[EXECUTION COPY]
U.S. $410,000,000
CREDIT AGREEMENT,
dated as of February 26, 1998,
among
ALADDIN GAMING, LLC,
as the Borrower,
VARIOUS FINANCIAL INSTITUTIONS,
as the Lenders,
THE BANK OF NOVA SCOTIA,
as the Administrative Agent for the Lenders,
MERRILL LYNCH CAPITAL CORPORATION,
as the Syndication Agent for the Lenders,
and
CIBC OPPENHEIMER CORP.
as the Documentation Agent for the Lenders.
Arranged By:
The Bank of Nova Scotia
Merrill Lynch Capital Corporation
CREDIT AGREEMENT
THIS CREDIT AGREEMENT, dated as of February 26, 1998, among ALADDIN
GAMING, LLC, a Nevada limited-liability company (the "Borrower"), the
various financial institutions as are or may become parties hereto
(collectively, the "Lenders"), THE BANK OF NOVA SCOTIA ("Scotiabank"), as
administrative agent (in such capacity, the "Administrative Agent") for the
Lenders, MERRILL LYNCH CAPITAL CORPORATION ("Merrill Lynch"), as
syndication agent (in such capacity, the "Syndication Agent") for the
Lenders, and CIBC OPPENHEIMER CORP. ("CIBC"), as documentation agent (in
such capacity, the "Documentation Agent") for the Lenders.
W I T N E S S E T H:
WHEREAS, 100% of the Borrower Common Membership Interests (such term
and other capitalized terms being used herein with the meanings provided in
Section 1.1) are owned by Holdings, which, in turn, (x) to the extent of
72% of its common Membership Interests is owned indirectly through Sommer
Enterprises, Enterprises and AHL by the Trust, (y) to the extent of 25% of
its common Membership Interests is owned indirectly through LCNI and London
Clubs Holdings by London Clubs and (z) to the extent of 3% of its common
Membership Interests is owned by GAI, LLC; and
WHEREAS, 100% of the Borrower Series A Preferred Membership Interests
are owned by Holdings; and
WHEREAS, the Borrower owns all of the outstanding common Membership
Interests of AMH, which is anticipated to own 49% of the common Membership
Interests of Aladdin Music, the remaining 51% of the Aladdin Music common
Membership Interests are anticipated to be owned directly by Planet
Hollywood (Boston) Inc., which is a direct, wholly-owned Subsidiary of
Planet Hollywood; and
WHEREAS, Borrower owns a site (the "Site") totaling approximately
35.16 acres at Las Vegas Boulevard and Harmon Avenue in Clark County,
Nevada on which it intends to demolish the existing Aladdin hotel and
casino (but leaving the existing Theater for the Performing Arts intact)
and to develop and construct a new resort, casino and entertainment complex
(the "Complex"), including:
(a) a luxury themed hotel and casino (the "Hotel/Casino") to be
known as the "Aladdin Hotel and Casino" consisting of a hotel of
approximately 2,600 rooms (the "Hotel"), an approximately 116,000
square foot casino (the "Casino"), a 1,400 seat production showroom
and seven restaurants, all of which will be developed, constructed,
owned and operated by the Borrower on the Main Project Parcel as more
particularly
described in Exhibit N-3 hereto (the Hotel/Casino collectively with
the Theater and the Energy Project Component, the "Main Project");
(b) a themed entertainment shopping mall with approximately
462,000 square feet of retail space (the "Desert Passage") and an
approximately 4,800 space car parking facility (the "Carpark", and
collectively with the Desert Passage, the "Mall Project"), both to be
developed, constructed, owned and operated by Aladdin Bazaar on the
Mall Project Parcel as more particularly described in Exhibit N-4
hereto;
(c) a second hotel and casino complex with a music and
entertainment theme (the "Music Project") to be developed, constructed
and operated by Aladdin Music on the Music Project Parcel as more
particularly described in Exhibit N-5 hereto;
(d) a 7,000 seat theater (the "Theater") currently known as "The
Aladdin Theater for the Performing Arts" to be leased by the Borrower
to, and to be renovated and operated by, Aladdin Music in accordance
with the Theater Lease; and
(e) a facility (the "Energy Project") to provide electricity,
chilled water and hot water to the Complex which will be constructed,
owned and operated by the Energy Project Provider; and
WHEREAS, the Borrower expects to fund the costs to construct the
Hotel/Casino Component and pay for the Equipment Component and the
Borrower's expenses, if any, with respect to the Energy Project Component,
which are expected pursuant to the Main Project Budget to cost $724,000,000
in the aggregate, by
(a) obtaining from Holdings in consideration for common
membership interests of the Borrower (x) the Site which has a net
equity value (the "Land Equity") of $67,000,000, based on an appraised
value of $135,000,000 (after giving effect to the release of the
portion of the Site required for the Mall Project and the Music
Project) and the discharge of all Indebtedness secured thereby of
$68,000,000, (y) the benefit of pre-development Main Project Costs of
at least $7,000,000 and (z) a portion of the London Clubs Contribution
in the amount of $42,000,000;
(b) obtaining from Holdings in consideration for Series A
Preferred Membership Interest of the Borrower, the amount of
$115,047,100, representing the proceeds received by Holdings, Capital
and Enterprises from the issuance of the Discount Notes and Warrants
in an aggregate amount of $107,047,100 pursuant to the Discount Note
Purchase Agreement and a portion of the London Clubs Contribution in
the amount of $8,000,000; and
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(c) obtaining from GECC pursuant to the Approved Equipment
Funding Commitment a $60,000,000 capitalized lease and $20,000,000 in
purchase money loans covering the Gaming Equipment and the Specified
Equipment; and
(d) obtaining Commitments from the Lenders in an aggregate
amount of $410,000,000, all as further described in the following
recital; and
WHEREAS, the Borrower desires to obtain
(a) Term A Loan Commitments from the Term A Lenders pursuant to
which the Borrower may, from time to time on and after the Effective
Date and prior to the Term A Loan Commitment Termination Date, obtain
(i) from the Issuer, Letters of Credit in a maximum
aggregate Stated Amount at any time outstanding not to exceed
$20,000,000, and
(ii) from the Term A Lenders, Borrowings of the Term A
Loans,
all subject, however, to the limitation that the sum at any time of
(x) the aggregate original principal amount of all Term A Loans plus
(y) the aggregate Stated Amount of outstanding Letters of Credit shall
not exceed $136,000,000;
(b) Term B Loan Commitments from the Term B Lenders pursuant to
which a single Borrowing of Term B Loans in a maximum original
principal amount of $114,000,000 shall be made by the Borrower on the
Closing Date; and
(c) Term C Loan Commitments from the Term C Lenders pursuant to
a single Borrowing of Term C Loans in a maximum original principal
amount of $160,000,000 shall be made by the Borrower on the Closing
Date; and
WHEREAS, the Lenders and the Issuer are willing, on the terms and
subject to the conditions hereinafter set forth (including Article V), to
enter into such Commitments and make such Loans to the Borrower and issue
(or participate in) such Letters of Credit for the account of the Borrower;
and
WHEREAS, the proceeds of
(a) the Loans will be applied (x) towards the Main Project Costs
in respect of which such Loans were advanced by the Lenders, (y) prior
to the Conversion Date, for payments of interest in respect of the
Loans made hereunder and (z) in the case of Term A Loans, in addition
to the foregoing purposes, towards the payment of reimbursement
obligations arising from drawn Letters of Credit; and
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(b) Letters of Credit will be issued for the account of the
Borrower if required as a deposit by suppliers and/or contractors
providing materials to the Main Project;
NOW, THEREFORE, the parties hereto agree as follows:
ARTICLE I
DEFINITIONS AND ACCOUNTING TERMS
SECTION 1.1. Defined Terms. The following terms (whether or not
italicized) when used in this Agreement, including its preamble and
recitals, shall, except where the context otherwise requires, have the
following meanings (such meanings to be equally applicable to the singular
and plural forms thereof):
"ABH" means Aladdin Bazaar Holdings, LLC, a Nevada limited-liability
company.
"Account" is defined in the Disbursement Agreement.
"Additional Contract Certificate" means an Additional Contract
Certificate substantially in the form of Exhibit Y hereto.
"Administrative Agent" is defined in the preamble and includes each
other Person as shall have subsequently been appointed as the successor
Administrative Agent pursuant to Section 9.4.
"Advance" is defined in the Disbursement Agreement.
"Affected Lender" is defined in clause(a) of Section 4.11.
"Affiliate" means, relative to any Person, any other Person which,
directly or indirectly, controls, is controlled by or is under common
control with such Person (excluding, however, any trustee under, or any
committee with responsibility for administering, any Plan). With respect
to any Lender, Approved Fund, or Issuer, a Person shall be deemed to be
"controlled by" another Person if such other Person possesses, directly or
indirectly, power to vote 51% or more of the securities (on a fully diluted
basis) having ordinary voting power for the election of directors, managing
general partners or managers, as the case may be. With respect to all
other Persons, a Person shall be deemed to be "controlled by" another
Person if such other Person possesses, directly or indirectly, power
(a) to vote 10% or more of the securities (on a fully diluted
basis) having ordinary voting power for the election of directors,
managing general partners or managers, as the case may be; or
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(b) to direct or cause the direction of the management and
policies of such Person whether by contract or otherwise.
"Affiliate Transaction" is defined in Section 7.2.13.
"Agent" means the Administrative Agent, the Syndication Agent and/or
the Documentation Agent, as the context may require.
"Agreement" means, on any date, this Credit Agreement as originally in
effect on the Effective Date and as thereafter from time to time amended,
supplemented, amended and restated, or otherwise modified.
"AHL" means Aladdin Holdings, LLC, a Delaware limited liability
company.
"AHL Pledge Agreement" means, on any date, the Pledge Agreement
executed and delivered by an Authorized Representative of AHL pursuant to
clause (d) of Section 5.1.3, as originally in effect on the Closing Date,
in substantially the form of Exhibit E-2 hereto and as thereafter from time
to time amended, supplemented, amended and restated or otherwise modified.
"Aladdin Bazaar" means Aladdin Bazaar, LLC, a Delaware limited
liability company.
"Aladdin Music" means Aladdin Music, LLC, a Nevada limited-liability
company.
"Aladdin Parties" means, collectively, the Borrower, Holdings,
Capital, Enterprises, Sommer Enterprises, AHL, Aladdin Music, AMH, ABH and
the Trust.
"Alternate Base Rate" means, on any date and relative to all Base Rate
Loans, a fluctuating rate of interest per annum (rounded upward, if
necessary, to the next highest 1/16 of 1%) equal to the higher of
(a) the Base Rate in effect on such day; and
(b) the Federal Funds Rate in effect on such day plus 1/2 of 1%.
Changes in the rate of interest on that portion of any Loans maintained as
Base Rate Loans will take effect simultaneously with each change in the
Alternate Base Rate. The Administrative Agent will give notice promptly to
the Borrower and the Lenders of changes in the Alternate Base Rate.
"AMH" means Aladdin Music Holdings, LLC, a Nevada limited-liability
company.
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"AMH Pledge Agreement" means, on any date, the Pledge Agreement
executed and delivered by an Authorized Representative of AMH pursuant to
clause (g) of Section 5.1.3, as originally in effect on the Closing Date,
in substantially the form of Exhibit E-3 hereto and as thereafter from time
to time amended, supplemented, amended and restated or otherwise modified.
"Anticipated Earnings" is defined in the Disbursement Agreement.
"Applicable Base Rate Margin" means, (w) relative to any Term B Loan
and Term C Loan, the proceeds of which on any date are being held in the
Bank Proceeds Account, 1.00% per annum, (x) relative to any Term B Loan,
the proceeds of which on any date have been advanced to the Borrower from
the Bank Proceeds Account, 2.50% per annum, (y) relative to any Term C
Loan, the proceeds of which on any date have been advanced to the Borrower
from the Bank Proceeds Account, 3.00% per annum and (z) relative to any
Term A Loan, (1) on any date prior to the date which is six months after
the Conversion Date, 2.00% per annum and (2) on any date from and after the
date which is six months after the Conversion Date, the per annum
percentage set forth below opposite the Total Debt to EBITDA Ratio set
forth in the Current Compliance Certificate:
Total Debt to EBITDA Ratio Applicable Base Rate Margin
- -------------------------- ---------------------------
greater than or equal to 4.0:1 1.75%
greater than or equal to 3.5:1 and < 4.0:1 1.50%
greater than or equal to 3.0:1 and < 3.5:1 1.00%
greater than or equal to 2.5:1 and < 3.0:1 0.75%
< 2.5:1 0.50%
"Applicable LIBO Rate Margin" means, (w) relative to any Term B Loan
and Term C Loan, the proceeds of which on any date are being held in the
Bank Proceeds Account, 2.00% per annum, (x) relative to any Term B Loan,
the proceeds of which on any date have been advanced to the Borrower from
the Bank Proceeds Account, 3.50% per annum, (y) relative to any Term C
Loan, the proceeds of which on any date have been advanced to the Borrower
from the Bank Proceeds Account, 4.00% per annum and (z) relative to any
Term A Loan, (1) on any date prior to the date which is six months after
the Conversion Date, 3.00% per annum and (2) on any date from and after the
date which is six months after the Conversion Date, the per annum
percentage set forth below opposite the Total Debt to EBITDA Ratio set
forth in the Current Compliance Certificate:
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Total Debt to EBITDA Ratio Applicable LIBO Rate Margin
- -------------------------- ---------------------------
greater than or equal to 4.0:1 2.75%
greater than or equal to 3.5:1 and < 4.0:1 2.50%
greater than or equal to 3.0:1 and < 3.5:1 2.00%
greater than or equal to 2.5:1 and < 3.0:1 1.75%
< 2.5:1 1.50%
"Applicable Percentage" means the percentage of Direct Costs actually
paid or payable by the Borrower to the Design/Builder pursuant to the
Design/Build Contract or, if applicable, to a Contractor or Subcontractor
pursuant to a Contract after taking into account the Retainage Amount.
"Approved Equipment Funding Commitment" means, collectively, (x) the
GECC Commitment and (y) any replacement of the GECC Commitment from an
institutional or other lender approved by the Administrative Agent in its
reasonable discretion if (1) such commitment is in form and substance
reasonably satisfactory to the Administrative Agent and does not include
any material conditions to funding that are not included in the GECC
Commitment and (2) the lender providing such commitment executes an
intercreditor agreement substantially similar to the GECC Intercreditor
Agreement.
"Approved Fund" means, relative to any Lender that is a fund that
invests in bank loans, any other fund that invests in bank loans and is
advised or managed by the same investment advisor as such Lender or by an
Affiliate of such investment advisor.
"Appurtenant Rights" means (x) all agreements, easements, rights of
way or use, rights of ingress or egress, privileges, appurtenances,
tenements, hereditaments and other rights and benefits at any time
belonging or pertaining to the Site or the Improvements, including the use
of any streets, ways, alleys, vaults or strips of land adjoining, abutting,
adjacent or contiguous to the Site and (y) all permits, licenses and
rights, whether or not of record, appurtenant to the Site.
"Architect of Record" means ADP/FD of Nevada, Inc.
"Architect's Agreement" means, collectively, the agreements pursuant
to which architects, engineers and other design professionals have agreed
with the Borrower to provide services in connection with the Main Project.
"Architect's Closing Certificate" means a closing certificate in the
form of Exhibit Q-3 hereto.
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"Arranger" means Scotiabank or Merrill Lynch.
"Arrangers' Fee Letter" means the confidential letter agreement, dated
December 4, 1997, among the Borrower, the Sponsors and the Arrangers.
"Assignee Lender" is defined in Section 10.11.1.
"Assignment of Contracts" means an assignment of any and all
contracts, agreements, proposals, Permits (to the extent such Permits are
assignable), approvals (to the extent such approvals are assignable), Plans
and Specifications pertaining to the Hotel/Casino Component, whether now
existing or subsequently entered into by the Borrower, including the
Approved Equipment Funding Commitments and the rights of the Borrower
thereunder, management contracts, the Contracts, development rights,
consents (to the extent assignable), architectural, engineering and leasing
documents and such other documents as may be designated by the
Administrative Agent. Such Assignment of Contracts shall include
appropriate continuation agreements by the Contractors and/or
Subcontractors thereunder.
"Assignment of Consulting Agreement" means, on any date, the
Assignment of Consulting Agreement, as originally in effect on the Closing
Date, between the Borrower, AHL and the Administrative Agent and as
thereafter from time to time amended, supplemented, amended and restated or
otherwise modified in accordance with the terms hereof.
"Assignment of Design/Build Contract" means, on any date, the
Assignment of Design/Build Contract, as originally in effect on the Closing
Date, between the Borrower and the Administrative Agent and as thereafter
from time to time amended, supplemented, amended and restated or otherwise
modified in accordance with the terms hereof.
"Assignment of Project Management Agreement" means, on any date, the
Assignment of Project Management Agreement, as originally in effect on the
Closing Date, between AHL and the Administrative Agent and as thereafter
from time to time amended, supplemented, amended and restated or otherwise
modified in accordance with the terms hereof.
"Assignment of Salle Privee Agreement" means, on any date, the
Assignment of Salle Privee Agreement, as originally in effect on the
Closing Date, between the Borrower and the Administrative Agent and as
thereafter from time to time amended, supplemented, amended and restated or
otherwise modified in accordance with the terms hereof.
"Authorized Representative" means, relative to any Person, those of
its officers or managing members (in the case of a limited liability
company) whose signatures and incumbency shall have been certified to the
Administrative Agent and the Lenders in a certificate of such Person
delivered to the Administrative Agent.
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"Available Funds" means, from time to time, the sum of (u) the
aggregate of the unutilized Commitments (excluding, however, the
Commitments of all Defaulting Lenders) under the Bank Credit Facility, plus
(v) the aggregate of the amounts on deposit in the Borrower's Funds
Account, the Construction Note Disbursement Account and all Anticipated
Earnings thereon, plus (w) the aggregate of the amounts on deposit in the
Guaranty Deposit Account, the Cash Management Account, the Bank Proceeds
Account, the Loss Proceeds Account and the Interest Payment Account, plus
(x) so long as (1) no default under the Site Work Agreement and the Mall
Project Loan and no Default hereunder have occurred and are continuing at
the relevant time of computation, (2) advances of the Mall Project Loan
have commenced on or before June 30, 1998 and have continued in accordance
with the approved draw schedule for the Mall Project Loan, (3) advances of
the Mall Project Loan to reimburse the Borrower in accordance with the Site
Work Agreement are made within 45 days after the Construction Consultant
and the Owner Representative have approved the work to be completed by the
Borrower pursuant to the Site Work Agreement, the aggregate amounts payable
to the Borrower by Aladdin Bazaar pursuant to Section 4.5 of the Site Work
Agreement, plus (y) the lesser of (1) the aggregate of the amounts
available to be drawn under all Approved Equipment Funding Commitments and
(2) the aggregate amount of Remaining Costs on the date of calculation for
the Equipment Component (as in effect from time to time), plus (z) the
aggregate amount of Main Project Costs which the Design/Builder and/or
Fluor have agreed or confirmed in writing, to the reasonable satisfaction
of the Disbursement Agent, that they are responsible for paying (on a
timely basis relative to the Main Project's cash needs) from their own
funds but which they have not yet paid.
"Bank Credit Facility" means the Term A Loan Commitment, the Term B
Loan Commitment and the Term C Loan Commitment.
"Bank Proceeds Account" means the account established by the Borrower
with the Disbursement Agent pursuant to the Borrower Collateral Account
Agreement into which the proceeds of the Loans shall be deposited by the
Administrative Agent from time to time.
"Base Rate" means, at any time, the rate of interest then most
recently established by the Administrative Agent in New York, New York as
its base rate for U.S. dollars loaned in the United States. The Base Rate
is not necessarily intended to be the lowest rate of interest determined by
the Administrative Agent in connection with extensions of credit.
"Base Rate Loan" means a Loan bearing interest at a fluctuating rate
determined by reference to the Alternate Base Rate.
"Board of Managers" means (x) for so long as the Borrower is a
limited-liability company, the Board of Managers appointed pursuant to the
Organizational Documents of the Borrower or (y) otherwise, the Board of
Directors of the Borrower.
"Borrower" is defined in the preamble.
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"Borrower Collateral Account Agreement" means, on any date, the
Borrower Collateral Account Agreement, as originally in effect on the
Closing Date, among the Borrower, the Disbursement Agent and the Securities
Intermediary and as thereafter from time to time amended, supplemented,
amended and restated or otherwise modified in accordance with the terms
hereof.
"Borrower Common Membership Interest" means a Common Share as defined
in the Organizational Documents of the Borrower.
"Borrower Pledge Agreement" means, on any date, the Pledge Agreement
executed and delivered by an Authorized Representative of the Borrower
pursuant to clause (f) of Section 5.1.3, as originally in effect on the
Closing Date, in substantially the form of Exhibit E-1 hereto and as
thereafter from time to time amended, supplemented, amended and restated or
otherwise modified.
"Borrower Series A Preferred Membership Interests" means the Series A
Preferred Shares as defined in the Organizational Documents of the
Borrower.
"Borrower's Closing Certificate" means a closing certificate in the
form of Exhibit Q-1 hereto.
"Borrower's Completion Certificate" means a certificate in the form of
Exhibit S-1 hereto.
"Borrower's Final Completion Certificate" means a certificate in the
form of Exhibit U-1 hereto.
"Borrower's Funds Account" is defined in the Borrower Collateral
Account Agreement.
"Borrowing" means the Loans of the same type and, in the case of LIBO
Rate Loans, having the same Interest Period made by all Lenders required to
make such Loans on the same Business Day and pursuant to the same Borrowing
Request in accordance with Section 2.1.
"Borrowing Request" means a Loan request and certificate duly executed
by an Authorized Representative of the Borrower substantially in the form
of Exhibit L-1 hereto.
"Building Department" means the Clark County Building Department.
"Business Day" means
(a) any day which is neither a Saturday or Sunday nor a legal
holiday on which banks are authorized or required to be closed in Las
Vegas, Nevada or New York, New York; and
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(b) relative to the making, continuing, prepaying or repaying of
any LIBO Rate Loans, any day described in clause (a) on which dealings
in Dollars are carried on in the London interbank eurodollar market.
"Capital" means Aladdin Capital Corp., a Nevada corporation.
"Capital Expenditures" means, for any period, the aggregate amount of
all expenditures (other than any residual purchase payments under the FF&E
Leases) of the Borrower and the other Aladdin Parties for fixed or capital
assets made during such period which, in accordance with GAAP, would be
classified as capital expenditures.
"Capital Stock" means, relative to any Person, any and all shares,
interests (including Membership Interests), participations or other
equivalents (however designated, whether voting or non-voting) of such
Person's capital, whether now outstanding or issued after the Effective
Date.
"Capitalized Lease Liability" means, relative to any Person, any
monetary obligation of such Person under any leasing or similar arrangement
which, in accordance with GAAP, would be classified as a capitalized lease,
and, for purposes of this Agreement and each other Loan Document, the
amount of such obligation shall be the capitalized amount thereof,
determined in accordance with GAAP, and the stated maturity thereof shall
be the date of the last payment of rent or any other amount due under such
lease prior to the first date upon which such lease may be terminated by
the lessee without payment of a premium or a penalty.
"Carpark" is defined in clause (b) of the fourth recital.
"Cash Contributions to Capital" means optional contributions (other
than Cash Equity Contributions as defined in the Keep-Well Agreement),
including to cure a Default that would otherwise exist under the Loan
Documents, made by the Sponsors in cash to the Borrower, which
contributions were (x) not made as a loan, (y) made in exchange for
Borrower Series A Preferred Membership Interests and (z) made on terms and
conditions satisfactory to the Administrative Agent as determined on good
faith in its sole discretion.
"Cash Equivalent Investment" means, at any time, (u) United States
Dollars, (v) securities issued or directly and fully guaranteed or insured
by the United States Government or any agency or instrumentality thereof
(provided that the full faith and credit of the United States is pledged in
support thereof) having maturities of not more than six months from the
date of acquisition, (w) certificates of deposit and eurodollar time
deposits with maturities of six months or less from the date of
acquisition, bankers' acceptances with maturities not exceeding six months
and overnight bank deposits, in each case with any domestic commercial bank
having capital and surplus in excess of $500 million and a Thompson Bank
Watch Rating of "B" or better, (x) repurchase obligations with a term of
not more than seven days for underlying securities of the types described
in item (v) and (w) entered into with any financial institution
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meeting the qualifications specified in item (w), (y) commercial paper
having the highest rating obtainable from Moody's Investors Service, Inc.
or Standard & Poor's Corporation and in each case maturing within six
months after the date of acquisition and (z) money market funds at least
95% of the assets of which constitute Cash Equivalents of the kinds
described in items (w)-(y) of this definition.
"Cash Management Account" is defined in the Disbursement Agreement.
"Casino" is defined in clause (a) of the fourth recital.
"CERCLA" is defined in clause (a) of the definition of "Environmental
Law".
"CERCLIS" means the Comprehensive Environmental Response Compensation
Liability Information System List.
"Change in Control" means at any time,
(a) the failure of the Trust or the beneficiaries or
remaindermen of the Trust to (i) directly own, free and clear of all
Liens (other than Liens in favor of the Administrative Agent for the
benefit of the Secured Parties), all of (A) the Membership Interests
of AHL not otherwise owned by GW Vegas, LLC on the Effective Date or
(B) following the dissolution of the Trust and AHL, the Membership
Interests of Sommer Enterprises not otherwise owned by Ronald B.
Dictrow on the Effective Date or (ii) otherwise have the ability to
elect the managers of (A) AHL or (B) following the dissolution of the
Trust and AHL, Sommer Enterprises;
(b) the failure of AHL or following the dissolution of the Trust
and AHL, the beneficiaries or remaindermen of the Trust to directly
own, free and clear of all Liens (other than Liens in favor of the
Administrative Agent for the benefit of the Secured Parties), 98.66%
of the Membership Interests of Sommer Enterprises or otherwise have
the ability to elect the managers of Sommer Enterprises;
(c) the failure of Sommer Enterprises to directly own, free and
clear of all Liens (other than Liens in favor of the Administrative
Agent for the benefit of the Secured Parties), 47.00% of the
Membership Interests of Holdings (except that (v) on the Opening Date,
the percentage interest of Sommer Enterprises in the Holdings Common
Membership Interests may be increased by 0.5% provided that the
percentage interest of LCNI therein is decreased by a corresponding
amount (w) in the event of a default by London Clubs in payment of its
share of amounts due under the Keep-Well Agreement, the percentage
interest of Sommer Enterprises in the Holdings Common Membership
Interests may be increased by 1, 1.5 or 2 times (depending on whether
London Clubs is in default for 30 Business Days, 45 Business Days or
60 Business Days from the date of such default, respectively)
multiplied by a dilution fraction (the "Dilution Fraction"), the
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numerator of which is the delinquent contribution and the denominator
of which is $200,000,000 provided that the percentage interest of LCNI
therein is decreased by a corresponding amount, (x) in the event of a
default by AHL in its share of amounts due under the Keep-Well
Agreement, the percentage interest of LCNI in the Holdings Common
Membership Interests may be increased by 1, 1.5 or 2 times (depending
on whether AHL is in default for 30 Business Days, 45 Business Days or
60 Business Days from the date of such default, respectively)
multiplied by the Dilution Fraction provided that the percentage
interest of Sommer Enterprises therein is decreased by a corresponding
amount), (y) in the event of any vesting of any unvested Membership
Interests in Holdings pursuant to an Employment Agreement, Sommer
Enterprises may be diluted thereby and (z) upon the exercise of the
Warrants, the dilutive effect of such exercise directly and indirectly
on the Membership Interests in Holdings) or otherwise for Sommer
Enterprises and LCNI to have the ability to elect the board of
managers of Holdings or for either of them to have the ability
individually or collectively to elect the board of managers of
Holdings;
(d) except for Capital Stock of Enterprises issued in connection
with the exercise of Warrants, the failure of Sommer Enterprises to
directly own, free and clear of all Liens (other than Liens in favor
of the Administrative Agent for the benefit of the Secured Parties),
all of the Capital Stock of Enterprises or otherwise have the ability
to elect the members of the Board of Directors of Enterprises;
(e) the failure of Enterprises to directly own, free and clear
of all Liens (other than Liens in favor of the Administrative Agent
for the benefit of the Secured Parties), at least 25% of the
Membership Interests of Holdings (except for any adjustments upon the
exercise of any Warrants) or individually or collectively with Sommer
Enterprises and LCNI to have the ability to elect the managing member
of Holdings;
(f) the failure of Holdings to directly own, free and clear of
all Liens (other than Liens in favor of the Administrative Agent for
the benefit of the Secured Parties), all of the Borrower Common
Membership Interests or otherwise to have the ability to elect the
managing member of the Borrower;
(g) the failure of Holdings to directly own, free and clear of
all Liens (other than Liens in favor of the Discount Note Indenture
Trustee for the benefit of the Discount Noteholders), the Borrower
Series A Preferred Membership Interests unless the failure to own the
Borrower Series A Preferred Membership Interests results from the
exercise by the Discount Note Indenture Trustee of the Lien in favor
of the Discount Note Indenture Trustee for the benefit of the Discount
Noteholders;
(h) the failure of Holdings to directly own, free and clear of
all Liens (other than Liens in favor of the Administrative Agent for
the benefit of the Secured Parties), all of
13
the Capital Stock of Capital or otherwise have the ability to elect
all of the members of the Board of Directors of Capital;
(i) the failure of the Borrower to directly own, free and clear
of all Liens (other than Liens in favor of the Administrative Agent
for the benefit of the Secured Parties), all of the Membership
Interests of AMH or otherwise to have the ability to elect the
managing member of AMH;
(j) the failure of AMH to directly own, free and clear of all
Liens (other than Liens in favor of the Administrative Agent for the
benefit of the Secured Parties), at least 49% of the Membership
Interests of Aladdin Music or otherwise to have the ability to elect
the managing member of Aladdin Music;
(k) the failure of LCNI to directly own, free and clear of all
Liens (other than Liens in favor of the Administrative Agent for the
benefit of the Secured Parties), at least 25.0% of the Holdings Common
Membership Interests (except that (v) on the Opening Date, the
percentage interest of LCNI in the Holdings Common Membership
Interests may be decreased by 0.5% provided that the percentage
interest of Sommer Enterprises therein is increased by a corresponding
amount (w) in the event of a default by Sommer Enterprises in payment
of its share of amounts due under the Keep-Well Agreement, the
percentage interest of LCNI in the Holdings Common Membership
Interests may be increased by 1, 1.5 or 2 times (depending on whether
Sommer Enterprises is in default for 30 Business Days, 45 Business
Days or 60 Business Days from the date of such default, respectively)
multiplied by the Dilution Fraction, provided that the percentage
interest of Sommer Enterprises therein is decreased by a corresponding
amount, (x) in the event of a default by LCNI in payment of its share
of amounts due under the Keep-Well Agreement, the percentage interest
of Sommer Enterprises in the Holdings Common Membership Interests may
be increased by 1, 1.5 or 2 times (depending on whether LCNI is in
default for 30 Business Days, 45 Business Days or 60 Business Days
from the date of such default, respectively) multiplied by the
Dilution Fraction provided that the percentage interest of LCNI is
decreased by a corresponding amount) and (y) in the event of any
vesting of unvested membership interests in Holdings pursuant to an
Employment Agreement, LCNI may be diluted thereby and (z) upon the
exercise of the Warrants, the dilutive effect of such exercise
directly and indirectly on the Membership Interest of Holdings) or
otherwise for LCNI and Sommer Enterprises to have the ability to elect
the board of managers of Holdings;
(l) until such time as London Clubs has paid and performed, in all
material respects, its obligations under the Completion Guaranty and the
Keep-Well Agreement (or the Completion Guaranty and the Keep-Well Agreement
have expired or terminated), the failure of London Clubs to directly own all
of the Capital Stock of London Clubs Holdings or otherwise have the ability
to elect all members of the Board of Directors of London Clubs Holdings;
14
(m) the failure of London Clubs to own directly or indirectly
all of the Capital Stock of LCNI or otherwise have the ability to
elect all members of the Board of Directors of LCNI; or
(n) any "Change of Control" under (and as defined in) the
Discount Note Indenture.
"Change Order" means, at any time, an adjustment made to the
Guaranteed Maximum Price or the Design/Build Contract Time with respect to
changes in the Work which increase or decrease the time of performance or
the actual cost to the Design/Builder of the Work.
"CIBC" is defined in the preamble.
"Claim" is defined in the Disbursement Agreement.
"Clark County Code" is defined in clause (b) of Section 7.1.19.
"Closing" is defined in Section 5.1.
"Closing Date" means the Business Day, if any, prior to the Term B and
Term C Loan Commitment Termination Date, on which the conditions in Article
V are satisfied.
"Code" means the Internal Revenue Code of 1986, and the regulations
thereunder, in each case as amended, reformed or otherwise modified from
time to time.
"Commitment" means, as the context may require, a Term A Loan
Commitment, a Term B Loan Commitment, a Term C Loan Commitment or a Letter
of Credit Commitment made by a Lender hereunder.
"Commitment Amount" means, as the context may require, the Term A Loan
Commitment Amount, the Term B Loan Commitment Amount, the Term C Loan
Commitment Amount or the Letter of Credit Commitment Amount.
"Commitment Letter" means the Commitment Letter, dated December 4,
1997, between the Arrangers, the Borrower and the Sponsors as thereafter
from time to time amended.
"Commitment Termination Date" means, as the context may require, the
Term A Loan Commitment Termination Date or the Term B Loan and Term C Loan
Commitment Termination Date.
"Commitment Termination Event" means
15
(a) the occurrence of any Event of Default described in
clauses (a) through (e) of Section 8.1.10; or
(b) the occurrence and continuance of any other Event of Default
and either (x) the declaration of all or any portion of the Loans to
be immediately due and payable pursuant to Section 8.3 or (y) the
giving of notice by the Administrative Agent, acting at the direction
of the Required Lenders, to the Borrower that the Commitments have
been terminated.
"Common Parking Area Use Agreement" means, the Common Parking Area Use
Agreement to be entered into between the Borrower and Aladdin Bazaar in
form and substance satisfactory to the Administrative Agent determined in
good faith in its sole discretion, and as thereafter from time to time
amended, supplemented, amended and restated or otherwise modified in
accordance with the terms hereof.
"Completion" means that each of the following has occurred:
(a) the construction of the Hotel/Casino and any Tenant
Improvements have been completed substantially in accordance with this
Agreement, the Plans and Specifications, the provisions of the
Reciprocal Easement Agreement applicable to the Hotel/Casino and all
of the other Operative Documents to the extent that the development,
construction, use or operation of the Hotel/Casino are affected
thereby, except for the Main Project Punchlist Items applicable to the
Hotel/Casino, and in substantial compliance with all Legal
Requirements pertaining to the construction of the Hotel/Casino so as
to allow the Hotel/Casino to be utilized for its intended purpose;
(b) reasonable and safe means of access and facilities necessary
for the use and occupancy of the Hotel/Casino have been installed and
are operational including corridors, elevators, stairways, heating,
ventilation, air conditioning, sanitary, water and electrical
facilities and all security systems and life safety systems required
by the Plans and Specifications, the Reciprocal Easement Agreement,
the other Operative Documents and all Legal Requirements and that the
Borrower has made arrangements (from the Energy Project or an
alternative source) to obtain reliable electrical and other utility
services at appropriate levels required to start up, operate and
maintain the Hotel/Casino in a safe, efficient and reliable manner;
and
(c) there are no outstanding claims or Liens by any Contractor
or Subcontractor or any other Person against any portion of the
Hotel/Casino Component except for Permitted Liens and Permitted
Encumbrances.
