i) and (ii) above,
temporary interferences with and diminution in utility services shall
be permitted if they occur upon prior written notice and during
Grantor's non-peak business hours and Grantee promptly reimburses
Grantor for all of Grantor's direct cost, expense and loss (excluding,
in the absence of Grantee's negligence, any consequential damages)
resulting from such interferences and/or diminution in such services.
Notwithstanding anything to the contrary set forth in this Section
2.3(f), any relocation of any utility easement permitted to be effected
by a Grantee shall be
30
subject to the approval of any non-Grantee Party (except Energy
Provider), in such non-Grantee's sole and absolute discretion, if said
relocation would have a material and detrimental effect on such
non-Grantee Party's ownership, construction, leasing, financing,
operation or restoration of its Tract.
2.4 Easement: Construction. Each Party hereto as to its
ownership or leasehold interest in its Tract, as applicable, as
Grantor, hereby grants to each of the other Parties hereto as to its
ownership or leasehold interest in its Tract, as applicable, as
Grantee, an easement in Grantor's Tract (to the extent reasonably
necessary for the Grantee's enjoyment or preservation of Grantee's
improvements located on Grantor's Tract and in Grantor's Buildings),
for the (i) installation, Construction and/or restoration of
improvements to the Grantee's Tract and Buildings performed pursuant to
this REA (including, without limitation, for staging areas, worker
parking, hoist and crane locations, underpinnings and temporary safety
closures); (ii) ingress, egress and access to said areas to perform
said Work; and (iii) use and maintenance of the following:
(a) separate or common footings, girders,
columns, braces, foundations and other standard support elements to a
maximum lateral distance as set forth in the Site Plans and the Plans
and Specifications for the purpose of supporting Building improvements
of Grantee and party walls shared by Grantor and Grantee as may be
necessary for the structural integrity and enclosure of adjacent or
subjacent Buildings and any replacement, substitution or modification
thereof as permitted by this REA; provided that, at the request of any
Party, the applicable Parties shall prepare and record an agreement
specifying the exact locations of such above-ground and underground
footings, girders, columns, braces, foundations and other standard
support elements, and provided further that the manner of attachment
shall be designed in accordance with good Construction practice in the
manner customary for such improvements and so as not to impose any load
on Grantor's Building in excess of the loads contemplated in the Plans
and Specifications for the Initial Planned Floor Area approved pursuant
to the provisions hereof, unless otherwise approved in writing by
Grantor and Grantee;
(b) canopies, roof and building overhangs, roof
flashings, wing walls, awnings, signs, lights and lighting devices and
other similar appurtenances, provided that all of the foregoing are
attached to the Buildings of Grantee to a maximum lateral distance as
set forth in the Site Plans and the Plans and Specifications or as
otherwise consented to by Grantor, which consent shall not be
unreasonably withheld; and
31
(c) electrical or similar vaults and HVAC supply
or exhaust shafts above and below the surface of such Tract, to a
maximum lateral distance as set forth in the Site Plans and the Plans
and Specifications; provided, however, the precise locations of the
items described in subparagraphs (a), (b) and (c) above must be shown
in the Plans and Specifications for the Initial Planned Floor Area and
approved pursuant to the provisions hereof or must otherwise be
approved by Grantor. Upon completion of the Construction elements
referred to in subparagraphs (a), (b) and (c) above and upon request of
any Party, the Parties shall execute an agreement, in recordable form,
appropriately identifying the nature and location of each such
Construction element and the location of the easements granted in this
Section 2.4, none of which shall thereafter be changed without the
prior written approval of Grantor, which approval shall be at Grantor's
sole and absolute discretion.
The Parties hereto acknowledge that it is
contemplated that the Music Hotel and the Optional Improvements, if
any, will not be developed and open to the public until after the First
Scheduled Opening Date. In connection therewith, each Party covenants
and agrees that its exercise of the easements granted under this
Section 2.4 shall not unreasonably interrupt or unreasonably interfere
with the Construction and/or business operations conducted by any other
Party at the Redeveloped Aladdin, it being understood that there is
likely to be more interruption and interference during the Construction
of the Music Hotel and Optional Improvements than might otherwise occur
during normal business operations.
2.5 Easement: Maintenance of Common Structural Supports.
The Grantor of any easement in Section 2.4 covenants to Grantee that,
if all or any part of Grantor's Building is removed or destroyed and
Grantor does not restore the same, and if Grantor and Grantee shall
have shared any foundations, footings, girders, columns, braces, party
walls or load-bearing walls, then Grantor shall leave in place such
structural support elements, or portions thereof not so removed or
destroyed, to the extent necessary, for adjacent, lateral, and
subjacent support and only for so long as that portion of Grantee's
Building sharing such structural support elements, as originally
constructed or as replaced under this REA, exists or is being restored.
In the event Grantee shall desire that Grantor reconstruct or restore
such structural support elements, the following provisions shall apply
to Grantee's exercise of its easement under this Section 2.5. Following
any such removal or destruction, to obtain Grantor's reasonable
approval of common footings and foundations and other structural
support elements which Grantee
32
desires that Grantor construct or restore, Grantee shall furnish
Grantor with all required live and dead load requirements, all column,
anchor and beam conditions and locations, and all other information
Grantor shall reasonably require with respect thereto. Upon Grantor's
reasonable approval (which approval shall be deemed granted if not
denied within fifteen (15) days after Grantor's receipt of the
information set forth in the preceding sentence), Grantor shall perform
all Construction, maintenance, repair or replacement of such footings
and foundations and other structural support elements and Indemnify
Grantee from all costs associated therewith; provided, however, that if
Grantor does not perform all such Construction, maintenance, repair or
replacement in a timely and diligent manner, then Grantee may perform
the same at Grantor's sole and reasonable cost and expense if Grantee
follows the self-help cure procedures set forth in Section 9.9 hereof.
Grantor shall be under no obligation to perform any Construction,
maintenance, repair or replacement of such footings and foundations and
other structural support elements, if such damage has occurred after
the termination of Grantor's restoration obligations set forth in
Section 9.4 hereof; provided, however, that in such event Grantee shall
have the right, at Grantee's cost and expense, to maintain, repair or
replace such footings and foundations and other structural support
elements on Grantor's Tract upon Grantor's reasonable approval (which
approval shall be deemed granted if not denied within fifteen (15) days
after Grantee's request therefor). Notwithstanding the foregoing, in
the event of damage affecting more than one Party's Tract, and the
affected Parties have each elected to restore their respective Tracts,
the provisions of Section 9.4 hereof shall control such Parties'
actions in connection with such restoration.
2.6 Easement: Exterior and Accent Lights. Each Party
hereto as to its ownership or leasehold interest in its Tract, as
applicable, as Grantor, hereby grants to each other Party hereto as to
its ownership or leasehold interest in its Tract, as applicable, as
Grantee, an easement in such location as Grantor shall reasonably
approve for the (a) installation, maintenance, repair, replacement
and/or removal, at Grantee's sole cost and expense (including the cost
of electricity), of exterior and accent lights, on such light standards
and locations and at such levels of illumination as set forth on the
Site Plans and the Plans and Specifications, to highlight the exterior
of Grantee's Building, installed pursuant to this REA; and (b) ingress,
egress and access to said area to perform said Work. All such exterior
and accent lighting must be located and detailed as set forth on the
Site Plans and the Plans and Specifications for the Initial Planned
Floor Area, and any exterior or accent lights thereafter proposed to be
installed by a Grantee shall be subject to Grantor's approval, at
Grantor's sole and absolute discretion, as to
33
location, type and character, and must be harmonious with existing
exterior and accent lighting treatments. During Construction on
Grantor's Tract in the vicinity of the easement, any Grantee of this
easement shall, upon thirty (30) days prior written notice from
Grantor, promptly remove all lights so installed by the Grantee from
the area under Construction; provided, however, upon completion of such
Construction, each Grantee shall have the right to reinstall said
lights at Grantee's cost and subject to compliance with the above
provisions.
2.7 Easement: Truck Loading Areas. Each Party, as to its
ownership or leasehold interest in its Tract, as applicable, as
Grantor, hereby grants to each other Party, as to its ownership or
leasehold interest in its Tract, as applicable, as Grantee, an easement
in that portion of the Grantor's Tract that borders those areas which
have been designated on the Site Plans and the Plans and Specifications
and/or Constructed, maintained, repaired or restored for purposes of
truck dock parking, turn-around and loading/delivery areas, storage
rack areas, and truck access areas serving Grantee's Tract, if and to
the extent that Grantor's Tract borders such areas. All such truck
loading areas shall be Constructed in accordance with the requirements
of this REA, the Site Work Agreement and the Parking Use Agreement.
Each Grantee's use of the easements granted in this Section 2.7, and
Grantor's rights and obligations in connection therewith, are subject
to the provisions hereof, the Parking Use Agreement and each Party's
exclusive truck loading facilities designated as such on the Site Plans
and the Plans and Specifications. The Parties hereby acknowledge that
the easements granted in this Section 2.7 are granted for the sole
purpose of permitting each Party the full use and enjoyment of said
exclusive truck loading facilities, which facilities shall be
maintained by the Party entitled to the exclusive use thereof.
2.8 Easement: Encroachments. Each Party hereto as to its
ownership or leasehold interest in its Tract, as applicable, as
Grantor, hereby grants to each other Party hereto as to its ownership
or leasehold interest in its Tract, as applicable, as Grantee, an
easement for encroachments and maintenance thereof if and to the extent
that:
(a) there are minor variations from the Plans
and Specifications in the Construction of any of the Buildings
occurring due to Construction accuracy, methods and/or
techniques;
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(b) there is minor settlement or shifting of any
Buildings over time so that any part of a Building encroaches
upon a part of an adjacent Tract; and
(c) there are canopies, roof and building
overhangs, door swings, signs, light standards, or other
similar encroachments as contemplated by the Plans and
Specifications for the Initial Planned Floor Area, or as may
otherwise be approved by Grantor, together with their
replacements as such replacements may be reasonably modified.
Such easement for the maintenance of encroachments shall exist, as to a
particular encroachment, only so long as the encroaching portion of the Building
shall remain standing and in existence. Notwithstanding the foregoing, in no
event shall an easement for any encroachment be created or maintained in favor
of one Tract if such encroachment materially and adversely interferes with the
use, operation and enjoyment of another Tract by its Occupants or Permitees.
Nothing contained herein shall in any manner be construed as diminishing, or be
deemed to constitute a waiver of, any rights of a Grantor resulting from a
Grantee's failure to construct its Buildings within its respective Tract in
strict accordance with the Plans and Specifications therefor, and this
encroachment easement shall not relieve or excuse a Grantee from exercising all
due diligence to Construct its Buildings within the boundaries of such Grantee's
Tract.
2.9 Easement: Roof. Each Party as to its ownership or leasehold
interest in its Tract, as applicable, as Grantor, hereby grants to each other
Party (except Energy Provider) as to its ownership or leasehold interest in its
Tract, as applicable, as Grantee, an easement for the usage of any of Grantor's
roof space for the Construction, maintenance, repair, replacement and/or
removal, at Grantee's sole cost and expense, of such telecommunication and
ventilation equipment as may be reasonably necessary or required for the benefit
of Grantee's Tract (but excluding telecommunications or other equipment
installed by third parties pursuant to a lease or license executed by Grantee),
subject to the reason able approval of Grantor (it being understood that, with
respect to visible items installed pursuant to this Section 2.9, said items must
be properly and attractively screened).
2.10 Easement: Setbacks. Each Party hereto as to its ownership or
leasehold interest in its Tract, as applicable, as Grantor, hereby grants to
each of the other Parties hereto as to its ownership or leasehold interest in
its Tract, as
35
applicable, as Grantee, an easement to the extent required by and for the
purpose of complying with any setback requirement imposed by applicable law or
private covenants, conditions and restrictions affecting the Site as of the
issuance of building permits for the Initial Planned Floor Area and the Music
Hotel. To the extent reflected on the Plans and Specifications for the Initial
Planned Floor Area, Grantor further agrees not to construct, place or otherwise
permit to be maintained any Building within such setback area in a manner which
would violate any such setback restrictions. Nothing contained herein shall
require a Grantor to relocate any Building constructed on its Tract in
compliance with such initial setback restrictions to allow for a setback
easement described herein due to changes in any applicable law or the decision
to develop the Optional Improvements.
2.11 Easement: General Integration. Maintenance and Development. Each
Party hereto as to its ownership or leasehold interest in its Tract, as
applicable, as Grantor, hereby grants to each of the other Parties hereto as to
its ownership or leasehold interest in its Tract, as applicable, as Grantee,
easements at any level above or below the ground to the extent to which such
easements may be required to comply with any provision of applicable law with
respect to ingress or egress in the event of fire or other emergency,
maintenance of Grantee's Buildings, or as otherwise may be reasonably necessary
to carry out the Construction, repair, operation, and restoration of Grantee's
Buildings; provided, however, that the location of any such additional easements
shall be governed by the provisions of Section 2. l(m) hereof pertaining to the
location or relocation of easements; and provided, further, that with respect to
any such additional easements, Grantee shall not, pursuant to Section 2.1(1)
hereof, unreasonably interrupt or unreasonably interfere with the Construction
and/or business operations conducted by Grantor on its Tract. Notwithstanding
the foregoing, no Party shall be required to grant an easement hereunder if it
is in any way adverse to that Parry and the Party requesting the easement can
comply with applicable laws or accomplish its purpose in another reasonable
manner.
2.12 No Dedication of Easements. Nothing contained in this Article
2, including the grant of any or all easements hereunder, shall be deemed to
constitute a dedication of any Tract or any portion or portions thereof to the
County or any other governmental body, agency or entity or to the general
public, or be construed to create any rights in or for the benefit of any Person
not a Party, it being intended that this REA shall be strictly limited to and
for the purposes herein expressed.
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2.13 Abandonment of Easements. Subject to the requirements of
Section 2. l(j), the easements granted in Article 2 and any improvements
constructed in the exercise thereof, may be (a) abandoned by the Grantee at any
time by Grantee's notice given to Grantor (together with the written joinder in
such abandonment by the fee owner and any ground lessee of Grantee's Tract); or
(b) terminated by Grantor after the Termination Date of this REA, if not
terminated by their own terms, because the use thereof, including the use of
facilities therein, shall have ceased for a period of two (2) years and prior to
the resumption of use (i) Grantor shall have notified the then record owner of
the fee or leasehold estate constituting the dominant tenement that such
easement has been abandoned, (ii) Grantor shall have caused to be recorded in
the Recorder's Office in the County an affidavit that such abandonment has taken
place and that such notice has been properly given, and (iii) within ninety (90)
days after such notice, any such record owner shall have failed to record in
such Recorder's Office an affidavit that the Grantee has in fact used such
easement within such two (2) year period. Any Person at any time acquiring an
interest in any Tract after the first such affidavit described above has been
placed of record (provided such affidavit and recording shall have been made
after the Termination Date as provided in subsection (b) above) shall be
entitled to rely on such failure to record an affidavit of use within such
ninety (90) day period as conclusive evidence that such easement has been
abandoned and terminated.
2.14 Granting of Easements to Utility Companies.
(a) Aladdin Gaming is hereby authorized by the other
Parties hereto to convey any utility easements in the Gaming Site, the Optional
Improvements Site and the Energy Site to Energy Provider, public utility
companies or to any municipal or other similar governmental agency requesting
the execution and delivery of a written easement agreement prior to the First
Scheduled Opening Date and subject and pursuant to the terms of the Site Work
Agreement, so long as Aladdin Gaming, in the exercise of its reasonable business
judgment, determines that the granting of such easements would not have a
material adverse effect on the Parties.
(b) Bazaar Company is hereby authorized by the other
Parties hereto to convey any utility easements in the Bazaar Site to public
utility companies or to any municipal or other similar governmental agency
requesting the execution and delivery of a written easement agreement prior to
the First Scheduled Opening Date and subject and pursuant to the terms of the
Site Work Agree-
37
ment, so long as Bazaar Company, in the exercise of its reasonable business
judgment, determines that the granting of such easements would not have a
material adverse effect on the Parties.
(c) Aladdin Music is hereby authorized by the other
Parties hereto to convey any utility easements in the Aladdin Music Site to
public utility companies or to any municipal or other similar governmental
agency requesting the execution and delivery of a written easement agreement
prior to the Second Scheduled Opening Date, so long as Aladdin Music, in the
exercise of its reasonable business judgment, determines that the granting of
such easements would not have a material adverse effect on the Parties.
2.15 Easement: Monorail. Aladdin Gaming shall have the right but
not the obligation, at any time to Construct, operate, alter, maintain and/or
remove a monorail and monorail stop to carry pedestrians and Permittees to and
from the Redeveloped Aladdin (the "MONORAIL") as such Monorail may be permitted
by the authorities of the County. In the event that Aladdin Gaming Constructs
the Monorail, Aladdin Gaming shall use commercially reasonable efforts (at no
significant cost to Aladdin Gaming) to provide a Monorail stop that provides
access into the Music Hotel. Subject to the other provisions of this Article 2,
each Party as to its ownership or leasehold interest in its Tract, as
applicable, as Grantor, hereby grants to Aladdin Gaming as to its ownership or
leasehold interest in its Tract, as applicable, as Grantee, an easement in
Grantor's Tract, for the Construction, operation, maintenance and removal of
such Monorail which may have supports located on a portion of the Gaming Site,
the Bazaar Site and/or the Music Site. The Monorail shall be deemed to be a part
of the Common Area and the costs of the Construction, operation and maintenance
thereof shall be subject to an equitable allocation among the Parties as
mutually approved by the Parties.
