UNSECURED INDEMNITY AGREEMENT
THIS UNSECURED INDEMNITY AGREEMENT (the "Indemnity") is entered into as
of the 14th day of November, 1997, by LAS VEGAS SANDS, INC., a Nevada
corporation ("LVSI"), VENETIAN CASINO RESORT, LLC, a Nevada limited liability
company ("VCR") and GRAND CANAL SHOPS MALL CONSTRUCTION, LLC, a Delaware limited
liability company ("GCCLLC," and jointly and severally with LVSI and VCR, the
"Company"), to and for the benefit of First Trust National Association, (the
"Mortgage Notes Indenture Trustee"), and, to the extent not otherwise
referenced, the Indemnified Parties (as hereinafter defined).
W I T N E S S E T H:
A. Pursuant to that certain Indenture, dated as of November 14, 1997,
by and between the Company, Mall Intermediate Holding Company, LLC, Lido
Intermediate Holding Company, LLC, and the Mortgage Notes Indenture Trustee (the
"Indenture"), VCR and LVSI have issued those certain Mortgage Notes (as defined
in the Funding Agents' Disbursement and Administration Agreement). Pursuant to
that certain Funding Agents' Disbursement and Administration Agreement by and
among the Company, the Mortgage Notes Indenture Trustee, The Bank of Nova
Scotia, a Canadian chartered bank, as the Bank Agent and the Disbursement Agent,
GMAC Commercial Mortgage Corporation, a California corporation, as the Interim
Mall Lender, and Atlantic-Pacific Las Vegas, LLC, a Delaware limited liability
company, as the HVAC Provider, dated as of November 14, 1997 (the "Funding
Agents' Disbursement and Administration Agreement"), the Mortgage Notes will be
held in an account pending disbursement to the Company to construct the Project
in accordance with the Funding Agents' Disbursement and Administration
Agreement. Capitalized terms used herein, but not otherwise defined herein,
shall have the meaning assigned to such terms in the Funding Agents'
Disbursement and Administration Agreement.
B. The Obligations are secured by, among other things, the Mortgage
Notes Indenture Deeds of Trust (as defined in the Funding Agents' Disbursement
and Administration Agreement (the "Deeds of Trust"), which Deeds of Trust
encumber the real property described in Exhibit "A" attached hereto (the "Real
Property"), and the improvements now or hereafter constructed thereon (which
improvements, together with the Real Property, shall hereinafter be referred to
as the "Property"). The Indenture, the Deeds of Trust and all other documents
executed in connection with the Obligations are collectively referred to as the
"Indenture Documents."
C. It is a condition of the Mortgage Notes Indenture Trustee's entering
into the Indenture Documents and the Mortgage Note Holders purchasing the
Mortgage Notes that this Indemnity be executed and delivered by the Company, and
the Mortgage Notes Indenture Trustee is entering into the Indenture Documents
and the Mortgage Note Holders are purchasing the Mortgage Notes in reliance on
this Indemnity.
D. The obligations of the Company hereunder are unsecured obligations
of the Company.
NOW, THEREFORE, in consideration of the foregoing and other valuable
consideration, the receipt of which is hereby acknowledged, the Company
covenants and agrees to and for the benefit of the Mortgage Notes Indenture
Trustee and the Mortgage Note Holders as follows:
1. Definitions.
(a) "Claims" means any and all actual out-of-pocket
costs incurred by an Indemnified Party (as defined below) (including, without
limitation, reasonable attorneys' fees and expenses, which fees and expenses
shall include, without limitation, fees and expenses of both outside and staff
counsel), expenses, losses, damages, liabilities, fines, penalties, charges,
injury to person, property, or natural resources, administrative and judicial
proceedings and orders, injunctive relief, judgments, remedial action
requirements and enforcement actions of any kind, arising directly or
indirectly, in whole or in part, out of or attributable to (i) any breach or
default by the Company in the performance of any of its obligations under
paragraphs 3(a)-(d) hereof, or (ii) any Release (as defined below) or threatened
Release, whether foreseeable or unforeseeable, arising prior to any release,
reconveyance or foreclosure of either Deed of Trust (or following any such
release, conveyance or foreclosure to the extent attributable to pre-existing
conditions), or conveyance in lieu of foreclosure; and in each instance,
regardless of when such Release, inaccuracy or breach is discovered and
regardless of whether or not caused by or in the control of the Company, any
employees, agents, contractors or subcontractors of the Company or any third
persons. Without limiting the generality of the foregoing and for purposes of
clarification only, Claims also include:
(i) actual out-of-pocket costs reasonably
incurred by an Indemnified Party in connection with (x) determining whether the
Property is in compliance with all applicable Hazardous Substances Laws (as
hereinafter defined), (y) taking any necessary precautions to protect against
any Release or threatened Release, or (z) any removal, remediation of any kind
and disposal of any Hazardous Substances (as hereinafter defined), and
(ii) any repair of any damage to the
Property or any other property caused by any such precautions, removal,
remediation or disposal.
The rights of the Indemnified Parties hereunder shall
not be limited by any investigation or the scope of any investigation undertaken
by or on behalf of the Mortgage Notes Indenture Trustee in connection with the
Property prior to the date hereof. Notwithstanding the foregoing, Claims shall
exclude any Release caused by or resulting from the negligence or misconduct of
any of the Indemnified Parties.
(b) "Hazardous Substances" means and includes any
flammable explosives, radioactive materials or hazardous, toxic or dangerous
wastes, substances or related materials or any other chemicals, materials or
substances, exposure to which is prohibited, limited or regulated by any
federal, state, county, regional or local authority or which, even if not so
regulated, may or could pose a hazard to the health and safety of the occupants
of the Property or of property adjacent to the Property, including, but not
limited to, asbestos, PCBs, petroleum products and byproducts (including, but
not limited to, crude oil or any fraction thereof, natural gas, natural gas
liquids, liquefied natural gas, or synthetic gas usable for fuel, or any mixture
thereof), substances defined or listed as "hazardous substances," "hazardous
materials," "hazardous wastes" or "toxic substances" or similarly identified in,
pursuant to, or for purposes of, any of the Hazardous Substances Laws,
including, without limitation, the Comprehensive Environmental Response,
Compensation, and Liability Act, as now or hereafter amended (42 U.S.C. Section
9601, et seq); the Hazardous Materials Transportation Act, as now or hereafter
amended (49 U.S.C. Section 1801, et seq); the Resource Conservation and Recovery
Act, as now or hereafter amended (42 U.S.C. Section 6901, et seq); any so-called
"Superfund" or "Superlien" law; or any other federal, state or local statute,
law, ordinance, code, rule, regulation, order or decree regulating, relating to
or imposing
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liability or standards of conduct concerning any hazardous, toxic or dangerous
waste, substance or material; or any substances or mixture regulated under the
Toxic Substance Control Act of 1976, as now or hereafter amended (15 U.S.C.
Section 2601 et seq); and any "pollutant" under the Clean Water Act, as now or
hereafter amended (33 U.S.C. Section 1251 et seq); and any hazardous air
pollutant under the Clean Air Act (42 U.S.C. Section 7901 et seq), in each case
as now or hereafter amended.
(c) "Hazardous Substances Laws" means all federal,
state and local environmental, health or safety laws, ordinances, regulations,
rules of common law or policies regulating Hazardous Substances, including,
without limitation, those governing the generation, use, refinement, handling,
treatment, removal, storage, production, manufacture, transportation or disposal
of Hazardous Substances, as such laws, ordinances, regulations, rules and
policies may be in effect from time to time and be applicable to the Property.