"Completion Certificate" means, collectively, the Borrower's
Completion Certificate and the Construction Consultant's Completion
Certificate in the form of Exhibits S-1 and S-2 hereto, respectively.
16
"Completion Date" means the date on which Completion occurs but in no
event shall the Completion Date extend beyond the Outside Completion
Deadline, time being of the essence as to the Borrower.
"Completion Guarantor" means, jointly and severally, each of London
Clubs, ABH and the Trust.
"Completion Guaranty" means, on any date, the Guaranty of Performance
and Completion, as originally in effect on the Closing Date, by the
Completion Guarantors in favor of the Lenders substantially in the form of
Exhibit C hereto and as thereafter from time to time amended, supplemented,
amended and restated or otherwise modified.
"Complex" is defined in the fourth recital and is more fully described
in Exhibit N-2 hereto.
"Compliance Certificate" means a certificate duly completed and
executed by an Authorized Representative of the Borrower substantially in
the form of Exhibit R hereto, as amended, supplemented, amended and
restated or otherwise modified from time to time, together with such
changes thereto as the Administrative Agent may from time to time
reasonably request for the purpose of monitoring the Borrower's compliance
with the financial covenants contained herein.
"Consent" means a consent, substantially in the form of Exhibit I
hereto, to the collateral assignment by the Borrower of the Main Project
Documents.
"Construction Benchmark Schedule" means the schedule for construction
and completion of each Construction Component, the Main Project as a whole
and the other work that the Borrower is required to perform pursuant to the
Operative Documents substantially the form of Exhibit X-1 (as amended from
time to time in accordance with the terms hereof) which (w) shall
demonstrate that Substantial Completion will occur on or before the Outside
Completion Deadline, (x) includes a statement from the Owner Representative
and the Design/Builder that the Construction Benchmark Schedule is
realistic and can be adhered to (subject to Force Majeure Events) in
completing the Main Project in accordance with the Plans and
Specifications, (y) shows on a monthly basis the anticipated progress of
the Work and other activities pertaining to the construction of the
Hotel/Casino Component, the Energy Project Component and Theater
renovations, and (z) the Construction Consultant has reviewed and certified
in the Construction Consultant's Closing Certificate that the statement
from the Owner Representative in item (x) is reasonable and that it is
appropriate for the Administrative Agent to rely thereon and on the other
schedules and benchmarks set forth in the Construction Benchmark Schedule.
"Construction Component" means the Hotel/Casino Component, the Energy
Project Component or the Equipment Component.
17
"Construction Consultant" means Rider Hunt (NV), L.L.C. or any other
Person designated from time to time by the Administrative Agent to serve as
the Construction Consultant under this Agreement and the Disbursement
Agreement.
"Construction Consultant Engagement Agreement" means the Engagement
Letter, dated as of January 28, 1998, by and among the Construction
Consultant, the Borrower, the Administrative Agent, the Disbursement Agent
and the Discount Note Indenture Trustee.
"Construction Consultant's Certificate" is defined in the Disbursement
Agreement.
"Construction Consultant's Closing Certificate" means a closing
certificate in the form of Exhibit Q-2 hereto.
"Construction Consultant's Completion Certificate" means a certificate
in the form of Exhibit S-2 hereto.
"Construction Consultant's Final Completion Certificate" means a
certificate in the form of Exhibit U-2 hereto.
"Construction Consultant's Report" means a report of the Construction
Consultant delivered to the Disbursement Agent and the Administrative Agent
pursuant to Section 3.1.10 of the Disbursement Agreement which shall
include an analysis of the Plans and Specifications, the Main Project
Budget, the Construction Benchmark Schedule, the Contracts, to the extent
available, the construction and renovation of the Theater the construction
of the Energy Project to be performed by the Energy Provider under the
Energy Project Ground Lease and the Energy Project Development Agreement,
and all other reports submitted to the Administrative Agent and stating,
among other things, that (x) the Construction Consultant has reviewed the
Main Project Documents, the Plans and Specifications, and other material
information deemed necessary by the Construction Consultant for the purpose
of evaluating whether the Main Project can be constructed and completed in
the manner contemplated by the Operative Documents and (y) based on its
review of such information, the Construction Consultant is of the opinion
that the Main Project can be constructed in the manner contemplated by the
Operative Documents and, in particular, that the Main Project can be
constructed and completed in accordance with the Main Project Documents and
the Plans and Specifications within the parameters set by the Construction
Benchmark Schedule and the Main Project Budget. Such report shall contain
an analysis reasonably satisfactory to the Administrative Agent
demonstrating the adequacy of the Main Project Budget to complete the Main
Project (and any improvements to be completed by the Borrower pursuant to
the Reciprocal Easement Agreement) in accordance with the Construction
Benchmark Schedule, confirmation that the Construction Benchmark Schedule
is realistic, and verifying that the information delivered by the Borrower
relating to the Complex and any improvements to be completed by the
Borrower pursuant to the Reciprocal Easement Agreement are accurate.
18
"Construction Expenses" means all Main Project Costs, excluding,
however, Pre-Opening Expenses, Debt Service due and payable after the
Conversion Date and Issuance Fees and Expenses.
"Construction Note Disbursement Account" is defined in the Holdings
Collateral Account Agreement.
"Contingent Liability" means, relative to any Person, any agreement,
undertaking or arrangement by which such Person guarantees, endorses or
otherwise becomes or is contingently liable upon (by direct or indirect
agreement, contingent or otherwise, to provide funds for payment, to supply
funds to, or otherwise to invest in, a debtor, or otherwise to assure a
creditor against loss) the Indebtedness of any other Person (other than by
endorsements of instruments in the course of collection), or guarantees the
payment of dividends or other distributions upon the shares of any other
Person. The amount of any Person's obligation under any Contingent
Liability shall (subject to any limitation set forth therein) be deemed to
be the outstanding principal amount of the debt, obligation or other
liability guaranteed thereby.
"Continuation/Conversion Notice" means a notice of continuation or
conversion and certificate duly executed by an Authorized Representative of
the Borrower substantially in the form of Exhibit M hereto.
"Contract" means any contract entered into from time to time by the
Borrower with any Contractor for performance of services or sale of goods
or services in connection with the design, engineering, installation,
construction, operation or maintenance of the Main Project, including all
warranties and guarantees.
"Contract Amendment Certificate" means a Contract Amendment
Certificate substantially in the form of Exhibit Z hereto.
"Contractor" means any architect, consultant, designer, contractor,
subcontractor, supplier, laborer or any other Person engaged by the
Borrower in connection with the design, engineering, installation and
construction of the Main Project (excluding, however, the Design/Builder).
"Controlled Group" means all members of a controlled group of
corporations and all members of a controlled group of trades or businesses
(whether or not incorporated) under common control which, together with the
Borrower, are treated as a single employer under Section 414(b) or 414(c)
of the Code or Section 4001 of ERISA.
"Conversion Date" means the date on which either of the following
first occurs:
19
(a) the relevant Governmental Instrumentality issues a Main
Project Certificate of Occupancy (which must include appropriate
parking facilities) and operating permit for the Energy Project; or
(b) the Administrative Agent and the Construction Consultant
determine that Completion of the Main Project has occurred.
"Credit Extension" means, as the context may require,
(a) the making of a Loan by a Lender; or
(b) the issuance of any Letter of Credit, or the extension of
any Stated Expiry Date of any existing Letter of Credit, by an Issuer.
"Credit Extension Request" means, as the context may require, any
Borrowing Request or Letter of Credit Issuance Request.
"Current Compliance Certificate" means the Compliance Certificate most
recently delivered by the Borrower to the Administrative Agent pursuant to
clause (d) of Section 7.1.1. Changes in the Applicable Base Rate Margin or
Applicable LIBO Rate Margin resulting, after the Conversion Date, from a
change in the Total Debt to EBITDA Ratio shall become effective upon
delivery by the Borrower to the Administrative Agent of a new Compliance
Certificate pursuant to clause (d) of Section 7.1.1. If the Borrower shall
fail to deliver a Compliance Certificate within the number of days after
the end of any Fiscal Quarter as required pursuant to clause (d) of
Section 7.1.1 (without giving effect to any grace period), the Applicable
Base Rate Margin or Applicable LIBO Rate Margin, as the case may be, from
and including the first day after the date on which such Compliance
Certificate was required to be delivered to but not including the date the
Borrower delivers to the Administrative Agent a Compliance Certificate
shall conclusively equal the highest Applicable Base Rate Margin or
Applicable LIBO Rate Margin, as the case may be, set forth in the
definition of such term.
"Debt Service" means all principal repayments or interest and other
amounts payable or accrued from time to time under any Loan Document or the
Approved Equipment Funding Commitments.
"Deed of Trust" means, on any date, the Deed of Trust, Assignment of
Rents and Leases, Security Agreement and Fixture Filing in the form of
Exhibit B hereto, as originally in effect on the date on which it is
recorded, made by the Borrower, as trustor, to the trustee named therein,
for the benefit of the Administrative Agent and the Lenders, as
beneficiaries covering the Site and as thereafter from time to time
amended, supplemented, amended and restated or otherwise modified.
20
"Default" means any Event of Default or any condition, occurrence or
event which, after notice or lapse of time or both, would constitute an
Event of Default.
"Defaulting Lender" means any Lender with respect to which a Lender
Default is in effect.
"Desert Passage" is defined in clause (b) of the fourth recital.
"Design/Build Contract" means, on any date, the Design/Build Contract,
as originally in effect on the Closing Date, between the Borrower and the
Design/Builder and as thereafter from time to time amended, supplemented,
amended and restated or otherwise modified in accordance with the terms
hereof.
"Design/Build Contract Time" is defined in Section 14.1 of the
Design/Build Contract.
"Design/Builder" means Fluor Daniel, Inc., a California corporation.
"Design/Builder Consent and Acknowledgment" means the Consent and
Acknowledgment by the Design/Builder in favor of the Lenders and the
Administrative Agent dated as of the Closing Date.
"Design/Build Final Completion" means "Final Completion" as defined in
Section 31.9 of the General Conditions annexed to the Design/Build Contract
as Attachment D.
"Development Agreement" means, on any date, the Aladdin Hotel & Casino
Agreement, dated March 18, 1997, among Holdings, Aladdin Management
Corporation and the County of Clark, as assigned by Holdings and Aladdin
Management Corporation to the Borrower, and as thereafter from time to time
amended, supplemented, amended and restated or otherwise modified in
accordance with the terms hereof.
"Direct Costs" means all Main Project Costs expended or incurred by
the Borrower for labor, services, materials, tools, utilities, equipment,
fixtures and furnishings in connection with the construction of the Main
Project all as set forth on the Main Project Budget.
"Disbursement Agent" means Scotiabank, in its capacity as the
disbursement agent under the Disbursement Agreement, and its successors in
such capacity.
"Disbursement Agreement" means, on any date, the Disbursement
Agreement, as originally in effect on the Closing Date, among the Borrower,
Holdings, the Administrative Agent, the Discount Note Indenture Trustee,
the Disbursement Agent, the Servicing Agent and the Securities Intermediary
and as thereafter from time to time amended, supplemented, amended and
restated or otherwise modified.
21
"Disclosure Schedule" means the Disclosure Schedule attached hereto as
Schedule I hereto, as it may be amended, supplemented, amended and restated
or otherwise modified from time to time by the Borrower with the written
consent of the Administrative Agent and the Required Lenders.
"Discount Note" means the 131/2% Series A and B Senior Discount Notes
due 2010 of Holdings and Capital issued on the Closing Date for gross
proceeds of $115,000,000.
"Discount Note Indenture" means, on any date, the Indenture relating
to the Discount Notes, as originally in effect on the Effective Date, among
Holdings, Capital and the Discount Note Indenture Trustee and as thereafter
from time to time amended, supplemented, amended and restated or otherwise
modified in accordance with the terms hereof.
"Discount Note Indenture Trustee" means State Street Bank and Trust
Company, in its capacity as the indenture trustee for the Discount
Noteholders under the Discount Note Indenture.
"Discount Note Offering Circular" means the offering memorandum, dated
February 14, 1998, with respect to the units, consisting of the Discount
Notes offered by Holdings and Capital and the Warrants offered by
Enterprises.
"Discount Note Purchase Agreement" means the Purchase Agreement with
respect to the Discount Notes and Warrants, dated as of February 18, 1998,
among Holdings, Capital, Enterprises, AHL, the Trust and Merrill Lynch and
First Boston (as representatives of the several initial purchasers).
"Discount Noteholder" means the duly registered holder of a Discount
Note.
"Documentation Agent" is defined in the preamble.
"Dollar" and the symbol "$" mean lawful money of the United States.
"Downgraded Lender" is defined in clause(b) of Section 4.11.
"EBITDA" means, for the Borrower only, for any applicable period, the
sum (without duplication) of
(a) Net Income for such period,
plus
(b) the amount deducted by the Borrower, in determining Net
Income for such period, representing
22
(i) Interest Expense of the Borrower;
plus
(ii) the amount deducted, in determining Net Income, of all
federal, state and local income taxes (whether paid in cash or
deferred) of the Borrower or, if the Borrower is treated as a
pass-through entity or is not treated as a separate entity for
United States federal income tax purposes, the amount of
Restricted Payments made by the Borrower in accordance with
clause (c) of Section 7.2.6, subject to the terms thereof;
plus
(iii) depreciation of assets of the Borrower;
plus
(iv) amortization;
plus
(v) the amount of Cash Equity Contributions (as defined in
the Keep-Well Agreement);
plus
(vi) the amount of Cash Contributions to Capital;
provided, however, that in computing EBITDA for purposes of determining the
"Total Debt to EBITDA Ratio" in clause (h)(i)(B) of Section 7.2.6 or the
amount of "Excess Cash Flow", the "Applicable Base Rate Margin" or the
"Applicable LIBO Rate Margin", subclauses (b)(v) and (b)(vi) shall be
excluded from such computation; provided further, however, that in
computing EBITDA for any period commencing on the Conversion Date and
ending as of the close of any Fiscal Quarter on or prior to the first
anniversary of the Conversion Date, EBITDA for such period shall equal the
product of (x) the sum of the amounts determined pursuant to clauses (a)
and (b) for such period multiplied by (y) a fraction, the numerator of
which is equal to 365 and the denominator of which is equal to the number
of days that have elapsed in such period.
"Effective Date" means the date this Agreement becomes effective
pursuant to Section 10.8.
"Employment Agreement" means, collectively, (u) the Amended Employment
and Consulting Agreement among Holdings, the Borrower and Richard J.
Goeglein effective January
23
1, 1997, (v) the Amended Employment Agreement among Holdings, the Borrower
and James H. McKennon effective April 15, 1997, (w) the Amended Employment
Agreement among Holdings, the Borrower and Cornelius T. Klerk effective
July 1, 1997, (x) the Amended Employment Agreement among Holdings, the
Borrower and Lee A. Galati effective July 1, 1997, (y) the Amended
Employment Agreement among Holdings, the Borrower and Jose A. Rueda
effective July 1, 1997 and (z) the Amended Consulting Agreement between
GAI, LLC, Holdings and the Borrower effective January 1, 1997.
"Energy Project" is defined in clause (e) of the fourth recital.
"Energy Project Commitment" means the commitment (as set forth in the
letter agreement, dated October 21, 1997, between the Energy Project
Provider and AHL) of the Energy Project Provider to enter into the Energy
Project Ground Lease, the Energy Project Development Agreement and the
Energy Project Service Agreement.
"Energy Project Completion" means that
(a) the construction of the Energy Project has been completed
substantially in accordance with the Energy Project Ground Lease and
the provisions of the Reciprocal Easement Agreement applicable to the
Energy Project except for any punchlist items applicable to the Energy
Project and in substantial compliance with all Legal Requirements
pertaining to the construction of the Energy Project so as to allow
the Energy Project to be utilized for its intended purposes;
(b) reasonable and safe means of access and facilities necessary
for the use and operation of the Energy Project have been installed
and are operational;
(c) the Borrower has certified to the Administrative Agent that
(1) arrangements have been made to obtain reliable electric and other
utility services at the appropriate levels required for the operation
of the Hotel/Casino and, to the extent applicable, other parts of the
Complex that are subject to the Energy Service Agreement, (2) all
other conditions precedent in the Energy Project Ground Lease relating
to construction, installation, start-up and test activities have been
satisfied in all material respects, and (3) there are no outstanding
claims or Liens by any contractor or subcontractor or any other Person
against any portion of the Energy Project Component except for
Permitted Liens and Permitted Encumbrances.
"Energy Project Component" means the portion of the Complex described
in Exhibit N-9 hereto.
"Energy Project Development Agreement" means, on any date, the
Development Agreement, as originally in effect on the Closing Date, between
the Borrower and the Energy
24
Project Provider and as thereafter from time to time amended, supplemented,
amended and restated or otherwise modified in accordance with the terms
hereof.
"Energy Project Easements" means the easements appurtenant, easements
in gross, license agreements and other right running for the benefit of the
Energy Project Provider and/or appurtenant to the Energy Project Ground
Lease, including those certain easements and licenses described in each
Title Policy.
"Energy Project Ground Lease" means, on any date, the Ground Lease, as
originally in effect on the Effective Date, between the Borrower and the
Energy Project Provider and as thereafter from time to time amended,
supplemented, amended and restated or otherwise modified in accordance with
the terms hereof.
"Energy Project Guarantor" means Unicom Corporation, an Illinois
corporation.
"Energy Project Guaranty" means the Guaranty, dated as of December 3,
1997, executed by the Energy Project Guarantor to and for the benefit of
the Borrower and as thereafter from time to time amended, supplemented,
amended and restated or otherwise modified in accordance with the terms
hereof.
"Energy Project Provider" means Northwind Aladdin, LLC, a Nevada
limited-liability company.
"Energy Project Service Agreement" means, on any date, the Energy
Services Agreement, as originally in effect on the Effective Date, between
the Borrower and the Energy Project Provider and as thereafter from time to
time amended, supplemented, amended and restated or otherwise modified in
accordance with the terms hereof.
"Enterprises" means Aladdin Gaming Enterprises, Inc., a Nevada
corporation.
"Enterprises Pledge Agreement" means, on any date, the Pledge
Agreement executed and delivered by an Authorized Representative of
Enterprises pursuant to clause (e) of Section 5.1.3, as originally in
effect on the Closing Date, in substantially the form of Exhibit E-4 hereto
and as thereafter from time to time amended, supplemented, amended and
restated or otherwise modified.
"Environmental Claim" means any and all obligations, liabilities,
losses, administrative, regulatory or judicial actions, suits, demands,
decrees, claims, liens, judgments, warning notices, notices of noncompliance
or violation, investigations, proceedings, removal or remedial actions or
orders, or damages (foreseeable and unforeseeable, including consequential
and punitive damages), penalties, fees, out-of-pocket costs, expenses,
disbursements, attorneys' or consultants' fees, relating in any way to any
Environmental Law or any Permit issued under any such Environmental Law
including (x) any and all Claims by Governmental Instrumentalities for
25
enforcement, cleanup, removal, response, remedial or other actions or
damages pursuant to any applicable Environmental Law and (y) any and all
Claims by any third party seeking damages, contribution, indemnification,
cost recovery, compensation or injunctive relief resulting from Hazardous
Substances or arising from alleged injury or threat of injury to health,
safety or the environment.
"Environmental Consultant" means ERM-Northeast, Inc., or any other
Person designated from time to time by the Administrative Agent in its sole
discretion to serve as the Environmental Consultant.
"Environmental Indemnity" means, on any date, the Environmental
Indemnity Agreement, as originally in effect on the Effective Date, from
the Borrower, the Trust and London Clubs for the benefit of the
Administrative Agent on behalf of the Lenders in the form of Exhibit K
hereto and as thereafter from time to time amended, supplemented, amended
and restated or otherwise modified.
"Environmental Law" means any of:
(a) the Comprehensive Environmental Response, Compensation, and
Liability Act of 1980, as amended (42 U.S.C. Section 9601, et seq.)
("CERCLA");
(b) the Federal Water Pollution Control Act (33 U.S.C. Section
1251, et seq.) ("Clean Water Act" or "CWA");
(c) the Resource Conservation and Recovery Act (42 U.S.C.
Section 6901, et seq.) ("RCRA");
(d) the Atomic Energy Act of 1954 (42 U.S.C. Section 2011, et
seq.);
(e) the Clean Air Act (42 U.S.C. Section 7401, et seq.);
(f) the Emergency Planning and Community Right to Know Act (42
U.S.C. Section 11001, et seq.);
(g) the Federal Insecticide, Fungicide, and Rodenticide Act (7
U.S.C. Section 136, et seq.) ("FIFRA");
(h) the Oil Pollution Act of 1990 (P.L. 101-380, 104 Stat. 486);
(i) the Safe Drinking Water Act (42 U.S.C. Sections 300f, et
seq.) ("SDWA");
(j) the Surface Mining Control and Reclamation Act of 1974 (30
U.S.C. Sections 1201, et seq.);
26
(k) the Toxic Substances Control Act (15 U.S.C. Section 2601, et
seq.) ("TSCA");
(l) the Hazardous Materials Transportation Act (49 U.S.C.
Section 1801, et seq.) ("HMTA");
(m) the Uranium Mill Tailings Radiation Control Act of 1978 (42
U.S.C. Section 7901, et seq.) ("UMTRCA");
(n) the Occupational Safety and Health Act (29 U.S.C. Section
651, et seq.) ("OSHA");
(o) the Nevada Hazardous Materials law (NRS Chapter 459);
(p) the Nevada Solid Waste/Disposal of Garbage or Sewage law
(NRS 444.440 to 444.650, inclusive);
(q) the Nevada Water Controls/Pollution law (NRS Chapter 445A);
(r) the Nevada Air Pollution law (NRS Chapter 445B);
(s) the Nevada Cleanup of Discharged Petroleum law (NRS 590.700
to 590.920, inclusive);
(t) the Nevada Control of Asbestos law (NRS 618.750 to 618.850);
(u) the Nevada Appropriation of Public Waters law (NRS 533.324
to 533.4385, inclusive);
(v) the Nevada Artificial Water Body Development Permit law (NRS
502.390);
(w) the Nevada Protection of Endangered Species, Endangered
Wildlife Permit (NRS 503.585) and Endangered Flora Permit law (NRS
527.270); and
(x) all other Federal, state and local Legal Requirements which
govern Hazardous Substances, and the regulations adopted and
publications promulgated pursuant to all such foregoing laws;
in each case as amended by an amendment thereto or succeeded by a successor
law, statute or regulation thereto.
"Environmental Matter" means any:
27
(a) release, emission, entry or introduction into the air
including the air within buildings and other natural or man-made
structures above ground;
(b) discharge, release or entry into water including into any
river, watercourse, lake or pond (whether natural or artificial or
above ground or which joins or flows into any such water outlet above
ground) or reservoir, or the surface of the riverbed or of other land
supporting such waters, ground waters, sewer or the sea;
(c) deposit, disposal, keeping, treatment, importation,
exportation, production, transportation, handling, processing,
carrying, manufacture, collection, sorting or presence of any
Hazardous Substance (including, in the case of waste, any substance
which constitutes a scrap material or an effluent or other unwanted
surplus substance arising from the application of any process or
activity (including making it reusable or reclaiming substances from
it) and any substance or article which is required to be disposed of
as being broken, worn out, contaminated or otherwise spoiled);
(d) nuisance, noise, defective premises, health and safety at
work, industrial illness, industrial injury due to environmental
factors, environmental health problems (including asbestosis or any
other illness or injury caused by exposure to asbestos) or genetically
modified organisms;
(e) conservation, preservation or protection of the natural or
man-made environment or any living organisms supported by the natural
or man-made environment; or
(f) other matter howsoever directly affecting the environment or
any aspect of it.
"Equipment Component" means the equipment, fixtures and other items
described in Exhibit N-10 hereto.
"Equity Interest" means, relative to any Person, Capital Stock and all
warrants, options or other rights to acquire Capital Stock (excluding,
however, any debt security that is convertible into, or exchangeable for,
Capital Stock) of such Person.
"ERISA" means the Employee Retirement Income Security Act of 1974, as
amended, and any successor statute thereto of similar import, together with
the regulations thereunder, in each case as in effect from time to time.
References to sections of ERISA also refer to any successor sections
thereto.
"ERISA Plan" means any employee benefit plan (x) maintained by the
Borrower or any member of the Controlled Group, or to which the Borrower or
any member of the Controlled Group contributes or is obligated to
contribute, for its employees and (y) covered by Title IV of ERISA or to
which Section 412 of the Code applies.
28
"Event of Default" is defined in Section 8.1.
"Event of Loss" means, relative to any property or asset (tangible or
intangible, real or personal), (x) any loss, destruction or damage of such
property or asset, (y) any actual condemnation, seizure or taking by
exercise of the power of eminent domain or otherwise of all or a part of
such property or asset, or confiscation of all or a part of such property
or asset or the requisition of the use of all or a part of such property or
asset or (z) any settlement in lieu of item (y).
"Excess Cash Flow" means, for any Fiscal Quarter, the excess (if any),
of
(a) EBITDA for such Fiscal Quarter
over
(b) the sum (during such Fiscal Quarter) of
(i) Interest Expense of the Borrower actually paid in cash
by the Borrower;
plus
(ii) scheduled payments, to the extent actually made, of
the principal amount of the Loans pursuant to Section 3.1.1 and
scheduled payments, to the extent actually made, with respect to
the FF&E Financing;
plus
(iii) the amount of all federal, state and local income
taxes (whether paid in cash or deferred) of the Borrower paid in
cash by the Borrower or, if the Borrower is treated as a pass-through
entity or is not treated as a separate entity for United States
federal income tax purposes, the amount of Restricted Payments made in
cash by the Borrower in accordance with clause (c) of Section 7.2.6,
subject to the terms thereof;
plus
(iv) the amount of all Restricted Payments on the Borrower
Series A Preferred Membership Interests made in accordance with
clause (d) of Section 7.2.6;
plus
29
(v) Capital Expenditures actually made or reserved by the
Borrower.
"Exchange Act" means the Securities Exchange Act of 1934, as amended.
"Existing Indebtedness" means Indebtedness of the Borrower in
existence on the Effective Date (after giving effect to payment of
Indebtedness that is being discharged and retired on the Closing Date,
including all Indebtedness to be Paid) and identified in item (b) of
Section 7.2.2 ("Existing Indebtedness") of the Disclosure Schedule.
"Federal Funds Rate" means, for any period, a fluctuating interest
rate per annum equal for each day during such period to
(a) the weighted average of the rates on overnight federal funds
transactions with members of the Federal Reserve System arranged by
federal funds brokers, as published for such day (or, if such day is
not a Business Day, for the next preceding Business Day) by the
Federal Reserve Bank of New York; or
(b) if such rate is not so published for any day which is a
Business Day, the average of the quotations for such day on such
transactions received by the Administrative Agent from three federal
funds brokers of recognized standing selected by it.
"Fee Letter" means, the Arrangers' Fee Letter or the Scotiabank Fee
Letter.
"FF&E" means all furnishings, fixtures and equipment other than the
Specified Equipment and the Gaming Equipment.
"FF&E Financing" means the incurrence of Indebtedness, the proceeds of
which are utilized solely to finance or refinance the acquisitions of (or
the incurrence of Capitalized Lease Liabilities by the Borrower with
respect to) the Gaming Equipment and the Specified Equipment.
"FF&E Lease" means one or more leases entered into by the Borrower
giving rise to synthetic lease liabilities to one or more lessors (the
"FF&E Lessors") covering a portion of the FF&E, the Specified Equipment
and/or the Gaming Equipment.
"FF&E Lease Document" means the FF&E Lease and any other document
executed and delivered by the Borrower and the FF&E Lessors in connection
therewith, as the same may be amended, supplemented, amended and restated,
replaced or otherwise modified from time to time in accordance with the
terms hereof.
"FF&E Lessor" is defined in the definition of "FF&E Lease".
30
"FF&E Reserve" is defined in Section 7.1.3.
"Final Completion" means that (r) Design/Build Final Completion shall
have occurred, (s) Energy Project Completion shall have occurred, (t)
Theater Renovation Completion shall have occurred, (u) all other
construction work with respect to the Main Project shall have been
substantially completed in accordance with the Main Project Document
applicable thereto so as to allow such improvements to be utilized for
their intended purposes and in substantial compliance with all Legal
Requirements applicable thereto, (v) each of the Hotel Casino, the Energy
Project and the Theater shall have received a permanent Main Project
Certificate of Occupancy from the Building Department and the Energy
Project shall have received all Permits required by the Governmental
Instrumentality having or asserting jurisdiction over the operation of the
Energy Project (and a copy of each such certificate shall have been
delivered to the Administrative Agent), (w) a Notice of Completion shall
have been posted with respect to Hotel/Casino, the Energy Project and the
Theater, as required, and recorded in the Office of the County, (x) the
Borrower shall have delivered to the Administrative Agent its Final
Completion Certificate certifying to the extent set forth therein that all
Main Project Punchlist Items have been completed, (y) the Construction
Consultant shall have delivered to the Administrative Agent its Final
Completion Certificate in which it verifies the statements in items (r),
(s), (t), (u), (v), and (w) and certifies that it is appropriate for the
Administrative Agent to rely on the Final Completion Certificate of the
Borrower delivered to the Administrative Agent pursuant to item (x) and (z)
the Mall Project Parcel and the Music Project Parcel shall be separate
legal parcels in accordance with Section 7.1.19.
"Final Completion Certificate" means a Borrower's Final Completion
Certificate or a Construction Consultant's Final Completion Certificate in
the form of Exhibit U-1 or Exhibit U-2 hereto.
"Final Completion Date" means the date on which Final Completion
occurs.
"Final Plans and Specifications" means, relative to any particular
portion of the Work or other improvement, Plans and Specifications for such
portion which (x) have received final approval from all Governmental
Instrumentalities required to approve such Plans and Specifications prior
to completion of the Work or improvements and (y) contain sufficient
specificity to permit the completion of such portion of the Work or other
improvements.
"Fiscal Quarter" or "FQ" means a calendar quarter ending on the last
day of March, June, September or December; references to a FQ with a
following number (e.g., FQ1) refer to the number of Fiscal Quarters then to
have elapsed in whole or in part since the Conversion Date.
"Fiscal Year" means any period of twelve consecutive calendar months
ending on December 31; references to a Fiscal Year with a number
corresponding to any calendar year
31
(e.g., the "1998 Fiscal Year") refer to the Fiscal Year ending on
December 31 of such calendar year.
"Fleet Commitment" means, on any date, the Commitment Letter, as
originally in effect on the Effective Date, between Fleet National Bank and
Aladdin Bazaar and as thereafter from time to time amended, supplemented,
amended and restated or otherwise modified in accordance with the terms
thereof.
"Fluor" means Fluor Corporation, a California corporation.
"Fluor Guaranty" means, on any date, the Fluor Guaranty, as originally
in effect on the Effective Date, by Fluor in favor of the Borrower and as
thereafter from time to time amended, supplemented, amended and restated or
otherwise modified in accordance with the terms hereof.
"Force Majeure Event" means any event which is defined as "Force
Majeure" in the Design/Build Contract and/or that causes a delay in the
construction of the Main Project and is outside the Borrower's control but
only to the extent
(a) such event does not arise out of (w) the negligence, willful
misconduct or inefficiencies of the Borrower, (x) late performance by
the Design/Builder or the Architect of Record, (y) any cause or
circumstance resulting in delays, stoppage or any other interference
with the construction of the Main Project caused by the insolvency,
bankruptcy or any lack of funds by the Borrower, any other Project
Party, the Energy Provider, the Energy Project Guarantor and/or the
Architect of Record or (z) delays, stoppage or other interference with
the construction of the Main Project caused by the insolvency,
bankruptcy or any lack of funds by Aladdin Bazaar, Aladdin Music
and/or the construction contractors and project architects with
respect to the Mall Project, the Music Project and/or the Energy
Project; and
(b) such event consists of an act of God (such as tornado,
flood, hurricane, etc.), fires and other casualties; strikes, lockouts
or other labor disturbances (except to the extent taking place at the
Site only); riots, insurrections or civil commotions; embargos,
shortages or unavailability of materials, supplies, labor, equipment
and systems that first arise after the Effective Date, but only to the
extent caused by another act, event or condition covered by this
clause (b); sabotage; vandalism; the requirements of law, statutes,
regulations and other Legal Requirements enacted after the Effective
Date (unless the Borrower should, in the exercise of due diligence and
prudent judgment, have anticipated such enactment); orders or
judgments; or any similar types of events;
provided, however, that (x) the Borrower has sought to mitigate the impact
of the delay, (y) any delay resulting from the foregoing shall not exceed
365 days and (z) the period during which a Force Majeure Event exists shall
commence on the date that the Borrower has given the Administrative Agent
written notice describing in reasonable detail the event which constitutes
a
32
Force Majeure Event and the Administrative Agent has confirmed the
existence of such Force Majeure Event on the date of such notice and shall
end on the date that such Force Majeure Event no longer exists, whether or
not notice is given to the Administrative Agent, as determined by the
Construction Consultant.
"F.R.S. Board" means the Board of Governors of the Federal Reserve
System or any successor thereto.
"GAAP" is defined in Section 1.4.
"GAI, LLC" means GAI, LLC, a Nevada limited-liability company.
"Gaming Equipment" means the gaming equipment and gaming devices which
are regulated gaming devices under any Nevada Gaming Law (such as slot
machines, cashless wagering systems and associated equipment) together with
all improvements and/or additions thereto financed by the $20,000,000 term
loan facility under the GECC Commitment.
"Gaming License" means any and all duly issued and valid licenses,
approvals, registrations, findings of suitability and authorizations
relating to gaming at the Hotel/Casino under the Nevada Gaming Laws or
required by the Nevada Gaming Authorities or necessary for the operation of
gaming at the Hotel/Casino.
"GECC" means General Electric Capital Corporation.
"GECC Commitment" means the commitment of GECC to enter into a
$60,000,000 synthetic lease facility and a $20,000,000 term loan facility
pursuant to that certain commitment letter, dated as of January 23, 1998,
between the Borrower and GECC.
"GECC Intercreditor Agreement" means the Intercreditor Agreement to be
entered into between GECC and the Administrative Agent, initially in the
form approved by the Administrative Agent determined in good faith in its
sole discretion, and as from time to time thereafter amended, supplemented,
amended and restated or otherwise modified.
"Governmental Instrumentality" means any national, state or local
government (whether domestic or foreign), any political subdivision thereof
or any other governmental, quasi governmental, judicial, public or
statutory instrumentality, authority, body, agency, bureau or entity
(including the Nevada Gaming Authorities, any zoning authority, the Federal
Deposit Insurance Corporation, the Comptroller of the Currency or the
F.R.S. Board, any central bank or any comparable authority) or any
arbitrator with authority to bind a party at law.