2.16 Easement: Signs.
(a) Each Party as to its ownership or leasehold interest
in its Tract, as applicable, as Grantor, hereby grants to each other Party
(except Energy Provider) as to its ownership or leasehold interest in its Tract,
as applicable, as Grantee, an easement for signs and posters advertising the
Aladdin Hotel and Casino, the Retail Facility, the Music Hotel or events in any
of the foregoing at such locations as are then used for such posters or
advertising and at the locations designated for same on the Site Plans and the
Plans and Specifications, subject to the reasonable approval of Grantor.
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(b) Aladdin Gaming, Bazaar Company and Aladdin Music
shall be entitled to have their respective Names on signs designating the
Aladdin Hotel and Casino, the Retail Facility and the Music Hotel, respectively,
over certain doors, gates and at certain other locations on each other Party's
Tract, subject to the approval of the Plans and Specifications for such signage,
as set forth in Section 3.1 hereof. The location and approximate size of all
signs referred to in this clause are designated on the Site Plans and the Plans
and Specifications.
(c) Aladdin Gaming, Bazaar Company and Aladdin Music
shall be entitled to have their respective Names on signs designating the
Aladdin Hotel and Casino, the Retail Facility and the Music Hotel, respectively,
at certain locations in the Common Areas, subject to the approval of the Plans
and Specifications for such signage, as set forth in Section 3.1 hereof. The
location and approximate size of all signs referred to in this clause are
designated on the Site Plans and the Plans and Specifications.
(d) Each Party which erects signs and posters pursuant to
this Section 2.16 shall maintain such signs and posters in good condition and
repair and the erection, maintenance and repair thereof shall be performed at
such Party's sole cost and expense.
ARTICLE 3
CONSTRUCTION OF REDEVELOPED ALADDIN
3.1 General Covenants and Background. The Parties agree that the
Construction of the Aladdin Improvements, the Bazaar Improvements, the Music
Hotel, the Central Energy Plant and any Optional Improvements shall be
accomplished in accordance with the requirements of the Site Work Agreement and
this REA, as applicable. As used in this REA, "CONSTRUCTION" means initially
installing or constructing upon, performing maintenance upon, making repairs to,
constructing alterations, additions and improvements, and/or razing, replacing
and restoring the whole or any part of the Buildings in accordance with the
provisions of this REA. All references to the Plans and Specifications refer to
those plans and specifications which have been attached hereto as Exhibit C, as
the same may be modified from time to time, pursuant to the procedures
hereinafter described. Any changes to the Plans and Specifications requested by
a Party which involve physical changes to another Party's Tract (except Energy
Provider's), other than
39
de minimis changes which have no adverse effect, must be consented to by such
other Party(ies), in their sole discretion. For the purposes of this Section
3.1, "adverse effect" means a materially detrimental effect on the ownership,
construction, leasing, financing, operation or restoration of a Party's Tract or
improvements thereon. Any changes to the Plans and Specifications requested by a
Party which have a direct adverse effect on (a) another Party's Tract (except
Energy Provider's), (b) the Site Work, (c) the Common Areas, or (d) the Quality
of Development and Planning for the Redeveloped Aladdin, shall be subject to the
reasonable approval of the non-requesting Party(ies) (except Energy Provider),
which approval shall be deemed granted if not denied within ten (10) business
days following a request therefor. Any changes to the Plans and Specifications
requested by a Party which do not have a direct adverse effect on those items
enumerated in clauses (a) through (d) above, but which are material and
substantial in nature, are subject to the reasonable approval of the
non-requesting Party(ies) (except Energy Providers), which approval shall be
deemed granted if not denied within ten (10) business days following a request
therefor. Any changes to the Plans and Specifications requested by a Party which
involve physical changes to any Tract other than to the Gaming Site, other than
de minimis changes which have no adverse effect, shall be subject to the
reasonable approval of Aladdin Gaming, which approval shall be deemed granted if
not denied within ten (10) business days following a request therefor. The
approval rights of Aladdin Gaming set forth in this paragraph shall be effective
at such time as Aladdin Bazaar Holdings, LLC is not an Affiliate (disregarding
for the purposes of this Section 3.1 the second sentence of the definition of
the term "Affiliate") of Aladdin Gaming.
Within ten (10) business days after the submission of such Plans and
Specifications, the Party affected by such Construction, if and to the extent
any approval is applicable as set forth herein, shall notify the constructing
Party whether the same are approved or disapproved in accordance with Article
18, specifying the reason therefor if disapproved. If such Party shall
disapprove the modified Plans and Specifications, such Parties shall attempt to
resolve any disagreements by consulting with each other and their respective
architects, engineers or consultants as soon as reasonably possible, and if such
Parties are unable to resolve any such disagreements, any Party to the
disagreement may elect to resolve the disagreement by arbitration pursuant to
the expedited arbitration procedure set forth in the Site Work Agreement if such
Work is to be performed prior to the Second Scheduled Opening Date and otherwise
pursuant to the procedure set forth in Article 12 hereof.
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The failure of any Party to exercise its approval rights within the
time periods set forth in this Section 3.1 shall be deemed approval with respect
to the Plans and Specifications theretofore submitted.
3.2 Workmanship. Each Party agrees that all Construction to be
performed hereunder by such Party during the term of this REA shall be done in a
good and workmanlike manner and in accordance with good construction practice,
with new, first-class materials and in compliance with all applicable laws,
rules, ordinances, regulations, orders, requirements of all federal, state and
municipal governments and all licenses, approvals, permits, variances,
entitlements and certificates of occupancy and in substantial compliance with
the Plans and Specifications for the same which have been approved by the other
Party to the extent required by Section 3.1 above. Subject to the Site Work
Agreement, each Party shall pay all costs, expenses, liabilities and liens
arising out of or in any way connected with its Construction, including without
limitation all costs to repair any Buildings or property of the other Party
damaged as a result of such Construction. Upon demand, each Party shall deliver
to the other Party copies of those items submitted to such Party's Mortgagee
evidencing (i) completion of such Party's Work hereunder in compliance with the
approved Plans and Specifications for such Party's Buildings, if applicable, and
all applicable laws, ordinances, regulations and rules, and (ii) payment of all
costs, expenses, liabilities and liens arising out of or in any way connected
with such Construction and (iii) discharge of all liens of record, or contested
and bonded, in which event any judgment or other process issued in such contest
shall be paid and discharged before execution thereof. Nothing contained herein
shall be deemed to prohibit a lien created by a Mortgage on a Tract.
3.3 Coordination. Each Party shall use all reasonable efforts to
cause its Project Architect/Engineer and Project Contractor to cooperate and
coordinate such Party's Construction with the Project Architect/Engineers and
Project Contractors and Construction of the other Parties to the extent
reasonably practicable in order to achieve the objectives set forth in Sections
3.1 and 3.2.
3.4 Interference During Construction. Each Party agrees to perform
its respective Work (and to cause such Party's Permittees to perform such Work)
in a manner so as to avoid (a) causing any increase in the cost of Construction
on any other Party's Tract or any part thereof, (b) interfering unreasonably
with any Work being performed on any other Party's Tract, or any part thereof,
or (c) interfering unreasonably with the use, occupancy or enjoyment of any
other
41
Party's Tract, or any part thereof, by any other Permittee. In furtherance of
the obligation set forth in clause (c) of the preceding sentence, the
constructing Party and/its Permittees shall exercise commercially reasonable
efforts to (i) minimize the amount of dust caused by its Construction
activities, (ii) utilize secondary access routes for all deliveries of
Construction equipment and supplies to minimize disruption to the other Parties'
business operations and (iii) to the extent deliveries of Construction equipment
and supplies are not able to be made on secondary access routes, to the extent
feasible, schedule such deliveries at non-peak business hours and days to
minimize disruption to the other Parties' business operations.
3.5 Optional Improvements and Music Hotel. (A) If and when Aladdin
Gaming elects to Construct any of the Optional Improvements, and before Aladdin
Music begins to Construct the Music Hotel, the Constructing Party shall so
notify the other Parties (except Energy Provider), which notification shall be
accompanied by such program requirements and conceptual plans and drawings as
the Constructing Party may have prepared at such time. (B) If and to the extent
that the Construction or Optional Improvements would require physical changes to
the Bazaar Site or the Gaming Site, other than de minimis changes which have no
adverse effect (as such term is used in Section 3.1 hereof), such changes must
be approved by the Party (or Parties, other than Energy Provider) whose Tract is
so affected, in such Party's sole discretion. (C) If and to the extent that the
Construction or the Optional Improvements have a direct adverse effect on (a)
the Bazaar Site or the Gaming Site, (b) the Work at the Bazaar Site or the
Gaming Site, (c) the Common Area, or (d) the Quality of Development and Planning
for the Aladdin Improvements, such Construction shall be subject to the
reasonable approval of the affected Party or Parties (other than Energy
Provider), which approval shall be deemed granted if not denied within twenty
(20) days following a request therefor. (D) If and to the extent that the
Construction Optional Improvements would not have a direct adverse effect on
those items enumerated in clauses (a) through (d) above, but are material and
substantial in nature, the Construction shall be subject to the reasonable
approval of the other Parties (except Energy Provider), which approval shall be
deemed granted if not denied within fifteen (15) days of a request therefor. (E)
At least thirty (30) days prior to the commencement of any material Construction
of the Music Hotel or any Optional Improvements or restoration thereof by any
Party, and in addition to compliance with other relevant provisions of this REA,
such Party shall cause its Project Architect/Engineer to submit to the other
Parties the following to the extent necessary or applicable: (a) a plot plan of
the Site affected by the Music Hotel or Optional Improvements showing (i) the
Buildings, (ii) the Common Area, (iii) utility connections, (iv) contractors'
staging
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areas, (v) material and equipment storage areas, (vi) Construction shacks and
other temporary improvements, (vii) access routes which the constructing Party
agrees to require its Construction personnel to use during the course of such
Construction or reconstruction, and (viii) workmen's parking area; (b) a time
schedule in reasonable detail indicating the approximate date or dates upon
which the constructing Party shall commence, continue and cease using the
affected portions of the Site for the Construction of the Music Hotel or any
Optional Improvements; and (c) any material changes to the zoning or use permits
affecting the Site. Within fifteen (15) or twenty (20) days, as applicable,
after the submission of such plans and specifications for the Music Hotel or
Optional Improvements, the Party affected by such Construction (other than
Energy Provider), shall, to the extent such approval is applicable as set forth
herein, notify the constructing Party whether the same are approved or
disapproved in accordance with Article 18, specifying the reason therefor if
disapproved. If such Party shall disapprove the plans and specifications for the
Music Hotel or the Optional Improvements, such Parties shall attempt to resolve
any disagreements by consulting with each other and their respective architects,
engineers or consultants as soon as reasonably possible, and if such Parties are
unable to resolve any such disagreements, any Party to the disagreement may
elect to resolve the disagreement by arbitration pursuant to the expedited
arbitration procedure set forth in the Site Work Agreement if such Work is to be
performed prior to the Second Scheduled Opening Date or pursuant to the
procedure set forth in Article 12 hereof. The failure of any Party to exercise
its approval rights within the time periods set forth in this Section 3.5 shall
be deemed its approval.
3.6 Mechanic's Liens. In the event any mechanic's lien is filed
against the Tract of any Party (referred to in this Section 3.6 as the "LIENED
PARTY"), the Party who ordered or contracted for the Work or materials on
account of which the lien was filed (referred to in this Section 3.6 as the
"CONTRACTING PARTY") hereby covenants for the benefit of the Liened Party either
to pay the same and have it promptly discharged of record or to take such action
as may be required reasonably and legally to object to such lien or to have such
lien removed from such Tract but in all events to have such lien discharged
prior to its foreclosure. Upon request of the Liened Party, the Contracting
Party covenants to bond against and to Indemnify the Liened Party, its
Mortgagee, and the title insurer of the Liened Party's Tract from such lien or
furnish such security as may be required by law, or by any Mortgagee of the
Liened Party, to remove, release and discharge such lien of record. For all
purposes applicable to provisions of the statutory law of the State of Nevada,
the Music Hotel, Common Parking Area, the
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Retail Facility, the Central Energy Plant and the Aladdin Improvements shall
each be deemed separate and distinct works of improvement, notwithstanding the
integration of the Buildings constituting the Redeveloped Aladdin.
3.7 Construction Bonds. If any Party is required by its Mortgagee
to obtain, or otherwise elects to require its Project Contractor to obtain,
payment and/or completion bonds in connection with the Construction of the
Initial Planned Floor Area, the Central Energy Plant, the Music Hotel or any
subsequent Optional Improvements, then such Party shall request that the other
Parties (except Energy Provider) and their respective Mortgagees (except Energy
Provider's Mortgagee) be named as additional obligees under such bonds, except
that the rights of said additional obligees shall be subordinate to the
Mortgagee's rights and the rights of the Party obtaining such bond; provided,
however, that naming such other Parties as obligees under such payment and/or
completion bonds shall be at reasonable cost to the Party obtaining such bond
and is permitted by said Party's Mortgagee.
3.8 Temporary Termination of Fire Service. In the event a Party is
to perform any Construction or repair Work, including but not limited to the
installation, modification or relocation of utility facilities pursuant to
Article 2, which shall require as an incident thereto the loss of operation of
fire service in any Party's Building, the constructing Party, as a condition
precedent to the commencement and continuation of such Construction, shall:
(a) notify the other Parties that fire service will be
temporarily terminated at least forty-eight (48) hours prior thereto, which
notice shall specify the Party is performing such Construction and the date or
dates and hours such service shall be lost;
(b) obtain the prior written consent of the Parties in
whose Building(s) such service shall be lost, which consent shall not be
unreasonably withheld;
(c) perform all such Construction during non-peak
business hours of (or such other hours as may be designated by) the Parties so
affected;
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(d) cause a fire watch to be posted and provide
substitute fire protection measures acceptable to the other Parties, at the
constructing Party's cost, during all periods when such fire service is not in
operation; and
(e) comply with all requirements of County laws, codes
and regulations.
3.9 Indemnity. As to Work or materials ordered or contracted for
by or on behalf of each Party or its agents, such Party covenants to Indemnify
the other Parties and the Tracts of the other Parties from (i) claims of lien of
laborers, materialmen and others arising from such Work performed or supplies
furnished pursuant to such order or contract and (ii) all Claims arising from or
as a result of the death of, or any accident, bodily injury, loss or damage
whatsoever caused to any natural Person, or to the property of any Person, as
shall occur by reason of the performance of any Work to be constructed or caused
to be constructed by such Party.
3.10 Submittal of As-Built Plans and Record Drawings. Within ninety
(90) days after each of the First Scheduled Opening Date, the Second Scheduled
Opening Date and the completion of any Optional Improvements, as applicable,
each Party shall cause its Project Architect/Engineer to prepare as-built plans
and record drawings with respect to the Building constructed on its Tract and,
after receipt thereof, shall deliver copies of same to the other Parties for
their records.
3.11 Self-Help Cure of Construction Defaults. If Bazaar Company
fails to perform any of its Construction duties or obligations under this
Article 3 in connection with the Construction of the Common Parking Area within
sixty (60) days after the applicable milestone dates for performance as
indicated on the construction schedule for the Common Parking Area, any other
Party may at any time give a written notice to Bazaar Company, setting forth the
specific nonperformance. If such nonperformance is not corrected within thirty
(30) days after receipt of such notice, or if such nonperformance is such that
it cannot be corrected within such time, then if Bazaar Company fails to
commence the performance of such duties within such period and diligently
prosecute the same to completion thereafter, then, in either such event, the
Party giving such notice shall have the right, upon prior written notice, to
perform same, including the right and temporary license to enter upon Bazaar
Company's Tract to perform same, and Bazaar Company shall pay, on demand, the
performing Party's reasonable costs
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thereof, with interest computed in accordance with Section 20.9(a) hereof,
provided, however, these provisions shall be without prejudice to Bazaar
Company's right to contest the right of the other Party's performance. All Work
performed by such Party shall be performed in compliance with the Gaming Laws
and this Article 3.
ARTICLE 4
ALLOCABLE SHARES OF COMMON COSTS
4.1 Payments.
(a) Except as may be otherwise noted in this REA, the
maintenance, operation, repair and other Work required to be performed on the
Common Area (the "COMMON AREA WORK") shall be performed by the Parties
(individually, an "OPERATOR PARTY" and collectively, the "OPERATOR PARTIES") set
forth on Schedule "I" hereto. Each Operator Party shall submit to all other
Parties (except Energy Provider), at least thirty (30) days prior to the
commencement of every Accounting Period, the reasonably estimated annual costs
to be incurred by such Operating Party in the performance of its Common Area
Work during the next Accounting Period (the "BUDGET") and each Party's Allocable
Share of Common Costs with respect thereto (the "ESTIMATED COST STATEMENT").
Notwithstanding the preceding sentence, each Operator Party shall submit the
applicable Budget and Estimated Cost Statement with respect to the first
Accounting Period as soon as reasonably possible following the recordation of
this REA. Bazaar Company and/or Aladdin Gaming may object to the Budget within
fifteen (15) days of its receipt thereof, in which event the objecting Party and
Operator Party shall negotiate in good faith in an attempt to reach an
agreement. Any Party (except Energy Provider) may object to the Estimated Cost
Statement within fifteen (15) days of its receipt thereof, in which event the
objecting Party and the relevant Operator Party shall negotiate in good faith to
reach an agreement. If an agreement concerning the Budget and/or the Estimated
Cost Statement is not reached within ten (10) days of an objection, then the
objection shall be subject to the arbitration procedures set forth in Article 12
hereof; provided, however, that during such arbitration each Party shall pay its
Allocable Share of Common Costs, as hereinafter provided, based upon the lesser
of (x) the actual cost of the subject Common Area Work for the previous
Accounting Period, plus ten percent (10%), or (y) the Estimated Cost Statement.
The failure of an Operator Party to timely
46
submit an Estimated Cost Statement shall not preclude the right of such Party to
collect each Party's Allocable Share of Common Costs.