(d) "Indemnified Parties" means the Mortgage Notes
Indenture Trustee, and the directors, officers, shareholders, agents, employees,
participants, successors and assigns of the Mortgage Notes Indenture Trustee,
and shall also include any purchasers of all or any portion of the Property at
any foreclosure sale and the initial purchaser following the consummation of any
deed in lieu of foreclosure, but not including any other purchasers of the
Property.
(e) "Release" means any presence, use, generating,
storing, spilling, leaking, pumping, pouring, emitting, emptying, discharging,
injecting, escaping, leaching, dumping or disposing of Hazardous Substances into
the environment, or about, on, from, under, within or affecting the Property, or
transported to or from the Property, including continuing migration of Hazardous
Substances into or through soil, surface water or groundwater.
2. Environmental Indemnification by the Company.
(a) The Company hereby agrees to defend (with counsel
reasonably approved by the Mortgage Notes Indenture Trustee), indemnify and hold
the Indemnified Parties harmless from and against, and shall reimburse the
Indemnified Parties for, any and all Claims.
(b) The Mortgage Notes Indenture Trustee shall have
the right to employ independent counsel to represent it in any action or
proceeding to which this Indemnity is applicable if and to the extent that the
Mortgage Notes Indenture Trustee determines in good faith that its rights and
interests may be compromised or not fully and adequately represented by legal
counsel acting for the Company, whether on account of any potential defenses
that the Company may have to its obligations under this Indemnity or otherwise,
and in such event the reasonable fees and expenses of the Mortgage Notes
Indenture Trustee's independent counsel shall be paid by the Company.
(c) The Company's obligations hereunder shall not be
diminished or affected in any respect as a result of any notice or disclosure,
if any, to, or other knowledge, if any, by, any Indemnified Party of any Release
or threatened Release, or as a result of any other matter related to the
Company's obligations hereunder, nor shall any Indemnified Party be deemed to
have permitted or acquiesced in any Release or any breach of the Company's other
obligations hereunder, solely because any Indemnified Party had notice,
disclosure or knowledge thereof, whether at the time this Indemnity is delivered
or at any time thereafter.
(d) This Indemnity shall not be limited by any
representation, warranty or
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indemnity of the Company made herein or in connection with any indebtedness
secured by the Deeds of Trust, irrespective of whether the Company has knowledge
as of the date of each Deed of Trust, or during the term of each Deed of Trust,
of the matters to which such representation, warranty or indemnity relates.
3. Environmental Covenants
(a) The Company shall not, nor shall the Company
permit any tenants or other occupants of the Property to, at any time in the
future, cause or permit a Release, except in compliance with applicable
Hazardous Substances Laws.
(b) The Company shall give prompt written notice to
the Mortgage Notes Indenture Trustee of any Pending Claims, or of any
Proceedings.
(c) The Company shall give prompt written notice to
the Mortgage Notes Indenture Trustee of the Company's discovery of any
occurrence or condition on any real property adjoining or in the vicinity of the
Property that could cause the Property or any part thereof to be subject to any
restrictions on the ownership, occupancy, transferability or use of the Property
under any Hazardous Substances Laws including, without limitation, the Company's
discovery of any occurrence or condition on the Property or on any real property
adjoining or in the vicinity of the Property that could cause the Property or
any part thereof to be classified as a hazardous waste property or border-zone
property, or to be otherwise subject to any restrictions on the ownership,
occupancy, transferability or use of the Property under any Hazardous Substances
Laws.