"Ground Lease" means, collectively, the Mall Project Ground Lease, the
Music Project Ground Lease and the Energy Project Ground Lease.
33
"Guaranteed Maximum Price" means the total costs payable by the
Borrower to the Design/Builder for the Work, which costs shall not exceed
$267,000,000, except as adjusted in accordance with this Agreement and the
Design/Build Contract.
"Guaranty Deposit Account" is defined in the Borrower Collateral
Account Agreement.
"Hazardous Substances" means (statutory acronyms and abbreviations
having the meaning given them in the definition of "Environmental Laws")
substances defined as "hazardous substances," "pollutants" or
"contaminants" in Section 101 of the CERCLA; those substances defined as
"hazardous waste," "hazardous materials" or "regulated substances" by the
RCRA; those substances designated as a "hazardous substance" pursuant to
Section 311 of the CWA; those substances defined as "hazardous materials"
in Section 103 of the HMTA; those substances regulated as a hazardous
chemical substance or mixture or as an imminently hazardous chemical
substance or mixture pursuant to Sections 6 or 7 of the TSCA; those
substances defined as "contaminants" by Section 1401 of the SDWA, if
present in excess of permissible levels; those substances regulated by the
Oil Pollution Act; those substances defined as a pesticide pursuant to
Section 2(u) of the FIFRA; those substances defined as a source, special
nuclear or by-product material by Section 11 of the AEA; those substances
defined as "residual radioactive material" by Section 101 of the UMTRCA;
those substances defined as "toxic materials" or "harmful physical agents"
pursuant to Section 6 of the OSHA); those substances defined as hazardous
wastes in 40 C.F.R. Part 261.3; those substances defined as hazardous waste
constituents in 40 C.F.R. Part 260.10, specifically including Appendices
VII and VIII of Subpart D of 40 C.F.R. Part 261; those substances
designated as hazardous substances in 40 C.F.R. Parts 116.4 and 302.4;
those substances defined as hazardous substances or hazardous materials in
49 C.F.R. Part 171.8; those substances regulated as hazardous materials,
hazardous substances or toxic substances in 40 C.F.R. Part 1910; those
substances defined as hazardous materials, hazardous substances or toxic
substances in any other Environmental Laws; and those substances defined as
hazardous materials, hazardous substances or toxic substances in the
regulations adopted and publications promulgated pursuant to said laws,
whether or not such regulations or publications are specifically referenced
herein.
"Hedging Liability" means, relative to any Person, any liability of
such Person under any currency exchange agreement, interest rate swap
agreement, interest rate cap agreement or interest rate collar agreement,
or any other agreement designed to protect such Person against fluctuations
in interest rates or currency exchange rates including the Rate Protection
Agreement.
"herein", "hereof", "hereto", "hereunder" and similar terms contained
in this Agreement or any other Loan Document refer to this Agreement or
such other Loan Document, as the case may be, as a whole and not to any
particular Section, paragraph or provision of this Agreement or such other
Loan Document.
"Holdings" means Aladdin Gaming Holdings, LLC, a Nevada limited-
liability company.
34
"Holdings Collateral Account Agreement" means, on any date, the
Holdings Collateral Account Agreement, as originally in effect on the
Closing Date, between Holdings, the Securities Intermediary and the
Disbursement Agent, for the benefit of the Discount Note Indenture Trustee,
and as thereafter from time to time amended, supplemented, amended and
restated or otherwise modified in accordance with the terms hereof.
"Holdings Common Membership Interest" means a Common Share as defined
in the Organizational Documents of Holdings.
"Holdings Pledge Agreement" means, on any date, the Pledge Agreement
executed and delivered by an Authorized Representative of Holdings pursuant
to clause (a) of Section 5.1.3, as originally in effect on the Closing
Date, in substantially the form of Exhibit E-5 hereto and as thereafter
from time to time amended, supplemented, amended and restated or otherwise
modified.
"Holdings Series A Preferred Membership Interests" means the Series A
Preferred Shares as defined in the Organizational Documents of Holdings and
issued to LCNI or Sommer Enterprises pursuant thereto in consideration for
any payments to the Borrower required by London Clubs, the Trust or AHL
pursuant to the Keep-Well Agreement, the Completion Guaranty or the
Noteholder Completion Guaranty, as the case may be, when such payments are
Cash Equity Contributions (as defined in the Keep-Well Agreement).
"Holdings Series B Preferred Membership Interests" means the Series B
Preferred Shares as defined in the Organizational Documents of Holdings and
issued to LCNI or Sommer Enterprises pursuant thereto in consideration for
any payments to the Borrower required by London Clubs, the Trust or AHL
pursuant to the Keep-Well Agreement when such payments are Cash Equity
Contributions (as defined in the Keep-Well Agreement).
"Hotel" is defined in clause (a) of the fourth recital.
"Hotel/Casino" is defined in clause (a) of the fourth recital.
"Hotel/Casino Component" means the portion of the Complex described in
Exhibit N-8.
"Hotel/Casino Component Funding Source" means the Land Equity, the
London Clubs Contribution, the proceeds of the Borrower Series A Preferred
Membership Interests, the Loans, the Approved Equipment Funding
Commitments, the amounts payable to the Borrower by Aladdin Bazaar pursuant
to Section 4.5 of the Site Work Agreement, together with any amounts
payable under the Completion Guaranty from time to time.
"Impermissible Qualification" means, relative to the opinion or
certification of any independent public accountant as to any financial
statement of the Borrower, any other Aladdin
35
Party, LCNI, London Clubs Holdings or London Clubs, any qualification or
exception to such opinion or certification
(a) which is of a "going concern" or similar nature;
(b) which relates to the limited scope of examination of matters
relevant to such financial statement; or
(c) which relates to the treatment or classification of any item
in such financial statement and which, as a condition to its removal,
would require an adjustment to such item the effect of which would be
to cause the Borrower to be in default of any of its obligations under
Section 7.2.4.
"Imposition" means any real estate tax, payment in lieu of taxes or
other assessment levied, assessed or imposed against the portion of the
Site owned by the Borrower, and any water rates, sewer rentals or other
governmental, municipal or public dues, charges or impositions, of every
nature and to whomever assessed, that may now or hereafter be levied or
assessed upon the portion of the Site owned by the Borrower, or upon the
rents, issues, income, proceeds or profits thereof, whether the Imposition
is levied directly or indirectly against such portion of the Site owned by
the Borrower or as excise taxes or income taxes.
"Improvement" means any building, structure or other improvements to
be located or constructed on the Main Project Parcel.
"In Balance" will be deemed to exist when (x) the Unallocated
Contingency Balance equals or exceeds the Required Minimum Contingency, (y)
after giving effect to the requested Credit Extension, the Available Funds
allocated to each Line Item Category equals or exceeds for such Line Item
Category the aggregate of (1) the costs required to complete such Line Item
Category, (2) the Retainage Amount to be paid to Persons who have supplied
labor or materials in connection with such Line Item Category and (3) the
amount required to pay interest and all other amounts due under this
Agreement and the Approval Equipment Funding Commitments at the maximum
rate of interest set forth in the Main Project Budget through the
Conversion Date and (z) the Guaranteed Maximum Price remains in effect.
"including" and "include" means including, without limiting the
generality of any description preceding such term, and, for purposes of
this Agreement and each other Loan Document, the parties hereto agree that
the rule of ejusdem generis shall not be applicable to limit a general
statement, which is followed by or referable to an enumeration of specific
matters, to matters similar to the matters specifically mentioned.
36
"Indebtedness" means, relative to any Person, without duplication:
(a) all obligations of such Person for borrowed money and all
obligations of such Person evidenced by bonds, debentures, notes or
other similar instruments;
(b) all obligations, contingent or otherwise, relative to the
face amount of all letters of credit (or reimbursement agreements in
respect thereof), whether or not drawn, and banker's acceptances
issued for the account of such Person;
(c) all obligations of such Person as lessee under leases which
have been or should be, in accordance with GAAP, recorded as
Capitalized Lease Liabilities;
(d) all other items which, in accordance with GAAP, would be
included as liabilities on the liability side of the balance sheet of
such Person as of the date at which Indebtedness is to be determined;
(e) net liabilities of such Person under all Hedging
Liabilities;
(f) whether or not so included as liabilities in accordance with
GAAP, all obligations of such Person to pay the deferred purchase
price of property or services, and indebtedness (excluding, however,
prepaid interest thereon) secured by a Lien on property owned or being
purchased by such Person (including indebtedness arising under
conditional sales or other title retention agreements), whether or not
such indebtedness shall have been assumed by such Person or is limited
in recourse; and
(g) all Contingent Liabilities of such Person in respect of any
of the foregoing.
For all purposes of this Agreement, (x) the Indebtedness of any Person
shall include the proportion of Indebtedness of any partnership in which
such Person is a general partner or joint venturer with liability for the
entire indebtedness of the joint venture and (y) the amount of any
Indebtedness outstanding as of any date shall be (1) the accredited value
thereof, in the case of Indebtedness issued with original issue discount
and (2) the principal amount thereof, together with any interest thereon
that is more than 30 days past due, in the case of any other Indebtedness.
"Indebtedness to be Paid" means the Indebtedness identified in Item
5.1.10 on the Disclosure Schedule.
"Indemnified Liability" is defined in Section 10.4.
"Indemnified Party" is defined in Section 10.4.
37
"Independent Consultant" means the Construction Consultant, the
Insurance Consultant, the Environmental Consultant or their successors
engaged pursuant to this Agreement.
"Indirect Cost" means any Main Project Cost which is not a Direct
Cost, including appraisal fees, the Term A Loan Commitment Fee, the Term B
and Term C Loan Commitment Fee, the fees set forth in the Fee Letters,
interest on the Loans prior to the Conversion Date, brokers' commissions,
fees of the Independent Consultants, insurance during construction, surety
bond premiums, cost of surveys, Impositions during construction, title
examination and title insurance premiums, recording expenses in connection
with the Deed of Trust and other Security Documents and fees and
disbursements of the attorneys for the Administrative Agent.
"Instrument" means any contract, agreement, indenture, mortgage, deed
of trust, document or writing (whether by formal agreement, letter or
otherwise) under which any obligation is evidenced, assumed or undertaken,
or any Lien (or right or interest therein) is granted or perfected.
"Insurance Consultant" means Sedgwick of Tennessee, Inc. or its
successor appointed pursuant to Section 9.8.
"Insurance Requirement" means any provisions of any insurance policy
covering or applicable to the Borrower, the Main Project or any portion
thereof, all requirements of the issuer of any such policy and all orders,
rules, regulations and other requirements of the National Board of Fire
Underwriters (or any body exercising similar functions) applicable to or
affecting the Main Project or any portion thereof, any use or condition
thereof or the Borrower.
"Interest Coverage Ratio" means, at the close of any Fiscal Quarter,
the ratio computed for the period consisting of such Fiscal Quarter (or
such shorter portion of any Fiscal Quarter after the occurrence therein of
the Conversion Date) and each of the three immediately prior Fiscal
Quarters (or such lesser number of Fiscal Quarters to have closed since the
Conversion Date) of:
(a) EBITDA for such period
to
(b) Interest Expense of the Borrower for such period;
provided, however, that in computing the Interest Coverage Ratio for any
such period ending on or prior to the first anniversary of the Conversion
Date, the amount determined pursuant to clause (b) shall equal the product
of (x) the Interest Expense for such period multiplied by (y) a fraction,
the numerator of which is equal to 365 and the denominator of which is
equal to the number of days that have elapsed in such period.
38
"Interest Expense" means, for any period, the aggregate cash interest
expense (net of cash interest income) of the Borrower (including, to the
extent the Borrower has any Contingent Liability in respect of such
interest expense, the interest expense of other Persons) for such period,
as determined in accordance with GAAP, including the portion of any
payments made in respect of Capitalized Lease Liabilities allocable to
interest expense, but excluding, however, deferred financing costs and
other non-cash interest expense.
"Interest Payment Account" means the account established by the
Borrower with the Disbursement Agent pursuant to the Borrower Collateral
Account Agreement into which the proceeds of the Loans shall be deposited
by the Administrative Agent from time to time.
"Interest Period" means, relative to any LIBO Rate Loan, the period
beginning on (and including) the date on which such LIBO Rate Loan is made
or continued as, or converted into, a LIBO Rate Loan pursuant to
Section 2.3 or Section 2.4 and shall end on (but exclude) the day which
numerically corresponds to such date one, two, three, six or, if then
generally available from all Lenders, twelve months thereafter (or, if such
month has no numerically corresponding day, on the last Business Day of
such month), as the Borrower may select in its relevant notice pursuant to
Section 2.3 or Section 2.4; provided, however, that
(a) the Borrower shall not be permitted to select Interest
Periods to be in effect at any one time which have expiration dates,
(i) in the case of Term A Loans made or maintained as LIBO
Rate Loans, occurring on more than eight different dates,
(ii)in the case of Term B Loans made or maintained as LIBO
Rate Loans, occurring on more than four different dates, and
(iii) in the case of Term C Loans made or maintained as LIBO
Rate Loans, occurring on more than four different dates;
(b) if such Interest Period would otherwise end on a day which
is not a Business Day, such Interest Period shall end on the next
following Business Day (unless such next following Business Day is the
first Business Day of a calendar month, in which case such Interest
Period shall end on the Business Day next preceding such numerically
corresponding day); and
(c) no Interest Period for any Loan may end later than the
Stated Maturity Date for such Loan.
"Investment" means, relative to any Person,
39
(a) any loan or advance made by such Person to any other Person
(including Affiliates) (excluding, however, commission, travel, petty
cash and similar advances to officers and employees made in the
ordinary course of business);
(b) any Contingent Liability of such Person incurred in
connection with loans or advances described in clause (a);
(c) any ownership or similar interest held by such Person in any
other Person; and
(d) any other item that is or would be classified as an
investment on a balance sheet of such Person prepared in accordance
with GAAP.
The amount of any Investment shall be the original principal or capital
amount thereof less all returns of principal or equity thereon and shall,
if made by the transfer or exchange of property other than cash, be deemed
to have been made in an original principal or capital amount equal to the
fair market value of such property at the time of such Investment. If
Holdings or any Subsidiary of Holdings sells, assigns, transfers or
otherwise disposes of any Equity Interests of any direct or indirect
Subsidiary of Holdings such that, after giving effect thereto, such Person
is no longer a Subsidiary of Holdings, Holdings or such Subsidiary shall be
deemed to have made an Investment on the date of such sale, assignment,
transfer or other disposition equal to the fair market value of the Equity
Interests of such Subsidiary not sold, assigned, transferred or otherwise
disposed of in an amount determined as provided in clause (d) of Section
7.2.6.
"Issuance Fee or Expense" means any fee or expense incurred by the
Borrower in connection with the raising of debt or equity to finance the
Main Project which is paid on or before the Closing Date as more fully set
forth on Schedule IX hereto.
"Issuer" means Scotiabank in its capacity as issuer of the Letters of
Credit. At the request of Scotiabank, another Lender or an Affiliate of
Scotiabank may issue one or more Letters of Credit hereunder.
"Keep-Well Agreement" means, on any date, the Keep-Well Agreement, as
originally in effect on the Closing Date, by the Sponsors and ABH in favor
of the Lenders substantially in the form of Exhibit D hereto and as
thereafter from time to time amended, supplemented, amended and restated or
otherwise modified.
"Knowledge" of any Obligor means, at any time and relative to any
matter, knowledge which the Authorized Representatives of such Obligor
would have after inquiring of the current employees of such Obligor and its
Subsidiaries who would reasonably be expected to have knowledge regarding
such matter, whether or not such Authorized Representatives actually made
inquiry of such employees.
40
"Land Equity" is defined in clause (a) of the fifth recital.
"LCNI" means London Clubs Nevada Inc., a Nevada corporation.
"LCNI Pledge Agreement" means, on any date, the Pledge Agreement
executed and delivered by an Authorized Representative of LCNI pursuant to
clause (b) of Section 5.1.3, as originally in effect on the Closing Date,
in substantially the form of Exhibit E-6 hereto and as thereafter from time
to time amended, supplemented, amended and restated or otherwise modified.
"Legal Requirement" means, relative to any Person or property, all
laws (including Nevada Gaming Laws, if applicable), statutes, codes,
regulations, rules, acts, ordinances, permits, licenses, authorizations,
directions and requirements of all Governmental Instrumentalities,
departments, commissions, boards, courts, authorities, agencies, officials
and officers, and any deed restrictions or other requirements of record,
applicable to such Person or such property, or any portion thereof or
interest therein or any use or condition of such property or any portion
thereof or interest therein (including those relating to zoning, planning,
subdivision, building, safety, health, use, environmental quality and other
similar matters).
"Lender Assignment Agreement" means a lender assignment agreement
substantially in the form of Exhibit H hereto.
"Lender" is defined in the preamble and, in addition, shall include
any commercial bank or other financial institution that becomes a Lender
pursuant to Section 10.11.1.
"Lender Default" means (x) the refusal (which has not been retracted)
of a Lender to make available its portion of any Borrowing or to fund its
portion of any unreimbursed payment under Section 2.6.1 or (y) a Lender
having notified the Administrative Agent or the Borrower that it does not
intend to comply with its obligations under Section 2.3 or under Section
2.6.1, in either case, as a result of the appointment of a receiver or
conservator with respect to such Lender at the direction or request of any
regulatory agency or authority.
"Lender's Environmental Liability" means any and all losses,
liabilities, obligations, penalties, claims, litigation, demands, defenses,
costs, judgments, suits, proceedings, damages (including consequential
damages), disbursements or expenses of any kind or nature whatsoever
(including reasonable attorneys' fees at trial and appellate levels and
consultants' and experts' fees and disbursements and expenses incurred in
investigating, defending against or prosecuting any litigation, claim or
proceeding) which may at any time be imposed upon, incurred by or asserted
or awarded against any Lender or any of such Lender's parent and subsidiary
corporations, and their Affiliates, shareholders, directors, officers,
employees, and agents in connection with or arising from:
41
(a) any Hazardous Substances on, in, under or affecting all or
any portion of any property of the Borrower, any of the Borrower's
Subsidiaries or Aladdin Bazaar, the groundwater thereunder, or any
surrounding areas thereof to the extent caused by Releases from the
Borrower, any of the Borrower's Subsidiaries, any other Aladdin Party
or Aladdin Bazaar or any of their respective properties;
(b) any misrepresentation, inaccuracy or breach of any warranty,
contained or referred to in Section 6.12;
(c) any violation or claim of violation by the Borrower, any of
the Borrower's Subsidiaries, any other Aladdin Party or Aladdin Bazaar
of any Environmental Laws; or
(d) the imposition of any Lien for damages caused by or the
recovery of any costs for the cleanup, release or threatened release
of Hazardous Substances by the Borrower, any of the Borrower's
Subsidiaries, any other Aladdin Party or Aladdin Bazaar, or in
connection with any property owned or formerly owned by the Borrower,
any of the Borrower's Subsidiaries, any other Aladdin Party or Aladdin
Bazaar, as the case may be.
"Lender's Tax" is defined in Section 4.6.
"Letter of Credit" is defined in Section 2.1.2.
"Letter of Credit Commitment" means, (x) relative to an Issuer, such
Issuer's obligation to issue Letters of Credit pursuant to Section 2.1.2
and (y) relative to each Lender (other than the Issuer) that has a Term A
Loan Commitment, the obligation of such Lender to participate in Letters of
Credit pursuant to Section 2.6.1.
"Letter of Credit Commitment Amount" means, on any date, a maximum
amount of $20,000,000, as such amount may be permanently reduced from time
to time pursuant to Section 2.2.
"Letter of Credit Disbursement" is defined in Section 2.6.2.
"Letter of Credit Disbursement Date" is defined in Section 2.6.2.
"Letter of Credit Issuance Request" means a Letter of Credit request
and certificate duly executed by an Authorized Representative of the
Borrower substantially in the form of Exhibit L-2 hereto.
"Letter of Credit Outstandings" means, on any date, an amount equal to
the sum of
42
(a) the then aggregate amount which is undrawn and available
under all issued and outstanding Letters of Credit,
plus
(b) the then aggregate amount of all unpaid and outstanding
Letter of Credit Reimbursement Obligations.
"Letter of Credit Reimbursement Obligation" is defined in
Section 2.6.3.
"Letter of Credit Stated Expiry Date" is defined in Section 2.6.
"LIBO Rate" means, relative to any Interest Period for LIBO Rate
Loans, the rate of interest equal to the average (rounded upwards, if
necessary, to the nearest 1/16 of 1%) of the rate per annum at which Dollar
deposits in immediately available funds are offered to the Administrative
Agent in the London, England interbank market as at or about 11:00 a.m.
London, England time two Business Days prior to the beginning of such
Interest Period for delivery on the first day of such Interest Period, and
in an amount approximately equal to the amount of the LIBO Rate Loans and
for a period approximately equal to such Interest Period.
"LIBO Rate Loan" means a Loan bearing interest, at all times during an
Interest Period applicable to such Loan, at a fixed rate of interest
determined by reference to the LIBO Rate (Reserve Adjusted).
"LIBO Rate (Reserve Adjusted)" means, relative to any Loan to be made,
continued or maintained as, or converted into, a LIBO Rate Loan for any
Interest Period, a rate per annum (rounded upwards, if necessary, to the
nearest 1/16 of 1%) determined pursuant to the following formula:
LIBO Rate
(Reserve Adjusted) = LIBO Rate
-----------------------------------
1.00 - LIBOR Reserve Percentage
The LIBO Rate (Reserve Adjusted) for any Interest Period for LIBO Rate
Loans will be determined by the Administrative Agent on the basis of the
LIBOR Reserve Percentage in effect, and the applicable rates furnished to
and received by the Administrative Agent from the Lenders, two Business
Days before the first day of such Interest Period.
"LIBOR Reserve Percentage" means, relative to any Interest Period for
LIBO Rate Loans, the reserve percentage (expressed as a decimal) equal to
the maximum aggregate reserve requirements (including all basic, emergency,
supplemental, marginal and other reserves and taking into account any
transitional adjustments or other scheduled changes in reserve
requirements) specified under regulations issued from time to time by the
F.R.S. Board and then
43
applicable to assets or liabilities consisting of or including
"Eurocurrency Liabilities", as currently defined in Regulation D of the
F.R.S. Board, having a term approximately equal or comparable to such
Interest Period.
"Lien" means, relative to any asset, any mortgage, lien, pledge,
charge, security interest or encumbrance of any kind in respect of such
asset, whether or not filed, recorded or otherwise perfected under
applicable law (including any conditional sale or other title retention
agreement, any lease in the nature thereof, any option or other agreement
to sell or give a security interest therein).
"Line Item" means each of the individual line items set forth in the
Main Project Budget.
"Line Item Category" means each of the following line item categories
of the Main Project Budget:
(a) Construction Costs;
(b) Indirect Costs;
(c) Indirect Fees;
(d) General FF&E;
(e) Gaming Equipment;
(f) Owner FF&E;
(g) Theming;
(h) Project Contingency;
(i) Mall Project Reimbursement;
(j) Capitalized Interest;
(k) Fees/Other Expenses;
(l) Retirement of Existing Debt;
(m) Retirement of Partnership Debt;
(n) Pre-Opening Expenses;
44
(o) Working Capital;
(p) Investment in Aladdin Music; and
(i) Land/Infrastructure Contract.
"Loan" means a Term A Loan, a Term B Loan or a Term C Loan of any
type.
"Loan Document" means, collectively, this Agreement, the Notes, the
Letters of Credit, each Pledge Agreement, each Rate Protection Agreement,
each Borrowing Request, each Letter of Credit Issuance Request, the
Security Agreement, the Keep-Well Agreement, the Completion Guaranty, the
GECC Intercreditor Agreement, the Trademark Security Agreement, the Deed of
Trust, the Disbursement Agreement, the Mall Project Completion Assignment,
the Fee Letters, the Environmental Indemnity, the Assignment of Contracts,
the Assignment of Consulting Agreement, the Assignment of Design/Build
Contract, the Assignment of Salle Privee Agreement, the Assignment of
Project Management Agreement, the Borrower Collateral Account Agreement,
the Holding Collateral Account Agreement, the Servicing and Collateral
Account Agreement, the Design/Builder Consent and Acknowledgment and any
other agreement, certificate, document or Instrument delivered in
connection with this Agreement and such other agreements, whether or not
specifically mentioned herein or therein.
"London Clubs" means London Clubs International, plc, a company
registered in England and Wales.
"London Clubs Contribution" means the $50,000,000 cash contribution by
London Clubs indirectly through London Clubs Holding and LCNI in
consideration for Common Membership Interests in Holdings.
"London Clubs Holdings" means London Clubs Holdings, Ltd., a company
registered in England and Wales.
"London Clubs Parties" means, collectively, London Clubs and LCNI.
"London Clubs Purchase Agreement" means the Amended and Restated
Purchase Agreement, dated the Effective Date, among London Clubs, LCNI,
AHL, Sommer Enterprises, the Trust, Holdings and the Borrower as originally
in effect on the Effective Date and as thereafter from time to time
amended, supplemented, amended and restated or otherwise modified in
accordance with the terms hereof.
"Loss Proceeds" is defined in Section 7.1.20.
"Loss Proceeds Account" is defined in the Borrower Collateral Account
Agreement.
45
"Main Project" is defined in clause (a) of the fourth recital.
"Main Project Budget" means a budget in substantially the form of
Exhibit X-2 (as amended from time to time in accordance with Section
7.2.18) which shall include (w) a breakdown of all Direct Costs and
Indirect Costs by Line Item Categories as set forth on the Trade Detail
Report, together with a schedule of costs by trades and Main Project Costs
(including Main Project Costs incurred prior to, as well as after, the
Effective Date, the Pre-Opening Expenses, the Issuance Fees or Expenses,
Debt Service and initial working capital required to operate the Main
Project on and after the Opening Date) which (1) are to be paid from the
Hotel/Casino Component Funding Sources and (2) are to be constructed and
paid for by the Borrower pursuant to the Site Work Agreement for
improvements to the Mall Project, (x) a schedule setting forth the FF&E
which is to be purchased from the proceeds of the Loans (which FF&E shall
not include any Gaming Equipment and/or Specified Equipment), (y) a
drawdown schedule for Advances necessary to achieve Final Completion and
such other information relative to such Main Project Costs and the funding
thereof as the Administrative Agent may reasonably require and (z) a
balanced statement of sources and uses of proceeds (and any other funds
necessary to complete the Main Project), broken down by Construction
Component and Line Item. The Main Project Costs shall not exceed
$724,000,000.
"Main Project Budget/Schedule Amendment Certificate" means a Main
Project Budget/Schedule Amendment Certificate substantially in the form of
Exhibit X-3 hereto.
"Main Project Certificate of Occupancy" means a permanent or temporary
certificate of occupancy, in either case, for the portion of the Main
Project specified in such certificate of occupancy issued by the Building
Department pursuant to applicable Legal Requirements which permanent or
temporary certificate of occupancy shall permit such portion of the Main
Project to be used for its intended purposes, shall be in full force and
effect and, in the case of a temporary certificate of occupancy, if such
temporary certificate of occupancy shall provide for an expiration date,
any Main Project Punchlist Items which must be completed in order for such
temporary certificate of occupancy to be renewed or extended shall be
completed no later than 15 days prior to the applicable expiration date.
"Main Project Costs" means all costs incurred or to be incurred in
accordance with the Main Project Budget in connection with the development,
design, engineering, procurement, installation, construction, Final
Completion and opening of the Main Project, including:
(a) all costs incurred under the Design/Build Contract and the
Contracts;
(b) interest accruing under this Agreement, the other Loan
Documents and the Approved Equipment Funding Commitments prior to the
Conversion Date;
(c) reasonable financing and closing costs related to the Main
Project until the Conversion Date, including insurance costs
(including, with respect to directors and
46
officers insurance, costs relating to such insurance extending beyond
the Conversion Date), guarantee fees, legal fees and costs and
expenses, financial advisory fees and expenses, technical fees and
expenses (including fees and expenses of the Construction Consultant,
the Environmental Consultant and the Insurance Consultant), commitment
fees, management fees, agency fees (including fees and expenses of the
Disbursement Agent and the Administrative Agent), interest, taxes
(including value-added tax and Restricted Payments made in accordance
with clause (c) of Section 7.2.6) and other out-of-pocket expenses
payable by the Borrower under all documents related to the financing
and construction of the Main Project until the Conversion Date;
(d) the costs of acquiring Permits for the Main Project prior to
the Final Completion Date (including Permits required for the
operation of the Main Project subsequent to the Final Completion
Date);
(e) costs incurred in settling insurance claims in connection
with Events of Loss and collecting Loss Proceeds;
(f) amounts due under the Energy Project Service Agreement prior
to the Conversion Date; and
(g) without duplication, working capital costs.
"Main Project Document" means, collectively, the Design/Build
Contract, the Fluor Guaranty, the Contracts, the Energy Project Service
Agreement, the Energy Project Ground Lease, the Mall Project Ground Lease,
the Music Project Ground Lease, the Theater Lease (if entered into), the
Reciprocal Easement Agreement, the Common Parking Area Use Agreement, the
Site Work Agreement, the Project Management Agreement, the Development
Agreement or any other document or agreement entered into on, prior to or
after the Effective Date, relating to the development, construction,
maintenance or operation of the Main Project (other than the Loan Documents
and the Discount Note Trust Indenture), as the same may be amended from
time to time in accordance with the terms and conditions hereof and
thereof.
"Main Project Easement" means any easement appurtenant, easement in
gross, license agreement or other right running for the benefit of the
Borrower or appurtenant to the Main Project Parcel, including those
easements and licenses described in the Reciprocal Easement Agreement and
each Title Policy.
"Main Project Intended Use" means each intended use of the Main
Project, as more particularly set forth on Exhibit O hereto.
"Main Project Parcel" means the portion of the Site described on
Exhibit N-3 hereto together with the Main Project Easements.
47
"Main Project Punchlist Completion Certificate" means the Main Project
Punchlist Completion Certificate substantially in the form of Exhibit V.
"Main Project Punchlist Item" means any minor or insubstantial detail
of construction or mechanical adjustment, the non-completion of which, when
all such items are taken together, will not interfere in any material
respect with the use or occupancy of any portion of the Main Project for
its intended purposes or the ability of the owner of the Main Project or
the Energy Project Provider, as applicable, to perform work that is
necessary or desirable to prepare such portion of the Main Project for such
use or occupancy; provided, however, that, in all events, "Main Project
Punchlist Items" shall include the items set forth in the punchlist to be
delivered by the Borrower in connection with Substantial Completion (as
defined in the Design/Build Contract) and all items that are listed on the
"punchlists" furnished by the Building Department, the Nevada Department of
Transportation or the Clark County Department of Public Works in connection
with, or after, the issuance of a temporary Main Project Certificate of
Occupancy for the portion of the Main Project covered thereby as those that
must be completed in order for the Building Department to issue a permanent
Main Project Certificate of Occupancy.
"Main Project Security" means all real and personal property which is
subject or is intended to become subject to the security interests or liens
granted by any of the Operative Documents.
"Major Contractor" means a Contractor who is party to a Material Main
Project Document.
"Mall Project" is defined in clause (b) of the fourth recital.
"Mall Project Completion Assignment" means, on any date, the Mall
Project Completion Assignment, as originally in effect on the Closing Date,
from Holdings in favor of the Lenders substantially in the form of Exhibit
G hereto and as thereafter from time to time amended, supplemented, amended
and restated or otherwise modified.
"Mall Project Easement" means any easement appurtenant, easement in
gross, license agreement or other right running for the benefit of Aladdin
Bazaar or appurtenant to the Mall Project Parcel, including those certain
easements and licenses described in the Reciprocal Easement Agreement and
each Title Policy.
"Mall Project Ground Lease" means, on any date, the Lease, as
originally in effect on the Effective Date, between the Borrower and
Aladdin Bazaar and as thereafter from time to time amended, supplemented,
amended and restated or otherwise modified in accordance with the terms
hereof.
"Mall Project Parcel" means the portion of the Site described on
Exhibit N-4 hereto, together with the Mall Project Easements.
48
"Mall Project Parcel Creation Date" means the date on which the Mall
Project Parcel is created in accordance with clause (b) of Section 7.1.19.
"Mandatory Prepayment" is defined in clause (c) of Section 3.1.1.
"Material Adverse Effect" means (x) a material adverse effect on the
financial condition, business, property, prospects of the Borrower or on
its ability to perform in all material respects its obligations under any
Operative Document to which it is a party, (y) a material adverse effect on
the financial condition, business, property, prospects and ability of any
other Project Party to perform in all material respects its obligations
under any Operative Document to which it is a party or (z) a material
impairment of the validity or enforceability of, or a material impairment
of the rights, remedies or benefits available to the Administrative Agent,
the Issuer or the Lenders under this Agreement or any other Operative
Document; provided, however, that whenever the term "Material Adverse
Effect" is used in a representation or warranty made by the Borrower, such
representation or warranty as it relates to clause (y) above shall be
deemed to have been made to the Borrower's Knowledge.
"Material Main Project Document" means the Mall Project Ground Lease,
the Music Project Ground Lease, the Reciprocal Easement Agreement, the Site
Work Agreement, the Common Parking Area Use Agreement, the Energy Project
Ground Lease, the Energy Project Service Agreement, the Theater Lease, the
Design/Build Contract, the Fluor Guaranty, the Project Management
Agreement, the Development Agreement and any other certificate, document or
Instrument delivered in connection with or by the Borrower and any other
Person pursuant to any Material Main Project Document, and such other
agreements, whether or not specifically mentioned herein or therein and,
without duplication, any Main Project Document with a total contract amount
in excess of $2,500,000.
"Membership Interest" means, relative to any Person which is a limited
liability company, a membership interest or a limited liability company
interest, as the case may be, of such Person.
"Merrill Lynch" is defined in the preamble.
"Minimum Fixed Charge Coverage Ratio" means, as of the close of any
Fiscal Quarter, commencing with the close of the Fiscal Quarter in which
the Conversion Date occurs, the ratio computed for the period consisting
of such Fiscal Quarter (or such shorter period of any Fiscal Quarter after
the occurrence therein of the Conversion Date and each of the three
immediately prior Fiscal Quarters (or such lesser number of Fiscal Quarters
to have closed since the Conversion Date) of:
(a) EBITDA (for all such Fiscal Quarters or such shorter period,
as the case may be and determined for any period ending on or prior to
the first anniversary of the Conversion Date, consistently with the
proviso to the definition of "EBITDA");
49
to
(b) the sum (for all such Fiscal Quarters or such shorter
period, as the case may be) of
(i) Interest Expense;
plus
(ii) scheduled principal repayments of the Loans pursuant
to clauses (b) and (c) of Section 3.1.1 after giving effect to
any reductions in such scheduled principal repayments
attributable to any optional or mandatory prepayments of the
Loans and scheduled payments made with respect to the FF&E
Financing;
plus
(iii) the amount of all federal, state and local income
taxes (whether paid in cash or deferred) of the Borrower paid by
the Borrower or, if the Borrower is treated as a pass-through
entity or is not treated as a separate entity for United States
federal income tax purposes, the amount of Restricted Payments
made by the Borrower in accordance with clause (c) of
Section 7.2.6, subject to the terms thereof, in each case, in
cash during such Fiscal Quarters;
plus
(iv) Restricted Payments of the types described in
clause (d) of Section 7.2.6 made in cash during such Fiscal
Quarters;
plus
(v) Capital Expenditures of the Borrower actually made or
reserved during all such Fiscal Quarters pursuant to
Section 7.2.7;
provided, however, that in computing the Minimum Fixed Charge Coverage
Ratio for any such period ending on or prior to the first anniversary of
the Conversion Date, the amount determined pursuant to clause (b) shall
equal the product of (x) the sum of the amounts determined pursuant to
clause (b) for such period multiplied by (y) a fraction, the numerator of
which is equal to 365 and the denominator of which is equal to the number
of days that have elapsed in such period.