(b) Each Party shall pay its Allocable Share of Common
Costs to the Operator Party on the first day of each month pursuant to the
Estimated Cost Statement. Within ninety (90) days following the end of each
Accounting Period, each Operator Party shall provide each other Party with a
full, complete and itemized separate statement (the "Annual Statement"),
together with reasonable supporting documentation, showing the actual Common
Costs incurred by such Operator Party in the performance of its Common Area Work
during such Accounting Period. The Annual Statement, and any Operator Party's
books and records in connection therewith, may upon reasonable notice be audited
by an independent accounting firm or real estate consultant retained by any
Party at its sole cost and discretion. If any Party has paid more than its
Allocable Share of Common Costs during any such Accounting Period with respect
to such Common Area Work, such Party shall receive a credit toward its next
payment(s) of its Allocable Share of Common Costs with respect to which such
overpayment occurred. If any Party has paid less than its Allocable Share of
Common Costs for such Accounting Period, then such Party shall pay the
deficiency in its Allocable Share of Common Costs to the Operator Party entitled
to same within thirty (30) days after receipt of the Annual Statement. At any
time, any Operator Party, with the reasonable approval of the other Parties, may
adjust the monthly estimated payments contained in the Estimated Cost Statement
to more closely reflect actual expenses being incurred as Common Costs in order
to reduce the magnitude of any year-end reconciliation. Any payment which is not
timely made by a Party under this Section 4.1 shall bear interest from the date
that is three (3) business days subsequent to such Party's receipt of a
delinquency notice from an Operator Party until such payment is received by the
Operator Party at the rate specified in Section 20.9 hereof. Any delinquent
payment made by a Party and bearing interest pursuant to the preceding sentence
shall include a late charge in the amount of five percent (5%) of the
delinquent amount due.
4.2 Resolution of Disputes. If a Party disagrees with an Operator
Party's year-end reconciliation of the Allocable Share of Common Costs, such
Party shall be entitled to object by written notice to such Operator Party
within thirty (30) days of receipt of the Annual Statement. If the Parties
cannot reach an agreement within thirty (30) days of such notice, the dispute
shall be resolved by arbitration pursuant to the provisions of Article 12
hereof.
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4.3 Creation of Lien and Personal Obligation for Payment of
Allocable Shares. Each Party hereby covenants for the benefit of every other
Party hereto, regardless of whether such covenant is expressed in any deed to a
Tract, that the delinquent amount of its Allocable Share of Common Costs and/or
its Allocable Share of Real Estate Taxes, together with any late charges,
Attorneys' Fees and interest due on any delinquent payment thereof, shall be a
charge upon such Party's Tract and shall be a continuing lien upon such Tract,
effective upon recordation of a notice of delinquency as provided herein. The
total amount so due shall be the personal obligation of the Party owing such
amount, and shall not pass to Transferees of such Party, but shall remain a
personal obligation of such previous Party and shall remain as a lien and charge
against the Tract of such previous delinquent Party. Notwithstanding the
foregoing, no Mortgagee shall be liable for the payment of liens for Allocable
Shares of Common Costs except those accruing after the Mortgagee obtains title
to the Tract encumbered by its Mortgage pursuant to an Involuntary Transfer and
liens of record prior to the recordation of the lien of such Mortgagee. Any such
Involuntary Transferee shall take title to the Tract subject to the Mortgage
free and clear of any claims and liens for unpaid Allocable Shares of Common
Costs. Any such Involuntary Transferee who so acquires title to the Tract shall
be liable for payment of Allocable Shares of Common Costs accruing after the
date of such Involuntary Transfer. Following any such Involuntary Transfer, the
Party owing such delinquent amount shall remain personally liable for the
payment thereof.
4.4 Adjustments to Allocable Share of Common Costs. The Common
Costs allocable to each Tract shall be subject to equitable adjustment at such
time as the Optional Improvements shall be developed by an Aladdin Party or a
successor thereof. Upon such an adjustment to the Common Costs, the Operator
Parties shall notify the other Parties of the new Allocable Share of Common
Costs which shall be payable by each Party commencing on the first day of the
succeeding month, provided such notification is delivered to each Party by the
tenth day of the then current month. If a Party disagrees with the adjustment to
the Allocable Share of Common Costs, such Party shall be entitled to object by
written notice to the Operator Parties within thirty (30) days of receipt of
such adjustment. If the Parties cannot reach an agreement within thirty (30)
days of such notice, the dispute shall be resolved by arbitration pursuant to
the provisions of Article 12 hereof.
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ARTICLE 5
CENTRAL ENERGY PLANT
5.1 Construction of Central Energy Plant. The Central Energy Plant
will be designed and Constructed to perform in accordance with the
specifications described in the Energy Provider Agreement and subject to the
provisions of this REA. All Construction of the Central Energy Plant, including
the maintenance, operation and restoration thereof, shall be performed without
contribution from any Party, except to the extent specifically provided in the
Energy Provider Agreement. Upon the expiration or termination of the Energy
Provider Agreement, Aladdin Gaming shall make the Energy Site available for the
Construction, renovation and operation of such facilities as may be necessary to
provide sufficient electricity, chilled water and hot water to each of the
Tracts. The Parties agree to cooperate in all reasonable respects to cause such
facilities to be provided for the Site, and the plans and specifications for any
such facilities and the operating agreements relating thereto shall be subject
to the reasonable approval of the Parties (other than Energy Provider), which
approval shall be deemed granted if not denied within fifteen (15) days
following the request therefor.
5.2 Purchase of Electricity, Chilled Water and Hot Water. Provided
that the Central Energy Plant provides electricity, chilled water and hot water
in accordance with the specifications and requirements described in the Energy
Provider Agreement, each Party which is the owner of a Building located on the
Site shall purchase electricity, chilled water and hot water in amounts
sufficient to service such Building(s) from Energy Provider pursuant to the
Energy Provider Agreement.
5.3 Sale of Excess Electricity, Chilled Water and Hot Water. The
sale to third parties of excess electricity, chilled water and/or hot water by
Energy Provider shall be permitted only upon the terms and conditions set forth
in the Energy Provider Agreement.
ARTICLE 6
FLOOR AREA, USE, AND OPERATION
6.1 Floor Area: First and Second Scheduled Opening Dates. Subject
to force majeure as described in Article 10 and the satisfaction of the
49
applicable conditions precedent contained in the Site Work Agreement, on or
before the First Scheduled Opening Date, Aladdin Gaming covenants that it shall
have completed Construction (as evidenced by issuance of certificates of
occupancy by the County) of that portion of the Initial Planned Floor Area of
the Aladdin Improvements that Aladdin Gaming is required to construct pursuant
to this REA. Subject to force majeure as described in Article 10 and the
satisfaction of the applicable conditions precedent contained in the Site Work
Agreement, on or before the First Scheduled Opening Date, Bazaar Company
covenants that it shall have completed Construction (as evidenced by issuance of
certificates of occupancy by the County) of the Common Parking Area and the
Retail Facility required to be constructed by Bazaar Company pursuant to this
REA. Subject to force majeure as described in Article 10, on or before the
Second Scheduled Opening Date, Aladdin Music covenants that it shall have
completed Construction (as evidenced by issuance of certificates of occupancy by
the County) of the Music Hotel required to be constructed by Aladdin Music
pursuant to this REA. On or before the Final Completion Deadline, Energy
Provider shall complete Construction of the Central Energy Plant required to be
constructed by Energy Provider pursuant to the Energy Provider Agreement.
6.2 Uses.
(a) Each portion of the Initial Planned Floor Area and
the Music Hotel shall be operated in a manner consistent with the standards of a
first-class facility, which standards shall be at least equivalent to the
standards of the Mirage (as of the date of this REA), as to the Aladdin Hotel
and Casino, the standards of Bally's (as of the date of this REA) as to the
Music Hotel, and the standards of the Forum Shops (as of the date of this REA),
as to the Retail Facility. The Parties agree that the Theater for Performing
Arts shall be used to present events which are consistent with the first-class
nature of the Redeveloped Aladdin.
(b) Bazaar Company agrees that the Retail Facility shall
be used only for retail merchandising, restaurants, services and entertainment
as are commonly found in first-class retail enclosed shopping centers and
related incidental uses, including but not limited to a management/leasing
office not exceeding eighteen thousand (18,000) square feet of Floor Area.
(c) Aladdin Gaming and Aladdin Music shall have the right
to lease or use portions of the Aladdin Improvements and the Music Hotel,
respectively, for retail purposes (whether or not such retail purposes would be
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competitive with Occupants of the Retail Facility), including, but not limited
to, restaurants, souvenir shops, spa facilities, and the like which are commonly
found in first-class casinos and/or first-class hotels.
(d) The Parties shall install, maintain, repair and
replace the landscaping on their respective Tracts (to the extent that said
landscaping is not part of the Common Area to be maintained by an Operator
Party) as required to keep the same in a first-class condition.
(e) The Parties shall use commercially reasonable efforts
to employ or cause to be employed sufficient security and traffic control
personnel to ensure the safety of all Permittees using the Tracts operated by
such Parties.
6.3 Limitation on Detrimental Characteristics. Notwithstanding any
other provision of this REA, no use or operation shall be made, conducted or
permitted on any part of the Site which is clearly objectionable to the
development or operation of the Retail Facility, the Music Hotel or the Aladdin
Improvements or which is inconsistent with the operation of a first-class
shopping center, hotel and casino, as described in Section 6.2(a) above.
6.4 Operation.
(a) Subject to Section 9.4 hereof, provided that Aladdin
Gaming is using commercially reasonable efforts to operate the Aladdin
Improvements, substantially similar in size to the gaming facility and hotel set
forth on the Plans and Specifications, in a first-class manner in accordance
with the provisions of Section 6.4(b) hereof, then Bazaar Company, subject to
requirements of applicable laws and regulations, shall use commercially
reasonable efforts to cause the Bazaar Improvements, substantially similar in
size to the Bazaar Improvements set forth on the Plans and Specifications. (i)
With respect to the Retail Facility and the retail tenants of the Bazaar
Improvements (A) for the three year period beginning on the First Scheduled
Opening Date, to be kept open to the general public at all times when any tenant
of the Retail Facility is open for business but in any event at such times as
the general business hours of the Forum Shops, and (B) subsequent to said three
year period, to be kept open to the general public at all times that are
industry standard for first-class mixed use casino-related shopping centers
located on Las Vegas Boulevard, and (ii) to be operated and leased as a
first-class themed entertainment center, in accordance with this REA. The common
areas within the Retail Facility (as distinguished from the Common Area)
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shall remain open 24 hours a day, seven days a week, each and every day of the
year, and shall be operated in a first-class manner consistent with the
provisions of Section 6.4(f) hereof.
(b) Subject to Section 9.4 hereof, provided that (i) the
Common Parking Area, substantially similar in size to the Common Parking Area
set forth on the Plans and Specifications, is open to the general public and
being operated in accordance with the Parking Use Agreement, and (ii) Bazaar
Company is using commercially reasonable efforts to keep the Retail Facility,
substantially similar in size as that set forth on the Plans and Specifications,
open to the public and operated and leased as a first-class themed entertainment
center in accordance with the provisions of Section 6.4(a) hereof, then Aladdin
Gaming shall use commercially reasonable efforts to cause the Aladdin
Improvements, substantially similar in size to the Aladdin Improvements set
forth on the Plans and Specifications, (x) subject to requirements of applicable
laws and regulations, and subject to practices which are industry standard for
first class mixed use shopping-center related hotels and casinos located on Las
Vegas Boulevard, to be kept open to the general public 24 hours a day, seven
days a week, each and every day of the year, and (y) to be operated as a
first-class hotel and casino, in accordance with this REA.
(c) Subject to Section 9.4 hereof, provided that (i) the
Common Parking Area, substantially similar in size to the Common Parking Area
set forth on the Plans and Specifications, is open to the general public and
being operated in accordance with the Parking Use Agreement, and (ii) Bazaar
Company is operating the Retail Facility, substantially similar in size as that
set forth on the Plans and Specifications, open to the public and operated and
leased as a first-class themed entertainment center in accordance with the
provisions of Section 6.4(a) hereof, then, as of the Second Scheduled Opening
Date, Aladdin Music shall use commercially reasonable efforts to cause the Music
Hotel, substantially similar in size to the Music Hotel set forth on the Plans
and Specifications, (x) subject to requirements of applicable laws and
regulations, and subject to practices which are industry standard for first
class mixed use shopping-center related hotels and casinos located on Las Vegas
Boulevard, to be kept open to the general public 24 hours a day, seven days a
week, each and every day of the year, and (y) to be operated as a first-class
hotel and casino, in accordance with this REA.
(d) Energy Provider shall operate the Central Energy
Plant pursuant to the Energy Provider Agreement.
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(e) In addition, regardless of whether the Parties are
operating their respective Buildings in accordance with the foregoing minimum
requirements, all Parties hereto covenant and agree for the benefit of all
Parties hereto to maintain all necessary Perimeter Access Areas to permit
Occupants and Permitees access to and enjoyment of the Buildings of any other
Party hereto which may be open for business to the general public.
(f) Subject to the provisions of this Section 6.4, all
Common Areas of the Redeveloped Aladdin and the common areas within the Retail
Facility shall be operated in a first-class manner comparable to the standards
of the Forum Shops and be "fully opened" to the public for ingress and egress at
all times 24 hours a day, seven days a week, each and every day of the year,
except that (i) such areas need not be open at any time that none of the Aladdin
Hotel and Casino, the Retail Facility and the Music Hotel is open for business,
(ii) such areas need not be open prior to the First Scheduled Opening Date, and
(iii) portions of such areas may be closed from time to time as required for
repair and maintenance provided that at all times there is reasonable ingress
and egress to each Tract of the Redeveloped Aladdin. "Fully opened" means,
without limitation, that there shall be reasonably adequate security, adequate
air conditioning, lighting and other utilities, consistent with first-class
standards; and in general that at all hours such areas shall be maintained, but
not necessarily staffed, in the same manner as when all stores are open for
business.
(g) The Parties agree that each Party (except Energy
Provider) shall have the right to sponsor and stage special events on their
Tracts at the locations designated for same on the Site Plans and the Plans and
Specifications. In the event that a Party schedules a special event in the
Theater for Performing Arts or on any public areas on level 115 (as defined in
the Plans and Specifications), such Party shall inform the other Parties (other
than Energy Provider) at least thirty (30) days prior thereto and provide each
of them with information with respect to the type of entertainment, proposed
time and location of staging, planned security arrangements and expected turnout
for the event. All such events shall be consistent with the first-class nature
of the Redeveloped Aladdin. Any disputes relating to such events shall be
resolved by arbitration pursuant to Article 12 hereof. The costs attributable to
any such special event, including security, refuse disposal and janitorial
staff, shall be at the sole cost and expense of the Party or Parties sponsoring
such event. Nothing in this Section 6.4(g) shall be construed as granting
approval rights to any Party.
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(h) Forty-five (45) days prior to any Party's exercise of
its right, if any, to cease compliance with the operational covenants set forth
in subsections 6.4(a) through 6.4(c) above, as applicable, based upon the
Default of another Party ("CESSATION RIGHT"), such non-Defaulting Party shall
serve notice of such intention upon each of the other Parties (including, but
not limited to, the Defaulting Party), which notice shall specify in reasonable
detail the circumstances of the subject Default. If the Defaulting Party fails
to Cure the Default specified in said notice, if any, or, if said Default cannot
reasonably be Cured within the aforesaid forty-five day period, the Defaulting
Party fails to diligently pursue said Cure within such period and until the
subject Default is Cured, then the non-Defaulting Party may exercise its
Cessation Right. The notice and Cure period required in this subsection 6.4(h)
is a condition precedent to any Party's exercise of its Cessation Right. Subject
to Sections 11.5 and 11.6 hereof, any Party's Cessation Right shall be
terminated upon the Cure of the Default underlying same.
6.5 Gaming Activities.
(a) Aladdin Gaming represents that neither Aladdin Gaming
nor any member thereof nor any Affiliate of Aladdin Gaming nor any member
thereof is unwilling or unable to file all necessary applications with the
Gaming Authorities to obtain whatever gaming licenses that may be required of
such Persons in connection with the Gaming Activities to be conducted in the
Gaming Facilities in the Aladdin Improvements. To Aladdin Gaming's actual
knowledge, no such Person has ever engaged in any conduct or practices which
would cause such Person to be denied any gaming license that may be required by
such Person. Without limiting the foregoing, no such Person has ever (a) been
convicted of any felony, (b) had a civil or criminal record expunged or sealed
by a court order, (c) received a pardon for any criminal offense, (d) held a
privileged or professional license in any state and had any disciplinary action
taken against him or her with respect to any such license, or (e) been refused a
gaming license or been subject to a related fining of unsuitability or been
refused a license for selling alcoholic beverages or been subject to a related
finding of unsuitability or been a participant in any group which has been
denied any such license or subject to such finding. Aladdin Gaming covenants to
take all commercially reasonable actions in order that Aladdin Gaming shall be
issued all necessary gaming licenses in order to conduct Gaming Activities in
the Gaming Facilities in the Music Hotel as soon as reasonably possible
following the recordation of this REA.
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(b) Aladdin Music represents that neither Aladdin Music
nor any member thereof nor any Affiliate of Aladdin Music nor any member thereof
is unwilling or unable to file all necessary applications with the Gaming
Authorities to obtain whatever gaming licenses that may be required of such
Persons in connection with the Gaming Activities to be conducted in the Gaming
Facilities in the Music Hotel. To Aladdin Music's actual knowledge, no such
Person has ever engaged in any conduct or practices which would cause such
Person to be denied any gaming license that may be required by such Person.