(d) In the event that any investigation, site
monitoring, containment, cleanup, removal, restoration, precautionary actions or
other remedial work of any kind or nature (hereinafter, "Remedial Work") is
required under any applicable Hazardous Substances Law as a result of, or in
connection with, any Release, suspected Release, or threatened Release, the
Company shall within thirty (30) days after receipt of information that such
Remedial Work is or may be required (or such shorter period of time as may be
required under applicable law, regulation, order or agreement), commence the
performance of, or cause to be commenced, and thereafter diligently prosecute to
completion, the performance of all such Remedial Work in compliance with all
applicable Hazardous Substances Laws. All Remedial Work shall be performed by
one or more contractors, approved in advance in writing by the Mortgage Notes
Indenture Trustee, and under the supervision of a consulting engineer approved
in advance in writing by the Mortgage Notes Indenture Trustee, which consent
shall not be unreasonably withheld. All costs and expenses of such Remedial Work
shall be paid by the Company, including, without limitation, the charges of such
contractor(s) and/or the consulting engineer, and the Indemnified Parties'
reasonable attorneys' fees and costs, including, without limitation, fees and
costs of both outside and staff counsel incurred in connection with monitoring
or review of such Remedial Work. In the event the Company shall fail to timely
commence, or cause to be commenced, or fail to diligently prosecute to
completion, the performance of such Remedial Work, the Mortgage Notes Indenture
Trustee or any other Indemnified Party may, but shall not be required to, cause
such Remedial Work to be performed and all costs and expenses thereof, or
incurred in connection therewith, shall be deemed Claims hereunder.
4. Liability.
(a) Notwithstanding any other provisions of this
Indemnity or any of the Indenture Documents, any liability of the Company
hereunder shall be its personal liability (but such personal liability shall not
be deemed to incorporate personal liability of its directors, officers,
employees
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or agents), and may be asserted against its interest in the Property as well as
against any and all of its other assets.
(b) Without limiting the foregoing, the obligations
of the Company hereunder shall survive the following events, to the maximum
extent permitted by law: (i) repayment of the Obligations and any judicial or
nonjudicial foreclosure under either Deed of Trust or conveyance in lieu of such
foreclosure, notwithstanding that all or any portion of any other obligations
secured by the such Deed of Trust shall have been discharged thereby, (ii) any
election by any Indemnified Party to purchase all or any portion of the Property
at a foreclosure sale by crediting all or any portion of the obligations secured
by either Deed of Trust against the purchase price therefor (except to the
extent and only to the extent that such Indemnified Party has specifically
elected in writing in its sole discretion to credit against the purchase price
any Claims hereunder which were liquidated in amount at the time of such
foreclosure sale, it being presumed for these purposes that the obligations
secured by such Deed of Trust shall be discharged by any such crediting in the
order set forth in paragraph 4.12 of such Deed of Trust), (iii) any release or
reconveyance of either Deed of Trust, any waiver of the lien of either Deed of
Trust, or any release or waiver of any other security for the Obligations, and
(iv) any termination, cancellation or modification of the Indenture, the
Mortgage Notes, the Funding Agents' Disbursement and Administration Agreement,
either Deed of Trust or any other agreement relating to the Obligations. Upon
and following the occurrence of any of the foregoing, the obligations of the
Company hereunder shall be unsecured obligations, and shall be enforceable
against the Company to the fullest extent permitted by applicable law.
(c) The obligations of the Company hereunder are not
intended to be the obligations of a surety or guarantor. The liability of the
Company under this Indemnity shall in no way be limited or impaired by (i) any
extensions of time for performance required by the Indenture Documents; (ii) the
accuracy or inaccuracy of any representations and warranties made by the Company
in any of the Indenture Documents; or (iii) the release of any person or entity
from performance or observance of any of the agreements, covenants, terms, or
conditions contained in any of the Indenture Documents by operation of law or
otherwise.
(d) The rights and remedies of the Indemnified
Parties under this Indemnity (i) shall be in addition to any other rights and
remedies of such Indemnified Parties under any Indenture Document or at law or
in equity, and (ii) may be enforced by any of the Indemnified Parties, to the
maximum extent permitted by law, without regard to or affecting any rights and
remedies that such Indemnified Party may have under any Indenture Document or at
law or in equity, and without regard to any limitations on such Indemnified
Party's recourse for recovery of the Obligations as may be provided in any
Indenture Document.