"Moody's" means Moody's Investors Service, Inc., a Delaware
corporation, or any successor thereto.
"Music Investment Prepayment" is defined in clause (d) of Section
3.1.1.
50
"Music Project" is defined in clause (c) of the fourth recital.
"Music Project Easement" means any easement appurtenant, easement in
gross, license agreement or other right running for the benefit of Aladdin
Music or appurtenant to the Music Project Parcel, including those certain
easements and licenses described in the Reciprocal Easement Agreement and
each Title Policy.
"Music Project Ground Lease" means, on any date, the Lease, as
originally in effect on the Effective Date, between the Borrower and
Aladdin Music and as thereafter from time to time amended, supplemented,
amended and restated or otherwise modified in accordance with the terms
hereof.
"Music Project Parcel" means the portion of the Site described on
Exhibit N-5 hereto, together with the Music Project Easements.
"Music Project Parcel Creation Date" means the date on which the Music
Project Parcel is created in accordance with clause (c) of Section 7.1.19.
"Net Distribution Amount" means, for any period, the amount of fees
paid to AMH under any keep-well agreement relating to the Music Project and
then paid as distributions in cash to the Borrower by AMH to the extent
permitted thereunder.
"Net Income" means, for any period, the aggregate of all amounts
(including extraordinary losses) which, in accordance with GAAP, would be
included in determining net income on the financial statements of the
Borrower for such period (excluding, however, (x) all amounts in respect of
any extraordinary gains and any non-cash income and (y) net income of any
Subsidiary, other than any Net Distribution Amount paid in cash to the
Borrower during such period).
"Net Worth" means the net worth of the Borrower determined in
accordance with GAAP.
"Nevada Gaming Authority" means the Nevada Gaming Commission, the
Nevada State Gaming Control Board or the Clark County Liquor and Gaming
Licensing Board.
"Nevada Gaming Law" means the Nevada Gaming Control Act, as codified
in Chapter 463 of the NRS, as amended from time to time, and the
regulations of the Nevada Gaming Commission promulgated thereunder, as
amended from time to time, and Clark County Code Sections 8.04.010 to
8.04.310 and 8.20.010 to 8.20.580, as amended from time to time.
"Non-Defaulting Lender" means and includes each Lender other than a
"Defaulting Lender".
"Non-U.S. Lender" is defined in Section 4.6.
51
"Note" means a Term A Note, a Term B Note, a Term C Note or a
Registered Note.
"Note Construction Disbursement Account" is defined in the Holdings
Collateral Account Agreement.
"Noteholder Completion Guaranty" means, on any date, the Noteholder
Completion Guaranty, as originally in effect on the Effective Date, by the
Completion Guarantors in favor of the Discount Note Indenture Trustee (for
the benefit of the Discount Noteholders) as thereafter from time to time
amended, supplemented, amended and restated or otherwise modified in
accordance with the terms hereof.
"NRS" means Nevada Revised Statutes.
"Obligations" means (x) all loans, advances, debts, liabilities and
obligations, howsoever arising, owed by the Borrower under this Agreement
to any Lender of every kind and description (whether or not evidenced by
any note or instrument and whether or not for the payment of money), direct
or indirect, absolute or contingent, due or to become due, now existing or
hereafter arising, pursuant to the terms of the Disbursement Agreement, any
of the Loan Documents or any of the other Operative Documents, including
all interest, fees, charges, expenses, attorneys' fees, consultants' fees
and accountants' fees chargeable to the Borrower in connection with such
Person's dealings with the Borrower and payable by the Borrower hereunder
or thereunder; (y) any and all sums advanced by the Lenders in order to
preserve the Main Project Security or preserve any Secured Parties'
security interest in the Main Project Security, including all protective
advances; and (z) in the event of any proceeding for the collection or
enforcement of, or any "working out" of, the Obligations after an Event of
Default shall have occurred and be continuing, the reasonable expenses of
retaking, holding, preparing for sale or lease, selling or otherwise
disposing of or realizing on the Main Project Security, or of any exercise
by any Secured Party of its rights under the Operative Documents, together
with reasonable attorneys' fees and court costs.
"Obligor" means, as the context may require, the Borrower, each other
Aladdin Party, LCNI, London Clubs Holdings, London Clubs, each Sponsor,
each Completion Guarantor and each other Person (other than the Agents, the
Issuer or any Lender) to the extent such Person is obligated under this
Agreement or any other Operative Document.
"Ongoing Investment" is any Investment listed in Item 7.2.5(a) on the
Disclosure Schedule.
"On Schedule Certificate" means a certificate in the form of Exhibit
AA hereto.
52
"Opening Condition" means, collectively, the following:
(a) Substantial Completion shall have occurred;
(b) the Hotel/Casino shall have received a Main Project
Certificate of Occupancy from the Building Department (and a copy of
such certificate shall have been delivered to the Administrative
Agent);
(c) each remaining Main Project Punchlist Item with respect to
the Hotel/Casino and the completion thereof shall be such that it will
not interfere with or disrupt the operation of the Main Project for
its intended purposes or detract from the aesthetic appearance of the
Main Project other than to a de minimis extent, as reasonably
determined by the Owner Representative and confirmed by the
Construction Consultant;
(d) the failure to complete each remaining Main Project
Punchlist Item would not interfere with or disrupt the operation of
the Main Project for its intended purposes or detract from the
aesthetic appearance of the Main Project other than to a de minimis
extent, as reasonably determined by the Owner Representative and
confirmed by the Construction Consultant; and
(e) the Borrower shall have available a fully trained staff to
operate the Hotel/Casino in accordance with first-class industry
standards for a hotel/casino operation of similar size and location.
"Opening Date" means the date on which all of the Opening Conditions
are satisfied.
"Operating" means the first time that (t) all Gaming Licenses have
been granted and are not then revoked or suspended, (u) all Liens (other
than Permitted Liens) related to the development, construction, and
equipping of the Main Project have been paid or, if payment is not yet due
or if such payment is contested in good faith by Borrower, either (1)
sufficient funds remain in the Construction Note Disbursement Account to
discharge such Liens or (2) such Liens have been bonded, (v) the
Construction Consultant, the Design/Builder and the Architect of Record
shall have delivered one or more certificates to the Administrative Agent
each certifying that the Main Project is Complete in all material respects
in accordance with the Plans and Specifications and all applicable Legal
Requirements, (w) the Main Project is in a condition (including
installation of FF&E) to receive invitees in the ordinary course of
business, (x) gaming and other operations in accordance with applicable
Legal Requirements are open to the general public and are being conducted
at the Hotel/Casino, (y) a Main Project Certificate of Occupancy has been
issued for the Main Project by the Building Department and (z) a notice of
completion of the Main Project has been duly recorded.
"Operating Costs" means all actual cash costs incurred by the Borrower
and related to the operation of the Main Project or any portion thereof in
the ordinary course of business,
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including costs incurred for labor, consumables, utility services and all
other operation-related costs; provided, however, that (x) Operating Costs
shall not include non-cash charges (including depreciation and
amortization) and (y) Debt Service shall constitute Operating Costs from
and after the Conversion Date but not prior to such date.
"Operative Document" means any Loan Document or Main Project Document.
"Organizational Document" means, relative to any Obligor, as
applicable, its certificate or articles of incorporation, by-laws,
certificate of partnership, partnership agreement, certificate of
formation, articles of organization, operating agreement, limited liability
company or operating agreement and all shareholder agreements, voting
trusts and similar arrangements applicable to any of such Obligor's
partnership interests, limited liability company interests or authorized
shares of capital stock.
"Outside Completion Deadline" means the date which is 28 months
following the Effective Date, time being of the essence; provided, however,
if a Force Majeure Event occurs, then the Borrower shall be permitted to
extend the Completion Date for up to one year subject to the satisfaction
by the Borrower of the conditions to such extension as set forth in the
definition of "Force Majeure Event".
"Owner Representative" means Tishman Construction Corporation of
Nevada.
"Participant" is defined in Section 10.11.2.
"PBGC" means the Pension Benefit Guaranty Corporation and any entity
succeeding to any or all of its functions under ERISA.
"Pension Plan" means a "pension plan", as such term is defined in
Section 3(2) of ERISA, which is subject to Title IV of ERISA (excluding,
however, a multiemployer plan as defined in Section 4001(a)(3) of ERISA),
and to which the Borrower or any corporation, trade or business that is,
along with the Borrower, a member of a Controlled Group, may have
liability, including any liability by reason of having been a substantial
employer within the meaning of Section 4063 of ERISA at any time during the
preceding five years, or by reason of being deemed to be a contributing
sponsor under Section 4069 of ERISA.
"Percentage" means, relative to any Lender, the applicable percentage
relating to Term A Loans, Term B Loans or Term C Loans, as the case may be,
as set forth opposite its signature hereto under the applicable column
heading or as set forth in a Lender Assignment Agreement under the
applicable column heading, as such percentage may be adjusted from time to
time pursuant to Lender Assignment Agreement(s) executed by such Lender and
its Assignee Lender(s) and delivered pursuant to Section 10.11.1. A Lender
shall not have any Commitment to make Term A Loans, Term B Loans or Term C
Loans, as the case may be, if its percentage under the applicable column
heading is zero percent (0%).
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"Permit" means any material building, construction, land use,
environmental or other permit, license, franchise, approval, consent and
authorization (including central bank and planning board approvals from
applicable Governmental Instrumentalities and approvals required under the
Nevada Gaming Law) required for or in connection with the construction,
ownership, use, occupation and operation of the Main Project and the
transactions provided for in this Agreement and the other Operative
Documents.
"Permitted Encumbrance" means any encumbrance against all or a portion
of the Site as set forth in Exhibit BB hereto.
"Permitted Exception" means any exception to title to all or a portion
of the Site as set forth in Exhibit CC hereto.
"Permitted Lien" means any of the following types of Liens (excluding,
however, any such Lien imposed pursuant to Section 401(a)(29) or 412(n) of
the Internal Revenue Code or by ERISA, any such Lien relating to or imposed
in connection with any Environmental Claim and any such Lien expressly
prohibited by any applicable terms of any of the Operative Documents or the
Discount Note Indenture):
(a) Liens in favor of the Borrower;
(b) Liens to secure the performance of statutory obligations,
surety or appeal bonds, performance bonds or other obligations of a
like nature incurred in the ordinary course of business or in the
construction of the Main Project; provided, however, that the Borrower
has obtained a title insurance endorsement insuring against losses
arising therewith or, if such Lien arises after completion of the Main
Project, the Borrower has bonded such Lien within a reasonable time
after becoming aware of the existence of such Lien;
(c) Liens securing the Obligations under the Operative
Documents;
(d) Liens existing on the Effective Date and set forth in Item
7.2.3 of the Disclosure Schedule;
(e) (x) Liens for Impositions or (y) statutory Liens of
landlords, and carriers', warehousemen's, mechanics', suppliers',
materialmen's, repairmen's or other similar Liens arising in the
ordinary course of business or in the construction of the Main
Project, in the case of each of items (x) and (y), with respect to
amounts that either (1) are not yet delinquent or (2) are being
diligently contested in good faith by appropriate proceedings,
provided, however, that, in each case, any reserve or other
appropriate provision as shall be required in conformity with GAAP
shall have been made therefor;
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(f) easements, rights-of-way, avigational servitude,
restrictions, minor defects or irregularities in title and other
similar charges or encumbrances which do not interfere in any material
respect with the ordinary conduct of business of the Borrower;
(g) Liens created by the Reciprocal Easement Agreement;
(h) Liens created by the Disbursement Agreement;
(i) licenses of patents, trademarks and other intellectual
property rights granted by the Borrower in the ordinary course of
business;
(j) any judgment attachment or judgment Lien not constituting an
Event of Default;
(k) subject to the terms of the GECC Intercreditor Agreement,
Liens to secure all obligations under the FF&E Financing; provided,
however, that (x) the principal amount of such Indebtedness does not
exceed the cost (including sales and excise taxes, installation and
delivery charges and other direct costs of, and other direct expenses
paid or charged in connection with, such purchase) of the FF&E
purchased or leased with the proceeds thereof and (y) the aggregate
principal amount of such Indebtedness including any Permitted
Refinancing Indebtedness incurred to refinance or replace any
Indebtedness secured by such Lien does not exceed $80,000,000
(including obligations characterized as operating leases or other off-
balance sheet financing arrangements) outstanding at any time;
(l) Liens securing obligations arising under the Contribution
Agreement and between the parties thereto so long as such Liens cannot
be enforced by the holder thereof until all Obligations have been paid
in cash in full, all Letters of Credit have been terminated or expired
and all Commitments have terminated provided, however, that to the
extent any distributions on any relevant Capital Stock or Membership
Interests, as the case may be, are permitted to be made to the
shareholders or members, as the case may be, in respect thereof under
the Loan Documents, such holder shall be permitted to enforce such
Liens (including by causing the redirection of any such distribution
to such holder);
(m) Liens incurred or deposits made in the ordinary course of
business in connection with workers' compensation, unemployment
insurance and other types of social security, or to secure the
performance of tenders, statutory obligations, surety and appeal
bonds, bids, leases, government contracts, trade contracts,
performance and return-of-money bonds and other similar obligations
(excluding, however, obligations for the payment of borrowed money),
incurred in the ordinary course of business so long as no foreclosure,
sale or similar proceedings have been commenced with respect to any
portion of the Main Project Security on account thereof, (x) for
amounts not yet overdue
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or (y) for amounts that are overdue and that (in the case of any such
amounts overdue for a period in excess of 5 days) are being contested
in good faith by appropriate proceedings, so long as (1) such reserves
or other appropriate provisions, if any, as shall be required by
generally accepted accounting principles shall have been made for any
such contested amounts, and (2) in the case of a Lien with respect to
any portion of the Main Project Security, such contest proceedings
conclusively operate to stay the sale of any portion of the Main
Project Security on account of such Lien;
(n) Liens for taxes, assessments or governmental charges or
claims the payment of which is not, at the time due and payable or
which is being contested in good faith by appropriate governmental
proceedings promptly instituted and diligently contested, so long as
(x) such reserve or other appropriate provision, if any, as shall be
required in conformity with generally accepted accounting principles
shall have been made therefor through an allocation in the Trade
Detail Report and (y) in case of any charge or claim which has or may
become a Lien against any of the Main Project Security, such contest
proceedings conclusively operate to stay the sale of any portion of
the Main Project Security to satisfy such charge or claim;
(o) Liens created by the Common Parking Area Use Agreement; and
(p) Liens created pursuant to Permitted Refinancing Indebtedness
which is incurred to refinance Indebtedness which has been secured by
a Lien and is permitted under Section 7.2.2 and which has been
incurred in accordance with such Section; provided, however, that such
Liens do not extend to cover any property or assets of the Borrower
not already securing the Indebtedness so refinanced.
"Permitted Refinancing Indebtedness" means any Indebtedness of the
Borrower issued in exchange for, or the net proceeds of which are used to
extend, refinance, renew, replace, defease or refund other Indebtedness of
the Borrower; provided, however, that (u) the principal amount of such
Permitted Refinancing Indebtedness does not exceed the principal amount
plus accrued interest on the Indebtedness so extended, refinanced, renewed,
replaced, defeased or refunded (plus the amount of reasonable expenses
incurred in connection therewith), (v) such Permitted Refinancing
Indebtedness has a final maturity date later than the final maturity date
of, and has a Weighted Average Life to Maturity equal to or greater than
the Weighted Average Life to Maturity of, the Indebtedness being extended,
refinanced, renewed, replaced, defeased or refunded, (w) such Indebtedness
is incurred by the Borrower as the Obligor on the Indebtedness being
extended, refinanced, renewed, replaced, defeased or refunded, (x) the
security, if any, for the Permitted Refinancing Indebtedness shall be the
same as that for the Indebtedness being refinanced (except to the extent
that less security is granted to holders of such refinancing Indebtedness),
(y) the holders of the Permitted Refinancing Indebtedness are not afforded
covenants, defaults, rights or remedies more burdensome to the obligor or
obligors than those contained in the Indebtedness being refinanced and
(z) the Permitted Refinancing Indebtedness is subordinated to the same
degree, if any, as the Indebtedness being refinanced.
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"Person" means any natural person, corporation, limited liability
company, partnership, joint venture, joint stock company, firm,
association, trust or unincorporated organization, government, governmental
agency, Governmental Instrumentality, court or any other legal entity,
whether acting in an individual, fiduciary or other capacity.
"Phase I Report" is defined in the Disbursement Agreement.
"Plan" means any Pension Plan or Welfare Plan.
"Planet Hollywood" means Planet Hollywood International, Inc.
"Plans and Specifications" means all plans, specifications, design
documents, schematic drawings and related items for the design,
architecture and construction of the Main Project that are listed on
Schedule VII hereto, as the same may be (x) finalized in a manner that
reflects a natural evolution of their status on the date hereof and in a
manner consistent with the standards set forth in Section 7.2.17 and (y)
amended in accordance with Section 7.2.17.
"Pledge Agreement" means, as the context may require, the Holdings
Pledge Agreement, the LCNI Pledge Agreement, the Sommer Enterprises Pledge
Agreement, the AHL Pledge Agreement, the Enterprises Pledge Agreement, the
Borrower Pledge Agreement or the AMH Pledge Agreement.
"Pledged Entity" means, at any time, each Person in respect of which
the Lenders have been granted, at such time, a security interest in and to,
or a pledge of, any of the issued and outstanding interests or shares of
Capital Stock of such Person.
"Preferred Stock" means any Equity Interest with preferential right of
payment of dividends or distributions, as applicable, or upon liquidation,
dissolution or winding up.
"Pre-Opening Expense" means any expense of the type listed in Schedule
VIII hereto.
"Pre-Opening Revenues" means all operating revenues received by the
Borrower with respect to the Main Project prior to the Opening Date.
"Process Agent" is defined in Section 10.14.
"Project Management Agreement" means, on any date, the Project
Management Agreement, as originally in effect on the Effective Date,
between AHL and the Owner Representative and as thereafter from time to
time amended, supplemented, amended and restated or otherwise modified in
accordance with the terms hereof.
"Project Party" means the Borrower, AHL, Sommer Enterprises, Capital,
Holdings, London Clubs, LCNI, the Design/Builder or Fluor.
58
"Quarterly Payment Date" means the last Business Day of each March,
June, September and December.
"Rate Protection Agreement" means any interest rate swap, cap, collar
or similar agreement entered into by the Borrower in respect of the Loans
pursuant to the terms of this Agreement under which the counterparty to
such agreement is (or, at the time such Rate Protection Agreement was
entered into, was) a Lender or an Affiliate of a Lender reasonably
acceptable to the Administrative Agent.
"Real Property" means, relative to any Person, such Person's present
and future right, title and interest (including any leasehold estate) in
(a) any plots, pieces or parcels of land;
(b) any improvements, buildings, structures and fixtures now or
hereafter located or erected thereon or attached thereto of every
nature whatsoever;
(c) any other interests in property constituting appurtenances
to the Site, or which hereafter shall in any way belong, relate or be
appurtenant thereto; and
(d) all other rights and privileges thereunto belonging or
appertaining and all extensions, additions, improvements, betterments,
renewals, substitutions and replacements to or of any of the rights
and interests described in clause (c).
"Realized Savings" means:
(a) the portion of any decrease to the Guaranteed Maximum Price
retained or to be retained by the Borrower in accordance with the
provisions of Attachment H to the Design/Build Contract in the "Cost of the
Work" (as defined in Section 3 of Attachment G to the Design/Build
Contract) contemplated by a Line Item but only to the extent that the
Guaranteed Maximum Price has been reduced as a result of such decrease in
the anticipated "Cost of the Work" as approved in writing by the
Design/Builder and such reduction is confirmed by the Construction
Consultant;
(b) with respect to the Construction Period Interest Line Item, a
decrease in the anticipated cost of construction period interest resulting
from (x) a decrease in the interest rates payable by the Borrower prior to
the date which is six months after the Conversion Date as determined by the
Administrative Agent with the reasonable concurrence of the Borrower taking
into account the current and future anticipated interest rates and the
anticipated times and amounts of draws under the Bank Credit Facility for
the payment of Main Project Costs or (y) the anticipated Conversion Date
being earlier than the date set therefor in the Construction Benchmark
Schedule as determined by the Owner Representative with the reasonable
concurrence of the Construction Consultant; and
59
(c) with respect to any other Line Item, the amount by which the
total cost allocated to such Line Item exceeds the total cost incurred by
the Borrower to complete all aspects of the Work contemplated by such Line
Item which amount shall not be established until the Borrower has actually
completed 90% of all such Work;
in each case, which is documented by the Borrower in a Realized Savings
Certificate substantially in the form of Exhibit W hereto, duly executed
and completed with all exhibits and attachments thereto.
"Reciprocal Easement Agreement" means, on any date, the Construction,
Operation and Reciprocal Easement Agreement, as originally in effect on the
Effective Date, by and among the Borrower, Aladdin Bazaar and AMH and as
thereafter from time to time amended, supplemented, amended and restated or
otherwise modified in accordance with the terms hereof.
"Register" is defined in clause (b) of Section 2.8.
"Registered Note" is defined in Section 2.8, in the form of Exhibit A-4
hereto (as such promissory note may be amended, endorsed or otherwise modified
from time to time).
"Release" means a "release", as such term is defined in CERCLA.
"Remaining Costs" means, without duplication, the sum of (w) the costs
required to achieve Final Completion plus (x) the Retainage Amounts to be
paid to Persons who have supplied labor or materials in connection with
such line item, plus (y) the amount required to pay fees and interest at
the maximum rate of interest set forth in the Loan Documents (after giving
effect to the Rate Protection Agreement) through the date which is six
months after the Conversion Date plus (z) the Required Minimum Contingency.
"Required Completion Amount" is defined in the Disbursement Agreement.
"Required Lenders" means, at any time,
(a) Non-Defaulting Lenders holding at least 66 2/3% of the sum
of the aggregate outstanding principal amount of the Loans then held
by such Lenders plus the participation interests of such Lenders in
the Letter of Credit Outstandings, or
(b) if no Loans or Letter of Credit are then outstanding,
Lenders having at least 66 2/3% of the Commitments;
provided, however, that (x) amendments affecting only one class of Lenders
(with a class for each of the Term A Lenders, the Term B Lenders and the
Term C Lenders) will require the approval of the Non-Defaulting Lenders
holding 66 2/3% or more of the principal amount of the Loans, Letters of
Credit or, if applicable, Commitments for such class and (y) the consent of
all
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of the Non-Defaulting Lenders in the same class and of all Non-Defaulting
Lenders in all classes shall be required with respect to the matters set
forth in Section 10.1.
"Required Minimum Contingency" means (w) during the first month after
the Effective Date, no less than $24,000,000, (x) during the second month
after the Effective Date, no less than $23,000,000, (y) during the third
month after the Effective Date, no less than $22,000,000 and (z) thereafter
the product of (1) $25,000,000 reduced by (2) the $25,000,000 multiplied by
the percentage completed in respect of such Line Item Category on the date
that the Advance is made.
"Required Scope Change Approval" means, relative to each proposed
Scope Change, the consent of the Administrative Agent.
"Restricted Payment" is defined in clause (b) of Section 7.2.6.
"Retainage Amount" means, at any given time, amounts which have
accrued and are owing under the terms of the Design/Build Contract, a
Contract or a Subcontract, as the case may be, for work or services already
provided but which at such time (and in accordance with the terms of the
Design/Build Contract, the Contract or Subcontract, as the case may be) are
being withheld from payment to the Design/Builder, a Contractor or a
Subcontractor, as the case may be, until certain subsequent events (e.g.,
completion benchmarks) have been achieved under the Design/Build Contract
or relevant Contract or Subcontract.
"Reviewing Accountant" means Arthur Andersen LLP or any nationally
recognized firm of independent public accountants subsequently selected by
the Borrower with the consent of the Administrative Agent from time to time
(which shall not be unreasonably withheld or delayed), as auditors of the
Borrower.
"S&P" means Standard & Poor's Ratings Group, Inc., a New York
corporation, or any successor thereto.
"Salle Privee Agreement" means, on any date, the Salle Privee
Agreement, as originally in effect on the Effective Date, between the
Borrower, LCNI and London Clubs and as thereafter from time to time
amended, supplemented, amended and restated or otherwise modified in
accordance with the terms hereof.
"Scheduled Amortization" is defined in clause (b) of Section 3.1.1.
"Scope Change" means any change in the "Services" or "Work".
"Scotiabank" is defined in the preamble.
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"Scotiabank Fee Letter" means the confidential letter agreement, dated
December 4, 1997, among the Borrower, the Sponsors and Scotiabank.
"SEC" means the Securities and Exchange Commission.
"Secured Party" means the Lenders, the Issuer, the Agents, each
counterparty to a Rate Protection Agreement that is (or at the time such
Rate Protection Agreement was entered into, was) a Lender or an Affiliate
thereof reasonably acceptable to the Administrative Agent and, in each
case, each of their respective successors, transferees and assigns.
"Securities Intermediary" is defined in the Disbursement Agreement.
"Security Agreement" means, on any date, the Security Agreement
executed and delivered by an Authorized Representative of the Borrower
pursuant to Section 5.1.5, as originally in effect on the Closing Date, in
substantially the form of Exhibit F hereto and as thereafter from time to
time amended, supplemented, amended and restated or otherwise modified.
"Services" is defined in Section 1.7 of the Design/Build Contract.
"Servicing Agent" means U.S. Bank National Association, in its
capacity as the servicing agent under the Disbursement Agreement, and its
successors and assigns in such capacity.
"Servicing and Collateral Account Agreement" means, on any date, the
Servicing and Collateral Account Agreement, as originally in effect on the
Closing Date, among the Disbursement Agent, the Borrower and the Servicing
Agent and as thereafter from time to time amended, supplemented, amended
and restated or otherwise modified in accordance with the terms hereof.
"Shoulder Space" means the property and space described in Exhibit N-6
hereto.
"Site" is defined in the fourth recital and is more fully described in
Exhibit N-1 hereto.
"Site Easement" means any easement appurtenant, easement in gross,
license agreement and other right running for the benefit of the Borrower,
the Main Project, the Mall Project and the owner of the Mall Project, the
Music Project and the owner of the Music Project, the Energy Project and
the lessee of the Energy Project or appurtenant to the Site, including
those certain easements and licenses described in the Title Policy.
"Site Work Agreement" means, on any date, the Site Work Development
and Construction Agreement, as originally in effect on the Effective Date,
among the Borrower, AHL and Aladdin Bazaar and as thereafter from time to
time amended, supplemented, amended and restated or otherwise modified in
accordance with the terms hereof.
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"Solvency Certificate" means a solvency certificate to be executed and
delivered by the chief financial or accounting Authorized Representative of
the Borrower substantially in the form of Exhibit P hereto.
"Solvent" means, relative to any Person and its Subsidiaries on a
particular date, that on such date (w) the fair value of the property of
such Person and its Subsidiaries on a consolidated basis is greater than
the total amount of liabilities, including contingent liabilities, of such
Person and its Subsidiaries on a consolidated basis, (x) the present fair
salable value of the assets of such Person and its Subsidiaries on a
consolidated basis is not less than the amount that will be required to pay
the probable liability of such Person and its Subsidiaries on a
consolidated basis on its debts as they become absolute and matured,
(y) such Person does not intend to, and does not believe that it or its
Subsidiaries will, incur debts or liabilities beyond the ability of such
Person and its Subsidiaries to pay as such debts and liabilities mature and
(z) such Person and its Subsidiaries on a consolidated basis are not
engaged in a business or transaction, and such Person and its Subsidiaries
on a consolidated basis are not about to engage in business or a
transaction, for which the property of such Person and its Subsidiaries on
a consolidated basis would constitute an unreasonably small capital.
"Sommer Enterprises" means Sommer Enterprises, LLC, a Nevada limited-
liability company.
"Sommer Enterprises Pledge Agreement" means, on any date, the Pledge
Agreement executed and delivered by an Authorized Representative of Sommer
Enterprises pursuant to clause (c) of Section 5.1.3, as originally in
effect on the Closing Date, in substantially the form of Exhibit E-7 hereto
and as thereafter from time to time amended, supplemented, amended and
restated or otherwise modified.
"Specified Equipment" means the portion of the new FF&E together with
all improvements and/or additions thereto covered by an FF&E Lease and
financed by a portion of the FF&E Financing.
"Sponsor" means AHL or London Clubs.
"Stated Amount" of each Letter of Credit means the total amount
available to be drawn under such Letter of Credit upon the issuance
thereof.
"Stated Maturity Date" means
(a) with respect to all Term A Loans, the date which is the
seventh anniversary of the Closing Date;
(b) with respect to all Term B Loans, the date which is
8.5 years after the Closing Date; and
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(c) with respect to all Term C Loans, the tenth anniversary of
the Closing Date.
"Subcontract" means a contract between the Design/Builder and a
Subcontractor which has been entered into in accordance with the
Design/Build Contract.
"Subcontractor" is defined in the Design/Build Contract.
"Subsidiary" means, relative to any Person, any corporation,
partnership or other business entity of which more than 50% of the
outstanding capital stock (or other ownership interest) having ordinary
voting power to elect the board of directors, managers or other voting
members of the governing body of such Person (irrespective of whether at
the time Capital Stock (or other ownership interest) of any other class or
classes of such Person shall or might have voting power upon the occurrence
of any contingency) is at the time directly or indirectly owned by such
Person, by such Person and one or more other Subsidiaries of such Person,
or by one or more other Subsidiaries of such Person. Except as otherwise
indicated herein, references to Subsidiaries refer to Subsidiaries of the
Borrower.
"Substantial Completion" means that (x) the conditions set forth in
the definition of "Completion" have occurred, (y) "Substantial Completion"
(as such is defined in Section 31.8 of the General Conditions annexed to
the Design/Build Contract as Attachment D) has occurred and (z) a Main
Project Certificate of Occupancy has been issued and is outstanding for the
Hotel/Casino.
"Survey" means, collectively, the surveys required by Section 3.1.24
of the Disbursement Agreement.
"Syndication Agent" is defined in the preamble.
"Tax" means any federal, state, local, foreign or other tax, levy,
impost, fee, assessment or other government charge, including income,
estimated income, business, occupation, franchise, property, payroll,
personal property, sales, transfer, use, employment, commercial rent,
occupancy, franchise or withholding taxes, and any premium, including
interest, penalties and additions in connection therewith.
"Tax Amount" means, relative to any period, without duplication, the
increase in the cumulative United States federal, state and local income
tax liability of the holders of Equity Interests in the Borrower (or if the
holder is a pass-though entity for United States income tax purposes, the
direct or indirect holders of its equity interests subject to United
States, state and local income tax) in respect of such interests for such
period, plus any additional amounts payable to such holders for taxes
arising from ownership of such Equity Interests.
"Tax Certificate" means a Tax Certificate substantially in the form of
Exhibit EE hereto.
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"Tenant Improvement" means (x) the portion of the construction to be
performed by or on behalf of the Borrower in the interior of the Main
Project pursuant to a lease to adapt the same for the initial use and
occupancy by the tenant under such lease or (y) if a tenant under a Lease
undertakes to complete the work to the portion of the Main Project covered
by such Lease, any allowances or payments advanced to such Person by the
Borrower.
"Term A Lender" means any Lender which has made a Term A Loan
Commitment or holds a Term A Loan.
"Term A Loan" is defined in Section 2.1.1.
"Term A Loan Commitment" means the aggregate principal amount of
Term A Loans which the Term A Lenders are obligated to make pursuant to
Section 2.1.1. The Term A Loan Commitment shall not exceed $136,000,000.
"Term A Loan Commitment Amount" means, on any date, relative to any
Term A Lender, the portion of the Term A Loan Commitment of such Term A
Lender reduced by the principal amount of any Term A Loans made by such
Term A Lender as of such date. The portion of the Term A Loan Commitment
of each Term A Lender is set forth below such Term A Lender's signature
hereto or in a Lender Assignment Agreement.
"Term A Loan Commitment Fee" is defined in Section 3.3.1.
"Term A Loan Commitment Termination Date" means the earlier of
(a) the Term B and Term C Loan Commitment Termination Date (if
the Term B Loans and Term C Loans have not been made on or prior to
such date);
(b) the Conversion Date; and
(c) the date on which any Commitment Termination Event occurs.
Upon the occurrence of any event described in clause (a) or (b), the Term A
Loan Commitments shall terminate automatically and without any further
action.
"Term A Note" means, on any date, a promissory note of the Borrower
payable to any Term A Lender, in the form of Exhibit A-1 hereto (as such
promissory note may thereafter from time to time be amended, supplemented,
amended and restated, endorsed or otherwise modified), evidencing the
aggregate Indebtedness of the Borrower to such Term A Lender resulting from
outstanding Term A Loans, and also means all other promissory notes
accepted from time to time in substitution or replacement therefor or
renewal thereof.
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"Term B and Term C Loan Commitment Fee" is defined in Section 3.3.1.
"Term B and Term C Loan Commitment Termination Date" means the earlier
of
(a) February 27, 1998; and
(b) the date on which any Commitment Termination Event occurs.
Upon the occurrence of any event described in clause (a) or (b), the Term B
Loan Commitments and the Term C Loan Commitments shall terminate
automatically and without any further action.
"Term B Lender" means any Lender which has made a Term B Loan
Commitment or holds a Term B Loan.
"Term B Loan" is defined in clause (a) of Section 2.1.3.
"Term B Loan Commitment" means the aggregate principal amount of
Term B Loans which the Term B Lenders are obligated to make pursuant to
clause (b) of Section 2.1.3. The Term B Loan Commitment shall not exceed
$114,000,000.
"Term B Loan Commitment Amount" means, on any date, relative to any
Term B Lender, the portion of the Term B Loan Commitment of such Term B
Lender reduced by the principal amount of any Term B Loans made by such
Term B Lender as of such date. The portion of the Term B Loan Commitment
of each Term B Lender is set forth below such Term B Lender's signature
hereto or in a Lender Assignment Agreement.
"Term B Note" means, on any date, a promissory note of the Borrower
payable to any Term B Lender, in the form of Exhibit A-2 hereto (as such
promissory note may thereafter from time to time be amended, supplemented,
amended and restated, endorsed or otherwise modified), evidencing the
aggregate Indebtedness of the Borrower to such Term B Lender resulting from
outstanding Term B Loans, and also means all other promissory notes
accepted from time to time in substitution or replacement therefor or
renewal thereof.
"Term C Lender" means any Lender which has made a Term C Loan
Commitment or holds a Term C Loan.
"Term C Loan" is defined in clause (b) of Section 2.1.3.
"Term C Loan Commitment"means the aggregate principal amount of Term C
Loans which the Term C Lenders are obligated to make pursuant to clause (c)
of Section 2.1.3. The Term C Loan Commitment shall not exceed
$160,000,000.