Without limiting the foregoing, no such Person has ever (a) been convicted of
any felony, (b) had a civil or criminal record expunged or sealed by a court
order, (c) received a pardon for any criminal offense, (d) held a privileged or
professional license in any state and had any disciplinary action taken against
him or her with respect to any such license, or (e) been refused a gaming
license or been subject to a related fining of unsuitability or been refused a
license for selling alcoholic beverages or been subject to a related finding of
unsuitability or been a participant in any group which has been denied any such
license or subject to such finding. Aladdin Music covenants to take all
commercially reasonable actions in order that Aladdin Music shall be issued all
necessary gaming licenses in order to conduct Gaming Activities in the Gaming
Facilities in the Music Hotel as soon as reasonably possible following the
recordation of this REA.
(c) No Gaming Activities or gaming devices, cashless
wagering systems or associated equipment (as such terms are defined in NRS
Chapter 463) ("GAMING EQUIPMENT") shall be permitted in or on the Bazaar Site,
except to the extent that Bazaar Company agrees to permit Aladdin Gaming to
engage in Gaming Activities or to open a Gaming Facility therein in its sole
discretion.
6.6 Commercial Subdivision; Taxes and Assessments. The Parties
agree to cooperate with each other to commercially subdivide the Site into
separate legal tracts for the Gaming Site, the Optional Improvements Site, the
Bazaar Site (with separate legal lots for each of the Retail Facility and the
Common Parking Area), the Aladdin Music Site and the Energy Site (the
"COMMERCIAL SUBDIVISION"). Aladdin Gaming agrees to use commercially reasonable
efforts to pursue the Commercial Subdivision at its own cost and expense and to
commence such process as soon as reasonably practicable after the date hereof,
but in any event so as to complete the Commercial Subdivision prior to the First
Scheduled Opening Date. Until such time as the Commercial Subdivision shall be
effected, the Parties agree to pay to Aladdin Gaming, within thirty (30) days of
a request
55
therefor (but in no event more frequently than quarterly), their respective
allocable share of the real estate taxes and assessments levied against the Site
(the "ALLOCABLE SHARE OF REAL ESTATE TAXES"), as such shares are set forth on
Schedule "II" hereto. The Allocable Share of Real Estate Taxes shall be
appropriately prorated with respect to the real estate tax year in which the
recordation of this REA and the Commercial Subdivision occurs. After such time
as the Commercial Subdivision is effected, each Party agrees that it will pay
before delinquency, all real estate taxes and assessments, both general and
special, which are levied or assessed against its Tract. Nothing herein
contained shall be deemed to limit the right of a Party to contest the validity
of any such taxes or assessments against its Tract by appropriate proceedings;
provided, that such contest is made in good faith at such Party's own cost, and
as long as neither title to the subject Tract, nor the rights, privileges and
easements granted herein with respect thereto would be forfeited or released as
a result of the continuing non-payment of such taxes. If a Party fails to comply
with this Section 6.6, any of the other Parties, upon giving the Defaulting
Party thirty (30) days' prior notice, may cure such failure and shall be
entitled to reimbursement from the Defaulting Party in accordance with the terms
of Section 20.9.
6.7 Adjacent Land. The Parties agree that the parcel of land
located on the northeast corner of the intersection of Las Vegas Boulevard South
and Harmon Avenue (the "ADJACENT LAND") shall not be purchased by any Party or
any Affiliate thereof without first notifying all other Parties (except Energy
Provider). If any Party or Affiliate thereof purchases the Adjacent Land, the
Parties agree that as of such purchase (a) the Adjacent Land and the then owner
thereof shall become subject to all of the terms and conditions of this REA (b)
the Construction of any improvements thereon shall be subject terms and
conditions of Section 3.5 hereof (it being understood that all Parties (except
Energy Provider) shall have approval rights in connection with such Construction
to the same extent that Bazaar Company has approval rights over the Construction
of the Optional Improvements) and (c) the Allocable Share of Common Costs will
be equitably adjusted among the parties. If any Party performs Construction on
the Adjacent Land, such Party hereby covenants that (x) such Construction shall
be consistent with the architectural character of the Aladdin Hotel and Casino
and the Retail Facility and (y) it shall use commercially reasonable efforts (at
no significant cost to such Party) to minimize interference with the visibility
of the Music Hotel from Las Vegas Boulevard resulting therefrom.
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ARTICLE 7
COVENANTS AGAINST WASTE
7.1 Waste. Each Party covenants to the other Parties that it shall
not commit or suffer any waste or damage to, or impairment of the value of, any
Party's Tract in the use of the easements created herein or otherwise.
7.2 Hazardous Substances. Each Party covenants to the other
Parties that it shall not keep, use or store, or allow to be kept, used or
stored, or discharge in any amount, any Hazardous Substances or any other
hazardous or toxic substances on or in the Site, without the express prior
written consent of the other Parties and all insurance companies which have
issued any insurance on the Site or any portion thereof, provided, however, a
Party may use Hazardous Substances (in quantities necessary for the activities
conducted) in the business of operating each Party's Tract to the extent such
use is in compliance with applicable laws and prudent Hazardous Substance
handling procedures and such Hazardous Substances to the extent not fully used
are properly and lawfully disposed of, without materially violating applicable
laws, endangering human health and safety or impairing any portion of the Site.
Each Party Indemnifies the others with respect to any Claims arising out of the
breach of the foregoing sentence and from any damages resulting from a Party's
use of Hazardous Substances which impairs such other Party's use of their Tract.
ARTICLE 8
INDEMNIFICATION AND INSURANCE
8.1 Indemnity. Each Party, as Indemnitor, covenants to Indemnify
the other Parties, as Indemnitees, with regard to any and all Claims arising
from such Indemnitor's operation, use or ownership of its Tract or arising from
any event occurring on its Tract or any Default under this REA; provided,
however, Indemnity under this Section 8.1 shall not be required if and to the
extent the Claim underlying an Indemnitee's request for indemnity is of a type
covered by "All-Risk" property damage insurance or by the insurance required to
be carried under this Article 8 and the insurance carrier accepts tender of such
Claim.
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8.2 General Liability Insurance. Throughout the term of this REA,
each Party shall maintain through the Controlled Insurance Program, or otherwise
shall cause to be maintained, in full force and effect, with a financially
responsible insurance company or companies, commercial general liability
(including public liability and property damage) insurance covering occurrences,
accidents and incidents on the Tract in which such Party has an interest, that
(a) occur during the term of this REA (regardless of when the claim is filed),
and (b) result in bodily injury, personal injury or death to any Person and/or
damage or destruction of property. Said insurance shall have a combined single
limit of liability per occurrence of not less than One Million Dollars
($1,000,000) on a primary basis and not less than One Hundred Million Dollars
($100,000,000) on an excess/umbrella basis, or such greater amounts as are
typical for similar casino-hotel projects in Las Vegas and as such Parties may
consider from time to time (but not more than once every three (3) years) and
agree upon. By endorsements, such insurance policy shall provide coverage for
liability arising from the premises, its operations, personal injury, completed
operations, broad-form property damage liability, and broad-form contractual
liability extending to the Indemnity given in Section 8.1. Each Party shall also
maintain, or cause to be maintained, motor vehicle insurance with not less than
Five Million Dollars ($5,000,000) combined single limit of liability per
occurrence, which limit such Parties shall review periodically in the same
manner as they shall review the general liability insurance coverage. In
addition to the minimum requirements set forth in this Section 8.2, Energy
Provider shall maintain the insurance coverages required pursuant to the Energy
Provider Agreement.
8.3 Property Insurance. Each Party shall maintain property damage
insurance on its improvements with coverage amounts not less than the full
replacement value thereof and as may be required by such Party's Mortgagee.
8.4 Blanket Insurance. The Parties agree that the insurance
described in this Article 8 may be provided in whole or in part through a policy
or policies covering other liabilities and locations of the Parties or their
respective Affiliates.
8.5 Controlled Insurance Program. The Parties acknowledge that
participation in the Controlled Insurance Program will not satisfy all of the
insurance obligations of the Parties hereunder.
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8.6 Mutual Release; Waiver of Subrogation. Each Party covenants
that it will, if generally available in the insurance industry, obtain for the
benefit of each such released Party a waiver of any right of subrogation which
the insurer of such Party may acquire against any such Party by virtue of the
payment of any such loss covered by such insurance. In the event any Party is by
law, statute or governmental regulation unable to obtain a waiver of the right
of subrogation for the benefit of another Party, then, during any period of time
when such waiver is unobtainable, said Party shall not have been deemed to have
released any subrogated claim of its insurance carrier against such other Party,
and during the same period of time such other Party shall be deemed not to have
released the Party who has been unable to obtain such waiver from any claims it
or its insurance carrier may assert which otherwise would have been released
pursuant to this Section.
8.7 Named Insureds. Each Party shall name the other Parties (a) as
additional named insureds on general liability insurance policies held by such
Party or such Party's contractors and (b) as an indemnitee under any indemnity
clause in such Party's contractors' general liability insurance policies, if, in
either event, such is obtainable without material additional cost to said Party.
Each Party shall, upon the written request of another Party, provide such
requesting Party with a copy of the insurance certificates evidencing the
insurance required to be maintained by such Party under this REA.
ARTICLE 9
REPAIR, MAINTENANCE, ALTERATIONS AND RESTORATION
9.1 Maintenance - Buildings. Each Party shall keep and maintain,
or cause to be kept and maintained, in good order, first-class (as defined in
Section 6.2(a) hereof, to the extent applicable) condition and repair,
reasonable wear and tear excepted, and in accordance with all applicable laws,
rules, ordinances, orders and regulations, all completed portions of such
Party's Tract. Without limiting the generality of the foregoing each Party
shall, with respect to such Party's Tract except with respect to the Common Area
in which case the Operator Party shall:
59
(a) regularly clean the floor surfaces with appropriate
finishing compounds and shall maintain them so that such surfaces remain smooth
and evenly covered with surfacing material;
(b) remove all papers, debris, filth and refuse and wash
or thoroughly sweep or vacuum surface areas;
(c) clean, repair and maintain all lighting fixtures and
relamp and reballast them as needed;
(d) subject to Sections 2.6 and 2.16 hereof, maintain or
cause to be maintained all signs, in a clean, orderly and first-class condition,
including relamping and repairing as may be required;
(e) maintain and keep in a sanitary condition public
restrooms and other common use facilities;
(f) clean, repair and maintain all mechanical systems,
vertical transportation equipment, sprinkler and fire control systems, and
mechanically actuated and manually operated doors;
(g) furnish necessary pest (including rodent) abatement
controls;
(h) subject to Section 2.1(n), keep the Perimeter Access
Areas and all other pedestrian and vehicular access areas within the Redeveloped
Aladdin open to passage to the general public; and
(i) maintain and replace landscaping as necessary to
maintain first-class condition.
9.2 Maintenance - Common Parking Area. Bazaar Company agrees that
it shall maintain the Common Parking Area in accordance with the provisions of
the Parking Use Agreement.
9.3 Alterations - Buildings and Common Area.
(a) Right to Alter. Following the date on which the
Construction of the Initial Planned Floor Area is completed with respect to the
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Gaming Site and Bazaar Site, and following the Second Scheduled Opening Date
with respect to the Aladdin Music Site, changes and alterations to each Party's
Tract shall be made subject to the following conditions: (i) any alterations
requested by a Party which involve physical changes to another Party's Tract
(other than Energy Provider's Tract), other than de minimis changes which have
no adverse effect (as defined in Section 3.1 hereof), must be approved by any
Party whose Tract is so affected, in such Party's sole discretion; (ii) any
alterations requested by a Party which have a direct adverse effect on (a)
another Party's Tract, (b) the Common Areas, or (c) the Quality of Development
and Planning for the Redeveloped Aladdin, shall be subject to the reasonable
approval of, with respect to clauses (a) and (b), the affected Party (except
Energy Provider), and with respect to clause (c), Aladdin Gaming and Bazaar
Company. Any alterations requested by a Party which do not have a direct adverse
effect on those items enumerated in clauses (a) through (c) above, but which are
material and substantial in nature, are subject to the reasonable approval of
any affected Party (except Energy Provider). If any affected Party (except
Energy Provider) shall disapprove any requested contemplated alterations, the
requesting and affected Parties shall attempt to resolve any disagreements by
consulting each other and their respective architects, engineers or consultants
as soon as reasonably possible, and if such Parties are unable to resolve any
such disagreements, any Party to the disagreement may elect to resolve the
disagreement by arbitration pursuant to Article 12. For the purposes of this
Section 9.3(a), the term "adverse effect" shall have the meaning for such term
set forth in Section 3.1 hereof.
(b) Right to Raze. Except as permitted by the Site Work
Agreement, no Party shall be permitted to demolish or raze any Buildings located
on its Tract in violation of the provisions of Article 6, including but not
limited to Section 6.4 thereof, except as may be necessary prior to rebuilding
the same following destruction or damage due to a casualty or condemnation
pursuant to the provisions of Section 9.4 hereof. If any Party elects to
demolish or raze any portion of its Buildings or Common Area located on its
Tract which is not required to be operated in accordance with Article 6, such
demolition shall be undertaken in a manner designed to minimize any disruption
or inconvenience to the other Parties in the operation of their business, and
thereafter that portion of the Site so leveled shall be maintained in a safe,
sightly and dust-free condition appropriately landscaped to be consistent with
the standards required in Section 3.1, until such Party which has demolished
same shall elect to rebuild on such portion of the Site. In no event shall such
demolition be undertaken in a way which would render unusable
61
any structural support easements or any of the other easements granted in
Article 2, except as may be permitted in strict accordance with the provisions
of Article 2.
(c) Right to Re-open Access. In the event that access to
and/or through the Tract of any Party is temporarily closed or impaired, the
Party responsible for creating the impaired access shall open such access or
provide alternate access to and/or through such Tract. If any Party fails to
provide adequate access, any other Party may at any time give a written notice
to the Party thus failing, setting forth the impaired access. If such access is
not re-opened within three (3) days after receipt of such notice, or if such
access cannot be reopened within such time, then if such Party fails to re-open
the access within such period and diligently prosecute the same to completion
thereafter, then, in either such event, the Party giving such notice shall have
the right, upon prior written notice, to re-open the access, including the right
and temporary license to enter upon the other Party's Tract to perform same, and
such Party which has failed to perform shall pay the performing Party's
reasonable costs thereof, provided, however, these provisions shall be without
prejudice to such non-performing Party to contest the right of the other Party
to re-open such access or expend such monies.
9.4 Restoration of Buildings and/or Common Area. In the event of
any casualty (which term shall include acts of God, fire, earthquake, flood,
explosion or similar occurrences) or condemnation that results in damage or
destruction to, or the taking of, less than substantially all of any Party's
Tract, whether insured or uninsured, which damage, destruction or taking occurs
during a time when such Party is required by this REA to be in operation, then
such Party shall restore, repair and/or rebuild such Tract with all due
diligence and in accordance with the Plans and Specifications therefor. All
restoration, repair and/or rebuilding shall be performed in accordance with the
applicable requirements of Article 3. If any Party desires to alter the
improvements to be so repaired or restored, such Party shall comply with the
provisions of Section 9.3(a) hereof. All costs and expenses of restoration,
repair and/or rebuilding of the Buildings, Common Area and/or other improvements
on a Party's Tract in excess of available insurance or condemnation proceeds
shall be paid by said Party; provided, however, that with respect to the Common
Parking Area, any such excess costs and expenses shall be allocated to all
Parties in accordance with each Tract's proportionate share of parking spaces
required in accordance with County laws, codes and regulations. Notwithstanding
the foregoing, the Parties (other than Energy Provider) shall not have the
obligation to restore their Tract if such
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damage or destruction occurs more than twenty-five (25) years after the Second
Scheduled Opening Date; provided, however, that if such damage or destruction
affects the Common Parking Area and occurs at any time during the term of this
REA, then the Common Parking Area shall be restored. In addition to the minimum
requirements set forth in this Section 9.4, Energy Provider shall adhere to the
restoration obligations required pursuant to the Energy Provider Agreement.
9.5 Restoration of Improvements Not Covered by Section 9.4.
Aladdin Gaming shall have no obligation to repair or restore any damage or
destruction to any improvements constituting Optional Improvements; however, the
provisions of Section 9.8 shall apply in the event a Party elects not to repair
or restore any such damaged or destroyed improvements.
9.6 Standards of Construction. A Party performing any restoration,
repair, rebuilding, maintenance, alterations, additions or improvements
(collectively called "WORK") shall, to the extent applicable, strictly comply
with the standards of construction set forth in Article 3 hereof and the
following requirements:
(a) Such Work shall include leveling, paving,
constructing proper exterior walls for what previously constituted common party
walls, and creating reasonably useful entrances and exits that afford proper
ingress to and egress between and among the Retail Facility, the Common Parking
Area, the Aladdin Improvements and the Music Hotel.
(b) No Work shall be commenced unless the Party desiring
to perform the same has in each instance complied with the appropriate
provisions of this REA.
(c) If the Work is to a structure which is adjacent to a
Party's Building, then during the performance of the Work the structure being
restored, repaired and/or rebuilt shall be secured and temporarily enclosed in
order to prevent conditioned air from escaping, and upon completion shall be
physically integrated with such Party's Building.
(d) If the Work could reasonably be deemed to constitute
a hazardous condition for Permitees or detract from the attractiveness of any
Party's Buildings, then during the performance of the Work, an adequate and
attractive
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construction barricade or other protective device shall be placed around the
structure being restored, repaired and/or rebuilt.
(e) All Work shall be performed in a good and workmanlike
manner in accordance with good construction practice, strictly conforming to and
complying with:
(i) The Plans and Specifications therefor
approved to the extent provided in Section 9.4;
(ii) All applicable requirements of laws, codes,
regulations, rules and underwriters, subject to the right of any Party to
contest the validity or application thereof at its sole cost and expense;
(iii) As applicable, the requirements of any
Mortgagee and the Plans and Specifications; and
(iv) As applicable, the provisions of Section
11.7.