5. Site Visits, Observation and Testing. The Mortgage Notes
Indenture Trustee and any of the other Indemnified Parties and their respective
agents and representatives shall have the right at any reasonable time, and upon
reasonable prior notice, to enter and visit the Property to make such
inspections and inquiries as they shall deem appropriate, including inspections
for violations of any of the terms of this Indemnity and for determining the
existence, nature and magnitude of any past or present Release or threatened
Release, and they shall also have the right, following any Event of Default as
defined in the Indenture, or where the Mortgage Notes Indenture Trustee has a
reasonable basis upon which to believe that the Property may be harmed, unsafe
or contaminated, and upon reasonable prior notice, to enter and visit the
Property to make such tests (including, without limitation, taking and removing
soil or groundwater samples) as they shall deem appropriate. Neither the
Mortgage Notes Indenture Trustee nor any of the other Indemnified Parties have
any duty, however, to visit or observe the Property or to conduct
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tests, and no site visit, observation or testing by the Mortgage Notes Indenture
Trustee or any other Indemnified Party shall impose any liability on the
Mortgage Notes Indenture Trustee or such other Indemnified Party. In no event
shall any site visit, observation or testing by the Mortgage Notes Indenture
Trustee or any other Indemnified Party be a representation that Hazardous
Substances are or are not present in, on or under the Property, or that there
has been or shall be compliance with any Hazardous Substances Laws or any other
applicable governmental law. Neither the Company nor any other party is entitled
to rely on any site visit, observation or testing by the Mortgage Notes
Indenture Trustee or any other Indemnified Party. Neither the Mortgage Notes
Indenture Trustee nor any of the other Indemnified Parties owe any duty of care
to protect the Company or any other party against, or to inform the Company or
any other party of, any Hazardous Substances or any other adverse condition
affecting the Property. The Mortgage Notes Indenture Trustee and any other
Indemnified Party shall give the Company reasonable notice before entering the
Property, and shall make reasonable efforts to avoid interfering with the
Company's use of the Property in exercising any rights provided in this
paragraph 5.
6. Interest Accrued. Any amount claimed hereunder by an
Indemnified Party not paid within thirty (30) days after written demand from
such Indemnified Party with an explanation of the amounts claimed shall bear
interest at a rate per annum equal to the maximum interest rate applicable to
overdue principal set forth in Section 4.01 of the Indenture.
7. Subrogation of Indemnity Rights. If the Company fails to
fully perform its obligations hereunder, any Indemnified Party shall be entitled
to pursue any rights or claims that the Company may have against any present,
future or former owners, tenants or other occupants or users of the Property,
any portion thereof or any adjacent or proximate properties, relating to any
Claim or the performance of Remedial Work, and the Company hereby assigns all of
such rights and claims to the Indemnified Parties under such circumstances and
shall take all actions required by the Indemnified Parties to cooperate with
such Indemnified Parties in enforcing such rights and claims under such
circumstances.
8. Reliance. The Company acknowledges that it is making and
giving the indemnities and representations and covenants contained in this
Indemnity with the knowledge that the Mortgage Notes Indenture Trustee and the
Mortgage Note Holders are relying on such indemnities and representations and
covenants in making the Obligations to the Company.
9. Successors and Assigns. This Indemnity shall inure to the
benefit of each Indemnified Party's successors and assigns, and shall be binding
upon the heirs, successors, and assigns of the Company. The Company shall not
assign any rights or obligations under this Indemnity without first obtaining
the written consent of the Mortgage Notes Indenture Trustee, which may be given
or withheld in the sole discretion of the Mortgage Notes Indenture Trustee.
Notwithstanding any other provision of this Indemnity to the contrary, the
Company shall not be released from its obligations hereunder without obtaining
the written consent of the Mortgage Notes Indenture Trustee, which consent may
be given or withheld in the sole discretion of the Mortgage Notes Indenture
Trustee. Nothing herein shall be deemed to be a consent to the transfer of the
Property which transfer would be otherwise prohibited by any Document.