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"Term C Loan Commitment Amount" means, on any date, relative to any
Term C Lender, the portion of the Term C Loan Commitment of such Term C
Lender reduced by the principal amount of any Term C Loans made by such
Term C Lender as of such date. The portion of the Term C Loan Commitment
of each Term C Lender is set forth below such Term C Lender's signature
hereto or in a Lender Assignment Agreement.
"Term C Note" means, on any date, a promissory note of the Borrower
payable to any Term C Lender, in the form of Exhibit A-3 hereto (as such
promissory note may thereafter from time to time be amended, supplemented,
amended and restated, endorsed or otherwise modified), evidencing the
aggregate Indebtedness of the Borrower to such Term C Lender resulting from
outstanding Term C Loans, and also means all other promissory notes
accepted from time to time in substitution or replacement therefor or
renewal thereof.
"Theater" is defined in clause (d) of the fourth recital.
"Theater Lease" means, on any date, the Lease, to be entered into
between the Borrower and Aladdin Music covering the Theater Space as the
same may be amended, supplemented, amended and restated, replaced or
otherwise modified from time to time in accordance with the terms hereof.
"Theater Renovation Completion" means that each of the following has
occurred:
(a) the renovation of the Theater has been completed
substantially in accordance with this Agreement, the Plans and
Specifications, the provisions of the Reciprocal Easement Agreement
applicable to the Theater and all of the other Operative Documents to
the extent that the development, renovation, use or operation of the
Theater are affected thereby, except for the Main Project Punchlist
Items applicable to the Theater and in substantial compliance with all
Legal Requirements pertaining to the renovation of the Theater so as
to allow the Theater to be utilized for its intended purpose;
(b) reasonable and safe means of access and facilities necessary
for the use and occupancy of the Theater have been installed and are
operational including corridors, elevators, stairways, heating,
ventilation, air conditioning, sanitary, water and electrical
facilities and all security systems and life safety systems required
by the Plans and Specifications, the Reciprocal Easement Agreement,
the other Operative Documents and all Legal Requirements; and
(c) there are no outstanding claims or Liens by any Contractor
or Subcontractor or any other Person against any portion of the
Hotel/Casino Component except for Permitted Liens and Permitted
Encumbrances.
"Theater Space" means the property and the space described in Exhibit
N-7 hereto.
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"Title Insurer" means, collectively, Stewart Title Guaranty Company
and Lawyers Title Insurance Corporation.
"Title Policy" means each lenders A.L.T.A. policy of title insurance
issued by the Title Insurer as of the Effective Date, as provided in
Section 3.1.25 of the Disbursement Agreement, including all amendments
thereto, endorsements thereof and substitutions or replacements therefor.
"Total Debt" means, on any date, the outstanding principal amount of
all Indebtedness of the Borrower of the type described in clauses (a), (b)
and (c) of such definition and (without duplication) any Contingent
Liability in respect of any of the foregoing of any other Person.
"Total Debt to EBITDA Ratio" means, as of the close of any Fiscal
Quarter, commencing with the close of the Fiscal Quarter in which the
Conversion Date occurs, the ratio of
(a) Total Debt outstanding on the last day of such Fiscal
Quarter
to
(b) EBITDA computed for the period consisting of such Fiscal
Quarter (or such shorter portion of any Fiscal Quarter after the
occurrence therein of the Conversion Date) and each of the three
immediately preceding Fiscal Quarters (or such lesser number of Fiscal
Quarters to have closed since the Conversion Date) and determined for
any period ending on or prior to the first anniversary of the
Conversion Date, consistently with the proviso to the definition of
the term "EBITDA".
"Trade Detail Report" means a Trade Detail Report in the form of
Exhibit DD hereto.
"Trademark Security Agreement" means, on any date, the Trademark
Security Agreement executed and delivered by an Authorized Representative
of the Borrower pursuant to Section 5.1.6, as originally in effect on the
Closing Date, in substantially the form of Exhibit B to the Security
Agreement and as thereafter from time to time amended, supplemented,
amended and restated or otherwise modified.
"Transaction" means the transactions contemplated by the Discount Note
Indenture and the Operative Documents.
"Trust" means the Trust under Article Sixth u/w/o Sigmund Sommer.
"Trust Estate" is defined in the Deed of Trust.
"type" means, relative to any Loan, the portion thereof, if any, being
maintained as a Base Rate Loan or a LIBO Rate Loan.
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"UCC" means the Uniform Commercial Code of the jurisdiction the law of
which governs the document with respect to the term used.
"Unallocated Contingency Balance" means (w) during the first month
after the Effective Date, the greater of (1) $24,000,000 or (2) the
Unallocated Contingency Calculation, (x) during the second month after the
Effective Date, the greater of $23,000,000 or (2) the Unallocated
Contingency Calculation, (y) during the third month after the Effective
Date, the greater of $22,000,000 or (2) the Unallocated Contingency
Calculation, and (z) thereafter, from time to time, the Unallocated
Contingency Calculation.
"Unallocated Contingency Calculation" means an amount equal to (x)
$25,000,000 minus (y) the product of (1) $25,000,000 multiplied by (2) the
percentage of construction completed on the date that the Advance is to be
made, as determined by the Construction Consultant.
"United States" or "U.S." means the United States of America, its
fifty states and the District of Columbia.
"Unsuitable Lender" is defined in clause (c) of Section 4.11.
"Voting Stock" means, with respect to any Person, Capital Stock of any
class or kind ordinarily having the power to vote for the election of
directors, managers or other voting members of the governing body of such
Person.
"Warrant" means the warrants issued by Enterprises on February 18,
1998 which, if exercised, will in the aggregate for all such warrants
entitle the holders thereof to acquire an aggregate of not more than
2,215,000 shares of the Capital Stock of Enterprises representing an
indirect interest in not more than 10% of the Holdings Common Membership
Interests, plus, warrants for up to 1,107,500 shares of the Capital Stock
of Enterprises which may be issued in connection with the Mall Project
credit enhancement on terms substantially the same as the Warrants issued
by Enterprises on February 18, 1998.
"Weighted Average Life to Maturity" means, relative to any
Indebtedness at any date, the number of years (calculated to the nearest
one-twelfth) obtained as the quotient of (x) the sum of the product of
(1) the amount of each then remaining installment, sinking fund, serial
maturity or other required payments of principal, including payment at
final maturity, in respect thereof, multiplied by (2) the number of years
(calculated to the nearest one-twelfth) that will elapse between such date
and the making of such payment divided by (y) the then outstanding
principal amount or liquidation preference, as applicable, of such
Indebtedness.
"Welfare Plan" means a "welfare plan", as such term is defined in
Section 3(1) of ERISA.
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"wholly-owned" means, with respect to any direct or indirect
Subsidiary, any Subsidiary all of the outstanding common stock (or similar
equity interest) of which (other than any director's qualifying shares or
investments by foreign nationals mandated by applicable laws) is owned
directly or indirectly by the Borrower.
"Work" is defined in Section 1.7 of the Design/Build Contract.
SECTION 1.2. Use of Defined Terms. Unless otherwise defined or the
context otherwise requires, terms for which meanings are provided in this
Agreement shall have such meanings when used in each other Loan Document,
the Disclosure Schedule, or any Borrowing Request, Letter of Credit
Issuance Request, Continuation/Conversion Notice, Compliance Certificate,
notice or other communications delivered from time to time in connection
with this Agreement or any other Loan Document.
SECTION 1.3. Cross-References. Unless otherwise specified,
references in this Agreement and in each other Loan Document to any Article
or Section are references to such Article or Section of this Agreement or
such other Loan Document, as the case may be, and, unless otherwise
specified, references in any Article, Section or definition to any item or
clause are references to such item or clause of such Article, Section or
definition.
SECTION 1.4. Accounting and Financial Determinations. Unless
otherwise specified, all accounting terms used herein or in any other Loan
Document shall be interpreted, and all accounting determinations and
computations hereunder or thereunder (including under Section 7.2.4) shall
be made, in accordance with, those generally accepted accounting principles
("GAAP") applied in the United States or, if applicable, the United Kingdom
in the preparation of the financial statements referred to in
Section 5.1.4. Unless otherwise expressly provided, all financial
covenants and defined financial terms for the Person covered thereby shall
be computed on a consolidated basis for such Person and its Subsidiaries,
in each case, without duplication.
ARTICLE II
COMMITMENTS, BORROWING AND ISSUANCE
PROCEDURES, NOTES AND LETTERS OF CREDIT
SECTION 2.1. Commitments. On the terms and subject to the conditions
of this Agreement (including Sections 2.1.4 and 2.1.5 and Article V),
(a) each Lender severally agrees to make Loans pursuant to its
Commitments, in each case as described in this Section 2.1; and
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(b) the Issuer agrees that it will issue Letters of Credit
pursuant to Section 2.1.2, and each other Lender that has a Term A
Loan Commitment severally agrees that it will purchase participation
interests in such Letters of Credit pursuant to Section 2.6.1.
No Lender shall have any liability for the failure of another Lender to
make its Commitment Amount available or to advance such Lender's Percentage
of any Loans to be made to the Borrower.
SECTION 2.1.1. Term A Loan Commitment. From time to time on any
Business Day occurring from and after the date on which the proceeds of all
Term B Loans and Term C Loans have been disbursed from the Bank Proceeds
Account but prior to the Term A Loan Commitment Termination Date, each
Lender that has a Term A Loan Commitment will make a loan (relative to such
Lender, its "Term A Loan") to the Borrower equal to such Lender's
Percentage of the aggregate amount of each Borrowing of the Term A Loans
requested by the Borrower to be made on such day; provided, however, that
each Lender may make Term A Loans prior to the date on which the proceeds
of the Term B Loans and Term C Loans have been disbursed from the Bank
Proceeds Account so long as the proceeds of such Loans are used to
reimburse the Issuer for, or fund the drawings of, Letters of Credit. The
Commitment of each such Lender described in this Section 2.1.1 is herein
referred to as its "Term A Loan Commitment". On the terms and subject to
the conditions hereof, the Borrower may from time to time borrow and prepay
the Term A Loans but no amount paid or prepaid with respect to the Term A
Loans may be reborrowed.
SECTION 2.1.2. Letter of Credit Commitment. From time to time on any
Business Day occurring from and after the date on which the Term B Loans
and the Term C Loans have been funded into the Bank Proceeds Account but
prior to the second Business Day immediately preceding the Conversion Date,
the Issuer will
(a) issue one or more standby letters of credit (relative to such
Issuer, its "Letter of Credit") for the account of the Borrower in the
Stated Amount requested by the Borrower on such day; or
(b) extend the Letter of Credit Stated Expiry Date of an existing
Letter of Credit previously issued in accordance with clause (a) of
this Section 2.1.2 to a date not later than the earlier of (x) the
Business Day immediately preceding the Conversion Date and (y) one
year from the date of such extension.
SECTION 2.1.3. Term B Loan and Term C Loan Commitments. In a single
Borrowing on the Closing Date, each Lender that has a Term B Loan
Commitment or a Term C Loan Commitment, as applicable,
(a) will make a loan (relative to such Lender, its "Term B Loan")
equal to such Lender's Percentage of the aggregate amount of the
Borrowing of Term B Loans to be
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made to the Borrower on such day (with the commitment of each such
Lender described in this clause (a) herein referred to as its "Term B
Loan Commitment"); and
(b) will make a loan (relative to such Lender, its "Term C Loan")
equal to such Lender's Percentage of the aggregate amount of the
Borrowing of Term C Loans to be made to the Borrower on such day (with
the commitment of each such Lender described in this clause (b) herein
referred to as its "Term C Loan Commitment"),
in each case directly into the Bank Proceeds Account on behalf of the
Borrower. On the terms and subject to the conditions hereof, the Borrower
may prepay the Term B Loans or the Term C Loans but no amount paid or
prepaid with respect to Term B Loans or Term C Loans may be reborrowed.
SECTION 2.1.4. Lenders Not Permitted or Required to Make Loans. No
Lender shall be permitted or required to make any Loan if, after giving
effect thereto, the aggregate outstanding principal amount of
(a) all Term A Loans
(i) of all Lenders with a Term A Loan Commitment, together
with the aggregate amount of all Letter of Credit Outstandings,
would exceed the then existing aggregate amount of the Term A
Loan Commitment Amounts, or
(ii) of such Lender with a Term A Loan Commitment, together
with such Lender's Percentage of the aggregate amount of all
Letter of Credit Outstandings, would exceed such Lender's then
existing Term A Loan Commitment Amount of such Lender; or
(b) all Term B Loans or all Term C Loans (as the case may be)
(i) of all Lenders made on the Closing Date would exceed the
aggregate amount of the Term B Loan Commitment Amounts (in the
case of Term B Loans) or the aggregate amount of the Term C Loan
Commitment Amounts (in the case of Term C Loans), or
(ii) of such Lender with a Term B Loan Commitment or with a
Term C Loan Commitment, as applicable, made on the Closing Date
would exceed such Lender's then existing Term B Loan Commitment
Amount (in the case of Term B Loans) or then existing Term C Loan
Commitment Amount (in the case of Term C Loans).
SECTION 2.1.5. Issuer Not Permitted or Required to Issue Letters of
Credit. No Issuer shall be permitted or required to issue any Letter of
Credit if, after giving effect thereto, (x) the
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aggregate amount of all Letter of Credit Outstandings would exceed the
Letter of Credit Commitment Amount or (y) the sum of the aggregate amount
of all Letter of Credit Outstandings plus the aggregate principal amount of
all Term A Loans then outstanding would exceed the aggregate amount of the
Term A Loan Commitment Amounts.
SECTION 2.2. Reduction of the Term A Loan Commitment Amount. The
Borrower may, from time to time on any Business Day occurring after the
Effective Date, voluntarily reduce the aggregate amount of the Term A Loan
Commitment Amounts on the Business Day so specified by the Borrower;
provided, however, that all such reductions shall require at least one
Business Day's prior notice to the Administrative Agent and be permanent,
and any partial reduction of the aggregate amount Term A Loan Commitment
Amounts shall be in a minimum amount of $1,000,000 and in an integral
multiple of $500,000. The aggregate amount of all Term A Loan Commitments
shall be reduced by the Administrative Agent, prior to the Term A Loan
Commitment Termination Date, by an amount equal to any reduction in the
Main Project Budget as approved by the Administrative Agent, the Borrower
and the Construction Consultant. In addition to the foregoing, in the
event that the Borrower does not enter into the Theater Lease with Aladdin
Music, there shall be no investment by the Borrower in Aladdin Music, the
amount set forth in the Main Project Budget as "Investment in Aladdin
Music, LLC" shall be applied by the Borrower to pay for the costs of
renovation of the Theater (based upon a renovation budget approved by the
Administrative Agent as determined in good faith in its sole discretion),
and the unadvanced portion of the aggregate amount of the Term A Loan
Commitment Amounts shall be reduced dollar-for-dollar by the amount
remaining in such line item. Upon any reduction of the aggregate amount of
the Term A Loan Commitment Amounts under this Section, the Term A Loan
Commitment Amount of each Term A Lender shall be reduced by an amount equal
to such Lender's Percentage of such reduction.
SECTION 2.3. Borrowing Procedure. Loans shall be made by the Lenders
in accordance with this Section 2.3.
SECTION 2.3.1. Borrowing Procedure. On the terms and subject to the
conditions of this Agreement, by delivering a Borrowing Request to the
Administrative Agent on or before 10:00 a.m., New York City time, on a
Business Day, the Borrower may from time to time irrevocably request, on
not less than one Business Day's notice in the case of Base Rate Loans, or
three Business Days' notice in the case of LIBO Rate Loans, and in either
case not more than five Business Days' notice, that a Borrowing be made.
On the terms and subject to the conditions of this Agreement, each
Borrowing shall be comprised of the type of Loans, and shall be made on the
Business Day, specified in such Borrowing Request. On or before 11:00 a.m.
(New York City time) on such Business Day each Lender that has a Commitment
to make the Loans being requested shall deposit with the Administrative
Agent same day funds in an amount equal to such Lender's Percentage of the
requested Borrowing. Such deposit will be made to an account which the
Administrative Agent shall specify from time to time by notice to the
Lenders. To the extent funds are received from the Lenders, the
Administrative Agent shall make such funds available to the Disbursement
Agent by wire transfer to the Bank Proceeds
73
Account or, if applicable, the Collection Account for distribution to the
Borrower in accordance with the Disbursement Agreement.
SECTION 2.3.2. Term A Loans. On the terms and subject to the
conditions of this Agreement and the Disbursement Agreement prior to the
Term A Loan Commitment Termination Date, the Borrower may from time to time
irrevocably request that Term A Loans be made by the Lenders. Any such
request for Term A Loans shall be made in accordance with Section 2.3.1 and
Section 2.4 of the Disbursement Agreement; provided, however, that any of
the Term A Loans which are advanced by the Lenders to reimburse the Issuer
for or fund draws under a Letter of Credit shall be made in accordance with
Sections 2.6.1 and 2.6.2.
SECTION 2.3.3. Term B Loans and Term C Loans. On the terms and
conditions of this Agreement prior to the Term B and Term C Loan Commitment
Termination Date, the Borrower may irrevocably request that the Term B
Loans and the Term C Loans be made by the Lenders on the Closing Date. Any
such request for the Term B Loans and the Term C Loans shall be made in
accordance with Section 2.3.1 and Section 2.4 of the Disbursement
Agreement. The Term B Loans and the Term C Loans shall be made
simultaneously and neither any Term B Loan nor any Term C Loan shall be
made without all other such Loans being then made. The proceeds of the
Term B Loans and the Term C Loans shall be made available by the Lenders,
by wire transfer to the Bank Proceeds Account, for distribution pro rata by
the Disbursement Agent in accordance with the Disbursement Agreement.
SECTION 2.3.4. Additional Term B Loans and/or Term C Loans. (a) On
the terms and subject to the conditions of this Agreement and the
Disbursement Agreement prior to the date on which all of the Term B Loans
and Term C Loans have been advanced from the Bank Proceeds Account, the
Borrower may request in accordance with Section 2.3.1 and Section 2.4 of
the Disbursement Agreement an additional borrowing of a loan to be deemed
to have been made as a Term B Loan and/or a Term C Loan in an aggregate
amount not exceeding $5,000,000 by (i) any of the Lenders, in each case,
which agrees to make such loan or (ii) any commercial bank, fund or other
financial institution reasonably acceptable to the Administrative Agent and
the Borrower, in each case, which agrees to make such loan in a single
borrowing on a Business Day prior to such date. The proceeds of such loan
shall be made available by such institution by wire transfer to the Bank
Proceeds Account, for distribution by the Disbursement Agent in accordance
with the Disbursement Agreement.
(b) Following the making of such loan, (i) such borrowing shall be
deemed to be a Borrowing; (ii) such loan shall be deemed to have been made
as a Term B Loan and/or a Term C Loan, as the case may be; (iii) the final
amortization payment amount set forth under the headings on "Scheduled
Repayment of Term B Loan" and "Scheduled Repayment of Term C Loan" in
Schedule II hereto shall be increased by the amount of such made as a Term
B Loan and Term C Loan, respectively; (iv)such institution shall be deemed
to be a Term B Loan Lender and/or a Term C Loan Lender; (v) the Percentage
of Term B Loans of each Term B Lender (including such institution) shall be
adjusted to equal a fraction, the numerator of which
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equals the amount of Term B Loans held by such Term B Lender (including, in
the case of such institution, such loan) and the denominator of which
equals the aggregate outstanding amount of all Term B Loans (including such
loan); and (vi) the Percentage of Term C Loans of each Term C Lender
(including such institution) shall be adjusted to equal a fraction, the
numerator of which equals the amount of Term C Loans held by such Term C
Lender (including, in the case of such institution, such loan) and the
denominator of which equals the aggregate outstanding amount of all Term C
Loans (including such loan).
(c) Notwithstanding the date on which such loan was made by such
institution or any provisions of the UCC, any applicable law or decision,
each Lender agrees that all Liens and security interests created under any
Loan Document in favor of the Lenders shall inure to the benefit of such
institution as if such institution had made such loan on the Closing Date
and such Liens and security interests shall be treated by such Lenders, on
the one hand, and such institution, on the other hand, as having equal
priority.
SECTION 2.4. Continuation and Conversion Elections. By delivering a
Continuation/Conversion Notice to the Administrative Agent on or before
10:00 a.m., New York City time, on a Business Day, the Borrower may from
time to time irrevocably elect, on not less than one Business Day's notice
in the case of Base Rate Loans, or three Business Days' notice in the case
of LIBO Rate Loans, and in either case not more than five Business Days'
notice, that all, or any portion in an aggregate minimum amount of
$4,000,000 and an integral multiple of $1,000,000, in the case of LIBO Rate
Loans, or an aggregate minimum amount of $4,000,000 and an integral
multiple of $1,000,000, in the case of Base Rate Loans, be, in the case of
Base Rate Loans, converted into LIBO Rate Loans or be, in the case of LIBO
Rate Loans, converted into Base Rate Loans or continued as LIBO Rate Loans
(in the absence of delivery of a Continuation/Conversion Notice with
respect to any LIBO Rate Loan at least three Business Days (but not more
than five Business Days) before the last day of the then current Interest
Period with respect thereto, such LIBO Rate Loan shall, on such last day,
automatically convert to a Base Rate Loan); provided, however, that
(x) each such conversion or continuation shall be pro rated among the
applicable outstanding Loans of all Lenders that have made such Loans and
(y) no portion of the outstanding principal amount of any Loans may be
continued as, or be converted into, LIBO Rate Loans when any Default has
occurred and is continuing.
SECTION 2.5. Funding. Each Lender may, if it so elects, fulfill its
obligation to make, continue or convert LIBO Rate Loans hereunder by
causing one of its foreign branches or Affiliates (or an international
banking facility created by such Lender) to make or maintain such LIBO Rate
Loan; provided, however, that such LIBO Rate Loan shall nonetheless be
deemed to have been made and to be held by such Lender, and the obligation
of the Borrower to repay such LIBO Rate Loan shall nevertheless be to such
Lender for the account of such foreign branch, Affiliate or international
banking facility. In addition, the Borrower hereby consents and agrees
that, for purposes of any determination to be made for purposes of
Section 4.1, 4.2, 4.3 or 4.4, it shall be conclusively assumed that each
Lender elected to fund all LIBO Rate Loans by purchasing Dollar deposits in
its relevant interbank eurodollar market.
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SECTION 2.6. Letter of Credit Issuance Procedures. By delivering to
the Administrative Agent a Letter of Credit Issuance Request on or before
10:00 a.m., New York City time, on a Business Day, the Borrower may from
time to time irrevocably request, on not less than three nor more than ten
Business Days' notice in the case of an initial issuance of a Letter of
Credit for the account of the Borrower and not less than three Business
Days' prior notice in the case of a request for the extension of the Letter
of Credit Stated Expiry Date of a Letter of Credit, that the Issuer issue,
or extend the Letter of Credit Stated Expiry Date of, as the case may be,
an irrevocable Letter of Credit in such form as may be requested by the
Borrower and approved by the Issuer, solely for the purposes described in
Section 7.1.9(c). Each Letter of Credit shall by its terms be stated to
expire on a date (its "Letter of Credit Stated Expiry Date") no later than
the earlier to occur of (x) the Business Day immediately preceding the
Conversion Date or (y) one year from the date of its issuance. The Issuer
will make available to the beneficiary thereof the original of each Letter
of Credit which it issues hereunder. The issuance of a Letter of Credit
under this Section 2.6 shall be deemed to be a Borrowing under the Term A
Loan Commitment in the face amount of such Letter of Credit.
SECTION 2.6.1. Other Lenders' Participation. Upon the issuance of
each Letter of Credit pursuant hereto, and without further action, each
Term A Lender (other than the Issuer) shall be deemed to have irrevocably
purchased, to the extent of its Letter of Credit Commitment, a
participation interest in such Letter of Credit (including any Letter of
Credit Reimbursement Obligation with respect thereto), and each Term A
Lender shall, to the extent of its then existing Term A Loan Commitment
Amount, be responsible for funding promptly (and in any event within one
Business Day) to the Issuer the amount of any Letter of Credit
Reimbursement Obligation which has not otherwise been reimbursed by the
Borrower in accordance with Section 2.6.3. In addition, each Term A Lender
shall, to the extent of its Term A Loan Commitment, be entitled to receive
a ratable portion of the Letter of Credit fees payable pursuant to
Section 3.3.3 with respect to each Letter of Credit (other than the
issuance fees payable to the Issuer of such Letter of Credit pursuant to
the last sentence of Section 3.3.3) and of interest payable pursuant to
Section 3.2 with respect to any Letter of Credit Reimbursement Obligation.
To the extent that a Term A Lender has reimbursed any Issuer for a Letter
of Credit Disbursement as required by this Section, such Term A Lender
shall be entitled to receive its ratable portion of any amounts
subsequently received (from the Borrower or otherwise) in respect of such
Letter of Credit Disbursement. The obligations of each Term A Lender under
this Section 2.6.1 are obligatory on the part of each Term A Lender, such
obligations of each Term A Lender shall be performed whether or not a
Default or Event of Default exists hereunder and whether or not the
conditions set forth in Section 3.2 of the Disbursement Agreement and
Article V of this Agreement have been satisfied, shall be absolute,
unconditional, and irrevocable, and shall be performed by each Term A
Lender strictly in accordance with the terms and provisions of this
Agreement, under any and all circumstances and irrespective of any set-off,
counterclaim, or defense to payment which the Term A Lenders, individually
or collectively, may have or have had against the Issuer, the other
Lenders, the Administrative Agent or the Disbursement Agent, shall not be
subject to the requirement that the Borrower reimburse the Issuer for any
sight drafts presented under any Letter of Credit and shall be
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independent of all of the obligations of the Borrower, the Lenders, the
Administrative Agent and/or the Disbursement Agent. Notwithstanding
anything to the contrary in this Section 2.6.1, so long as any Letter of
Credit is outstanding, each of the Term A Lenders shall have the absolute
obligation to make a Term A Loan to the Issuer on behalf of Borrower in
accordance with Section 2.6.2.
SECTION 2.6.2. Letter of Credit Disbursements. The Issuer will
notify the Borrower and the Administrative Agent promptly of the
presentment for payment of any Letter of Credit, together with notice of
the date (the "Letter of Credit Disbursement Date") such payment shall be
made (each such payment, a "Letter of Credit Disbursement"). Immediately
thereafter, the Administrative Agent shall give telephonic and facsimile
notice to the Term A Lenders of the presentation of such sight draft, the
amount of such sight draft, the date on which payment thereon has been or
will be made, and the Percentage of each Term A Lender in the amount of
such sight draft together with a copy of the sight draft and accompanying
documents. A copy of such sight draft, together with such accompanying
documents, shall, for purposes of this Agreement, be deemed to be a
Borrowing Request for a Term A Loan to each of the Term A Lenders (which,
on the date of such Borrowing, shall bear interest at the Base Rate).
Subject to the terms and provisions of such Letter of Credit, the Issuer
shall make such Letter of Credit Disbursement to the beneficiary (or its
designee) of such Letter of Credit. Prior to 11:00 a.m., New York City
time, on the first Business Day following the date on which notice was
given by the Administrative Agent to the Term A Lenders, the Term A Lenders
shall advance as an obligatory advance hereunder a Term A Loan to the
Administrative Agent (whether or not the Borrower has satisfied the
conditions set forth in Section 3.2 of the Disbursement Agreement or
Article V of this Agreement), for the account of the Issuer, in an amount
equal to such Term A Lender's Percentage of the amount which the Issuer has
disbursed under such Letter of Credit, together with interest thereon at a
rate per annum equal to the rate per annum then in effect for Base Rate
Loans (with the then Applicable Base Rate Margin accruing on such amount)
pursuant to Section 3.2 for the period from the Letter of Credit
Disbursement Date through the date of such reimbursement. The Term A Loans
made pursuant to this Section 2.6.2 shall be applied to the payment of such
sight draft (and at the election of the Issuer be advanced directly to the
beneficiary) and shall not be used for any other purpose. Without limiting
in any way the foregoing and notwithstanding anything to the contrary
contained herein or in any separate application for any Letter of Credit,
the Borrower hereby acknowledges and agrees that it shall be obligated to
reimburse the Issuer upon each Letter of Credit Disbursement by means of a
Borrowing of Term A Loans made pursuant to this Section 2.6.2.
SECTION 2.6.3. Reimbursement. The obligation (a "Letter of Credit
Reimbursement Obligation") of the Borrower under Section 2.6.2 to reimburse
the Issuer with respect to each Letter of Credit Disbursement (including
interest thereon), and, upon the failure of the Borrower to reimburse the
Issuer, each Term A Lender's obligation under Section 2.6.1 to reimburse
the Issuer, shall be absolute, unconditional and irrevocable under any and
all circumstances and irrespective of any setoff, counterclaim or defense
to payment which the Borrower or such Term A Lender, as the case may be,
may have or have had against the Issuer or any other Term A
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Lender, including any defense based upon the failure of any Letter of
Credit Disbursement to conform to the terms of the applicable Letter of
Credit (if, in the Issuer's good faith opinion, such Letter of Credit
Disbursement is determined to be appropriate) or any non-application or
misapplication by the beneficiary of the proceeds of such Letter of Credit;
provided, however, that after paying in full its Letter of Credit
Reimbursement Obligation hereunder, nothing herein shall adversely affect
the right of the Borrower or such other Term A Lender, as the case may be,
to commence any proceeding against the Issuer for any wrongful Letter of
Credit Disbursement made by the Issuer under a Letter of Credit as a result
of acts or omissions constituting gross negligence or wilful misconduct on
the part of the Issuer.
SECTION 2.6.4. Deemed Letter of Credit Disbursements. Upon the
occurrence and during the continuance of any Default of the type described
in Section 8.1.10 or, with notice from the Administrative Agent, upon the
occurrence and during the continuance of any other Event of Default,
(a) an amount equal to that portion of all Letter of Credit
Outstandings attributable to the then aggregate amount which is
undrawn and available under all Letters of Credit issued and
outstanding hereunder shall, without demand upon or notice to the
Borrower, be deemed to have been paid or disbursed by the Issuer under
such Letters of Credit (notwithstanding that such amount may not in
fact have been so paid or disbursed); and
(b) upon notification by the Administrative Agent to the Borrower
of its obligations under this Section, the Borrower shall be
immediately obligated to reimburse the Issuer for the amount deemed to
have been so paid or disbursed by such Issuer, in which case the last
four sentences of Section 2.6.2 shall apply.
Any amounts so payable by the Borrower pursuant to this Section 2.6.4 shall
be deposited in cash with the Administrative Agent and held as collateral
security for the Obligations in connection with the Letters of Credit
issued by the Issuer, and the Administrative Agent shall make disbursements
thereof from time to time to reimburse the Issuer for payments made by the
Issuer with respect to Letters of Credit. At such time when the Default or
Events of Default giving rise to the deemed disbursements hereunder shall
have been cured or waived, the Administrative Agent shall return to the
Borrower all amounts then on deposit with the Administrative Agent pursuant
to this Section which have not been applied to the partial satisfaction of
such Obligations.
SECTION 2.6.5. Nature of Letter of Credit Reimbursement Obligations.
The Borrower and, to the extent set forth in Section 2.6.1, each Term A
Lender shall assume all risks of the acts, omissions or misuse of any
Letter of Credit by the beneficiary thereof. The Issuer (except to the
extent of its own gross negligence or wilful misconduct) shall not be
responsible for:
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(a) the form, validity, sufficiency, accuracy, genuineness or
legal effect of any Letter of Credit or any document submitted by any
party in connection with the application for and issuance of a Letter
of Credit, even if it should in fact prove to be in any or all
respects invalid, insufficient, inaccurate, fraudulent or forged;
(b) the form, validity, sufficiency, accuracy, genuineness or
legal effect of any instrument transferring or assigning or purporting
to transfer or assign a Letter of Credit or the rights or benefits
thereunder or the proceeds thereof in whole or in part, which may
prove to be invalid or ineffective for any reason;
(c) failure of the beneficiary to comply fully with conditions
required in order to demand payment under a Letter of Credit;
(d) errors, omissions, interruptions or delays in transmission or
delivery of any messages, by mail, facsimile or otherwise; or
(e) any loss or delay in the transmission or otherwise of any
document or draft required in order to make a Letter of Credit
Disbursement under a Letter of Credit.
None of the foregoing shall affect, impair or prevent the vesting of any of
the rights or powers granted to the Issuer or any Term A Lender hereunder.
In furtherance and not in limitation or derogation of any of the foregoing,
any action taken or omitted to be taken by an Issuer in good faith (and not
constituting gross negligence or willful misconduct) shall be binding upon
the Borrower and each such Term A Lender, and shall not put such Issuer
under any resulting liability to the Borrower or any such Term A Lender, as
the case may be.
SECTION 2.7. Notes. Each Lender's Loans under a Commitment shall be
evidenced by a Note payable to the order of such Lender in a maximum
principal amount equal to such Lender's original applicable Commitment
Amount. The Borrower hereby irrevocably authorizes each Lender to make (or
cause to be made) appropriate notations on the grid attached to such
Lender's Note (or on any continuation of such grid), which notations, if
made, shall evidence, inter alia, the date of, the outstanding principal
of, and the interest rate and Interest Period applicable to the Loans
evidenced thereby. Such notations shall be conclusive and binding on the
Borrower absent manifest error; provided, however, that the failure of any
Lender to make any such notations shall not limit or otherwise affect any
Obligations of the Borrower or any other Obligor.
SECTION 2.8. Registered Notes. (a) Any Lender may request the
Borrower (through the Administrative Agent), and the Borrower agrees (i) to
exchange for any Notes held by such Lender, or (ii) to issue to such Lender
on the date it becomes a Lender, promissory notes(s) registered as provided
in clause (b) of this Section 2.8 (each, a "Registered Note"), to be in
substantially the form agreed to by the Borrower and such Lender.
Registered Notes may not be exchanged for Notes that are not Registered
Notes.
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(b) The Borrower shall maintain, or cause to be maintained, a
register (the "Register") (which, at the request of the Borrower,
shall be kept by the Administrative Agent of behalf of the Borrower at
no extra charge to the Borrower at the address to which notices to the
Administrative Agent are to be sent under this Agreement) on which it
enters the name of the registered owner of the Lender Obligations(s)
evidenced by a Registered Note.
(c)The Register shall be available for inspection by the Borrower
and any Lender at any reasonable time upon reasonable (but in any
event not less than 10 business Days) prior written notice.
ARTICLE III
REPAYMENTS, PREPAYMENTS, INTEREST AND FEES
SECTION 3.1. Repayments and Prepayments; Application.
SECTION 3.1.1. Repayments and Prepayments. The Borrower shall repay
in full the unpaid principal amount of each Loan upon the applicable Stated
Maturity Date therefor. Prior thereto, payments and prepayments of Loans
shall or may be made as set forth below.
(a)(i) From time to time on any Business Day, the Borrower may
make a voluntary prepayment, in whole, of the outstanding
principal amount of any Term A Loan, provided, however, that
(A) All such voluntary prepayments shall require at
least one but no more than five Business Days' prior written
notice to the Administrative Agent; and
(B) All such voluntary partial prepayments shall be, in
the case of LIBO Rate Loans, in an aggregate minimum amount
of $4,000,000 and an integral multiple of $1,000,000 and, in
the case of Base Rate Loans, in an aggregate minimum amount
of $4,000,000 and an integral multiple of $1,000,000.