(f) Except as herein provided to the contrary, all Work
shall be completed at the sole cost and expense of the Party performing the
same, and with due diligence.
9.7 Licenses for Repairs, Maintenance, Alterations and
Restoration. Each Party (hereinafter, the "LICENSEE") is hereby granted a
temporary license to use portions of the Common Area for the purposes of
performing maintenance upon, making repairs to, constructing alterations,
additions and improvements, and/or razing, replacing and restoring the whole or
any part of the Common Area and/or Buildings, as are permitted pursuant to this
REA. Within a reasonable time prior to commencement of Work pursuant to said
license, the Licensee shall submit to the other Parties (except Energy Provider)
for their approval the following: a plot plan of the Site affected by the Work
and a time schedule therefor, all in accordance with the provisions of Section
3.5 and the approvals provided for therein. At all times during any Licensee's
use of a portion of the Common Area, as aforesaid, such Licensee shall comply
with the applicable requirements of this REA, and, upon cessation of such use,
shall promptly restore the portions of the Common Area so used to the same
condition in which they existed prior to the time of commencement of such use,
including the clearing of such area of all dirt, debris, equipment and
Construction materials. The Licensee
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shall also restore, at its sole cost and expense, any portions of the Site which
may have been damaged as a result of such Construction promptly upon the
occurrence of such damage and shall at all times during the period of any such
Construction keep all portions of the Site, except the portions upon which said
Construction is being performed and the portions of the Common Area being
utilized by such Party pursuant to this Section, free from and unobstructed by
any dirt, debris, equipment or Construction materials related to such
Construction. Each Licensee covenants to Indemnify each other Party with regard
to such Licensee's exercise of the license provided by this Section.
9.8 Clearing of Building Site. Whenever a Party is not obligated
hereunder to restore, repair and/or rebuild any Building that has been damaged,
destroyed or taken by any casualty or condemnation and elects not to do so, then
and in such event such Party shall raze such Building or such part thereof as
has been so damaged or destroyed in accordance with the requirements of Section
9.3(b).
9.9 Self-Help Cure of Maintenance and Restoration Defaults. If any
Party fails to perform any of its duties or obligations under this Article 9,
including but not limited to the obligations of certain Parties to maintain
certain portions of the Common Area, any other Party may at any time give a
written notice to the Defaulting Party thus failing, setting forth the specific
nonperformance. If such nonperformance is not corrected within thirty (30) days
after receipt of such notice, or if such nonperformance is such that it cannot
be corrected within such time, then if such Defaulting Party fails to commence
the performance of such duties within such period and diligently prosecute the
same to completion thereafter, then, in either such event, the Party giving such
notice shall have the right, upon prior written notice, to perform same,
including the right and temporary license to enter upon the Defaulting Party's
Tract to perform same, and the Defaulting Party shall pay, on demand, the
performing Party's reasonable costs thereof (subject to the allocation provision
of Section 9.4 hereof), with interest computed in accordance with Section
20.9(a) hereof, provided, however, these provisions shall be without prejudice
to the Defaulting Party's right to contest the right of the other Party to make
such repairs or expend such monies. All Work performed by such Party shall be
performed in compliance with the Gaming Laws and Article 3 hereof and,
notwithstanding anything herein to the contrary, shall be performed by such
Party to the extent necessary to properly operate such Party's Tract and shall
not be performed by such Party in order to effect a rebuilding or restoration of
the Building on the Defaulting Party's Tract, except a rebuilding,
65
repair or restoration of the Common Parking Area following damage or partial
condemnation, which shall be permitted hereunder in the event that the Party
responsible for the maintenance and operation of the Common Parking Area (a)
fails to diligently pursue such rebuilding, repair or restoration within the
ninety (90) day period following a casualty to the Common Parking Area or (b)
fails for a period of sixty (60) days to meet milestones on the critical path of
any construction schedule in connection with such rebuilding, repair or
restoration. Notwithstanding anything hereinabove contained to the contrary, in
the event that any Party in good faith deems that there is an emergency
situation which threatens immediate injury to Persons or immediate damage to
property, or material interference with access to or parking for a Party's
Tract, such Party may, without the notice required above, but with such notice
as is reasonable under the circumstances, cure any such Default.
9.10 Lien. Any amount due under this Article 9 from the Defaulting
Party to the other Party shall be a lien against the Tract of the Defaulting
Party, effective upon and enforceable in accordance with Section 4.3 hereof.
9.11 Article 9 Approvals. Except as otherwise provided herein, any
approval required pursuant to this Article 9 shall be deemed granted if not
denied within thirty (30) days after the approving Party's receipt of the
requisite information and a request threfor and shall be subject to the terms
and conditions of Article 18 hereof.
ARTICLE 10
FORCE MAJEURE
10.1 Force Majeure. Except as otherwise expressly provided in this
REA to the contrary, each Party shall be Excused from its duty to perform any
covenant or obligation of this REA, except an obligation to pay any sums of
money not expressly conditioned on any Party's performance of a covenant or
obligation that has itself been Excused by this Section, in the event but only
so long as the performance of any such covenant or obligation is prevented,
delayed, retarded or hindered by any of the following: act of God, fire,
earthquake, floods, explosion, action of the elements, war, invasion,
insurrection, riot, mob violence, sabotage, inability to procure or general
shortage of labor, equipment, facilities, materials or supplies in the open
market, failure of transportation, strikes, lockouts, action of
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labor unions, condemnation, requisition, laws, orders of governmental or civil
or military or naval authorities, or any other cause, whether similar or
dissimilar to the foregoing, not within the respective control of such Party
(other than the lack of or inability to procure funds to fulfill its covenants
and obligations provided in this REA), including the timely performance by any
Party (other than such Party) of its respective obligations under the Site Work
Agreement. Notwithstanding any specific references in certain provisions of this
REA to this Section, the absence of such specific reference in any other
provision shall not be deemed to diminish the general applicability of this
Section.
10.2 Notice. In the event any Party claims Excuse from its duty to
perform any covenant or obligation set forth in this REA due to any of the
events of force majeure set forth in Section 10.1, such Party shall notify the
other Parties of the occurrence of such event of force majeure within ten (10)
days following the occurrence thereof. The provisions of Section 10.1 shall not
be effective to Excuse any Party failing to give such notice from the
performance of such covenant or obligation until such notice is given to the
other Parties; provided, however, in no event shall the giving of such notice at
any time following such ten (10) day period extend the period during which such
Party is otherwise Excused beyond any maximum Excuse periods set forth in this
REA.
ARTICLE 11
DISCHARGE AND RELEASE
11.1 Discharge on Transfer. Except as provided in Section 11.3, a
Transferor shall be Discharged from and after the effective date of the Transfer
from all of its unaccrued obligations hereunder, provided that all of the
following conditions precedent are satisfied:
(a) Transferor shall have paid all amounts due and
payable to the other Parties, and shall have performed all of its obligations
accrued, as of said effective date;
(b) Transferor shall have given the other Parties notice
of the Transfer; and
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(c) Transferor shall have delivered to each other Party a
written instrument in recordable form, duly executed and acknowledged by
Transferee, whereby Transferee shall have expressly assumed all of the
covenants, duties and obligations of Transferor under this REA from and after
said effective date.
11.2 Discharge on Involuntary Transfer: Condemnation. Subject to
the provisions of Section 11.3, an Involuntary Transferor shall be Discharged
from and after the effective date of the Involuntary Transfer from all of its
unaccrued obligations hereunder, on condition that such Involuntary Transferor
shall have paid all amounts due and payable to the other Parties by such
Involuntary Transferor, and shall have performed all of its obligations accrued,
as of said effective date. In the event of a condemnation of at least
substantially all of a Party's Tract, such Party shall be Discharged from and
after the effective date of the taking of title to or possession of such Tract,
whichever first occurs, from all of its unaccrued obligations hereunder, on
condition that such Party shall have paid all amounts due and payable to the
other Parties by such Party, and shall have performed all of its obligations
accrued, as of said effective date.
11.3 Exceptions to Discharge. Neither a Transfer nor an Involuntary
Transfer shall Discharge a Party from its initial Construction obligations under
Section 3.1. Further, neither a Transfer nor an Involuntary Transfer shall
Discharge a Transferor or Involuntary Transferor from (i) amounts due and unpaid
from such Transferor or Involuntary Transferor or (ii) accrued obligations of
such Transferor or Involuntary Transferor, in either event, as of the date of
such Transfer or Involuntary Transfer, and such Transferor or Involuntary
Transferor shall not be Released from such obligations by such Transfer or
Involuntary Transfer.
11.4 Discharge of Mortgagee. A Mortgagee that acquires title to a
Tract (or portion thereof) in an Involuntary Transfer shall subsequently be
Discharged from and after the effective date of such Mortgagee's Transfer of its
interest in said Tract provided it has performed all of its obligations that
accrued during its period of ownership, and complies with Sections 11.1 (b) and
(c).
11.5 Aladdin Gaming Released From Operating Covenants. Provided
that Aladdin Gaming is not then in Default under this REA, the Bazaar Lease, the
Site Work Agreement or the Parking Use Agreement, Aladdin Gaming shall be
Released from its operating covenants under Article 6 and its Tract shall
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be Released from such operating covenants if Bazaar Company shall have failed to
Cure a material Default in the performance of any of its duties under Article 6
within one hundred twenty (120) days after notice to Cure from Aladdin Gaming,
which failure shall constitute an Event of Default.
11.6 Bazaar Company Released from Operating Covenants. Provided
that Bazaar Company is not then in Default under this REA, the Bazaar Lease, the
Site Work Agreement, or the Parking Use Agreement, Bazaar Company shall be
Released from its operating covenants under Article 6 and its Tract shall be
Released from such operating covenants if Aladdin Gaming shall have failed to
Cure a material Default in the performance of any of its duties under Article 6
within one hundred twenty (120) days after notice to Cure from Bazaar Company,
which failure shall constitute an Event of Default.
11.7 Aladdin Music Released from Operating Covenants. Provided that
Aladdin Music is not then in Default under this REA or the Music Lease, Aladdin
Music shall be Released from its operating covenants under Article 6 and its
Tract shall be Released from its operating covenants if Bazaar Company shall
have failed to Cure a material Default in the performance of any of its duties
under Article 6, within one hundred twenty (120) days after notice to Cure from
Aladdin Music, which failure shall constitute an Event of Default.
11.8 Excuse and Release From Restoration Covenants.
(a) Excuse. Each Party shall be Excused from its
restoration covenants under Article 9 for so long as any other Party is Excused
from and is not performing, or is in Default of, its restoration and/or
operation covenants, in each case to the extent that and for so long as such
nonperformance of such other Party interferes with the subject Party's ability
to perform its obligations hereunder.
(b) Release. A Party (the "RELEASED PARTY") shall be
Released from its restoration covenants under Article 9 in each of the following
circumstances:
(i) The Released Party shall be Released from
said covenants if the Released Party has also been Released from its operating
covenants under Section 6.4 hereof pursuant to Sections 11.5, 11.6, or 11.7
hereof.
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(ii) The Released Party shall be Released from
said covenants if the other Parties have not Cured their respective Defaults
under said covenants after sixty (60) days notice from the Released Party.
11.9 No Waiver. A Party's Excuse, Discharge or Release, or a
Party's continued performance or operation after its Excuse, Discharge or
Release or its service of a notice of Default or a notice to Cure shall not
diminish such Excuse, Discharge or Release nor any rights of such Party under
this REA, including any claim for damages, or constitute such Party's waiver of
the effectiveness of the notice it shall have served.
ARTICLE 12
ARBITRATION
12.1 Disputes Covered. Except where a Party may grant or withhold
its consent or approval under the express provisions of this REA in its sole and
absolute discretion, any dispute between the Parties involving any approvals
hereunder, including those arising from lack of approval or disagreements over
interpretation or application of such provisions, and any other disputes
involving provisions of this REA shall be resolved by binding arbitration con
ducted in the manner described in this Article 12; provided, however, that any
Party may seek prohibitory injunctive relief without first submitting the
controversy to arbitration. Prior to the Second Scheduled Opening Date, the
arbitration procedures set forth in Article VIII of the Site Work Agreement
shall control, notwithstanding the fact that all the Parties are not parties to
the Site Work Agreement.
12.2 Arbitration Procedures.
(a) A Party seeking arbitration ("DEMANDING PARTY") shall
deliver a written notice of demand to resolve dispute (the "DEMAND") to the
other Party to such dispute ("NON-DEMANDING PARTY"), with a copy of the Demand
delivered to all other Parties (except Energy Provider). The Demand shall
include a brief statement of the Demanding Party's claim or controversy, the
amount thereof, and the name of the proposed Arbitrator to decide the dispute
("ARBITRATOR"). Within ten (10) days after receipt of the demand, the
Non-Demanding Party against whom a demand is made
70
shall deliver a written response to the Demanding Party. Such response shall
include a short and plain statement of the Non-Demanding Party's defense to the
claim and shall also state whether such Party agrees to the Arbitrator chosen by
the Demanding Party. If the Non-Demanding Party fails to agree to the Arbitrator
chosen by the Demanding Party, then such Non-Demanding Party shall state in its
response the name of the proposed Arbitrator chosen by such non-Demanding Party
as the proposed Arbitrator. If the Non-Demanding Party fails to deliver its
written response to the Demanding Party within ten (10) days after receipt of
the demand, or if the Non-Demanding Party fails to select in its written
response a proposed Arbitrator, then the Arbitrator selected by the Demanding
Party shall serve as the Arbitrator. An Arbitrator shall not be employed by any
Party or its Affiliate, directly, indirectly or as an agent, except in
connection with the arbitration proceeding. Any person appointed as an
Arbitrator shall be knowledgeable and experienced in the matters sought to be
arbitrated.
(b) The locale of the arbitration shall be in Las Vegas,
Nevada at the offices of the American Arbitration Association or at such other
location in Las Vegas, Nevada agreed to by the parties, or if the Parties cannot
agree, at the Aladdin Hotel and Casino.
(c) If the Non-Demanding Party selects a proposed
Arbitrator different than the Arbitrator selected by the Demanding Party, and
such selection is indicated by the Non-Demanding Party in its written response
to the Demanding Party made within ten (10) days after receipt of the demand,
then the Parties shall, for ten (10) days after the Demanding Party's receipt of
the Non-Demanding Party's written response to the demand, attempt to agree upon
an Arbitrator. If the Parties cannot agree upon an Arbitrator within said ten
(10) day period, then, on the application of the Demanding Party, a single
neutral Arbitrator shall be appointed by the Eighth Judicial District Court of
the State of Nevada in accordance with the provisions of NRS Section 38.055.
(d) The Arbitrator's powers shall be limited as follows:
the Arbitrator shall follow the substantive laws of the State of Nevada, and the
Rules of Evidence of Nevada, and his/her decision shall be subject to review
thereon in accordance with the provisions of NRS Chapter 38 (the Nevada Uniform
Arbitration Act).
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(e) The costs of the resolution (including all reporter
costs) shall be split among the Parties participating in the arbitration,
provided, however, that such costs, along with all other costs and expenses,
including attorney's fees, shall be subject to award, in full or in part, by the
Arbitrator, in his/her discretion, to the prevailing party. Unless the
Arbitrator so awards attorneys' fees, each Party shall be responsible for its
own attorneys' fees.
(f) To the extent possible, the arbitration hearings
shall be conducted on consecutive days, excluding Saturdays, Sundays and
holidays, until the completion of the hearings.
(g) In connection with any arbitration proceedings
commenced hereunder, any Party shall have the right to join any third parties in
such proceedings in order to resolve any other disputes, the facts of which are
related to the matters submitted for arbitration hereunder.
(h) The Arbitrator shall render her/his decision(s)
concerning the substantive issue(s) in dispute in writing. The written decision
shall be sent to the Parties no later than thirty (30) days following the last
hearing date.
(i) All hearings shall be concluded within ninety (90)
days from the day the Arbitrator is selected or appointed, unless the Arbitrator
determines that this deadline is impractical.
(j) If any of the provisions relating to arbitration are
not adhered to or complied with, any Party may petition the Eighth Judicial
District Court of the State of Nevada, for appropriate relief in accordance with
the provisions of NRS Chapter 38.
(k) Upon application of a Party to the Eighth Judicial
District Court of the State of Nevada within one year of any award, the award of
the Arbitrator may be confirmed and entered as a judgment in a court of
competent jurisdiction. All arbitration conducted under this Article 12 shall be
in accordance with NRS Chapter 38 and the rules of the American Arbitration
Association situated in Las Vegas, Nevada to the extent such rules do not
conflict with the procedures herein set forth. To the extent permitted by law,
compliance with this Article 12 is a condition
72
precedent to the commencement by any Party of a judicial proceeding arising out
of any arbitratable dispute relating directly or indirectly to this REA.
ARTICLE 13
ATTORNEYS' FEES
13.1 Prevailing Party. If any Party shall institute any action or
proceeding ("SUIT"), excluding arbitration, against any other Party relating to
a breach or alleged violation of any covenant, term or obligation of this REA,
any Default, or enforcement of the provisions hereof, the Prevailing Party (as
hereinafter defined) shall be entitled to recover from the nonprevailing Party,
as part of the Prevailing Party's costs of Suit or its damages, said Prevailing
Party's reasonable Attorneys' Fees as fixed by the court. The "PREVAILING PARTY"
shall be the Party which by law is entitled to recover its costs of Suit,
whether or not the Suit proceeds to final judgment. A Party not entitled to
recover its costs shall not recover Attorneys' Fees; provided, however, where a
Party shall have instituted and then dismissed Suit as against another Party,
without the concurrence of such other Party, such other Party shall be the
Prevailing Party. No sum for Attorneys' Fees shall be included in calculating
the amount of a judgment to determine whether a Party is the Prevailing Party
entitled to recover its costs and Attorneys' Fees. The term "ATTORNEYS' FEES"
shall include fees of outside counsel and costs allocable to in-house counsel
(including, in each instance, fees and charges attributable to services
performed by legal assistants or other non-attorney personnel performing
services under the supervision of an attorney). The provisions of this Article
shall not apply to any action or cause of action for declaratory relief.