10. Miscellaneous. This Indemnity shall be governed by and
construed in accordance with the laws of the State of Nevada. If this Indemnity
is executed by more than one person or entity, the liability of the undersigned
hereunder shall be joint and several. Separate and successive actions may be
brought hereunder to enforce any of the provisions hereof at any time and from
time to time. No action hereunder shall preclude any subsequent action, and the
Company hereby waive and covenants not to
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assert any defense in the nature of splitting of causes of action or merger of
judgments. In no event shall any provision of this Indemnity be deemed to be a
waiver of or to be in lieu of any right or claim, including, without limitation,
any right of contribution or other right of recovery, that any party to this
Indemnity might otherwise have against any other party to this Indemnity under
any Hazardous Substances Laws. If any term of this Indemnity or any application
thereof shall be invalid, illegal or unenforceable, the remainder of this
Indemnity and any other application of such term shall not be affected thereby.
No delay or omission in exercising any right hereunder shall operate as a waiver
of such right or any other right.
11. Notices. All notices expressly provided hereunder to be
given by the Company to the Mortgage Notes Indenture Trustee and all notices and
demands of any kind or nature whatsoever which the Company may be required or
may desire to give to or serve on the Mortgage Notes Indenture Trustee shall be
in writing and shall be served by certified mail, return receipt requested, or
by a reputable commercial overnight carrier that provides a receipt, such as
Federal Express. Notice shall be addressed as follows:
Mortgage Notes Indenture Trustee: First Trust National Association
180 East 5th Street
St. Paul, Minnesota 55101
Attn: Corporate Trust Department
Telecopy No: (___) ___-____
Telephone No: (___) ___-____
with a copy to: Latham & Watkins
701 B Street, Suite 2100
San Diego, California 92101
Attn: Sony Ben-Moshe, Esq.
Telecopy No.: (619) 696-7419
Telephone No.: (619) 236-1234
The Company: Las Vegas Sands, Inc.
3355 Las Vegas Boulevard, South
Las Vegas, Nevada 89109
Attn: Sheldon G. Adelson,
Chairman of the Board
Telecopy No: (___) ___-____
Telephone No: (___) ___-____
with a copy to: Paul, Weiss, Rifkind, Wharton & Garrison
1285 Avenue of the Americas, 24th Floor
New York, New York, 10019
Attn: Harris B Fredius, Esq.
Telecopy No: (212) 757-3990
Telephone No: (212) 373-3003
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12. Attorneys' Fees and Expenses. If the Mortgage Notes
Indenture Trustee or any Mortgage Note Holder refers this Indemnity or any of
the other Indenture Documents to an attorney to enforce, construe or defend the
same, as a consequence of any Event of Default as defined in the Indenture, with
or without the filing of any legal action or proceeding, the Company shall pay
to the Mortgage Notes Indenture Trustee, immediately upon demand, the amount of
all attorneys' fees and costs incurred by the Mortgage Notes Indenture Trustee
in connection therewith, together with interest thereon from the date of award
at the maximum interest rate applicable to overdue principal set forth in
Section 4.01 of the Indenture.
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IN WITNESS WHEREOF, this Indemnity is executed as of the day
and year first above written.
The Company:
LAS VEGAS SANDS, INC.,
a Nevada corporation
By: /s/ William P. Weidner
----------------------
Name: William P. Weidner
Title: President
VENETIAN CASINO RESORT, LLC,
a Nevada limited liability company
BY: LAS VEGAS SANDS, INC.,
a Nevada corporation,
its managing member
By: /s/ William P. Weidner
----------------------
Name: William P. Weidner
Title: President
GRAND CANAL SHOPS MALL CONSTRUCTION, LLC,
a Delaware limited liability company
BY: VENETIAN CASINO RESORT, LLC,
a Nevada limited liability company,
its member
BY: LAS VEGAS SANDS, INC.,
a Nevada corporation,
its managing member
By: /s/ William P. Weidner
----------------------
Name: William P. Weidner
Title: President
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