(ii) From time to time on any Business Day after the second
anniversary of the Effective Date, the Borrower may make a
voluntary prepayment, in whole or in part, of the outstanding
principal amount of any Term B Loan or Term C Loan; provided,
however, that
(A) any such prepayment of such Loans shall be made pro
rata among such Loans of the same type and, if applicable,
having the same Interest Period of all Lenders that have
made such Loans (with the
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amounts so allocated being applied to the remaining
amortization payments for such Loans in such amounts as the
Borrower shall determine);
(B) all such voluntary prepayments shall require at
least one but no more than five Business Days' prior written
notice to the Administrative Agent;
(C) all such voluntary partial prepayments shall be, in
the case of LIBO Rate Loans, in an aggregate minimum amount
of $4,000,000 and an integral multiple of $1,000,000 and, in
the case of Base Rate Loans, in an aggregate minimum amount
of $4,000,000 and an integral multiple of $1,000,000; and
(D) shall be accompanied by a premium equal to the
product of (1) the percentage set forth opposite the 12-month
period ending on the anniversary of the Effective Date in which
such prepayment is made multiplied by (2) the amount then
prepaid:
Third Anniversary: 3.00%
Fourth Anniversary: 2.00%
Fifth Anniversary: 1.00%
Each Anniversary Thereafter: 0%
(b) From and after the Conversion Date, the principal amount of
the Term A Loans, the Term B Loans and the Term C Loans shall be
amortized (the "Scheduled Amortization") on the dates and in the
amounts set forth on Schedule II.
(c) From and after the Conversion Date, the Borrower shall make
mandatory prepayments of principal (the "Mandatory Prepayments") of
all Loans in addition to the Scheduled Amortization on the dates and
in the amounts set forth in Schedule III; provided, however, on any
date on which a Mandatory Prepayment is to be made, any Term B Lender
or a Term C Lender may elect not to receive its portion of such
Mandatory Prepayment in which case 50% of the portion of the Mandatory
Prepayment which was to have been made to such Lender shall be paid
pro rata to (x) the Term B Lenders and the Term C Lenders and which
have elected to receive their portions of such Mandatory Prepayment
and (y) the Term A Lenders which have made a Term A Loan (up to the
outstanding amount of the Term A Loans), and upon the payment of such
50% portion of such Mandatory Prepayment, the Borrower shall be deemed
to have satisfied its obligations to make such Mandatory Prepayment.
Except as set forth in the proviso of the immediately preceding
sentence, Mandatory Prepayments will be applied pro rata in inverse
order among the Term A Loan, the Term B Loan and the Term C Loan.
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(d) If the entire "Investment in Aladdin Music, LLC" has been
advanced from the Commitments, the Borrower shall make a mandatory
prepayment of principal (the "Music Investment Prepayment") of all
Term A Loans within 5 days after request by the Administrative Agent
to the Borrower by an amount equal to the excess of the amount set
forth in the Main Project Budget as "Investment in Aladdin Music, LLC"
over the costs of renovation of the Theater; and upon the payment of
such Music Investment Prepayment, the Borrower shall be deemed to have
satisfied its obligations to make such Music Investment Prepayment.
(e) In addition to the Scheduled Amortization, the Mandatory
Prepayments and the Music Investment Prepayments, the entire
outstanding principal balance of all Loans shall become immediately
due and payable (and any outstanding Letters of Credit shall be cash
collateralized as contemplated by Section 2.6.4), and the obligation
of any Term A Lender to make a Term A Loan (except as otherwise
required under Section 2.6.2) or the Issuer to issue any Letters of
Credit shall automatically terminate (a) upon a sale, transfer or
conveyance of or borrowing against (whether or not secured by) the
Hotel/Casino not otherwise permitted under the Loan Documents, (b) a
Change in Control, or (c) if no disbursement of any proceeds of the
Term B Loan or the Term C Loan is made from the Bank Proceeds Account
within 12 months after the Closing Date (subject, however, to Force
Majeure Events). Any repayment of the aggregate principal amount of
the Term B Loan and the Term C Loan which is due with respect to a
Change in Control shall be accompanied by a premium equal to the
product of (x) the aggregate principal amount of the Term B Loans and
the Term C Loans then outstanding multiplied by (y) 1%.
SECTION 3.1.2. Application. Amounts paid or prepaid pursuant to
Section 3.1.1 shall be applied as set forth in this Section.
(a) So long as no Event of Default has occurred and is
continuing, the Lenders shall apply all amounts received in accordance
with the provisions of this Agreement first, to all Obligations (other
than principal and interest on the Loans), second, to accrued and
unpaid interest on the Loans, third, to the outstanding principal
amount of the Loans being maintained as Base Rate Loans, and fourth,
to the outstanding principal amount of the Loans being maintained as
LIBO Rate Loans; provided, however, that Music Investment Prepayments,
Mandatory Prepayments and Scheduled Amortization of LIBO Rate Loans,
if not made on the last day of the Interest Period with respect
thereto, shall be prepaid subject to the provisions of Section 4.4.
(b) After an Event of Default has occurred and so long as such
Event of Default is continuing, all amounts received by the Lenders
shall be applied first, to the costs and expenses of protecting and
preserving the security interests of the Lenders under the Loan
Documents, second, to the costs and expenses of protecting and
preserving the Main Project, third, to the costs and expenses of
enforcing the rights of the Lenders
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under this Agreement and the other Operative Documents, fourth, to
all other Obligations due under this Agreement and the other Operative
Documents (other than principal and interest on the Loans), fifth, to
the Lenders for accrued and unpaid interest on the Loans and to the
Lenders for all amounts due to them or their Affiliates under any Rate
Protection Agreements, sixth, to the aggregate outstanding principal
balance of the Term A Loans, then to the aggregate outstanding
principal balance of the Term B Loans and then to the aggregate
outstanding principal balance of the Term C Loans and, after all
amounts evidenced and secured by the Loan Documents have been
indefeasibly paid in full and the Borrowers have performed their
obligations under the Loan Documents, the balance, if any, shall be
delivered to the Borrower.
(c) Each payment and prepayment of the principal amount of the
Loans shall be applied to the outstanding principal amount of Loans of
such Borrower in inverse order of maturity.
SECTION 3.2. Interest Provisions. Interest on the outstanding
principal amount of Loans and the Letter of Credit Reimbursement
Obligations shall accrue and be payable in accordance with this
Section 3.2.
SECTION 3.2.1. Rates. Subject to Section 2.3.2, pursuant to an
appropriately delivered Borrowing Request or Continuation/Conversion
Notice, the Borrower may elect that Loans comprising a Borrowing accrue
interest at a rate per annum:
(a) on that portion maintained from time to time as a Base Rate
Loan, equal to the sum of the Alternate Base Rate from time to time in
effect plus the Applicable Base Rate Margin; and
(b) on that portion maintained as a LIBO Rate Loan, during each
Interest Period applicable thereto, equal to the sum of the LIBO Rate
(Reserve Adjusted) for such Interest Period plus the Applicable LIBO
Rate Margin.
All LIBO Rate Loans shall bear interest from and including the first day of
the applicable Interest Period to (but not including) the last day of such
Interest Period at the interest rate determined as applicable to such LIBO
Rate Loan.
SECTION 3.2.2. Post-Maturity Rates. After the date any principal
amount of any Loan or Letter of Credit Reimbursement Obligation is due and
payable (whether on the Stated Maturity Date, upon acceleration or
otherwise), or after any other monetary Obligation of the Borrower shall
have become due and payable, the Borrower shall pay, but only to the extent
permitted by law, interest (after as well as before judgment) on such
amounts at a rate per annum equal to (a) in the case of any overdue amounts
in respect of Loans or other obligations (or the related Commitments)
relative thereto, the rate that would otherwise be applicable to such Loans
made as Base Rate Loans pursuant to Section 3.2.1 plus 2% and (b) in the
case of
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other overdue monetary Obligations, the rate that would otherwise be
applicable to Term A Loans made as Base Rate Loans pursuant to Section
3.2.1 plus 2%.
SECTION 3.2.3. Payment Dates. Interest accrued on each Loan shall be
payable, without duplication:
(a) on the Stated Maturity Date therefor;
(b) on the date of any payment or prepayment, in whole or in
part, of principal outstanding on such Loan on the principal amount so
paid or prepaid;
(c) with respect to Base Rate Loans, on each Quarterly Payment
Date occurring after the Effective Date;
(d) with respect to LIBO Rate Loans, on the last day of each
applicable Interest Period (and, if such Interest Period shall exceed
three months, on each Quarterly Payment Date during such Interest
Period);
(e) with respect to any Base Rate Loans converted into LIBO Rate
Loans on a day when interest would not otherwise have been payable
pursuant to clause (c), on the date of such conversion; and
(f) on that portion of any Loan the Stated Maturity Date of which
is accelerated pursuant to Section 8.2 or Section 8.3, immediately
upon such acceleration.
Interest accrued on Loans or other monetary Obligations arising under this
Agreement or any other Loan Document after the date such amount is due and
payable (whether on the Stated Maturity Date, upon acceleration or
otherwise) shall be payable upon demand.
SECTION 3.3. Fees. The Borrower agrees to pay the fees set forth in
this Section 3.3. All such fees shall be non-refundable.
SECTION 3.3.1. Commitment Fee. From and after the Effective Date and
until the Conversion Date, a non-refundable fee (the "Term A Loan
Commitment Fee") in the amount of one-half percent per annum of the
aggregate amount of the then existing Term A Loan Commitment Amounts shall
accrue on the daily average of the aggregate amount of the then existing
Term A Loan Amount. The Term A Loan Commitment Fee shall be payable in
arrears to the Term A Lenders on each Quarterly Payment Date in proportion
to such Term A Lenders' respective then existing Term A Loan Commitment
Amount.
SECTION 3.3.2. Agency Fee. The Borrower agrees to pay to the
Administrative Agent, for its own account, the fees in the amounts and on
the dates set forth in the Fee Letters.
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SECTION 3.3.3. Letter of Credit Fee. From and after the date that a
Letter of Credit is issued until such time as such Letter of Credit is
fully drawn or, if applicable, returned to the Issuer, the Borrower agrees
to pay to the Administrative Agent, for the account of the Term A Lenders,
a Letter of Credit fee in an amount equal to the then Applicable Margin for
Term A Loans maintained as LIBO Rate Loans (whether or not advanced by the
Lenders), multiplied by the Stated Amount of such Letter of Credit, such
fees being payable on each Quarterly Payment Date in arrears to the Term A
Lenders in proportion to such Term A Lenders' respective Percentage of the
Stated Amount of such Letter of Credit. The Borrower further agrees to pay
in advance on each Quarterly Payment Date to the Issuer the issuance fee as
specified in the Scotiabank Fee Letter.
SECTION 3.3.4. Other Fees. The Borrower agrees to pay the
Administrative Agent, for the account of the Person entitled thereto,
without duplication, all other fees described in the Fee Letters when and
as due and payable in accordance with the terms of the Fee Letters.
ARTICLE IV
CERTAIN LIBO RATE AND OTHER PROVISIONS
SECTION 4.1. LIBO Rate Lending Unlawful. If any Lender shall
determine (which determination shall, upon notice thereof to the
Administrative Agent, the Borrower and the other Lenders, be conclusive and
binding on the Borrower) that the introduction of or any change in or in
the interpretation of any law makes it unlawful, or any central bank or
other governmental authority asserts that it is unlawful, for such Lender
to make, continue or maintain any Loan as, or to convert any Loan into, a
LIBO Rate Loan, the obligations of such Lender to make, continue, maintain
or convert any such LIBO Rate Loan shall, upon such determination,
forthwith be suspended until such Lender shall notify the Administrative
Agent that the circumstances causing such suspension no longer exist, and
all outstanding LIBO Rate Loans shall automatically convert into Base Rate
Loans at the end of the then current Interest Periods with respect thereto,
or sooner, if required by such law or assertion.
SECTION 4.2. Deposits Unavailable. If the Administrative Agent shall
have determined that
(a) Dollar deposits in the relevant amount and for the relevant
Interest Period are not available to the Administrative Agent in its
relevant market; or
(b) by reason of circumstances affecting the Administrative
Agent's relevant market, adequate means do not exist for ascertaining
the interest rate applicable hereunder to LIBO Rate Loans,
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then, upon notice from the Administrative Agent to the Borrower and the
Lenders, the obligations of all Lenders under Section 2.3 and Section 2.4
to make or continue any Loans as, or to convert any Loans into, LIBO Rate
Loans shall forthwith be suspended until the Administrative Agent shall
notify the Borrower and the Lenders that the circumstances causing such
suspension no longer exist.
SECTION 4.3. Increased LIBO Rate Loan Costs, etc. The Borrower
agrees to reimburse each Lender for any increase in the cost to such Lender
of, or any reduction in the amount of any sum receivable by such Lender in
respect of, making, continuing or maintaining (or of its obligation to
make, continue or maintain) any Loans as, or of converting (or of its
obligation to convert) any Loans into, LIBO Rate Loans that arises in
connection with any change in, or the introduction, adoption,
effectiveness, interpretation, reinterpretation or phase-in after the date
hereof of, any law or regulation, directive, guideline, decision or request
(whether or not having the force of law) of any court, central bank,
regulator or other governmental authority, except for such changes with
respect to increased capital costs and taxes which are governed by
Sections 4.5 and 4.6, respectively. Such Lender shall promptly notify the
Administrative Agent and the Borrower in writing of the occurrence of any
such event, such notice to state, in reasonable detail, the reasons
therefor and the additional amount required fully to compensate such Lender
for such increased cost or reduced amount. Such additional amounts shall
be payable by the Borrower directly to such Lender within five days of its
receipt of such notice, and such notice shall, in the absence of manifest
error, be conclusive and binding on the Borrower.
Without limiting the foregoing, in the event that, as a result of any
such change, introduction, adoption or the like described above, the LIBOR
Reserve Percentage decreases for any Lender's LIBO Rate Loans, such Lender
shall give prompt notice thereof in writing to the Administrative Agent and
the Borrower. The LIBO Rate (Reserve Adjusted) attributable to such
Lender's LIBO Rate Loans shall be adjusted to give the Borrower the benefit
of such decrease (for so long as such decrease shall remain in effect).
SECTION 4.4. Funding Losses. In the event any Lender shall incur any
loss or expense (including any loss or expense incurred by reason of the
liquidation or reemployment of deposits or other funds acquired by such
Lender to make, continue or maintain any portion of the principal amount of
any Loan as, or to convert any portion of the principal amount of any Loan
into, a LIBO Rate Loan) as a result of
(a) any conversion or repayment or prepayment of the principal
amount of any LIBO Rate Loans on a date other than the scheduled last
day of the Interest Period applicable thereto, whether pursuant to
Section 3.1 or otherwise;
(b) any Loans not being made as LIBO Rate Loans in accordance
with the Borrowing Request therefor; or
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(c) any Loans not being continued as, or converted into, LIBO
Rate Loans in accordance with the Continuation/Conversion Notice
therefor,
then, upon the written notice of such Lender to the Borrower (with a copy
to the Administrative Agent), the Borrower shall, within five days of its
receipt thereof, pay directly to such Lender such amount as will (in the
reasonable determination of such Lender) reimburse such Lender for such
loss or expense. Such written notice (which shall include calculations in
reasonable detail) shall, in the absence of manifest error, be conclusive
and binding on the Borrower.
SECTION 4.5. Increased Capital Costs. If any change in, or the
introduction, adoption, effectiveness, interpretation, reinterpretation or
phase-in of, any law or regulation, directive, guideline, decision or
request (whether or not having the force of law) of any court, central
bank, regulator or other governmental authority affects or would affect the
amount of capital required or expected to be maintained by any Lender or
any Person controlling such Lender, and such Lender determines (in good
faith but in its sole and absolute discretion) that the rate of return on
its or such controlling Person's capital as a consequence of the
Commitments or the Loans made, or the Letters of Credit participated in, by
such Lender is reduced to a level below that which such Lender or such
controlling Person could have achieved but for the occurrence of any such
circumstance, then, in any such case upon notice from time to time by such
Lender to the Borrower, the Borrower shall immediately pay directly to such
Lender additional amounts sufficient to compensate such Lender or such
controlling Person for such reduction in rate of return. A statement of
such Lender as to any such additional amount or amounts (including
calculations thereof in reasonable detail) shall, in the absence of
manifest error, be conclusive and binding on the Borrower. In determining
such amount, such Lender may use any method of averaging and attribution
that it (determines in good faith in its sole and absolute discretion)
shall deem applicable.
SECTION 4.6. Lender's Tax. All payments by the Borrower of principal
of, and interest on, the Credit Extensions and all other amounts payable
hereunder (including fees) shall be made free and clear of and without
deduction for any present or future income, excise, stamp or franchise
taxes and other taxes, fees, duties, withholdings or other charges of any
nature whatsoever imposed by any taxing authority, but excluding franchise
taxes and taxes imposed on or measured by any Lender's net income or
receipts (each such non-excluded item being called a "Lender's Tax"). In
the event that any withholding or deduction from any payment to be made by
the Borrower hereunder is required in respect of any Lender's Tax pursuant
to any applicable law, rule or regulation, then the Borrower will
(a) pay directly to the relevant authority the full amount
required to be so withheld or deducted;
(b) promptly forward to the Administrative Agent an official
receipt or other documentation satisfactory to the Administrative
Agent evidencing such payment to such authority; and
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(c) pay to the Administrative Agent for the account of the
Lenders such additional amount or amounts as is necessary to ensure
that the net amount actually received by each Lender will equal the
full amount such Lender would have received had no such withholding or
deduction been required.
Moreover, if any Lender's Tax is directly asserted against the
Administrative Agent or any Lender with respect to any payment received by
the Administrative Agent or such Lender hereunder, the Administrative Agent
or such Lender may pay such Lender's Tax and the Borrower will promptly pay
such additional amounts (including any penalties, interest or expenses) as
is necessary in order that the net amount received by such Person after the
payment of such Lender's Tax (including any Lender's Tax on such additional
amount) shall equal the amount such Person would have received had not such
Lender's Tax been asserted.
If the Borrower fails to pay any Lender's Tax when due to the
appropriate taxing authority or fails to remit to the Administrative Agent,
for the account of the respective Lenders, the required receipts or other
required documentary evidence, the Borrower shall indemnify the Lenders for
any incremental Lender's Tax, interest or penalties that may become payable
by any Lender as a result of any such failure. For purposes of this
Section 4.6, a distribution hereunder by the Administrative Agent or any
Lender to or for the account of any Lender shall be deemed a payment by the
Borrower.
Upon the request of the Borrower or the Administrative Agent, each
Lender that is organized under the laws of a jurisdiction other than the
United States or a State thereof (for purposes of this Section 4.6, a "Non-U.S.
Lender") shall, prior to the date on which any Loan is made or Letter of
Credit is issued hereunder (or in the case of a Lender that becomes a party
to this Agreement pursuant to Section 4.11 or any Assignee Lender, before it
becomes a party hereto) (a) execute and deliver to the Borrower and the
Administrative Agent one or more (as the Borrower or the Administrative Agent
may reasonably request) United States Internal Revenue Service Forms 4224 or
Forms 1001 or such other forms or documents (or successor forms or
documents), appropriately completed, certifying in each case that such Lender
or Assignee Lender is entitled to receive payments under this Agreement
without deduction or withholding of any United States federal income taxes,
and an applicable Internal Revenue Service Form W-8 or Form W-9 or successor
applicable form (if required by law), as the case may be, to establish an
exemption from United States backup withholding tax or (b) if such Non-U.S.
Lender is not a "bank" or other person described in Section 881 (c) (3) of
the Code and cannot deliver either Form 4224 or Form 1001 pursuant to clause
(a) above, execute and deliver to the Borrower and the Administrative Agent
one or more (as the Borrower or Administrative Agent may reasonably request)
copies of the Tax Certificate, Form W-8 (or any successor form) and any other
certificate or statement of exemption required under the Code or Treasury
Regulations issued thereunder, appropriately completed, certifying that such
Lender or Assignee Lender is entitled to receive payments under this
Agreement without deduction or withholding of United States federal income
tax and establishing an exemption from United States backup withholding tax.
All Lenders other than Non-U.S. Lenders shall, prior to the date
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on which any Loan is made or Letter of Credit is issued hereunder (or in the
case of a Lender that becomes a party to this Agreement pursuant to Section
4.11 or is an Assignee Lender, before such Lender becomes a party hereto),
execute and deliver to the Borrower and the Administrative Agent one or more
copies (as the Borrower or Administrative Agent may reasonably request) of
United States Internal Revenue Form W-9 or successor applicable form (if
required by law), as the case may be, to establish exemption from United
States backup withholding tax.
Each Lender which undertakes to deliver to the Borrower a Tax
Certificate, a Form 4224, Form 1001, Form W-8 or Form W-9 pursuant to the
preceding paragraph shall further undertake to deliver to the Borrower two
further copies of said Tax Certificate, Form 4224, Form 1001, Form W-8 or
Form W-9 (if required by law), or successor applicable forms, or other
manner of certification, as the case may be, on or before the date that
such form expires or becomes obsolete or after the occurrence of an event
requiring a change in the most recent form delivered by it to the Borrower
and the Administrative Agent, and such extensions or renewals thereof as
may be reasonably requested by the Borrower or Administrative Agent,
certifying in the case of a Tax Certificate, Form 4224 or Form 1001 that
such Lender is entitled to receive payments under this Agreement without
deduction or withholding of any United States federal income taxes, unless
in any case an event (including any change in treaty, law or regulation)
has occurred prior to the date on which such delivery would otherwise be
required which renders all forms inapplicable or which would prevent such
Lender from duly completing and delivering any such form with respect to it
and such Lender advises the Borrower and the Administrative Agent that it
is not capable of receiving payments without any deduction or withholding
of United States federal income tax, and in the case of a Form W-8 or Form
W-9, establishing an exemption from backup withholding. In the event that
any Sponsor, Indemnitor or Guarantor is required to make a payment pursuant
to a Completion Guaranty, Keep-Well Agreement, Environmental Indemnity or
other agreement entered into pursuant hereto, such Persons shall have the
same rights as the Borrower or Administrative Agent (as described above) to
obtain from the Lenders the appropriate Internal Revenue Service Forms
certifying that the Lenders are entitled to receive such payments from such
Persons without deduction or withholding for United States federal income
taxes and without backup withholding tax.
SECTION 4.7. Payments, Computations, etc. Unless otherwise expressly
provided, all payments by the Borrower pursuant to this Agreement, the
Notes, each Letter of Credit or any other Loan Document shall be made by
the Borrower to the Administrative Agent for the pro rata account of the
Lenders entitled to receive such payment. All such payments required to be
made to the Administrative Agent shall be made, without setoff, deduction
or counterclaim, not later than 11:00 a.m., New York City time, on the date
due, in same day or immediately available funds, to such account as the
Administrative Agent shall specify from time to time by notice to the
Borrower. Funds received after that time shall be deemed to have been
received by the Administrative Agent on the next succeeding Business Day.
The Administrative Agent shall promptly remit in same day funds to each
Lender its share, if any, of such payments received by the Administrative
Agent for the account of such Lender. All interest (including interest on
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LIBO Rate Loans) and fees shall be computed on the basis of the actual
number of days (including the first day but excluding the last day)
occurring during the period for which such interest or fee is payable over
a year comprised of 360 days (or, in the case of interest on a Base Rate
Loan (calculated at other than the Federal Funds Rate), 365 days or, if
appropriate, 366 days). Whenever any payment to be made shall otherwise be
due on a day which is not a Business Day, such payment shall (except as
otherwise required by clause (c) of the definition of the term "Interest
Period") be made on the next succeeding Business Day and such extension of
time shall be included in computing interest and fees, if any, in
connection with such payment.
SECTION 4.8. Sharing of Payments. If any Lender shall obtain any
payment or other recovery (whether voluntary, involuntary, by application
of setoff or otherwise) on account of any Loan or Letter of Credit
Reimbursement Obligation (other than pursuant to the terms of Section 4.3,
4.4, 4.5 or 4.6) in excess of its pro rata share of payments then or
therewith obtained by all Lenders, such Lender shall purchase from the
other Lenders such participations in Credit Extensions made by them as
shall be necessary to cause such purchasing Lender to share the excess
payment or other recovery ratably with each of them; provided, however,
that if all or any portion of the excess payment or other recovery is
thereafter recovered from such purchasing Lender, the purchase shall be
rescinded and each Lender which has sold a participation to the purchasing
Lender shall repay to the purchasing Lender the purchase price to the
ratable extent of such recovery together with an amount equal to such
selling Lender's ratable share (according to the proportion of
(a) the amount of such selling Lender's required repayment to the
purchasing Lender
to
(b) total amount so recovered from the purchasing Lender)
of any interest or other amount paid or payable by the purchasing Lender in
respect of the total amount so recovered. The Borrower agrees that any
Lender so purchasing a participation from another Lender pursuant to this
Section may, to the fullest extent permitted by law, exercise all its
rights of payment (including pursuant to Section 4.9) with respect to such
participation as fully as if such Lender were the direct creditor of the
Borrower in the amount of such participation. If, under any applicable
bankruptcy, insolvency or other similar law, any Lender receives a secured
claim in lieu of a setoff to which this Section applies, such Lender shall,
to the extent practicable, exercise its rights in respect of such secured
claim in a manner consistent with the rights of the Lenders entitled under
this Section to share in the benefits of any recovery on such secured
claim.
SECTION 4.9. Setoff. Each Lender shall, upon the occurrence and
during the continuance of any Default described in clauses (a) through (e)
of Section 8.1.10 or, with the consent of the Required Lenders, upon the
occurrence and during the continuance of any other
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Event of Default, have the right to appropriate and apply to the payment of
the Obligations owing to it (whether or not then due), and (as security for
such Obligations) the Borrower hereby grants upon the execution of this
Agreement to each Lender a continuing security interest in, any and all
balances, credits, deposits, accounts or moneys of the Borrower then or
thereafter maintained with such Lender; provided, however, that any such
appropriation and application shall be subject to the provisions of
Section 4.8. Each Lender agrees promptly to notify the Borrower and the
Administrative Agent after any such setoff and application made by such
Lender; provided, however, that the failure to give such notice shall not
affect the validity of such setoff and application. The rights of each
Lender under this Section are in addition to other rights and remedies
(including other rights of setoff under applicable law or otherwise) which
such Lender may have.
SECTION 4.10. Mitigation. Each Lender agrees that if it makes any
demand for payment under Sections 4.3, 4.4, 4.5, or 4.6, or if any adoption
or change of the type described in Section 4.1 shall occur with respect to
it, it will use reasonable efforts (consistent with its internal policy and
legal and regulatory restrictions and so long as such efforts would not be
disadvantageous to it, as determined in its sole discretion) to designate a
different lending office if the making of such a designation would reduce
or obviate the need for the Borrower to make payments under Sections 4.3,
4.4, 4.5, or 4.6, or would eliminate or reduce the effect of any adoption
or change described in Section 4.1.
SECTION 4.11. Replacement of Lenders. Each Lender hereby severally
agrees as set forth in this Section. If
(a) (i) any Lender (an "Affected Lender") makes demand upon the
Borrower for (or if the Borrower is otherwise required to pay) amounts
pursuant to Section 4.3, 4.4, 4.5 or 4.6 and the payment of such
additional amounts are, and are likely to continue to be, more onerous
in the reasonable judgment of the Borrower than with respect to the
other Lenders or (ii) a Lender becomes a Defaulting Lender, the
Borrower may, within 30 days of receipt by the Borrower of such demand
or notice (or the occurrence of such other event causing the Borrower
to be required to pay such compensation) or from the date that such
Lender becomes a Defaulting Lender, as the case may be, give notice in
writing to the Administrative Agent and such Affected Lender or such
Defaulting Lender, as the case may be, of its intention to replace
such Affected Lender or such Defaulting Lender, as the case may be,
with a financial institution designated in such notice. The
Administrative Agent and the Syndication Agent agree to use
commercially reasonable efforts to assist the Borrower in replacing
such Defaulting Lender. If the Administrative Agent shall, in the
exercise of its reasonable discretion and within 30 days of its
receipt of such notice, notify the Borrower and such Affected Lender
or such Defaulting Lender, as the case may be, in writing that the
designated financial institution is satisfactory to the Administrative
Agent (such consent not being required where such financial
institution is already a Lender or an Approved Fund), then such
Affected Lender or such Defaulting Lender, as the case may be, shall,
subject to the
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payment of any amounts due pursuant to Section 4.4 by the Borrower,
assign, in accordance with Section 10.11.1, all of its Commitments,
Loans, Notes and other rights and obligations under this Agreement and
all other Loan Documents (including Reimbursement Obligations, if
applicable) to such designated financial institution; provided,
however, that (i) such assignment shall be without recourse,
representation or warranty (except as to (x) such Affected Lender's or
such Defaulting Lender's, as the case may be, then existing Commitment
Amount(s) and the outstanding principal amount of Loans held by such
Affected Lender or such Defaulting Lender, as the case may be, and (y)
the absence of Liens arising by, through and under the Affected Lender
or such Defaulting Lender, as the case may be ) and shall be on terms
and conditions reasonably satisfactory to such Affected Lender and
such designated financial institution, (ii) the purchase price paid by
such designated financial institution shall be in the amount of such
Affected Lender's or such Defaulting Lender's, as the case may be,
Loans and its Percentage of outstanding Reimbursement Obligations,
together with all accrued and unpaid interest and fees in respect
thereof, plus all other amounts (including the amounts demanded and
unreimbursed under Sections 4.3, 4.5 and 4.6), owing to such Affected
Lender or such Defaulting Lender, as the case may be, hereunder and
(iii) the Borrower shall pay to such Affected Lender or such
Defaulting Lender, as the case may be, and the Administrative Agent
all reasonable out-of-pocket expenses incurred by such Affected Lender
or such Defaulting Lender, as the case may be, and the Administrative
Agent in connection with such assignment and assumption (including the
processing fees described in Section 10.11.1).
(b) If S&P, Moody's or Thompson's BankWatch (or InsuranceWatch
Ratings Service, in the case of Lenders that are insurance companies
(or Best's Insurance Reports, if such insurance company is not rated
by Insurance Watch Ratings Service) (or Duff & Phelps, Inc. or Fitch
Investor Services, Inc., if such Lender is neither an insurance
company nor rated by S&P, Moody's or Thompson's BankWatch)) shall,
after the date that any Person becomes a Lender and prior to the date
that all of the Commitments of such Lender have been fully funded,
downgrade the long-term certificate of deposit rating or long-term
senior unsecured debt rating of such Lender (a "Downgraded Lender"),
and the resulting ratings shall be below BBB-, Baa3 or C (or BB, in
the case of Lender that is an insurance company (or B, in the case of
an insurance company rated by Best's Insurance Reports (or BBB- or
BBB-, in the case of a Lender which is neither rated by S&P, Moody's
or Thompson's BankWatch nor an insurance company))), respectively, or
the equivalent, the Borrower (or the Issuer) may, within 30 days of
receipt by the Borrower (or the Issuer) of notice of such downgrade
and while such downgrade is in effect, give notice in writing to the
Administrative Agent and such Downgraded Lender (and the Borrower) of
its intention to replace such Downgraded Lender (or have such
Downgraded Lender replaced) with a financial institution designated in
such notice (or another notice given by the Borrower at the request of
the Issuer). If the Administrative Agent and the Issuer shall, in the
exercise of their reasonable discretion and within 30 days of their
receipt of such notice, notify the
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Borrower and such Downgraded Lender in writing that the designated
financial institution is satisfactory to the Administrative Agent and
the Issuer (such consent not being required where such financial
institution is already a Lender or an Approved Fund), then such
Downgraded Lender shall, subject to the payment of any amounts due
pursuant to Section 4.4 by the Borrower, assign, in accordance with
Section 10.11.1, all of its Commitments, Loans, Notes and other rights
and obligations under this Agreement and all other Loan Documents
(including Reimbursement Obligations, if applicable) to such
designated financial institution; provided, however, that (i) such
assignment shall be without recourse, representation or warranty
(except as to (x) such Downgraded Lender's then existing Commitment
Amount(s) and the principal amount of Loans held by such Downgraded
Lender and (y) the absence of Liens arising by, through and under the
Downgraded Lender) and shall be on terms and conditions
reasonably satisfactory to such Downgraded Lender and such designated
financial institution, (ii) the purchase price paid by such designated
financial institution shall be in the amount of such Downgraded
Lender's Loans and its Percentage of outstanding Reimbursement
Obligations, together with all accrued and unpaid interest and fees in
respect thereof, plus all other amounts (including the amounts
demanded and unreimbursed under Sections 4.3, 4.5 and 4.6), owing to
such Downgraded Lender hereunder and (iii) the Borrower shall pay to
the Downgraded Lender and the Administrative Agent all reasonable
out-of-pocket expenses incurred by the Downgraded Lender and the
Administrative Agent in connection with such assignment and assumption
(including the processing fees described in Section 10.11.1).
(c) If any Nevada Gaming Authority or any other gaming authority
with jurisdiction over the gaming business of the Borrower, as the
case may be, shall determine that any Lender (an "Unsuitable Lender")
does not meet the suitability standards prescribed under any
applicable Nevada Gaming Law or the suitability standards of such
gaming authority, as the case may be, the Borrower may give notice in
writing to the Administrative Agent and such Unsuitable Lender of its
intention to replace such Unsuitable Lender with a financial
institution designated in such notice. If the Administrative Agent
shall, in the exercise of its reasonable discretion and promptly
following its receipt of such notice, notify the Borrower and such
Unsuitable Lender in writing that the designated financial institution
is satisfactory to the Administrative Agent (such consent not being
required where such financial institution is already a Lender or an
Approved Fund), then such Unsuitable Lender shall, subject to the
payment of any amounts due pursuant to Section 4.4 by the Borrower,
assign, in accordance with Section 10.11.1, all of its Commitments,
Loans, Notes and other rights and obligations under this Agreement and
all other Loan Documents (including Reimbursement Obligations, if
applicable) to such designated financial institution; provided,
however, that (i) such assignment shall be without recourse,
representation or warranty (except as to (x) such Unsuitable Lender's
then existing Commitment Amount(s) and the principal amount of Loans
held by such Unsuitable Lender and (y) the absence of Liens arising
by, through and under the Unsuitable Lender) and shall be on terms and
conditions
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reasonably satisfactory to such Unsuitable Lender and such designated
financial institution, (ii) the purchase price paid by such designated
financial institution shall be in the amount of such Unsuitable Lender's
Loans and its Percentage of outstanding Reimbursement Obligations,
together with all accrued and unpaid interest and fees in respect
thereof, plus all other amounts (including the amounts demanded and
unreimbursed under Sections 4.3, 4.5 and 4.6), owing to such Unsuitable
Lender hereunder and (iii) the Borrower shall pay to the Unsuitable
Lender and the Administrative Agent all reasonable out-of-pocket
expenses incurred by the Unsuitable Lender and the Administrative Agent
in connection with such assignment and assumption (including the
processing fees described in Section 10.11.1); provided further,
however, that if the Borrower fails to find a substitute financial
institution within any time specified by the appropriate gaming
authority for the withdrawal of such Unsuitable Lender (the "Withdrawal
Period"), the Borrower shall prepay in full the outstanding principal
amount of the Loans made by such Unsuitable Lender (without giving
effect to Section 4.8) and shall be deemed to have requested a reduction
in each of the aggregate amounts of the Commitment Amounts relating to
all Commitments held by such Lender, in each case, in an amount equal to
such Unsuitable Lender's then existing Commitment Amounts.