ARTICLE 14
NOTICES
14.1 Notices to Parties. Any notice, demand, request, consent,
approval, designation, or other communication that any Party is required or
desires to give, make or communicate to any other Party shall be given, made or
communicated in writing either by personal delivery, by facsimile or telex
transmission,
73
by reliable overnight courier, or by United States registered or certified mail,
return receipt requested with postage fully prepaid, to the following addresses:
To Aladdin Gaming: Aladdin Gaming, LLC
c/o Sigmund Sommer Properties
2810 West Charleston Boulevard
Suite 58
Las Vegas, Nevada 89102
Attention: Mr. Jack Sommer
Telephone No.: (702) 870-1234
Facsimile No.: (702) 870-8733
with a copy to: Mr. Ronald Dictrow
Sigmund Sommer Properties
280 Park Avenue
New York, New York 10017
Telephone No.: (212) 661-0700
Facsimile No.: (212) 661-0844
and a copy to: Skadden, Arps, Slate, Meagher & Flom LLP
919 Third Avenue
New York, New York 10022-3897
Attention: Wallace L.Schwartz, Esq.
Telephone No.: (212) 735-3000
Facsimile No.: (212) 735-2000
and a copy to: Schreck Morris
300 S. Fourth Street
Suite 1200
Las Vegas, Nevada 89101
Attention: Ellen Schulhofer, Esq.
Telephone No.: (702) 382-2101
Facsimile No.: (702) 382-8135
To Bazaar Company: Aladdin Bazaar, LLC
c/o TH Bazaar Centers,Inc.
4350 La Jolla Village Drive
Suite 400
San Diego,California 92122-1233
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Attention: Mr. Wayne Finley and
Ms. Wendy Godoy
Telephone No.: (619) 546-3535
Facsimile No.: (619) 546-3413
with a copy to: Aladdin Bazaar Holdings, LLC
c/o Aladdin Management Corporation, Manager
2810 West Charleston Boulevard
Suite 58
Las Vegas, Nevada 89102
Attention: Mr. Jack Sommer
Telephone No.: (702) 870-1234
Facsimile No.: (702) 870-8733
and a copy to: TH Bazaar Centers Inc.
4350 La Jolla Village Drive
Suite 400
San Diego, California 92122-1233
Attention: General Counsel
Telephone No.: (619) 546-3535
Facsimile No.: (619) 546-3413
and a copy to: Allen, Matkins, Leck, Gamble & Mallory
LLP
501 West Broadway, Suite 900
San Diego, CA 92101
Attention: Michael C. Pruter, Esq.
David A. B. Burton, Esq.
Telephone No.: (619) 235-1517
Facsimile No.: (619) 233-1158
and a copy to: Skadden, Arps, Slate, Meagher & Flom LLP
919 Third Avenue
New York, New York 10022-3897
Attention: Wallace L. Schwartz, Esq.
Telephone No.: (212) 735-3000
Facsimile No.: (212) 735-2000
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and a copy to: Schreck Morris
300 S. Fourth Street
Suite 1200
Las Vegas, Nevada 89101
Attention: Ellen Schulhofer, Esq.
Telephone No.: (702) 382-2101
Facsimile No.: (702) 382-8135
To Aladdin Music: Aladdin Music Holdings, LLC
c/o Sigmund Sommer Properties
2810 West Charleston Boulevard
Suite 58
Las Vegas, Nevada 89102
Attention: Mr. Jack Sommer
Telephone No.: (702) 870-1234
Facsimile No.: (702) 870-8733
with a copy to: Mr. Ronald Dictrow
Sigmund Sommer Properties
280 Park Avenue
New York, New York 10017
Telephone No.: (212) 661-0700
Facsimile No.: (212) 661-0844
and a copy to: Skadden, Arps, Slate, Meagher & Flom LLP
919 Third Avenue
New York, New York 10022-3897
Attention: Wallace L. Schwartz, Esq.
Telephone No.: (212) 735-3000
Facsimile No.: (212) 735-2000
and a copy to: Schreck Morris
300 S. Fourth Street
Suite 1200
Las Vegas, Nevada 89101
Attention: Ellen Schulhofer, Esq.
Telephone No.: (702) 382-2101
Facsimile No.: (702) 382-8135
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To Energy Provider: Northwind Aladdin, LLC
c/o Unicom Thermal Technologic, Inc.
30 West Monroe Street, Suite 500
Chicago, Illinois 60603
Attention: President
Telephone No.: (312) 634-3200
Facsimile No.: (312) 346-3201
and a copy to: Schwartz, Cooper, Greenberger & Kraus
180 North LaSalle Street, Suite 2700
Chicago, Illinois 60601
Attention: Andrew H. Connor, Esq.
Telephone No.: (312) 346-1300
Facsimile No.: (312) 782-8416
Each Party may designate at any time a different or additional address for its
receipt of notices by giving at least ten (10) days' written notice of such
change of address to all other Parties.
Any notice, demand, request or other communication (except any consent,
approval or designation), including any copy, shall be deemed to have been
given, made, received and communicated, as the case may be, on the date personal
delivery was effected if personally served, on the date of acknowledgment of
receipt if by facsimile or telex (provided a hard copy of the same is sent in
another manner permitted herein within twenty-four (24) hours of transmission),
on the date shown as the delivery date on the overnight courier's cartage copy
if by overnight courier, or on the date of delivery as shown on the return
receipt if delivered by mail; provided, however, if delivery is not completed
due to the absence of the recipient or his/her refusal to accept delivery ,
delivery to the Person identified above for receipt of copies shall be deemed to
be delivery to the primary addressee. If any such notice requires any action or
response by the recipient or involves any consent or approval solicited from the
recipient, such fact shall be clearly stated in the notice in the manner
provided in Article 18. Any responsive consent, approval or designation shall be
sent as provided above and shall be deemed to have been given, made, received
and communicated, as the case may be, on the date of personal delivery, the date
on which the facsimile or telex was transmitted, the date deposited with the
overnight courier, or the date the same was deposited in the United States mail
in conformity with this Section.
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In the event a Party shall give notice to any other Party of a Default,
such Party shall concurrently send each of the other Parties and their
Mortgagees (in accordance with Article 15) a copy of such notice; provided,
however, failing to give a copy of such notice to the other Parties (and/or
their Mortgagees) shall not affect the validity of such notice of Default nor
shall giving or failing to give such notice create any liability on the part of
the Party so declaring a Default.
ARTICLE 15
MORTGAGEE PROVISIONS
15.1 Mortgagee Notice. Any Mortgagee under a Mortgage affecting the
Tract of a Party shall be entitled to receive notice of any Default by the Party
as to such Tract, provided that such Mortgagee shall have delivered a copy of a
notice substantially in the form hereinafter contained to each Party. The form
of such notice shall be as follows:
The undersigned, whose address is
__________________________________________________________________
_____________________________________________________________ does
hereby certify that it is the "Mortgagee" (as such term is defined
in the REA) of the Tract of land described on Exhibit "A" attached
hereto and made a part hereof and being the Tract of Party
("Party") in Clark County, Nevada. In the event that any notice
shall be given of the Default of the Party as to whose Tract the
Mortgage held by the undersigned applies, a copy thereof shall be
delivered to the undersigned who shall have all rights of a
Mortgagee to Cure such Default as specified in the REA. Failure to
deliver a copy of such notice to the undersigned shall in no way
affect the validity of the notice of Default as it respects such
Party, but shall make the same invalid as it respects the
Mortgagee of the undersigned, and such Mortgagee's Cure rights
shall remain undisturbed.
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Any such notice to a Mortgagee shall be given in the same manner as provided in
Article 14. In the event that any notice shall be given of the Default of a
Party and such defaulting Party has failed to Cure or commence to Cure such
Default as provided in this REA, then and in that event any such Mortgagee under
a Mortgage affecting the Tract of the Defaulting Party shall be entitled to
receive an additional notice, given in the manner provided in Article 14, that
the Defaulting Party has failed to Cure or commence to Cure such Default. Each
Mortgagee shall have thirty (30) days after receipt of said additional notice to
Cure or, if such Default cannot be Cured within thirty (30) days, to commence to
Cure any such Default and to prosecute said Cure continuously and diligently
until completed (it being understood that such period beyond said thirty (30)
days shall apply to events including, but not limited to, non-monetary Defaults
temporarily incapable of a Cure by a Mortgagee due to (a) an automatic stay or
(b) the requirement of possession); provided however, that any Default personal
to a Party shall not prejudice the rights of any Mortgagee; provided further,
however, no dispute of any nature between Mortgagees shall serve to toll or
extend said Cure period nor impose liability of any nature on any Party to
resolve such dispute in connection with accepting Cure from any particular
Mortgagee.
ARTICLE 16
AMENDMENT
16.1 Method and Effect of Amendment. The Parties agree that the
provisions of this REA may be modified or amended, in whole or in part, only by
an instrument in writing, executed and acknowledged by Bazaar Company, Aladdin
Gaming and Aladdin Music, and duly recorded in the Office of the Recorder in and
for the County. Any amendment or modification hereof, including any extension
and renewal hereof, whenever made, shall be superior to any and all liens, to
the same extent as if such amendment or modification had been executed
concurrently with this REA; provided that, in the event a Party (other than
Energy Provider) has a Mortgage which requires the Mortgagee's consent to any
amendment of this REA, and such Mortgagee has given notice of the existence of
such Mortgage to the other Parties to this REA in accordance with Article 15,
the Mortgagee's written consent to any proposed amendment, which consent shall
not be unreasonably withheld or delayed, must be obtained in order for such
amendment to be enforceable against and binding on such Mortgagee. Nothing
contained herein shall constitute a Party's agreement that this REA cannot be
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effectively amended as between the Parties without the approval of a Party's
Mortgagee. If a Party's Mortgagee (other than Energy Provider's Mortgagee)
reasonably requests a modification or amendment to this REA which does not
materially increase the obligations or decrease the rights of the Parties
hereunder, the Parties agree to amend or modify this REA accordingly.
16.2 No Third Party Beneficiary. Except for the provisions of
Article 15 which are for the benefit of a Mortgagee, the provisions of this REA
are for the exclusive benefit of the Parties hereto and not for the benefit of
any third Person, nor shall this REA be deemed to have conferred any rights,
express or implied, upon any third Person. It is expressly understood and agreed
that the Parties specifically intend that no other Person (other than a
Mortgagee in accordance with Article 15) shall have any right to enforce any of
the provisions of this REA.
ARTICLE 17
TERMINATION OF REA
Except as to the easements, covenants and/or provisions of this REA
which by their terms shall or may survive such date, and except as to the
Parties' restoration obligations set forth in Section 9.4 hereof, which
obligations (except Energy Provider's and except with respect to the Common
Parking Area) shall terminate twenty-five (25) years after the Second Scheduled
Opening Date, this REA shall terminate on December 31, 2097, unless sooner
terminated by the written consent of all Parties (other than Energy Provider).
ARTICLE 18
EXERCISE OF APPROVAL RIGHTS
18.1 Wherever in this REA the approval or consent of any Party is
required, and unless a different time limit is provided in this REA (in which
event such different time limit shall control), such approval or disapproval
shall be given within twenty (20) days following the receipt of the item to be
so approved or disapproved or the same shall be conclusively deemed to have been
approved by such Party, subject to the provisions of this Article. Such
approval, or disap-
80
proval, shall be given in writing, and such approval shall not be unreasonably
withheld, unless the provisions of this REA with respect to a particular consent
or approval shall expressly provide that the same may be given or refused in the
sole and absolute judgment or discretion of such Party. Any disapproval shall
specify with particularity the reasons therefor; provided, however, that
wherever in this REA any Party is given the right to approve or disapprove in
its sole and absolute judgment or discretion, such Party may disapprove without
specifying a reason therefor and its disapproval shall not be subject to contest
in any judicial, administrative, arbitration or other proceeding.
18.2 A Party requesting approval shall send such request in a
writing setting forth the applicable time period, pursuant to Section 18.1
hereof, within which such Party must act or otherwise respond. If the time
specified in the notice is incorrectly set forth or omitted, the time limit
shall be thirty (30) days unless a longer time period is specified in this REA,
in which case the longer time period shall control. Failure to specify such time
period shall not invalidate such notice but shall instead require the action of
such Party within said thirty (30) day period or such longer period.
18.3 Any request for the consent or approval of any Party shall
refer to the proper section numbers of the REA to which the request relates,
properly state the time period permitted hereunder for approval, and state that
the document, or the facts contained therein, shall be deemed approved or
consented to by the recipient unless the recipient objects thereto within the
required time period specified in such notice. Notwithstanding anything to the
contrary contained in this REA, no recipient's approval of or consent to the
subject matter of a notice shall be deemed to have been given by its failure to
object thereto if such notice (or the accompanying cover letter) did not
properly refer to the applicable section of this REA and properly state the time
period permitted hereunder for approval.
ARTICLE 19
EFFECTIVE DATE OF REA
This REA shall not be effective until it has been executed,
acknowledged and delivered by all signatories hereto. The Parties agree that
this REA is to be recorded in the Office of the Recorder of the County. The duly
executed
81
REA shall be effective against all Persons having actual or constructive notice
thereof whether or not it has been recorded.
ARTICLE 20
MISCELLANEOUS
20.1 Breach Shall Not Defeat Mortgage. A breach of any of the
easements, conditions, covenants, or restrictions of this REA shall not defeat
or render invalid the lien of any Mortgage made in good faith and for value, but
all such easements, conditions, covenants and restrictions shall be binding upon
and effective against any Person who acquires title to said property or any
portion thereof by Involuntary Transfer.
20.2 Breach Shall Not Permit Termination. No breach of this REA
shall entitle any Party to cancel, rescind or otherwise terminate this REA, but
such limitation shall not affect, in any manner, any other right or remedies
which the Parties may have by reason of any breach of this REA.
20.3 Captions. The table of contents and the captions of the
Sections and Articles of this REA are for convenience only and shall not be
considered or referred to in resolving questions of interpretation and/or
construction.
20.4 Interpretation. Any uncertainty or ambiguity regarding the
provisions of this REA shall not be interpreted against any Party as the
draftsman of the document, but shall be resolved by application of all other
principles of law regarding interpretation of contracts.
20.5 Governing Laws and Forum. This REA shall be governed by,
interpreted under, and construed in accordance with the laws of the State of
Nevada. The Parties intend and agree that the proper forum for the litigation of
any and all disputes or controversies arising out of or related to this REA, to
the extent that arbitration is not permitted for the resolution of such dispute
or arbitration as described herein, is any circuit court of the State of Nevada
or the Eighth Judicial District Court of the State of Nevada. Each of the
Parties agrees that it will not commence any action or proceeding arising out of
or relating to this REA in any court other than as specified in the preceding
sentence and that it shall not
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challenge on grounds of forum non conveniens or any other grounds any action or
proceeding so commenced, and hereby stipulates and irrevocably agrees that said
courts have in personam jurisdiction over each of them for such litigation of
any dispute or controversy arising out of or in any way related to this REA.
20.6 Injunctive Relief. In the event of any violation or threatened
violation by any Person of any of the terms, restrictions, covenants and
conditions of this REA, any of the Parties shall have the right to seek an
injunction of such violation or threatened violation in a court of competent
jurisdiction.
20.7 No Partnership. Neither this REA nor any acts of the Parties
(other than acts undertaken pursuant to written agreements expressly setting
forth such intention) shall be deemed or construed by the Parties to constitute
an agreement to share profits and losses or to create the relationships of
principal-agent, partnership, joint venture, or any association whatsoever
between any of the Parties.
20.8 Not a Public Dedication. Nothing in this REA shall be deemed to
be a gift to the general public, or a dedication for any public purpose
whatsoever, of any portion of the Site, it being the intention of the Parties
that this REA shall be strictly limited to and for the purposes herein
expressed.
20.9 Payment on Default.
(a) If any Party (i) is compelled or elects to pay any
sum of money or do any acts which require the payment of money by
reason of any other Party's Default or (ii) does not pay any other sum
when due to any other Party pursuant to the terms and provisions of
this REA, then the Defaulting Party shall, provided that said Party
shall have been served a written delinquency notice from the paying
Party, upon demand, promptly reimburse the paying Party all such sums
together with interest thereon at the lesser of (x) the rate of fifteen
percent (15%) per annum, and (y) the maximum rate permitted by law,
compounded annually, from the date that is three (3) business days
subsequent to such Defaulting Party's receipt of the delinquency notice
from the paying Party until the date of such reimbursement by the
Defaulting Party.
(b) If the Defaulting Party shall not have made the
requested repayment within ten (10) days after demand therefor, the
paying
83
Party (or Person to whom the amount is due) shall have the right to
deduct the amount thereof, together with interest as aforesaid, without
liability or forfeiture, from any sums then due or thereafter becoming
due from the paying Party to the Defaulting Party, subject, however, to
Sections 4.2 and 9.9 and Article 12 hereof, if the payment amount is in
dispute.
(c) A Party's deduction from any sums due or payable by
it pursuant to the provisions of this Section 20.9 shall not constitute
a Default in the payment thereof unless such Party fails to pay the
amount of such deduction (with interest thereon at the rate provided
above from the respective date of deduction) to the Defaulting Party to
whom the sum is owing within thirty (30) days after final adjudication
or decision that such amount is owing. The option given in this Section
20.9 is for the sole protection of the paying Party (or Person to whom
such sum is due) but shall not Release the Defaulting Party from its
obligation to perform the terms, provisions, covenants and conditions
of this REA which are required to be performed by such Party, nor
deprive the paying Party (or Party to whom such sum is due) of any
legal or equitable rights which it may have by reason of such Default.