(d) Upon the effective date of an assignment described in
clause (a), (b) or (c), the Borrower shall issue a replacement Note or
Notes, as the case may be, to such replaced Lender and such
institution shall become a "Lender" for all purposes under this
Agreement and the other Loan Documents. Upon any such termination or
assignment, such replaced Lender shall cease to be a party hereto but
shall continue to be entitled to the benefits of any provisions of
this Agreement which by their terms survive the termination of this
Agreement.
ARTICLE V
CONDITIONS TO CREDIT EXTENSIONS
SECTION 5.1. Initial Credit Extension. The obligations of the
Lenders to fund the Term B Loans and the Term C Loans into the Bank
Proceeds Account (the "Closing") shall be subject to the prior or
concurrent satisfaction of each of the conditions precedent set forth in
this Section 5.1.
SECTION 5.1.1. Satisfaction of Conditions Precedent to the Closing
Date. The Borrower and Holdings shall satisfy in all material respects the
conditions precedent to the Closing as set forth in Section 3.1 of the
Disbursement Agreement.
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SECTION 5.1.2. Delivery of Notes. The Administrative Agent shall
have received, for the account of each Lender, such Lender's Notes duly
executed and delivered by an Authorized Representative of the Borrower.
SECTION 5.1.3. Pledge Agreements. The Administrative Agent shall
have received, with counterparts for each Lender,
(a) the Holdings Pledge Agreement, dated as of the Closing Date,
duly executed and delivered by an Authorized Representative of
Holdings, together with certificates evidencing all of issued and
outstanding (x) Borrower Common Membership Interests and (y) Capital
Stock of Capital, which certificates shall be accompanied by undated
powers of transfer relating thereto duly executed in blank;
(b) the LCNI Pledge Agreement from LCNI , dated as of the Closing
Date, duly executed and delivered by an Authorized Representative of
LCNI, together with certificates evidencing all of the Holdings Common
Membership Interests of LCNI, which certificates shall be accompanied
by undated powers of transfer relating thereto duly executed in blank;
(c) the Sommer Enterprises Pledge Agreement, dated as of the
Closing Date, duly executed and delivered by an Authorized
Representative of Sommer Enterprises, together with (x) certificates
evidencing all of the Holdings Common Membership Interests of Sommer
Enterprises and (y) certificates evidencing all of the issued and
outstanding shares of Capital Stock of Enterprises, subject to the
rights of the holders of the Warrants both while such holders hold
Warrants and on the exercise of such Warrants into shares of Capital
Stock of Enterprise, which certificates shall be accompanied by
undated powers of transfer relating thereto duly executed in blank;
(d) the AHL Pledge Agreement, dated as of the Closing Date, duly
executed and delivered by an Authorized Representative of AHL,
together with certificates evidencing all of the Membership Interests
of AHL in Sommer Enterprises, which certificates shall be accompanied
by undated powers of transfer relating thereto duly executed in blank;
(e) the Enterprises Pledge Agreement, dated as of the Closing
Date, duly executed and delivered by an Authorized Representative of
Enterprises, together with certificates evidencing all of the Holdings
Common Membership Interests of Enterprises, which certificates shall
be accompanied by undated powers of transfer relating thereto duly
executed in blank;
(f) the Borrower Pledge Agreement, dated as of the Closing Date,
duly executed and delivered by an Authorized Representative of the
Borrower, together with certificates evidencing all of the Membership
Interests of the Borrower in AMH, which certificates
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shall be accompanied by undated powers of transfer relating thereto
duly executed in blank; and
(g) the AMH Pledge Agreement, dated as of the Closing Date, duly
executed and delivered by an Authorized Representative of AMH,
together with certificates evidencing all of the Membership Interests
of AMH in Aladdin Music, which certificates shall be accompanied by
undated powers or transfer relating thereto duly executed in blank.
SECTION 5.1.4. Financial Information, etc. The Administrative Agent
shall have received prior to the Effective Date, with counterparts for each
Lender, audited financial statements of each of the Borrower, the other
Aladdin Parties, (other than the Trust and Aladdin Music), LCNI and London
Clubs, in each case as at December 31, 1997, except in the case of the LCNI
and London Clubs which audited financial statements shall have been
prepared as at March 30, 1997.
SECTION 5.1.5. Security Agreement. The Administrative Agent shall
have received, with counterparts for each Lender, executed counterparts of
the Security Agreement, dated as of the Closing Date, duly executed by the
Borrower, together with
(a) executed copies of Uniform Commercial Code financing
statements (Form UCC-1), naming the Borrower as a debtor and the
Administrative Agent as the secured party, or other similar
instruments or documents, to be filed under the Uniform Commercial
Code of all jurisdictions as may be necessary or, in the reasonable
opinion of the Administrative Agent, desirable to perfect the security
interests of the Administrative Agent pursuant to the Security
Agreement and the other Operative Documents;
(b) executed copies of proper Uniform Commercial Code termination
statements, if any, necessary to release all Liens and other rights of
any Person
(i) in any collateral described in the Security Agreement
previously subject to a Lien or other right granted to any
Person, and
(ii) securing any of the Indebtedness to be Paid,
together with such other Uniform Commercial Code termination
statements as the Administrative Agent may reasonably request from
such Obligors; and
(c) certified copies of search reports certified by the offices
from which they were requested or another Person acceptable to the
Administrative Agent, dated a date reasonably near to the Effective
Date, listing all effective financing statements which name the
Borrower (under its present name and any previous names) and such
other Persons designated by the Administrative Agent as the debtor and
which are filed in the
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jurisdictions in which filings were made pursuant to clause (a) above,
together with copies of such financing statements (none of which
(other than those described in clause (a), if such search report, as
the case may be, is current enough to list such financing statements
described in clause (a)) shall cover any collateral described in the
Security Agreement).
SECTION 5.1.6. Trademark Security Agreement. The Administrative
Agent shall have received the Trademark Security Agreement, as applicable,
each dated as of the Closing Date and duly executed and delivered by the
Borrower or appropriate Owner of the related intellectual property
registration.
SECTION 5.1.7. Deed of Trust. The Administrative Agent shall have
received the Deed of Trust, dated as of the Closing Date, duly executed by
the Borrower, together with
(a) evidence of the completion (or satisfactory arrangements for
the completion) of all recordings and filings of the Deed of Trust as
may be necessary or, in the reasonable opinion of the Administrative
Agent, desirable effectively to create a valid, perfected first
priority Lien against the properties and the leasehold interests
described therein purported to be covered thereby;
(b) the Title Policy described in Section 3.1.25 of the
Disbursement Agreement together with all endorsements described
therein; and
(c) such other approvals, opinions, or documents as the
Administrative Agent may reasonably request including consents and
estoppel agreements and a current survey of the Site in form and
substance reasonably satisfactory to the Administrative Agent and the
Title Insurer.
SECTION 5.1.8. Solvency, etc. The Administrative Agent shall have
received, with counterparts for each Lender, a duly executed Solvency
Certificate, dated as of the Effective Date.
SECTION 5.1.9. Initial Rate Protection Agreement. The Administrative
Agent shall have received the initial Rate Protection Agreement, dated as
of the Closing Date, executed and delivered by an Authorized Representative
of the Borrower, which shall be in a notional amount of the Commitments at
a maximum rate approved by the Administrative Agent in its sole discretion.
SECTION 5.1.10. Payment of Outstanding Indebtedness, etc. All
Indebtedness to be Paid on or before the Closing Date, together with all
interest, all prepayment premiums and other amounts due and payable with
respect thereto, shall have been paid in full from the London Clubs
Contribution and/or the proceeds of the Discount Notes and the commitments
in respect of such Indebtedness shall have been terminated, and all Liens
securing payment of any
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such Indebtedness shall have been discharged and released and the
Administrative Agent shall have received copies of all termination
statements or other instruments as may be suitable or appropriate in
connection therewith.
SECTION 5.1.11. Closing Fees, Expenses, etc. The Administrative
Agent shall have received for its own account, or for the account of each
Lender, as the case may be, all fees, costs and expenses due and payable
pursuant to Sections 3.3 and 10.3, if then invoiced.
SECTION 5.1.12. Opinions of Counsel. The Administrative Agent shall
have received the opinions substantially in the forms of the ones attached
as Schedule IV hereto, dated the Closing Date and addressed to the
Administrative Agent, the Lenders and, if applicable, the Disbursement
Agent, which shall be in form and substance satisfactory to the
Administrative Agent.
SECTION 5.1.13. Satisfactory Form and Substance. All documents
executed or submitted pursuant hereto by or on behalf of the Borrower, any
of the other Aladdin Parties, and any of the other Project Parties shall be
reasonably satisfactory in form and substance to the Administrative Agent
and its counsel and the Administrative Agent and its counsel shall have
received all information, approvals, opinions, documents or instruments as
the Administrative Agent or its counsel may reasonably request.
SECTION 5.1.14. Other Loan Documents. The Administrative Agent shall
have received, with counterparts for each Lender, each of the following
documents duly executed by the parties thereto, each of which shall be in
full force and effect, and all actions necessary or desirable, including
all filings, in the reasonable opinion of the Administrative Agent to
perfect the same as a valid first security interest encumbering the Main
Project Security shall have been taken or made:
(a) the Keep-Well Agreement;
(b) the Completion Guaranty;
(c) the Disbursement Agreement;
(d) the Mall Project Completion Assignment;
(e) the Fee Letters;
(f) the Environmental Indemnity;
(g) the Assignments of Contracts;
(h) the Borrower Collateral Account Agreement;
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(i) the Holdings Collateral Account Agreement; and
(j) the Servicing and Collateral Account Agreement.
SECTION 5.1.15. Main Project Documents. The Administrative Agent
shall have received, with counterparts for each Lender, the Main Project
Documents (other than the Theater Lease) duly executed by the parties
thereto, each of which shall be in full force and effect.
SECTION 5.1.16. Other Documents. The Administrative Agent shall have
received such other documents and evidence as it may reasonably request in
connection with the transactions contemplated hereby.
SECTION 5.2. All Credit Extensions. The obligation of each Lender
and each Issuer to make any Credit Extension (including the initial Credit
Extension) shall be subject to Sections 2.1.4 and 2.1.5 and the
satisfaction of each of the conditions precedent set forth in this
Section 5.2.
SECTION 5.2.1. Conditions for Advances under the Disbursement
Agreement and the Making of Term A Loans. Not in limitation but in
furtherance of the other conditions in this Article V, the following
conditions shall be satisfied prior to the making of any Advance under the
Disbursement Agreement or any Term A Loan, as the case may be,
(a) all conditions to the making of any Advance as set forth in
Section 3.2 of the Disbursement Agreement shall be satisfied by the
Borrower or otherwise waived in writing by the Administrative Agent in
good faith in its sole discretion;
(b) the proceeds of the Term B Loan and Term C Loan shall be
fully disbursed from the Term B Sub-Account and the Term C Sub-Account,
respectively, prior to the making of the Term A Loan (other than advances
of the Term A Loan which are made to reimburse the Issuer for, or fund
draws under, a Letter of Credit); and
(c) the amount to be advanced to the Borrower hereunder and under
the Disbursement Agreement for Direct Costs, Indirect Costs,
unincorporated materials, investments in Aladdin Music and advances
for interest on the Loans shall be limited as set forth in Article 2
of the Disbursement Agreement.
SECTION 5.2.2. Conditions for the Making of an Additional Term B Loan
and/or Term C Loan. Not in limitation but in furtherance of the other
conditions in this Article V, the following conditions shall be satisfied
prior to the making of the Loan(s) referred to in Section 2.3.4:
(a) the Administrative Agent shall have received from the
Borrower a certificate, dated the date such Loan(s) is to be made, of
the Secretary of the Borrower as to limited
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liability company action then in full force and effect authorizing the
Borrowing of such Loan(s) and the execution, delivery and performance
of the Note(s) referred to in clause (b) below;
(b) the Administrative Agent shall have received, for the account
of the Lender making such Loan(s), such Lender's Note(s) duly executed
and delivered by an Authorized Representative of the Borrower;
(c) if such Lender was not already a Lender prior to the making
of such Loan, the Administrative Agent shall have received from such
Lender a joinder to this Agreement, which joinder shall be in form and
substance reasonably satisfactory to the Administrative Agent;
(d) the Administrative Agent shall have received, for the account
of the Lender making such Loan(s), such Lender's Note(s) duly executed
and delivered by an Authorized Representative of the Borrower;
(e) the Administrative Agent shall have received an affirmation
and acknowledgment (in form and substance satisfactory to the
Administrative Agent in its sole discretion) from an Authorized
Representative of each Obligor;
(f) the Administrative Agent shall have received opinions, dated
the date such Loan is to be made and addressed to the Agents and the
Lenders, from the Borrower's New York counsel and Nevada counsel in
form and substance (including opinions as to the non-impairment of any
Liens or security interests created under, or any guarantees made
under, any Loan Document in favor of the Administrative Agent for the
benefit of the Lenders) reasonably satisfactory to the Administrative
Agent; and
(g) such other amendments, approvals, opinions, or documents as
the Administrative Agent may reasonably request.
SECTION 5.2.3. Compliance with Warranties, No Default, etc. Both
before and after giving effect to any Credit Extension the following
statements shall be true and correct:
(a) the accuracy of the representations and warranties contained
in Article VI (excluding, however, those contained in Section 6.7) and
each other Operative Document as if made on the date of the Credit
Extension or Advance, as the case may be, (except those that relate to
a different date) unless the failure of the foregoing to be the case
would not have a Material Adverse Effect;
(b) except as disclosed by the Borrower to the Agents and the
Lenders pursuant to Section 6.7 there exists
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(i) no material litigation which could reasonably be
expected to have a Material Adverse Effect or which purports to
affect the legality, validity or enforceability of this
Agreement, the Notes or any other Operative Document; and
(ii) no material development shall have occurred in any
litigation disclosed pursuant to Section 6.7 which could
reasonably be expected to have a Material Adverse Effect;
(c) the absence of any material adverse change in (i) the
financial condition, business, property or prospects of the Borrower
or on its ability to perform in all material respects its obligations
under any Operative Document to which it is a party or (ii) the
financial condition, business, property or prospects of any other
Project Party affecting its ability to perform in all material
respects its obligations under any Operative Document to which it is a
party or (iii) a material impairment of the validity of enforceability
of, or a material impairment of the rights, remedies or benefits
available to the Administrative Agent, the Issuer or the Lenders under
this Agreement or any other Operative Document;
(d) the absence of any default or an event of default with
respect to the Operative Documents which would be reasonably likely to
cause a Material Adverse Effect.
SECTION 5.2.4. Credit Extension Request, etc. Subject to Section
2.3.2 with respect to Term A Loans and Section 2.3.3 with respect to Term B
Loans and Term C Loans, the Administrative Agent shall have received a
Borrowing Request for the Loan being requested or a Letter of Credit
Issuance Request if a Letter of Credit is being requested or extended.
Each of the delivery of a Borrowing Request or Letter of Credit Issuance
Request and the acceptance by the Borrower of the proceeds of such Credit
Extension shall constitute a representation and warranty by the Borrower
that on the date of such Credit Extension (both immediately before and
after giving effect to such Credit Extension and the application of the
proceeds thereof) the statements made in Section 5.2.3 are true and correct
in all material respects.
SECTION 5.2.5. Satisfactory Legal Form. All documents executed or
submitted pursuant hereto by or on behalf of the Borrower, any of the other
Aladdin Parties, LCNI, London Clubs Holdings, London Clubs and any of the
other Project Parties shall satisfy the applicable provisions of
Section 7.2.12.
SECTION 5.2.6. Other Documents. The Administrative Agent shall have
received, with counterparts for each Lender, any Operative Documents (other
than the Theater Lease) entered into or obtained after the Closing Date
(including the GECC Intercreditor Agreement), each of which shall be duly
executed by the parties thereto and in full force and effect.
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ARTICLE VI
REPRESENTATIONS AND WARRANTIES
In order to induce the Lenders, the Issuer and the Agents to enter
into this Agreement and to make Credit Extensions hereunder, the Borrower
represents and warrants unto the Agents, the Issuer and each Lender as set
forth in this Article VI.
SECTION 6.1. Organization, etc. Each of the Borrower, each of the
other Aladdin Parties and LCNI, are validly organized and existing and in
good standing under the laws of the state or jurisdiction of its
organization, is duly qualified to do business and is in good standing in
each jurisdiction where the nature of its business requires such
qualification and where failure to do so would have a Material Adverse
Effect; and has full power and authority and holds all requisite
governmental licenses, permits and other approvals to enter into and
perform its Obligations under this Agreement and each of the other
Operative Documents to which it is a party and to own, hold and, if
applicable, lease its property and to conduct its business substantially as
currently conducted by it the absence of which would have a Material
Adverse Effect; provided, however, that the failure of the Borrower to be
in good standing in the State of Nevada shall be deemed to have a Material
Adverse Effect on it.
SECTION 6.2. Due Authorization, Non-Contravention, etc. The
execution, delivery and performance by each of the Borrower, each of the
other Aladdin Parties and LCNI of this Agreement and each of the other
Operative Documents to which it is a Party, and participation by the
Borrower, each of the other Aladdin Parties and LCNI in the consummation of
all aspects of the Transaction, and the execution, delivery and performance
by the Borrower, each of the other Aladdin Parties and LCNI of the other
agreements executed and delivered in connection with the Transaction are in
each case within each such Person's powers, have been duly authorized by
all necessary action, and do not
(a) contravene any such Person's Organizational Documents;
(b) contravene any contractual restriction binding on or
affecting any such Person which contravention would have a Material
Adverse Effect;
(c) contravene (i) any court decree or order binding on or
affecting any such Person or (ii) any Legal Requirement binding on or
affecting any such Person; or
(d) result in, or require the creation or imposition of, any Lien
on any of such Person's properties (except as expressly permitted by
this Agreement).
SECTION 6.3. Government Approval, Regulation, etc. No authorization
or approval or other action by, and no notice to or filing with, any
governmental authority or regulatory body or other Person (other than those
that have been, or on the Closing Date will be, duly obtained or
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made and which are, or on the Closing Date will be, in full force and
effect and except for filings and registrations of any UCC financing
statements, the Deed of Trust or intellectual property filings (all of
which have been duly executed and delivered to the Administrative Agent on
the Closing Date by the Borrower or other relevant Project Party, as the
case may be, party thereto) necessary to record the Lenders' security
interest in certain personal, real or intellectual property included in the
Collateral) is required for the due execution, delivery or performance by
the Borrower, the other Aladdin Parties and LCNI of this Agreement and any
other Operative Document to which it is a party, in each case by the
parties thereto or the consummation of the Transaction.
SECTION 6.4. Validity, etc. This Agreement and each other Loan
Document executed by the Borrower will, on the due execution and delivery
thereof, constitute, the legal, valid and binding obligations of the
Borrower, enforceable against the Borrower in accordance with their
respective terms; and each other Operative Document executed by the
Borrower, the other Aladdin Parties and LCNI will, on the due execution and
delivery thereof by such Person, constitute the legal, valid and binding
obligation of such Person enforceable against such Person in accordance
with its terms (except, in any case above, as such enforceability may be
limited by applicable bankruptcy, insolvency, reorganization or similar
laws affecting creditors' rights generally and by principles of equity).
SECTION 6.5. Financial Information. The financial statements of the
Borrower, the other Aladdin Parties and LCNI furnished to the
Administrative Agent pursuant to Section 5.1.4 have been prepared in
accordance with GAAP consistently applied, and present fairly the financial
condition of the Persons covered thereby as at the dates thereof and the
results of their operations for the periods then ended. All balance
sheets, all statements of operations, equity amounts, cash flow and all
other financial information of each of the Borrower, the other Aladdin
Parties and LCNI furnished pursuant to Section 7.1.1 have been and will for
periods following the Effective Date be prepared in accordance with GAAP
consistently applied, and do or will present fairly the financial condition
of the Persons covered thereby as at the dates thereof and the results of
their operations for the periods then ended, except that quarterly
financial statements need not include footnote disclosure and may be
subject to ordinary year-end adjustment. The Borrower represents that (a)
all factual information that has been or will be made available to the
Agents by or on behalf of the Borrower, the other Aladdin Parties and LCNI
is or will be, when furnished, complete and correct in all material
respects and does not or will not, when furnished, contain any untrue
statement of a material fact or omit to state a material fact necessary in
order to make the statements contained therein not materially misleading in
light of the circumstances under which such statements are made and (b) the
projections that have been or will be made available to the Agents by or on
behalf of the Borrower, the other Aladdin Parties and LCNI have been or
will be prepared in good faith based upon reasonable assumptions.
SECTION 6.6. No Material Adverse Change. No material adverse change
in (a) the financial condition, business, property, prospects or ability of
the Borrower to perform in all
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material respects its obligations under any Operative Document to which it
is a party or (b) the financial condition, business, property, prospects
and ability of any other Aladdin Party, LCNI or, to the best Knowledge of
the Borrower, the Design/Builder or Fluor to perform in all material
respects its obligations under any Operative Document to which it is a
party has occurred since the date of the financial statements of such
Person delivered pursuant to Section 5.1.4.
SECTION 6.7. Litigation, Labor Controversies, etc. There is no
pending material litigation, action, proceeding, or labor controversy which
could reasonably be expected to have a Material Adverse Effect or which
purports to affect the legality, validity or enforceability of this
Agreement, the Notes or any other Operative Document, except as disclosed
in Item 6.7 of the Disclosure Schedule.
SECTION 6.8. Subsidiaries. The Subsidiaries of the Borrower, the
other Aladdin Parties (other than the Trust) and LCNI are identified in
Item 6.8 of the Disclosure Schedule.
SECTION 6.9. Ownership of Properties. Other than the Borrower,
Aladdin Music and the Trust, the Aladdin Parties and LCNI do not own or
lease any real property other than the Mall Project Ground Lease and Music
Project Ground Lease. The Borrower and AMH (x) in the case of owned real
property, have good and marketable fee title to, and (y) in the case of
leased real property, hold valid and enforceable leasehold interests in,
all of such owned or lease real property, as the case may be, free and
clear in each case of all Liens or claims, except for Liens permitted
pursuant to Section 7.2.3 and where the failure to own or hold such title,
as the case may be, will not have a Material Adverse Effect. Except as
permitted pursuant to Section 6.13 or Section 7.2.3, the Borrower, the
other Aladdin Parties and LCNI (x) in the case of owned personal property,
have good and valid title to, and (y) in the case of leased personal
property, hold valid and enforceable leasehold interests in, all of such
material personal properties and assets, tangible and intangible, of any
nature whatsoever, free and clear in each case of all Liens or claims,
except for Liens permitted pursuant to Section 7.2.3, or where the failure
to own or hold such title will not have a Material Adverse Effect.
SECTION 6.10. Taxes. (a) Each of the Aladdin Parties and LCNI has
filed, or caused to be filed, all material tax and informational returns
that are required to have been filed by it in any jurisdiction, and has
paid all material Taxes shown to be due and payable on such returns and all
other taxes and assessments payable by it, to the extent the same have
become due and payable (other than those Taxes (i) that it is contesting in
good faith and by appropriate proceedings, with adequate, segregated
reserves established for such Taxes or (ii) with respect to which failure
to pay the same could not reasonably be expected to have a Material Adverse
Effect or to impair the respective interests of the Lenders in the Main
Project Security) and, to the extent such Taxes are not due, has
established reserves therefor by allocating, in the Trade Detail Report,
amounts that are adequate for the payment thereof and are required by GAAP.
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(b) None of the Aladdin Parties or LCNI has incurred any material Tax
liability in connection with the Main Project or the other transactions
contemplated by the Operative Documents which has not been disclosed in
writing to, and approved by, the Administrative Agent, except as set forth
in Item 6.10(b) of the Disclosure Schedule.
(c) All interest that accrues on funds on deposit in the Accounts
(other than the Construction Note Disbursement Account) is for the account
of the Borrower and, accordingly, no withholding or deduction of any
payments (including payments of principal, interest or premium, if any) to
any Agent or Lender is required in respect thereof.
SECTION 6.11. Pension and Welfare Plans. During the twelve
consecutive month period prior to the Effective Date and prior to the date
of any Credit Extension hereunder, no steps have been taken to terminate
any Pension Plan, and no contribution failure has occurred with respect to
any Pension Plan sufficient to give rise to a Lien under section 302(f) of
ERISA. No condition exists or event or transaction has occurred with
respect to any Pension Plan which might result in the incurrence by the
Borrower or any member of the Controlled Group of any material liability,
fine or penalty. Except as disclosed in Item 6.11 in the Disclosure
Schedule neither the Borrower nor any member of the Controlled Group has
any Contingent Liability with respect to any post-retirement benefit under
a Welfare Plan, other than liability for continuation coverage described in
Part 6 of Title I of ERISA.
SECTION 6.12. Environmental Warranties. Except as set forth in Item
6.12 in the Disclosure Schedule:
(a) all facilities and property (including underlying
groundwater) owned or leased by the Borrower, Aladdin Bazaar and
Aladdin Music have been, and continue to be, owned or leased by such
Person in material compliance with all Environmental Laws;
(b) there have been no past, and there are no pending or
threatened
(i) claims, complaints, notices or requests for information
received by the Borrower, Aladdin Bazaar or Aladdin Music with
respect to any alleged violation of any Environmental Law, or
(ii) complaints, notices or inquiries to the Borrower,
Aladdin Bazaar or Aladdin Music regarding potential liability
under any Environmental Law;
(c) there have been no Releases of Hazardous Substances at, on or
under any property now or previously owned or leased by the Borrower,
Aladdin Bazaar or Aladdin Music that, singly or in the aggregate,
have, or may reasonably be expected to have, a Material Adverse
Effect;
105
(d) the Borrower, Aladdin Bazaar and Aladdin Music have been
issued and are in material compliance with all permits, certificates,
approvals, licenses and other authorizations relating to environmental
matters and necessary or desirable for their businesses;
(e) to the Knowledge of the Borrower, no property now or
previously owned or leased by the Borrower, Aladdin Bazaar or AMH, is
listed or proposed for listing (with respect to owned property only)
on the National Priorities List pursuant to CERCLA, on the CERCLIS or
on any similar state list of sites requiring investigation or clean-up;
(f) there are no underground storage tanks, active or abandoned,
including petroleum storage tanks, on or under any property now or
previously owned or leased by the Borrower, Aladdin Bazaar or Aladdin
Music that, singly or in the aggregate, have, or may reasonably be
expected to have, a Material Adverse Effect;
(g) neither the Borrower, Aladdin Bazaar nor Aladdin Music has
directly transported or directly arranged for the transportation of
any Hazardous Substances to any location which is listed or proposed
for listing on the National Priorities List pursuant to CERCLA, on the
CERCLIS or on any similar state list or which is the subject of
federal, state or local enforcement actions or other investigations
which may lead to material claims against the Borrower, Aladdin Bazaar
or Aladdin Music for any remedial work, damage to natural resources or
personal injury, including claims under CERCLA;
(h) there are no polychlorinated biphenyls or friable asbestos
present at any property now or previously owned or leased by the
Borrower, Aladdin Bazaar or Aladdin Music that, singly or in the
aggregate, have, or may reasonably be expected to have, a Material
Adverse Effect; and
(i) no conditions exist at, on or under any property now or
previously owned or leased by the Borrower, Aladdin Bazaar or Aladdin
Music which, with the passage of time, or the giving of notice or
both, would give rise to liability under any Environmental Law.
SECTION 6.13. Intellectual Property. The Borrower owns or licenses
(as the case may be) or will own or hold licenses for all such patents,
patent rights, trademarks, trademark rights, trade names, trade name
rights, service marks, service mark rights and copyrights as the Borrower
considers necessary for the conduct of the businesses of the Borrower
without, to the Knowledge of Borrower, any infringement upon rights of
other Persons, in each case except as could not reasonably be expected to
individually or in the aggregate result in a Material Adverse Effect and
there is no individual patent, patent right, trademark, trademark right,
trade name, trade name right, service mark, service mark right or copyright
the loss of which would result in a Material Adverse Effect, any of the
other Aladdin Parties or LCNI, except as may be disclosed in Item 6.13 in
the Disclosure Schedule.
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SECTION 6.14. Regulations G, U and X. Neither the Borrower, any of
the other Aladdin Parties nor LCNI is engaged in the business of extending
credit for the purpose of purchasing or carrying margin stock, and no
proceeds of any Credit Extensions will be used to purchase or carry margin
stock or otherwise for a purpose which violates, or would be inconsistent
with, F.R.S. Board Regulation G, U or X. Terms for which meanings are
provided in F.R.S. Board Regulation G, U or X or any regulations
substituted therefor, as from time to time in effect, are used in this
Section with such meanings.
SECTION 6.15. Accuracy of Information. None of the factual
information, taken as a whole (including the factual information set forth
in the Discount Note Offering Circular), heretofore or contemporaneously
furnished by or on behalf of the Borrower, any of the other Aladdin
Parties, LCNI or London Clubs in writing to any Agent, the Issuer or any
Lender for purposes of or in connection with this Agreement or any
transaction contemplated hereby or with respect to the Transaction (true
and complete copies of which were furnished to each Agent, the Issuer and
each Lender in connection with its execution and delivery hereof), contains
any untrue statement of a material fact, and none of the other factual
information, taken as a whole, hereafter furnished in connection with this
Agreement or any other Operative Document by the Borrower, any of the other
Aladdin Parties, LCNI, London Clubs Holdings or London Clubs to any of the
Agents, the Issuer or any Lender will contain any untrue statement of a
material fact on the date as of which such information, taken as a whole,
is dated or certified and, as of the Effective Date, the information
delivered prior thereto (unless such information specifically relates to a
prior date) does not, and the factual information, taken as a whole,
hereafter furnished shall not on the date as of which such information is
dated or certified, omit to state any material fact necessary to make such
information, taken as a whole, not misleading.
SECTION 6.16. Permits. There are no Permits that are required or
will become required for the ownership, construction, financing or
operation of the Main Project, other than the Permits described in Exhibit
D to the Disbursement Agreement. Each Permit described in Exhibit D to the
Disbursement Agreement as required to be obtained by the date that this
representation is deemed to be made is in full force and effect and is not
at such time subject to any appeals or further proceedings or to any
unsatisfied condition (that is required to be satisfied by the date that
this representation is deemed to be made) that may allow modification or
revocation. Each Permit described in Exhibit D to the Disbursement
Agreement as not required to have been obtained by the date that this
representation is deemed to be made is of a type that is routinely granted
on application except approval by the applicable Governmental
Instrumentalities for the creation of the Mall Project Parcel and the Music
Project Parcel as separate legal parcels under Nevada subdivision law and
except for approvals, licences, authorizations and findings of suitability
required under Nevada Gaming Laws for the operation of the Main Project as
a Casino. The Borrower has no reason to believe that any Permit so
indicated will not be obtained before it becomes necessary for the
ownership, construction, financing or operation of the Main Project or that
obtaining such Permit will result in undue expense or delay. The Borrower
is not in violation of any condition in any Permit the effect of which
could reasonably be expected to have a Material Adverse Effect.
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SECTION 6.17. Security Interests.
(a) The security interests granted to the Secured Parties pursuant to
the Loan Documents (i) constitute, as to personal property included in the
Main Project Security, subject to the Nevada Gaming Laws, the filings,
registrations and recordations set forth on Schedule V hereto and, with
respect to subsequently acquired personal property included in the Main
Project Security, will constitute, a perfected security interest under the
UCC and/or other applicable law, except for any subsequently issued
certificate or instrument that constitutes collateral thereunder which will
be perfected upon the delivery of such certificate or instrument to the
Administrative Agent, and (ii) have been, and, with respect to such
subsequently acquired property, will be perfected under the UCC and/or
other applicable law as aforesaid, (A) the first priority contemplated
thereby and (B) as between the Secured Parties and any third Persons,
superior priority and rights over the rights of any such third Persons now
existing or hereafter arising whether by way of mortgage, deed of trust,
lien, security interests, encumbrance, assignment or otherwise, subject to
the rights and priorities of Permitted Liens and Permitted Encumbrances.
All such action as is necessary has been taken to establish and perfect the
Secured Parties' rights in and to the Main Project Security, including any
recording, filing, registration, giving of notice or other similar action,
subject to the filings, registrations and recordations set forth on
Schedule V hereto. As of the Effective Date, no filing, registration,
recordation, re-filing or re-recording other than those listed on Schedule
V hereto is necessary to perfect and maintain the perfection of the
interest, title or Liens of the Loan Documents, and on the Effective Date
all such filings or recordings will have been made except for any filings
or recordings for Liens as to which the Title Insurers have issued or
committed to issue Title Policies acceptable to the Administrative Agent.
The Borrower has properly delivered or caused to be delivered to the
Administrative Agent all Main Project Security that requires perfection of
the Lien and security interest described above by possession.
(b) No authorization, approval or other action by, and no notice to or
filing with, any Governmental Instrumentality (except for those by or with
the Nevada Gaming Authorities when any of the Borrower, the Aladdin Parties
and LCNI obtain a gaming license) is required for either (i) the pledge or
grant by the Borrower, the other Aladdin Parties and LCNI of the Liens
purported to be created in favor of the Secured Parties pursuant to any of
the Loan Documents or (ii) the exercise by the Administrative Agent and the
other Secured Parties of any rights or remedies in respect of any Main
Project Security (whether specifically granted or created pursuant to any
of the Loan Documents or created or provided for by applicable law), except
for filings or recordings contemplated by Section 6.17(a) above or as set
forth on Schedule V hereto.
(c) Except such as may have been filed in favor of the Secured Parties
as contemplated by Section 6.17(a) above or as set forth on Schedule V
hereto, no effective UCC financing statement, fixture filing or other
instrument similar in effect covering all or any part of the Main Project
Security is on file in any filing or recording office.
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(d) All information supplied to the Administrative Agent and the
Lenders by or on behalf of the Borrower, the other Aladdin Parties and LCNI
with respect to any of the Main Project Security (in each case taken as a
whole with respect to any particular Main Project Security) is accurate and
complete in all material respects.
SECTION 6.18. Existing Defaults. There is no Default or Event of
Default which has occurred and is continuing under any of the Operative
Documents.
SECTION 6.19. Design/Build Contract; Construction Contracts. Each of
the Design/Build Contract and the other Contracts which have been executed
by or on behalf of the Borrower (w) is in full force and effect and there
are no material defaults thereunder on the part of the Borrower or, to the
best knowledge of the Borrower, of the other party thereto which have not
been previously disclosed in writing to the Administrative Agent (nor has
any event, act or condition occurred which, with notice or expiration of
any applicable grace period, or both, would constitute an event of default
thereunder by the Borrower or, to the best of the Knowledge of the
Borrower, the other party thereto, as the case may be and which has not
been previously disclosed in writing to the Administrative Agent), (x) has
not been terminated, modified, amended or assigned except as permitted
hereunder, (y) has not expired by its terms and (z) has been delivered to
the Administrative Agent prior to the Effective Date.