20.10 Severability. If any term, covenant, restriction or condition
contained in this REA shall, to any extent, be invalid or unenforceable, the
remainder of this REA (or the application of such term, covenant, restriction or
condition to Persons or circumstances other than those with respect to which it
is invalid or unenforceable), shall not be affected thereby and each term,
covenant, restriction and condition of this REA shall be valid and enforceable
to the fullest extent permitted by law, except those terms, covenants,
restrictions or conditions which are expressly subject to or conditioned upon
such invalid or unenforceable provisions.
20.11 Successors. The provisions of this REA shall, except as
otherwise provided herein, run with the land, both as respects benefits and
burdens created herein.
20.12 Time of Essence. Time is of the essence with respect to the
performance of each of the terms, covenants, restrictions and conditions
contained in this REA.
84
20.13 Waiver of Default. A Party's waiver of another Party's Default
must be made in writing, and no such waiver shall be implied from a Party's
failure to take any action in respect of such Default if such Default continues
or is repeated. No express waiver of any Default shall affect any Default, or
cover any period of time, other than the precise Default and period of time
specified in such express waiver. One or more waivers of any Default in the
performance of any term, covenant, restriction or condition of this REA shall
not be deemed to waive any subsequent Default. A Party's giving of its consent
or approval to any act or request of another Party shall not be deemed to waive
or render unnecessary the consenting/approving Party's consent to or approval of
any subsequent similar acts or requests.
20.14 Rights Cumulative. Except as limited by Article 12, the rights
and remedies of any Party under this REA shall be cumulative and not exclusive
of any other rights or remedies of such Party at law or in equity. A Party's
exercise of any given right or remedy shall not impair such Party's standing to
exercise any other right or remedy.
20.15 Counterparts. This REA may be executed in multiple
counterparts, each of which shall be deemed an original, and all such
counterparts taken together shall constitute one and the same instrument.
Further, this REA may be executed in triplicate originals.
20.16 Estoppel Certificates. Each Party hereby severally covenants
that upon at least twenty (20) days' prior notice from another Party, it will
issue to any prospective or existing Mortgagee or to any prospective Transferee,
an estoppel certificate stating: (a) whether the Party to whom the request has
been directed knows of any default under this REA, and if there are known
defaults, specifying the nature thereof, (b) whether to its knowledge this REA
has been assigned, modified or amended in any way (and if it has, then stating
the nature thereof; (c) that to the Party's knowledge this REA as of that date
is in full force and effect; and (d) as to such other reasonably requested
factual matters known to the Party concerning this REA. Such certificate shall
act as a waiver of any claim by the Party furnishing such certificate to the
extent such claim is based upon facts which are contrary to those asserted in
the certificate but only to the extent the claim is asserted against a bona fide
encumbrancer or purchaser for value without knowledge of facts contrary to those
contained in the certificate and who has acted in reasonable reliance upon the
certificate. Such certificate shall in no event subject the Party furnishing it
to any liability whatsoever (except for fraud),
85
notwithstanding the negligent or inadvertent failure of such Party to disclose
correct or relevant information.
20.17 Limitation on Liability. Notwithstanding anything contained in
this REA, if at any time a Party (such Party being referred to in this Section
20.17 as the "breaching Party") shall fail to perform or pay any covenant or
obligation on its part to be performed or paid hereunder or under any such other
agreement, or shall breach any warranty made hereunder, and as a consequence
thereof any other Party, or their successors and assigns, shall recover a money
judgment against the breaching Party, such judgment shall (subject to the rights
of any Mortgagee whose lien predates the attachment of such judgment) be
enforced against and satisfied out of only (i) the proceeds of sale produced
upon execution of such judgment and levy thereon against the breaching Party's
interest in its Tract and improvements thereon, (ii) the rents, issues, profits
or other income receivable from the such Tract and improvements thereon, (iii)
the consideration received by the breaching Party from the sale of all or any
part of its interest in its Tract and improvements thereon made after such
failure of performance or breach of warranty (which consideration shall be
deemed to include any assets at any time held by the breaching Party to the
extent that the value of same does not exceed the proceeds of such sale), (iv)
any insurance proceeds or condemnation award payable as the result of any
casualty to or condemnation of the breaching Party's Tract and/or improvements
thereon, and (v) any sums due or to become due from the other Party to the
breaching Party regardless of when the obligation arises, by way of set-off, and
the other Party and any other owner or holder of any claim or action against the
breaching Party shall look solely to the breaching party's Tract and
improvements thereon and to said property specified in clauses (i), (ii), (iii),
(iv) and (v) above for the payment and satisfaction of any such claim or action
and any judgment thereon. Except as set forth in the preceding sentence, the
breaching Party shall not have any personal liability for the performance or
payment of any such covenant, warranty or obligation hereunder or under any such
other agreement or upon any judgment thereon. Furthermore, none of the members
individually in the limited liability companies referred to herein as "Aladdin
Gaming", "Bazaar Company", "Aladdin Music" and "Energy Provider" shall have any
liability whatsoever for the performance or payment of any covenant, warranty or
obligation of such Party hereunder or upon any judgment thereon. No Party shall
seek specific performance of any affirmative covenant or affirmative obligation
by or against the breaching Party or any partner in the breaching Party, except
to the extent that the same can be achieved with the property and proceeds
specified in clauses (i), (ii), (iii), (iv) and (v) above. The provisions of
this Section 20.17 are
86
not intended to relieve the breaching Party from the performance of any
of its obligations hereunder, but rather to limit the breaching Party's
liability as aforesaid, and to relieve and release any partner or
member of the breaching Party from any such liability as aforesaid; nor
shall any of the provisions of this Section 20.17 be deemed to limit or
otherwise affect any Party's right to obtain injunctive relief
necessary to enforce other rights specifically granted to such Party in
this REA. To the extent that (with or without recourse to the limited
remedies provided in this Section 20.17) a Party is, by virtue of the
foregoing limitations, unable to recover the full amount of any money
judgment against the Defaulting Party, the non-Defaulting Party may,
for so long as such amount (and interest thereon in accordance with
Section 20.9) shall remain unpaid, offset amounts owed by the
Defaulting Party against amounts owed to the non-Defaulting Party
hereunder and/or pursuant to the Site Work Agreement and/or the Parking
Use Agreement and/or that certain subordinated debenture between
Aladdin Gaming and Bazaar Company.
20.18 Index. Wherever in this REA reference is made to a
constant dollar denomination, calculation of constant dollar
equivalency shall be adjusted every fifth Accounting Period based on
the Implicit Price Deflator of the Gross National Product of the United
States (Personal Consumption Expenditures By Major Type of Product
Table), issued and published by the United States Department of
Commerce (1972 = 100) (the "INDEX"), or any successor index thereto,
appropriately adjusted. In the event that the Index is converted to a
different standard reference base or otherwise revised, the
determination of the adjustment to be made with reference to the Index
shall be made with the use of such conversion factor, formula or table
for converting the Index as may be published by the Department of
Commerce or, if said Department shall not publish the same, then with
the use of such conversion factor, formula or table as may be published
by Prentice Hall, Inc., or other nationally recognized publisher of
similar statistical information as may be agreed upon by the Parties.
If at any time such index as herein recited shall not exist, the
Parties shall substitute an index or procedure that reasonably reflects
and monitors consumer prices, and the same shall be considered the
"Index" hereunder and in the event the Parties are unable to agree upon
a substitute index or procedure, the matter shall be resolved pursuant
to Article 12. Notwithstanding anything to the contrary set forth
herein, the adjustments provided in this Section 20.18 shall be
effective only upon notice given by any Party (except Energy Provider)
to all other Parties not more than 120 days nor less than 30 days
before the beginning of every fifth Accounting Period, which notice
shall make specific reference to this Section 20.18.
87
20.19 Compliance With Laws. Each Party shall comply with all
applicable laws, ordinances, rules, orders and regulations of all
governmental agencies and entities respecting the use, occupancy and/or
enjoyment of its Tract and improvements thereon including, but not
limited to, obtaining and maintaining all necessary licenses, approvals
and permits from all federal, state and local authorities required for
the operation of such Tract and improvements.
20.20 Conflicts. In the case of each and every conflict or
inconsistency between the provisions of the Bazaar Lease, the Music
Lease, the Parking Use Agreement, the Site Work Agreement or the Energy
Provider Agreement and this REA, the Parties agree that the provisions
of this REA shall prevail and control. All Mortgages shall be subject
and subordinate to the terms, covenants and provisions of this REA and
any amendment hereto to which the subject Mortgagee has consented to
pursuant to Section 16.1 hereof.
[REMAINDER OF THIS PAGE INTENTIONALLY LEFT BLANK.]
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IN WITNESS WHEREOF, this REA has been executed by the Parties
as of the day and year first written above.
"Aladdin Gaming" ALADDIN GAMING, LLC
a Nevada limited-liability-company
By:
--------------------------------
Name: Ronald Dictrow
Title: Secretary
"Bazaar Company" ALADDIN BAZAAR, LLC
a Delaware limited liability company
By: Aladdin Bazaar Holdings, LLC, a Nevada
limited-liability company, its member
By: Aladdin Management Corporation
Its: Manager
By:
--------------------------------
Name: Ronald Dictrow
Title: Treasurer
By: TH Bazaar Centers Inc., Delaware corporation,
its member
By:
--------------------------------
Name: Wayne J. Finley
Title: Sr. Vice President
By:
--------------------------------
Name: Wendy M. Godoy
Title: Sr. Vice President
"Aladdin Music" ALADDIN MUSIC HOLDINGS, LLC,
a Nevada limited-liability company
By: Aladdin Music Holdings, LLC
Its: Member
By:
-----------------------------------
Name: Ronald Dictrow
Title: Treasurer
STATE OF New York )
) ss.
COUNTY OF New York )
On February 27, 1998, before me, Dawn M. Schoenig, a Notary Public in
and for said state, personally appeared Ronald Dictrow, personally
known to me (or proved to me on the basis of satisfactory evidence) to
be the persons whose names are subscribed to the within instrument and
acknowledged to me that they executed the same in their authorized
capacities, and that by their signatures on the instrument, the
persons, or the entity upon behalf of which the persons acted, executed
the instrument.
WITNESS my hand and official seal.
-----------------------------------
Notary Public in and for said State
STATE OF New York )
) ss.
COUNTY OF New York )
On February 27, 1998, before me, Dawn M. Schoenig a Notary Public in
and for said state, personally appeared Wayne Finley and Wendy Godoy,
personally known to me (or proved to me on the basis of satisfactory
evidence) to be the persons whose names are subscribed to the within
instrument and acknowledged to me that they executed the same in their
authorized capacities, and that by their signatures on the instrument,
the persons, or the entity upon behalf of which the persons acted,
executed the instrument.
WITNESS my hand and official seal.
-----------------------------------
Notary Public in and for said State
AMENDMENT AND RATIFICATION
OF
CONSTRUCTION, OPERATION AND RECIPROCAL EASEMENT AGREEMENT
THIS AMENDMENT AND RATIFICATION OF CONSTRUCTION, OPERATION AND
RECIPROCAL EASEMENT AGREEMENT (the "Amendment and Ratification") is made and
entered into as of November 20, 2000, by and between ALADDIN GAMING, LLC, a
Nevada limited liability company ("Aladdin Gaming") and ALADDIN BAZAAR, LLC, a
Delaware limited liability company ("Bazaar Company").
RECITALS:
A. Aladdin Gaming was the fee simple owner of that certain real
property located at 3667 Las Vegas Boulevard South in Clark County, Nevada which
is more particularly described in Exhibit "A-1" to the REA (as hereinafter
defined) (the "Original Site").
B. On February 26, 1998, Aladdin Gaming and Bazaar Company
entered into a lease agreement (the "Bazaar Lease"), a memorandum of which was
recorded in the Official Records of Clark County, Nevada, as Book Number 980302
and Document Number 00001 (as amended modified or re-recorded to date, the
"Bazaar Memorandum"), pursuant to which Aladdin Gaming leased to Bazaar Company
a portion of the Original Site which is more particularly described in Exhibit
"A-3" to the REA (the "Original Bazaar Site").
C. On February 26, 1998, Aladdin Gaming and Aladdin Music
Holdings, LLC, a Nevada limited liability company ("Aladdin Music") entered into
a lease agreement (the "Music Lease"), a memorandum of which was recorded in the
Official Records of Clark County, Nevada, as Book Number 980302 and Document
Number 00002 (as amended modified or re recorded to date, the "Music
Memorandum"), pursuant to which Aladdin Gaming leased to Aladdin Music a portion
of the Original Site which is more particularly described in Exhibit "A-4" to
the REA (the "Original Aladdin Music Site").
D. On February 26, 1998, Aladdin Gaming, Bazaar Company and
Aladdin Music, entered into a Construction, Operation and Reciprocal Easement
Agreement, which was recorded in the Official Records of Clark County, Nevada,
as Book Number 980302 and Document Number 00003 (as amended modified or
re-recorded to date, the "REA"), pursuant to which Aladdin Gaming, Bazaar
Company and Aladdin Music, among other matters, granted to one another
reciprocal easements over and across the Original Site for parking, access and
construction (the "Easements").
E. The Parties to the REA desire to modify the boundaries of the
Site, the Gaming Site, the Bazaar Site, the Aladdin Music Site, the Energy Site
and the Optional Improvements Site (as such terms are respectively defined in
the REA) to reflect the actual location of the improvements constructed on the
Site pursuant to the REA.
F. Pursuant to the Bazaar Lease, and of even date herewith,
Aladdin Gaming is conveying fee title to the Modified Bazaar Site (as
hereinafter defined) to Bazaar Company (the
"Bazaar Site Fee Transfer"), leaving Aladdin Gaming as the fee owner of the
remaining portion of the Site (the "Modified Site").
G. Of even date herewith Aladdin Gaming and Aladdin Music are
terminating the Music Lease (the "Music Lease Termination"), leaving Aladdin
Gaming as the fee owner of the Modified Site, which includes the Modified
Aladdin Music Site (as hereinafter defined). Pursuant to the Music Lease
Termination, Aladdin Gaming has expressly assumed all of the covenants, duties
and obligations of Aladdin Music under the REA.
H. By this Amendment and Ratification and as a result of the
Bazaar Site Fee Transfer and the Music Lease Termination, the Parties hereto
desire to ratify the REA and to re-grant to one another the Easements over and
across the Modified Site, the Modified Bazaar Site and the Modified Aladdin
Music Site.
NOW THEREFORE, in consideration of the foregoing, the covenants
contained herein, and for other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the Parties hereto hereby agree as
follows:
1. Exhibits "A-l", "A-2", "A-3", "A-4", "A-5" and "A-6" to the
REA, representing the legal descriptions of, respectively, the Site, the Gaming
Site, the Bazaar Site, the Aladdin Music Site, the Energy Site and the Optional
Improvements Site, are hereby amended and restated in their entirety by,
respectively Exhibits "A-l", "A-2", "A-3", "A-4", "A-5" and "A-6" attached
hereto. The parcels of land described in Exhibits "A-3" and "A-4" attached
hereto are referred to herein as, respectively, the "Modified Bazaar Site" and
the "Modified Aladdin Music Site".
2. The Easements granted pursuant to the REA by and to Aladdin
Gaming, as fee owner of the Original Site, Bazaar Company, as lessee of the
Original Bazaar Site, and Aladdin Music, as lessee of the Original Aladdin Music
Site, are hereby re-granted pursuant to this Amendment and Ratification by and
to Aladdin Gaming, as fee owner of the Modified Site and Bazaar Company, as fee
owner of the Modified Bazaar Site.
3. Aladdin Music is hereby released as a party to the REA, and
from all of its covenants, duties and obligations under the REA, as all of
Aladdin Music's covenants, duties and obligations under the REA have been
expressly assumed by Aladdin Gaming.
4. The Parties recognize that Aladdin Gaming is the owner of air
rights above a portion of the Bazaar Site represented by Parcel NB11, which
Bazaar Site Parcel NB11 has an upper plane elevation of approximately 2173 feet.
Aladdin Gaming retains all rights above such limited section of the Bazaar
Improvements located on the Parcel NB11 site; provided, however, that
notwithstanding any provision of the REA to the contrary, including, but not
limited to, Articles 2 and 9 of the REA, if Aladdin Gaming utilizes such air
rights above parcel NB11, Aladdin Gaming will not penetrate, touch or impact the
Bazaar Improvements building, nor will Aladdin Gaming utilize the Bazaar
Improvements building in any form or manner as structural support or otherwise.
5. The Easements granted pursuant to this Amendment and
Ratification are appurtenant and not in gross. The parties hereto intend that
the Easements contained in the REA and ratified herein shall run with the
Modified Site and the Modified Bazaar Site and shall bind any successors or
assigns of those sites for the benefit of any and all persons who may now or in
the future own the Modified Site, the Modified Bazaar Site or the Modified
Aladdin Music Site. Notwithstanding anything to the contrary contained herein or
in the REA, no easement shall be deemed to be granted and/or no easement shall
be permitted to be used, if or while the grant or use of such easement, as
applicable, would violate any law, statute or regulation of the County of any
other governmental authority claiming jurisdiction of the Site.
6. A memorandum of this Amendment and Ratification shall be
recorded in the Office of the Recorder in Clark County, Nevada, and shall serve
as notice to all prospective and successive owners of the Modified Site, the
Modified Bazaar Site or the Modified Aladdin Music Site that those parcels are
benefited and/or restricted in the manner described in the REA.
7. The Parties hereto hereby amend and ratify the REA. All terms,
provisions and conditions of the REA not inconsistent herewith, shall be binding
upon Aladdin Gaming, as fee owner of the Modified Site and Bazaar Company, as
fee owner of the Modified Bazaar Site.
8. If any term, provision or condition contained in this
Amendment and Ratification shall, to any extent, be invalid or unenforceable,
the remainder of this Amendment and Ratification (or the application of such
term, provision or condition to persons or circumstances other than those in
respect of which it is invalid or unenforceable), except those terms, provisions
or conditions which are made subject to or conditioned upon such invalid or
unenforceable terms, provisions or conditions, shall not be affected thereby,
and each term, provision and condition of this Amendment and Ratification shall
be valid and enforceable to the fullest extent permitted by law.
9. This Amendment and Ratification may not be amended or
otherwise modified, except by an agreement in writing signed by the parties
hereto.
10. All capitalized terms not otherwise defined herein shall have
the meanings ascribed to them in the REA.
11. This Amendment and Ratification may be executed in
counterparts, each of which shall be deemed an original, but all of which taken
together shall" constitute one and the same instrument.
IN WITNESS WHEREOF, this Amendment and Ratification has been executed
by the Parties as of the day and year first written above.
[Signatures follow]
"Aladdin Gaming"
ALADDIN GAMING, LLC,
a Nevada limited liability company
By: ____________________________
Richard Goeglein
Its: President, CEO
"Bazaar Company"
ALADDIN BAZAAR, LLC,
a Nevada limited liability company
By: Aladdin Bazaar Holdings, LLC,
a Nevada limited liability
company
Its: Member
By: Aladdin Management Corporation,
a Nevada corporation
Its: Manager
By: ____________________________
Jack Sommer
Its: Vice President
By: TH Bazaar Centers Inc.,
a Delaware corporation
Its: Member
By: __________________________________
DOUGLAS L. HAGEMAN
Its: SENIOR VICE PRESIDENT
AND GENERAL COUNSEL
By: __________________________________
WAYNE FINLEY
Its: SR. VICE PRESIDENT
MEMORANDUM OF AMENDMENT AND RATIFICATION OF REA
APN: 162-21-201-006
PREPARED BY AND WHEN RECORDED MAIL TO:
Aladdin Gaming, LLC
c/o Schreck Morris
1200 Bank of America Plaza
300 South Fourth Street
Las Vegas, Nevada 89101
Attn.: Ellen Schulhofer, Esq.
MEMORANDUM OF AMENDMENT AND RATIFICATION OF REA
THIS MEMORANDUM OF AMENDMENT AND RATIFICATION OF REA ("MEMORANDUM"), is
made as of November 20, 2000 by and between ALADDIN GAMING, LLC, a Nevada
limited liability company ("Aladdin Gaming") and ALADDIN BAZAAR, LLC, a Delaware
limited liability company ("Bazaar Company").
1. Aladdin Gaming and Bazaar Company have entered into that
certain Amendment and Ratification of Construction, Operation and Reciprocal
Easement Agreement, dated of even date herewith (the "Amendment and
Ratification"), pursuant to which Aladdin Gaming and Bazaar Company have agreed
to amend and ratify that certain Construction, Operation and Reciprocal Easement
Agreement recorded in the Official Records of Clark County, Nevada, as Book
Number 980302 and Document Number 00003 and subsequently re-recorded (the
"REA").
2. In the Amendment and Ratification, among other things: (i)
Exhibits "A-1", "A-2", "A-3", "A-4", "A-5" and "A-6" to the REA, representing
the legal descriptions of, respectively, the Site, the Gaming Site, the Bazaar
Site, the Aladdin Music Site, the Energy Site and the Optional Improvements Site
(as defined respectively in the REA), are amended and restated in their entirety
by, respectively Exhibits "A-1", "A-2", "A-3", "A-4", "A-5" and "A-6" attached
hereto; (ii) Aladdin Gaming and Bazaar Company re-grant to one another the
appurtenant easements set forth in the REA; (iii) Aladdin Music Holdings, LLC, a
Nevada limited liability company ("Aladdin Music") is released as a party to the
REA; and (iv) Aladdin Gaming has expressly assumed all of the covenants, duties
and obligations of Aladdin Music under the REA.
3. The purpose of this Memorandum is to give notice of the
existence of the Amendment and Ratification. This Memorandum is not a complete
summary of the Amendment and Ratification. To the extent that any provision of
this Memorandum conflicts with any provision of the Amendment and Ratification,
the Amendment and Ratification shall control.
4. This Memorandum is being executed and delivered for recording
in the Office of the Clerk of Clark County, State of Nevada.
5. This Memorandum may be executed in counterparts, each of which
shall be deemed an original, but all of which taken together shall constitute
one and the same instrument.
"Aladdin Gaming"
ALADDIN GAMING, LLC,
a Nevada limited liability company
By: _______________________
Richard Goeglein
Its: President, CEO
"Bazaar Company"
ALADDIN BAZAAR, LLC,
a Nevada limited liability company
By: Aladdin Bazaar Holdings, LLC,
a Nevada limited liability
company
Its: Member
By: Aladdin Management Corporation,
a Nevada corporation
Its: Manager
By: ________________________
Jack Sommer
Its: Vice President
By: TH Bazaar Centers Inc.,
a Delaware corporation
Its: Member
By: _______________________
Its:_______________________
By: _______________________
Its:_______________________
STATE OF NEVADA )
) ss.
COUNTY OF CLARK )
This instrument was acknowledged before me on SEPTEMBER 5, 2000 by Richard
Goeglein as President and CEO of Aladdin Gaming, LLC, a Nevada limited liability
company.
-------------------------------
(Signature of notarial officer)
STATE OF NEVADA )
) ss.
COUNTY OF CLARK )
This instrument was acknowledged before me on SEPTEMBER 5, 2000 by Jack Sommer
as Vice President of Aladdin Management Corporation, a Nevada Corporation.
-------------------------------
(Signature of notarial officer)
STATE OF __________________)
) ss.
COUNTY OF _________________)
This instrument was acknowledged before me on _____________________, 2000 by
________________________________ as ________________________ of TH Bazaar
Centers Inc., a Delaware corporation.
_______________________________
(Signature of notarial officer)
STATE OF __________________)
) ss.
COUNTY OF _________________)
This instrument was acknowledged before me on _____________________, 2000 by
________________________________ as ________________________ of TH Bazaar
Centers Inc., a Delaware corporation.
_______________________________
(Signature of notarial officer)
CALIFORNIA ALL-PURPOSE ACKNOWLEDGMENT
State of California )
) ss.
County of SAN DIEGO )
On Sept. 15, 2000 before me, YVONNE POSNER, NOTARY PUBLIC
Date Name and Title of Officer (e.g.Jane Doe, Notary Public)
personally appeared DOUGLAS L. HAGEMAN + WAYNE FINLEY
Name(s) of Signer(s)
[X] personally known to me
[ ] proved to me on the basis of
satisfactory evidence
to be the person(s) whose name(s) is/are
subscribed to the within instrument and
acknowledged to me that they executed
the same in their authorized
capacity(ies), and that by their
signature(s) on the instrument the
person(s), or the entity upon behalf of
which the person(s) acted, executed the
instrument.
WITNESS my hand and official seal.
__________________________________
Place Notary Seal Above Signature of Notary Public
OPTIONAL
Though the information below is not required by law, it may prove valuable to
persons relying on the document and could prevent fraudulent removal and
reattachment of this form to another document.
DESCRIPTION OF ATTACHED DOCUMENT
Title or Type of Document:Memorandum of Amendment and Ratification of REA
Document Date: _________________________________ Number of Pages:_______________
Signer(s) Other Than Named Above: ______________________________________________
CAPACITY(IES) CLAIMED BY SIGNER
Signer's Name: _______________________________________________ RIGHT THUMBPRINT
[ ] Individual OF SIGNER
[ ] Corporate Officer -- Title(s): ___________________________ Top of thumb here
[ ] Partner -- [ ] Limited [ ] General
[ ] Attorney in Fact
[ ] Trustee
[ ] Guardian or Conservator
[ ] Other: ___________________________________________________
Signer Is Representing: _____________________________________
[Filed on March 31, 2003]
RECORDING REQUESTED BY
AND WHEN RECORDED MAIL TO:
Allen Matkins Leck Gamble & Mallory LLP
501 West Broadway, Ninth Floor
San Diego, California 92101-3547
Attention: Michael C. Pruter, Esq.
- --------------------------------------------------------------------------------
(Space above for Recorder's Use)
SECOND AMENDMENT OF CONSTRUCTION, OPERATION
AND RECIPROCAL EASEMENT AGREEMENT
THIS SECOND AMENDMENT OF CONSTRUCTION, OPERATION AND RECIPROCAL
EASEMENT AGREEMENT ("Second Amendment") is made and entered into as of
February_____, 2003, by and between ALADDIN GAMING, LLC, a Nevada limited
liability company ("Aladdin Gaming") and ALADDIN BAZAAR, LLC, a Delaware limited
liability company ("Bazaar Company").
A. Aladdin Gaming, Bazaar Company and Aladdin Music Holdings,
LLC, a Nevada limited liability company ("Aladdin Music"), entered into that
certain Construction, Operation and Reciprocal Easement Agreement, dated
February 26, 1998, which was recorded on March 2, 1998 in the Official Records
of Clark County, Nevada ("Official Records"), as Book Number 980302 and Document
Number 00003, re-recorded on March 24, 1998 in the Official Records as Book
Number 980324 and Document Number 01111, re-recorded in the Official Records on
May 29, 1998, as Book Number 980529 and Document Number 02358, and re-recorded
on October 22, 1998, in the Official Records as Book Number 981022 and Document
Number 00509 (the "Original REA").
B. Aladdin Gaming and Bazaar Company entered into that certain
Amendment and Ratification of Construction, Operation and Reciprocal Easement
Agreement, dated November 20, 2000, and that certain Memorandum of Amendment
and Ratification of REA, dated November 20, 2000, which was recorded in the
Official Records on November 20, 2000, as Book Number 20001120 and Document
Number 00858 ("First Amendment"). The Original REA, as amended by the First
Amendment, is hereinafter referred to as the "REA".
C. Except as otherwise defined herein, all capitalized terms used
herein shall have the same meanings ascribed to such terms in the REA.
D. The Parties for themselves and for their successors agree and
acknowledge that one of the purposes and intents of the REA is to assure that
the properties described herein will at all times be operated and maintained in
compliance with the Clark County Codes and regulations
then in affect. In connection with the issuances of final Certificates of
Occupancy for (i) the Aladdin Improvements, consisting of certain improvements
commonly known as the "Aladdin Hotel and Casino", including an approximately
2,567 room hotel, an approximately 116,000 square foot casino, an approximately
7,000-seat Theatre for Performing Arts, and an approximately 70,000 square feet
of convention and conference facilities, and for (ii) the Bazaar Improvements,
consisting of certain improvements commonly known as the "Desert Passage(R)",
consisting of a themed shopping mall with approximately 460,000 square feet of
retail space and an approximately 4,800-space parking garage, the Parties desire
to modify and amend the REA concerning certain matters relating to fire and life
safety systems as provided in this Second Amendment.
NOW, THEREFORE, in consideration of the foregoing, the covenants
contained herein, and for the good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the Parties hereby agree as
follows:
1. The introductory sentence of Section 3.8 of the REA, and
Section 3.8(a) of the REA, are hereby deleted in their entirety and replaced
with the following:
"3.8 Fire and Life Safety Systems. In the event a Party is
to perform any Construction or repair Work, including but not limited
to the installation, modification or relocation of utility facilities
pursuant to Article 2, which shall require as an incident thereto the
loss, diminution, or disruption of fire and life safety systems in any
Party's Building, the constructing Party, as a condition precedent to
the commencement and continuation of such Construction, shall:
(a) obtain all necessary permits and approvals;
(b) notify the other Parties and Clark County
that fire and life safety systems will be temporarily lost, diminished
or disrupted at least forty-eight (48) hours prior thereto, which
notice shall specify the Party which is performing such Construction
and the date or dates and hours such service shall be lost;"
2. Existing Sections 3.8(b) through (e) are hereby re-numbered as
Sections 3.8(c) through (f), respectively.
3. Except as expressly modified herein, all of the terms of the
REA continue to be and are in full force and effect, and shall be binding upon
the Parties to the REA. The provisions of this Second Amendment shall run with
the land, both as respects benefits and burdens created herein, and shall be
binding upon each Party successors and assigns.
4. This Second Amendment may be executed in counterparts, each of
which shall be deemed an original, but all of which together shall constitute
one and the same instrument.
-2-
IN WITNESS WHEREOF, the parties have executed this Second Amendment as
of the date first written above.
ALADDIN GAMING, LLC, a Nevada limited
liability company
By:
-----------------------------------
Name: William Timmins
Title: Executive Vice President
ALADDIN BAZAAR, LLC, a Delaware limited
liability company
By: TH BAZAAR CENTERS INC, a Delaware
corporation
By:
-----------------------------------
Wendy M. Godoy, Senior Vice
President & Chief Financial Officer
By:
-----------------------------------
Douglas L. Hageman, Senior Vice
President & General Counsel
-3-
STATE OF NEVADA )
) ss.
COUNTY OF CLARK )
On March 25, 2003, before me, C. R. Bowden, a Notary Public in and
for said state, personally appeared William Timmins, personally known to me to
be the person whose name is subscribed to the within instrument and acknowledged
to me that he executed the same in his authorized capacity, and that by his
signature on the instrument, the person, or the entity upon behalf of which the
person acted, executed the instrument.
WITNESS my hand and official seal.
Notary Public in and for State
(SEAL)
-4-
STATE OF CALIFORNIA )
) ss.
COUNTY OF SAN DIEGO )
On FEBRUARY 11, 2003, before me Laurel Anne Dewolf, a Notary Public in
and for said state, personally appeared Wendy M. Godoy, personally known to me
to be the person whose name is subscribed to the within instrument and
acknowledged to me that she executed the same in her authorized capacity, and
that by her signature on the instrument, the person, or the entity upon behalf
of which the person acted, executed the instrument.
WITNESS my hand and official seal.
Notary Public in and for said State
(SEAL)
STATE OF CALIFORNIA )
) ss.
COUNTY OF SAN DIEGO )
On FEBRUARY 11, 2003, before me Laurel Anne Dewolf, a Notary Public in
and for said state, personally appeared Douglas L. Hageman, personally known to
me to be the person whose name is subscribed to the within instrument and
acknowledged to me that he executed the same in his authorized capacity, and
that by his signature on the instrument, the person, or the entity upon behalf
of which the person acted, executed the instrument.
WITNESS my hand and official seal.
Notary Public in and for said State
(SEAL)
-5-
LENDER'S CONSENT AND SUBORDINATION
The undersigned, Fleet National Bank, as administrative agent, is the
Mortgagee of the Bazaar Site pursuant to that certain Building Loan Deed of
Trust, Assignment of Leases and Rents and Security Agreement with Fixture
Filing, dated May 29, 1998 and recorded on May 29, 1998 in the Official Records
as Book Number 980529 and Document Number 02361. Mortgagee, on the terms and
conditions stated in this Consent and Subordination, does hereby agree that the
interests of Mortgagee in and to the Bazaar Site is and shall be subject and
subordinate to the rights of the Parties to the REA (as defined in and amended
by the foregoing Second Amendment), and consents to the execution of the
foregoing Second Amendment by Bazaar Company. This Consent and Subordination
shall not apply to any future modification or amendment to the REA unless such
modification or amendment has been expressly approved in writing by Mortgagee.
FLEET NATIONAL BANK, as administrative agent
By:
-----------------------------------------
Name: JANE E. Mc GRATH
Title: Vice President
STATE OF MASSACHUSETTS )
) ss.
COUNTY OF SUFFOLK )
On February 25, 2003 before me Jessamy Finet, a Notary Public in
and for said state, personally appeared Jane E. Mcgrath, personally known to me
(or proved to me on the basis of satisfactory evidence) to be the person whose
name is subscribed to the within instrument and acknowledged to me that she
executed the same in her authorized capacity, and that by her signature on the
instrument, the person, or the entity upon behalf of which the person acted,
executed the instrument.
WITNESS my hand and official seal.
--------------------------------------------
Notary Public in and for said State
(SEAL)
-7-
LENDER'S CONSENT AND SUBORDINATION
The undersigned, BNY Asset Solutions LLC, as administrative agent, is
the Mortgagee of the Gaming Site under that certain Deed of Trust, Assignment of
Rents and Leases, Fixture Filing and Security Agreement, dated February 26,
1998, and recorded on March 2, 1998 in the Official Records as Book Number
980302 and Document Number 00006. Mortgagee, on the terms and conditions stated
in this Consent and Subordination, does hereby agree that the interests of
Mortgagee in and to the Gaming Site is and shall be subject and subordinate to
the rights of the Parties to the REA (as defined in and amended by the foregoing
Second Amendment), and consents to the execution of the foregoing Second
Amendment by Aladdin Gaming. This Consent and Subordination shall not apply to
any future modification or amendment to the REA unless such modification or
amendment has been expressly approved in writing by Mortgagee.
BNY Asset Solutions LLC, as administrative agent
By:
----------------------------------------------
Name:
-------------------------------------------
Title:
-------------------------------------------
STATE OF TEXAS )
) ss.
COUNTY OF DALLAS )
On March 20, 2003, before me, Kristi E. Gross, a Notary Public in and
and for said state, personally appeared Michael F. Cocanougher personally known
to me (or proved to me on the basis of satisfactory evidence) to be the person
whose name is subscribed to the within instrument and acknowledged to me that
he/she executed the same in his/her authorized capacity, and that by his/her
signature on the instrument, the person, or the entity upon behalf of which the
person acted, executed the instrument.
WITNESS my hand and official seal.
___________________________________
Notary Public in and for said State
[SEAL]