SECTION 6.20. Contingent Liabilities. None of the Aladdin Parties
(other than the Trust) nor LCNI has any material Contingent Liabilities in
respect of Indebtedness (excluding, however, Indebtedness of the nature
referred to in clause (d) of the definition thereof) or obligations except
those authorized under or contemplated by the Operative Documents and not
prohibited by this Agreement or the Discount Note Indenture.
SECTION 6.21. Business, Debt, Contracts, etc. None of the Aladdin
Parties (other than the Trust) nor LCNI has conducted any business other
than the business contemplated by the Operative Documents. None of the
Aladdin Parties (other than the Trust) nor LCNI has any outstanding
Indebtedness other than Indebtedness incurred under the Loan Documents or
permitted under the Loan Documents or liabilities other than those incurred
under the Operative Documents or permitted under the Loan Documents and the
Discount Note Indenture, and is not a party to or bound by any Contract
other than as contemplated by the Operative Documents to which such Person
is a party or permitted under the Loan Documents and the Discount Note
Indenture.
SECTION 6.22. Representations and Warranties. As of the Effective
Date (in each case except to the extent related to a different date), all
representations and warranties of the Aladdin Parties and LCNI and, to the
best of the Borrower's Knowledge, the Design/Builder, Fluor, the Architect
of Record, and each other Major Contractor and each other Person (other
than the Borrower) to a Material Main Project Document contained in the
Operative Documents are true and correct in all material respects (unless
the failure of such representation or warranty could not reasonably be
expected to have a Material Adverse Effect) and the Borrower hereby
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confirms each such representation and warranty made by it with the same
effect as if set forth in full herein.
SECTION 6.23. Utilities. All utility services necessary for the
construction and the operation of the Main Project for its intended
purposes are or will be available at the Site as and when required on
commercially reasonable terms.
SECTION 6.24. In Balance Requirement. As of the date of each
Borrowing and Advance the Main Project Budget shall be In Balance.
SECTION 6.25. Sufficiency of Interests and Main Project Documents.
SECTION 6.25.1. Ownership, Title, etc. Except for the Permitted
Liens, Permitted Encumbrances and Permitted Exceptions and as set forth on
the Exhibits to the Trademark Security Agreement, the Borrower owns the
Site in fee simple, free and clear of all Liens and encumbrances and has
good legal and beneficial title to the property, assets and revenues on
which it purports to grant Liens pursuant to the Loan Documents. The
Borrower, AMH, Bazaar, and the Energy Provider own the Site Easements, as
their interests may appear. After giving effect to the Mall Project Ground
Lease, Aladdin Bazaar has and, until the Mall Project Parcel Creation Date,
will have, good leasehold title to the Mall Project Parcel and the Mall
Project Easements. From and after the Mall Project Parcel Creation Date,
Aladdin Bazaar will own the Mall Project Parcel and the Mall Project
Easements in fee simple. After giving effect to the Music Project Ground
Lease, Aladdin Music has and, until the Music Project Parcel Creation Date,
will have, good leasehold title to the Music Project Parcel and the Music
Project Easements. From and after the Music Project Parcel Creation Date,
Aladdin will own the Music Project Parcel and the Music Project Easements
in fee simple. Other than those services to be performed and materials to
be supplied that can be reasonably expected to be commercially available
when and as required, the Borrower owns all of the property interests and
has entered into all documents and agreements necessary to develop,
construct, complete, own and operate the Main Project on the Main Project
Parcel and in accordance with all Legal Requirements and the Construction
Benchmark Schedule and as contemplated in the Operative Documents.
SECTION 6.25.2. Main Project Documents. The Administrative Agent has
received a true, complete and correct copy of each of the Main Project
Documents in effect or required to be in effect as of the date this
representation is made or deemed made (including all exhibits, schedules,
side letters and disclosure letters referred to therein or delivered
pursuant thereto, if any). A list of all Main Project Documents entered
into as of the Effective Date is attached hereto as Schedule VI hereto.
SECTION 6.25.3. Satisfaction to Main Project Document Conditions.
All conditions precedent to the obligations of the respective parties
(other than the Borrower) under the Main Project Documents have been
satisfied, except for such conditions precedent (a) the failure of which to
be satisfied could not reasonably be expected to have a Material Adverse
Effect or
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(b) which by their terms cannot be met until a later stage in the
construction or operation of the Main Project, and the Borrower has no
reason to believe that any such condition precedent (the failure of which
to be satisfied could reasonably be expected to have a Material Adverse
Effect) cannot be satisfied on or prior to the appropriate stage in the
construction or operation of the Main Project.
SECTION 6.26. Main Project Budget; Trade Detail Report.
SECTION 6.26.1. Main Project Budget. The Main Project Budget (a) is
consistent with the provisions of the Operative Documents in all material
respects, (b) has been and will be prepared in good faith and with due
care, (c) sets forth, for each Line Item, the total Main Project Costs
which are anticipated to be incurred through Final Completion, and (d)
fairly represents the Borrower's expectation as to the matters covered
thereby. The Main Project Budget (including the detailed schedules
thereto) allocates the Main Project Costs to be incurred with respect to
construction and completion of each of the Hotel/Casino Component, the
Energy Project Component and the Equipment Component.
SECTION 6.26.2. Trade Detail Report. The Trade Detail Report (as in
effect from time to time):
(a) sets forth the amount allocated to each Line Item pursuant
to the Main Project Budget then in effect;
(b) sets forth, for each Line Item other than the Line Items in
the Line Item Category entitled "Project Contingency", an amount no
less than the total anticipated costs to be incurred by the Borrower
from the commencement through the completion of the work contemplated
by such Line Item, as determined by the Borrower and the Owner
Representative with the reasonable concurrence of the Construction
Consultant in the Construction Consultant's Certificate dated the date
on which this representation is made or deemed made;
(c) sets forth, for each Line Item Category, an aggregate amount
no less than the aggregate amount set forth for such Line Item
Category in the Main Project Budget then in effect less Realized
Savings obtained with respect to such Line Item Category (and not
reflected in the Main Project Budget); and
(d) to the Knowledge of the Borrower is true and correct in all
material respects.
SECTION 6.27. Fees and Enforcement. Other than amounts that have
been paid in full or will have been paid in full by the Effective Date or
the date when due for same, no fees or Taxes, including stamp, transaction,
registration or similar taxes, are required to be paid for the legality,
validity or enforceability of the Operative Documents.
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SECTION 6.28. ERISA Compliance. Either (a) there are no ERISA Plans
for the Borrower or any member of the Controlled Group or (b) the Borrower
and each member of the Controlled Group have fulfilled their obligations
(if any) under the minimum funding standards of ERISA and the Code for each
ERISA Plan in compliance in all material respects with the currently
applicable provisions of ERISA and the Code and have not incurred any
liability to the PBGC or an ERISA Plan under Title IV of ERISA (other than
liability for premiums due in the ordinary course). Neither the execution
of this Agreement or the other Operative Documents nor the consummation of
the Transactions will involve a "prohibited transaction" within the meaning
of Section 406 of ERISA or Section 4975 of the Code which is not exempt
under Section 408 of ERISA or under Section 4975(d) of the Code.
SECTION 6.29. Labor Disputes; Acts of God; Casualty and Condemnation.
Neither the business nor the properties of the Borrower or, to the
Knowledge of the Borrower, any other party to a Material Main Project
Document is affected by any fire, explosion, accident, strike, lockout or
other labor dispute (except as set forth in Item 6.29 in the Disclosure
Schedule as in effect on the Effective Date), drought, storm, hail,
earthquake, embargo, act of God or of the public enemy, or other casualty
or Force Majeure Event, that could reasonably be expected to have a
Material Adverse Effect. As of the date hereof, there is no casualty or
condemnation proceeding pending or, to the best knowledge of the Borrower,
threatened, affecting all or a portion of the Site.
SECTION 6.30. Liens. Except for Permitted Liens and Permitted
Encumbrances, the Borrower has not secured or agreed to secure any
Indebtedness by any Lien upon any of its present or future revenues or
assets or upon the Borrower Common Membership Interests. The Borrower does
not have outstanding any Lien or obligation to create Liens on or with
respect to any of its properties or revenues (other than the security
interest granted by Holdings to the Discount Note Indenture Trustee
pursuant to the Holdings Collateral Account Agreement), other than
Permitted Liens and Permitted Encumbrances and as provided in the Loan
Documents. Holdings has not secured or agreed to secure any Indebtedness
by any Lien upon any of its present or future revenues or assets or
Holdings Series A Preferred Membership Interests other than the security
interest granted by Holdings to the Discount Note Indenture Trustee
pursuant to the Holdings Collateral Amount Agreement and the Holdings
Pledge Agreement. None of the Borrower, Holdings, Capital, Enterprises,
Sommer Enterprises, AHL, AMH, ABH or LCNI has outstanding any Lien or
obligation to create Liens on or with respect to any of its properties or
revenues, other than as provided in the Loan Documents and the Discount
Note Indenture.
SECTION 6.31. Construction Benchmark Schedule; Guaranteed Maximum
Price.
SECTION 6.31.1. Construction Benchmark Schedule. The Construction
Benchmark Schedule accurately specifies in summary form the Work and the
other improvements that the Borrower and the Design/Builder propose to
complete in each calendar month from the Effective Date through the Final
Completion of the Main Project, all of which can be expected to be
achieved.
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SECTION 6.31.2. Guaranteed Maximum Price. The Design/Build Contract
has been amended to provide that the Guaranteed Maximum Price will remain
in effect if the Borrower provides the Design/Builder with the Notice to
Proceed (as defined in the Design/Build Contract) on or before February 27,
1998 and that the Design/Builder shall have no right to terminate the
Design/Build Contract if the Notice to Proceed is delivered on or before
March 1, 1998.
SECTION 6.32. Proper Subdivision. The Site has been properly
subdivided or entitled to exception therefrom, and for all purposes the
Site may be mortgaged, conveyed and otherwise dealt with as separate legal
lot or parcel. The parties acknowledge, however, that this Agreement
contemplates the creation of a separate legal parcel for each of the Mall
Project Parcel (including sub-parcels relating to the common parking area
and the retail facility), the Music Project Parcel, the Energy Project
Parcel and the Optional Improvement Site.
SECTION 6.33. Offices; Location of Collateral.
(a) The chief executive office or chief place of business (as such
term is used in Article 9 of the Uniform Commercial Code as in effect in
the State of New York from time to time) of the Borrower is located in
Clark County, Nevada. The Borrower's federal employer identification
number is 86-0856993.
(b) All of the Main Project Security (other than the Accounts and
general intangibles) is, or when installed pursuant to the Main Project
Documents will be, located on the Site.
(c) The Borrower's books of accounts and records are located at the
chief executive office or the chief place of business.
SECTION 6.34. Government Regulation. None of the Aladdin Parties nor
LCNI is subject to regulation under the Public Utility Holding Company Act
of 1935, the Federal Power Act or the Interstate Commerce Act or
registration under the Investment Company Act of 1940 or under any other
federal or state statute or regulation which may limit its ability to incur
Indebtedness, other than the Nevada Gaming Laws (from and after the date
that such Person holds any Gaming License), or which may otherwise render
all or any portion of the Obligations unenforceable. Incurrence of the
Obligations under the Operative Documents complies with all applicable
provisions of the Nevada Gaming Laws.
SECTION 6.35. No Brokers. The Borrower represents that no broker or
finder was responsible for or involved with the parties in connection with
the transactions contemplated by this Agreement and the other Loan
Documents and that there is no obligation for the payment of any brokerage
commission, compensation or fee of any kind with respect to this Agreement
or any other Loan Document except those included as an Issuance Fee or
Expense.
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ARTICLE VII
COVENANTS
SECTION 7.1. Affirmative Covenants. The Borrower agrees with the
Agents, the Issuer and each Lender that, until all Commitments have
terminated and all Obligations have been indefeasibly paid and performed in
full, the Borrower will perform or cause to be performed the obligations
set forth in this Section 7.1.
SECTION 7.1.1. Financial Information, Reports, Notices, etc. The
Borrower will furnish, or will cause to be furnished, to each Lender, the
Issuer, the Administrative Agent and, as applicable, the Construction
Consultant copies of the following financial statements, reports, notices
and information:
(a) as soon as available and in any event within 30 days after
the end of each month other than the last month of any Fiscal Quarter,
a balance sheet of the Borrower and a consolidated and consolidating
balance sheet of the Borrower and Subsidiaries, in each case as of the
end of such month, and consolidated and consolidating statements of
earnings and cash flow of the Borrower and Subsidiaries and statements
of earnings and cash flow of the Borrower for such month and for the
period commencing at the end of the previous Fiscal Year and ending
with the end of such month, certified as complete and correct by the
chief financial or accounting Authorized Representative of the
Borrower;
(b) as soon as available and in any event within 45 days after
the end of each of the first three Fiscal Quarters of each Fiscal
Year, a balance sheet of the Borrower, the other Aladdin Parties
(other than the Trust) and LCNI and a consolidated and consolidating
balance sheet of each of the Borrower and Subsidiaries and the other
Aladdin Parties (other than the Trust) and each of their respective
Subsidiaries, in each case as of the end of such Fiscal Quarter, and
consolidated and consolidating statements of earnings and cash flow of
each of the Borrower and Subsidiaries and the other Aladdin Parties
(other than the Trust) and each of their respective Subsidiaries and
statements of earnings and cash flow of the Borrower, the other
Aladdin Parties (other than the Trust) and LCNI, in each case for such
Fiscal Quarter and for the period commencing at the end of the
previous Fiscal Year and ending with the end of such Fiscal Quarter,
certified as complete and correct by the chief financial or accounting
Authorized Representative of the Person for which such information is
being delivered;
(c) as soon as available and in any event within 90 days after
the end of each Fiscal Year, a copy of the annual audited financial
statements for such Fiscal Year for such Person and for the Borrower
and Subsidiaries and the other Aladdin Parties (other than the Trust)
and each of their respective Subsidiaries, including therein a
consolidated and consolidating balance sheet of each of the Borrower
and Subsidiaries and the other
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Aladdin Parties (other than the Trust) and each of their respective
Subsidiaries as of the end of such Fiscal Year and consolidated and
consolidating statements of earnings and cash flow of each of the
Borrower and Subsidiaries and the other Aladdin Parties (other than
the Trust) and each of their respective Subsidiaries for such Fiscal
Year, in each case as audited (without any Impermissible
Qualification) by nationally recognized independent public accountants
acceptable to the Administrative Agent;
(d) as soon as available and in any event within 45 days after
the end of each of the first three Fiscal Quarters of each Fiscal Year
and within 90 days after the end of the Fiscal Year, a Compliance
Certificate, executed by the chief financial or accounting Authorized
Representative of the Borrower, showing (in reasonable detail and with
appropriate calculations and computations in all respects reasonably
satisfactory to the Administrative Agent) compliance (currently and on
a pro forma basis after giving effect the payments to be made in
respect of all federal, state and local income taxes of the Borrower
or, if the Borrower is treated as a pass-through entity or is not
treated as a separate entity for United States federal income tax
purposes, the payments to be made pursuant to clause (c) of Section
7.2.6) with the financial covenants set forth in Section 7.2.4.
(e) as soon as possible and in any event within 90 days after the
end of the fiscal year of the Trust, a letter from the Trust's tax
accountants stating that the net worth of the Trust based upon the
fair market value of its assets less liabilities is not less than
$100,000,000, together with all other financial information required
to be submitted by the Trust from time to time to the Person financing
the Mall Project;
(f) as soon as possible and in any event within three days after
the Borrower, any of the other Aladdin Parties, LCNI, London Clubs
Holdings or London Clubs obtains Knowledge of the occurrence of a
Default, a statement of the chief executive, financial or accounting
Authorized Representative of such Person setting forth details of such
Default and the action which such Person has taken and proposes to
take with respect thereto;
(g) as soon as possible and in any event within five Business
Days after the Borrower, any of the other Aladdin Parties, LCNI,
London Clubs Holdings or London Clubs obtains Knowledge of (x) the
occurrence of any material adverse development with respect to any
litigation, action, proceeding or labor controversy of the type and
materiality described in Item 6.7 of the Disclosure Schedule, or
(y) the commencement of any litigation, action, proceeding or labor
controversy of the type and materiality described in Item 6.7 of the
Disclosure Schedule, notice thereof and, to the extent the
Administrative Agent reasonably requests, copies of all documentation
relating thereto;
(h) promptly after the sending or filing thereof, (x) copies of
all reports and registration statements which the Borrower, any of the
other Aladdin Parties or LCNI files with the SEC or any national or
foreign securities exchange and (y) copies of all
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reports required to be filed by the Borrower with any Governmental
Instrumentality, including any reports with respect to Environmental
Matters and the Permits;
(i) immediately upon becoming aware of (w) the institution of any
steps by the Borrower or any other Person to terminate any Pension
Plan, (x) the failure to make a required contribution to any Pension
Plan if such failure is sufficient to give rise to a Lien under
Section 302(f) of ERISA, (y) the taking of any action with respect to
a Pension Plan which could result in the requirement that the Borrower
furnish a bond or other security to the PBGC or such Pension Plan or
(z) the occurrence of any event with respect to any Pension Plan which
could result in the incurrence by the Borrower, any of the other
Aladdin Parties or LCNI of any material liability, fine or penalty,
notice thereof and copies of all documentation relating thereto;
(j) promptly upon receipt thereof, copies of all detailed
management letters submitted to the Borrower by the independent public
accountants referred to in clause (b) in connection with each audit
made by such accountants of the books of the Borrower, any of the
other Aladdin Parties or LCNI;
(k) promptly when available and in any event no later than 45
days prior to the last day of each Fiscal Year (commencing after the
Effective Date), a budget for the next Fiscal Year, which budget shall
be prepared on a Fiscal Quarter basis and shall contain a projected,
consolidated balance sheet and statement of earnings and cash flow of
the Borrower and Subsidiaries for such Fiscal Year, prepared in
reasonable detail by the chief accounting or financial Authorized
Representative of the Borrower (the Administrative Agent shall have
the right to request clarifications on such budget within 20 days
after delivery thereof);
(l) promptly and in any event within five Business Days after the
receipt thereof, any material notice received by any of the Borrower,
any Aladdin Party or LCNI from any Nevada Gaming Authority, including
all NGC-1 Reports and all exception reports, which notice relates to
the construction, operation or maintenance of the Main Project, any
Permit related thereto or any Equity Interest or any Membership
Interest in any such Person;
(m) as soon available and in any event within 30 days after the
end of each month following the Opening Date, a report detailing the
occupancy rate of the Hotel, the average room rate thereof, the win
rate at the Casino and such other information prepared by the Borrower
relating to the operation and condition of the Hotel/Casino;
(n) prior to Final Completion, within 30 days after the end of
each month, a monthly status report describing in reasonable detail
the progress of the construction of each Construction Component and
the Main Project as a whole since the immediately preceding report
hereunder, including the cost incurred to the end of such month, an
116
estimate of the time and cost required to complete each Construction
Component and the Main Project as a whole, the progress of
construction and how it relates to the Construction Benchmark Schedule
and such other information and reports as the Administrative Agent or
Construction Consultant may reasonably request; and
(o) prior to Final Completion promptly after receipt thereof by
the Borrower, all progress reports provided by the Design/Builder
pursuant to the Design/Build Contract and the attachments thereto, if
any, and such additional information relative thereto as the
Administrative Agent or Construction Consultant may reasonably
request;
(p) as soon as possible and in any event within three days after
the Borrower obtains Knowledge thereof, notice of any event,
occurrence or circumstance which reasonably could be expected to cause
the Main Project Budget not to be In Balance or render the Borrower,
one or more of the Completion Guarantors, the Design/Builder, Fluor,
the Energy Project Provider, or the Energy Project Guarantor incapable
of, or preventing such Person from (x) achieving the Completion Date
on or before the Outside Completion Deadline or (y) meeting any
material obligation of such Person under the Operative Documents, the
Design/Build Contract or the other Material Main Project Documents as
and when required thereunder;
(q) as soon as possible and in any event within three days after
the Borrower obtains Knowledge thereof, notice of any termination or
event of default or notice thereof or any requests for indemnification
of any other party or any other notice relating to material rights or
obligations with respect to the Reciprocal Easement Agreement, Site
Work Agreement or Common Parking Area Use Agreement pursuant to the
terms thereof under any Material Main Project Document;
(r) any change in the Authorized Representatives of the Borrower,
the other Aladdin Parties, LCNI, London Clubs Holdings or London Clubs
and such notice shall include a certified specimen signature of any
new Authorized Representative so appointed and, if requested by the
Administrative Agent, satisfactory evidence of the authority of such
new Authorized Representative;
(s) prior to Final Completion, any proposed material change in
the nature or scope of the Main Project or the business or operations
of any of the Aladdin Parties (other than the Trust) or LCNI;
(t) prior to Final Completion, any notice of any schedule delay
delivered under the Design/Build Contract and all remedial plans and
updates thereof;
(u) the occurrence or existence of any Environmental Matter
requiring notice to a Governmental Instrumentality or with respect to
which notice is received from a Governmental Instrumentality;
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(v) any Event of Loss or any other event or development which
could reasonably be expected to have a Material Adverse Effect;
(w) prior to Final Completion, promptly, but in no event later
than ten days after the receipt thereof by the Borrower, copies of (x)
all Main Project Documents and Permits obtained or entered into by the
Borrower after the Effective Date, (y) any amendment, supplement or
other modification to any Permit received by the Borrower after the
Effective Date, and (z) all notices relating to the Main Project
received by or delivered to the Borrower from any Governmental
Instrumentality or any of the other Project Parties; and
(x) such other information respecting the condition or
operations, financial or otherwise, of the Borrower, the other Aladdin
Parties and/or LCNI as required by the other Loan Documents applicable
to it other than with respect to the Trust (including information and
reports from the chief accounting or financial Authorized
Representative of the Borrower, in such detail as the Administrative
Agent or any Lender or the Issuer through the Administrative Agent may
reasonably request, with respect to the terms of and information
provided pursuant to any Compliance Certificate) and as any Lender or
the Issuer through the Administrative Agent may from time to time
reasonably request.
SECTION 7.1.2. Compliance with Laws, etc. The Borrower and
Subsidiaries will comply in all material respects with all applicable Legal
Requirements, including:
(a) the maintenance and preservation of the corporate or other
organizational existence of such Person; and
(b) the payment, before the same become delinquent, of all
material Taxes, assessments and governmental charges imposed upon it
or upon its property, except to the extent being diligently contested
in good faith by appropriate proceedings and for which adequate
reserves, if any, in accordance with GAAP shall have been set aside on
its books.
SECTION 7.1.3. Maintenance of Properties; Operation; Reserves. The
Borrower and Subsidiaries will maintain, preserve, protect and keep the
portion of the Site owned or leased by such Person in good repair, working
order and condition (ordinary wear and tear excepted), and make necessary
and proper repairs, renewals and replacements so that its business carried
on in connection therewith may be properly conducted at all times. The
Borrower will operate the Main Project as a luxury themed casino hotel
(with a separate level of the Casino catering to premium players) in
accordance with the standards which shall be at least equivalent to the
standards of the Mirage on the Effective Date. The Theater shall be used
to present events which are consistent with the first class nature of
Complex. The Borrower shall maintain adequate working capital reserves and
other reserves as set forth in the annual budget to be delivered by the
Borrower in accordance with clause (k) of Section 7.1.1. From and after
the
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Opening Date, the Borrower shall for each year following the Opening Date
establish a reserve for replacements ("FF&E Reserve") which shall be funded
on a monthly basis at the percentage of gross revenues set forth below and
to the level of maximum funding set forth below, in each case, opposite
such year. After the FF&E Reserve has been funded to the level of maximum
funding set forth below opposite such year, the Borrower shall have no
further obligation to fund the FF&E Reserve until such time as amounts are
withdrawn from the FF&E Reserve in which case monthly contributions at the
percentage of gross revenues set forth opposite such year below shall
resume:
Percentage of Maximum
Year Gross Revenues Funding
---- -------------- -------
1 1.75% $12,000,000
2 1.25% $12,000,000
3 1.3% $12,000,000
4 1.35% $12,000,000
5 2.5% $18,000,000
6 2.5% $18,000,000
7 3.0% $18,000,000
8 3.0% $18,000,000
9 3.0% $18,000,000
10 3.0% $18,000,000
SECTION 7.1.4. Insurance. The Borrower shall maintain the insurance
set forth on Exhibit E to the Disbursement Agreement and shall comply in
all material respects with the requirements of such insurance policies.
SECTION 7.1.5. Books and Records. The Borrower and Subsidiaries shall
maintain adequate books, accounts and records with respect to the Main
Project in compliance in all material respects with the regulations of any
Governmental Instrumentality having jurisdiction thereof and, with respect
to financial statements, in accordance with GAAP. Subject to reasonable
safety requirements and the rights of other Persons, and (from and after
the date that the Borrower holds a Gaming License) subject to Nevada Gaming
Laws, the Borrower shall, at its cost and expense, permit employees or
agents of the Administrative Agent and the Construction Consultant at any
reasonable times and upon reasonable prior notice to inspect the Main
Project, to examine or audit all of the Borrower's books, accounts and
records pertaining or related to the Main Project, to make copies and
memoranda thereof and, with respect to any Environmental Matters, to
perform any tests or studies and prepare any reports reasonably required by
the Administrative Agent. For all expenditures with respect to which Loans
are made, the Borrower shall retain, until at least five years after the
Administrative Agent has received the report specified in clause (a) of
Section 7.1.1 for the calendar month in which the
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last Advance was made by the Lenders, all records (contracts, orders,
invoices, bills, receipts and other documents) evidencing such
expenditures.
SECTION 7.1.6. Environmental. The Borrower and Subsidiaries will:
(a) construct, use and operate all of its facilities and
properties in material compliance with all Environmental Laws, keep
all necessary permits, approvals, certificates, licenses and other
authorizations relating to environmental matters in effect and remain
in material compliance therewith, and handle all Hazardous Substances
in material compliance with all applicable Environmental Laws;
(b) promptly notify the Administrative Agent and provide copies
upon receipt of all material written claims, complaints, notices or
inquiries relating to potential liability under or non-compliance
with, Environmental Laws, and shall promptly resolve any material non-
compliance with Environmental Laws and keep its property free of any
Lien imposed by any Environmental Law; and
(c) provide such information and certifications which the
Administrative Agent may reasonably request from time to time to
evidence compliance with this Section, including certificates
confirming (x) removal of asbestos in the existing building on or
before June 30, 1998, (y) removal of asbestos from the Theater within
30 days after such removal has been completed and (z) removal of all
underground storage tanks within 30 days after such removal has been
completed.
SECTION 7.1.7. Additional Collateral. The Borrower shall cause the
Administrative Agent to have at all times a first priority perfected
security interest (subject only to Permitted Liens and Permitted
Encumbrances) in all of the property (real and personal) owned from time to
time by the Borrower, the other Aladdin Parties (other than the Trust) and
LCNI to the extent the same constitutes or would constitute "Collateral"
under the Loan Documents. Without limiting the generality of the
foregoing, the Borrower shall, and shall cause each of the other Aladdin
Parties (other than the Trust) and LCNI to, execute, deliver and/or file
(as applicable) or cause to be executed, delivered and/or filed (as
applicable), the pledge agreement(s), the security agreement(s), Uniform
Commercial Code (Form UCC-1) financing statements, Uniform Commercial Code
termination statements, and other documentation necessary to grant and
perfect such security interest, in each case in form and substance
satisfactory to the Administrative Agent.
SECTION 7.1.8. Use of Proceeds. The Borrower shall apply the
proceeds of the Credit Extensions:
(a) to pay in part the Main Project Costs which are identified in
the Main Project Budget to be paid from the Loans;
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(b) to pay the costs, expenses and fees required to be paid by
the Borrower under this Agreement, the other Loan Documents and, to
the extent set forth in the Main Project Budget, the other Operative
Documents; and
(c) in the case of Letters of Credit, for issuing Letters of
Credit for the account of the Borrower to be delivered to suppliers or
contractors providing materials to the Main Project which constitute
Main Project Costs set forth in the Main Project Budget to be paid
from the Loans; provided, however, that no Letter of Credit shall be
issued for the Gaming Equipment or the Specified Equipment which is to
be leased under an FF&E Lease and/or financed by the credit facilities
contemplated by the Approved Equipment Funding Commitments.
SECTION 7.1.9. Deposits into the Accounts. The Borrower shall
deposit or cause to be deposited (v) all amounts required pursuant to
Section 7.1.14 into the Guaranty Deposit Account, (w) all amounts paid
pursuant to the Completion Guaranty into the Guaranty Deposit Account, (x)
all Loss Proceeds into the Loss Proceeds Account, (y) all Pre-Opening
Revenues, the Net Distribution Amount, all amounts received from Aladdin
Bazaar for reimbursement of costs of work on the Shoulder Space pursuant to
the Site Work Agreement, all damages, liquidated or otherwise, and all
other amounts paid to the Borrower prior to the Conversion Date pursuant to
the Design/Build Contract, the Fluor Guaranty, the Contracts and the other
Main Project Documents into the Borrower's Funds Account and (z) all other
funds received by the Borrower prior to the Conversion Date (other than
those permitted or required to be deposited elsewhere) into the Borrower's
Funds Accounts. The Borrower shall not, at any time prior to the
Completion Date, open or establish any bank, deposit or any other accounts
at any financial institution other than the Accounts provided for herein.
SECTION 7.1.10. Main Project Costs. The Borrower shall apply all
proceeds described in Section 7.1.9 and all other amounts in the Accounts
from time to time only to pay Main Project Costs in accordance with the
terms of this Agreement and, if applicable, the Disbursement Agreement,
including:
(a) the application of the proceeds of Hotel/Casino Component
Funding Sources only to pay Main Project Costs permitted pursuant to
the allocation procedures of Section 2.5 of the Disbursement
Agreement;
(b) the application of the proceeds of Approved Equipment Funding
Commitments only to the payment of the Gaming Equipment, the Specified
Equipment and other Main Project Costs allocated to the Equipment
Component;
(c) the application of amounts in the Accounts only to pay Main
Project Costs allocated to the Hotel/Casino Component, as set forth in
the Main Project Budget; and
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(d) the incurrence and payment of Pre-Opening Expenses only to
satisfy the Opening Conditions.
SECTION 7.1.11. Repayment of Indebtedness. The Borrower shall repay,
in accordance with its terms, all Indebtedness, including all sums due
under this Agreement and the other Operative Documents subject, however, in
the case of any such Indebtedness (excluding, however any Obligation) the
repayment of which is limited by any term of any Operative Document, to
such limitation.
SECTION 7.1.12. Diligent Construction of the Main Project. With
respect to the construction and Final Completion of each of the
Hotel/Casino, the Energy Project, and, if applicable, the renovations to
the Theater, the Borrower shall:
(a) take or cause to be taken all action, make or cause to be
made all Contracts and, if required, Subcontracts and do or cause to
be done all things necessary to construct of the Hotel/Casino and, if
applicable, the renovations to the Theater diligently to Final
Completion in accordance with the Design/Build Contract, the Plans and
Specifications and the other Operative Documents;
(b) take or cause to be taken all action and do or cause to be
done all things necessary to enforce the obligation of the Energy
Project Provider and, if applicable, the Energy Project Guarantor to
construct or cause the construction of the Energy Project diligently
to Final Completion in accordance with the Energy Project Ground
Lease, the Energy Service Agreement and the other Operative Documents
applicable to the Energy Project, subject to clause (c) of Section
8.1.13; and
(c) promptly after completing the Main Project Punchlist Items
applicable to the Hotel/Casino and the Theater, as the case may be,
request the Construction Consultant to issue the Main Project
Punchlist Completion Certificate applicable to the Hotel/Casino and
the Theater, as the case may be.
SECTION 7.1.13. Compliance with Legal Requirements. The Borrower
promptly and diligently shall (x) own, construct, maintain and operate the
Main Project in compliance in all material respects with all applicable
Legal Requirements, including the Permits, the Environmental Laws and (from
and after the date that the Borrower holds a Gaming License) Nevada Gaming
Laws and (y) procure, maintain and comply, or cause to be procured,
maintained and complied with, in all material respects, all Permits
required for any ownership, construction, financing, maintenance or
operation of the Main Project or any part thereof at or before the time
each such Permit becomes necessary for the ownership, construction,
financing, maintenance or operation of the Main Project, as the case may
be, as contemplated by the Operative Documents, except that the Borrower
may, at its expense, contest by appropriate proceedings conducted in good
faith the validity or application of any such Legal Requirements, provided,
however, that (1) none of the Agents, any of the Lenders, any of the
Aladdin Parties or
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LCNI would be subject to any criminal liability for failure to comply
therewith and (2) all proceedings to enforce such Legal Requirements
against the Agents, any of the Aladdin Parties or LCNI shall have been duly
and effectively stayed during the entire pendency of such contest, except
where failure to procure such stay could not reasonably be expected to
result in a Material Adverse Effect.
SECTION 7.1.14. In Balance; Borrower Equity. If at any time the
Project Budget is not In Balance, the Borrower shall deposit or cause to be
deposited into the Guaranty Deposit Account, in cash, funds in the amount
required to bring the Project Budget In Balance. Each such deposit shall
be made on the earlier of (x) 10 days after demand therefor by the
Administrative Agent or (y) the Business Day immediately preceding the date
on which an Advance is to be made by the Lenders pursuant to the Loan
Documents or, if applicable, by the Disbursement Agent pursuant to the
Disbursement Agreement, as the case may be.
SECTION 7.1.15. Security Interest in Newly Acquired Property. If the
Borrower shall at any time acquire any interest in property not covered by
the Loan Documents (excluding, however, property in which, pursuant to the
Loan Documents, the Borrower is not required to grant a security interest
in favor of any Secured Party) or enter into a Main Project Document, then
promptly upon such acquisition or execution the Borrower shall execute,
deliver and record a supplement to the Loan Documents, reasonably
satisfactory in form and substance to the Administrative Agent, subjecting
such interests to the Lien and security interests created by the applicable
Loan Documents (with the priority contemplated thereby in favor of each
Secured Party) and (if the Main Project Document is a Material Main Project
Document) deliver to the Administrative Agent, on behalf of the Secured
Parties, Consents (with such changes thereto as are reasonably acceptable
to the Administrative Agent) with respect to the collateral assignment of
any such Main Project Document.
SECTION 7.1.16. Plans and Specifications. The Borrower shall provide
to the Construction Consultant a copy of, and maintain at the Site, a
complete set of Plans and Specifications as in effect from time to time.
The Borrower shall provide or make available to the Construction Consultant
a copy of all shop drawings, schedules, reports, diagrams, layouts, setting
plans, cuts, explanations, catalogue references, samples and other data
prepared by the Design/Builder, the Architect of Record or any
Subcontractor in connection with the development of the Plans and
Specifications during the time that the Borrower and the Owner
Representative have to review and approve such items in order for the
Construction Consultant to confirm the conformity thereof to the
applicable provisions of this Agreement and the other Operative Documents;
provided, however, in no event shall any such review by the Construction
Consultant require the Borrower or the Owner Representative to delay the
approval process thereof as set forth in Section 4.2 of the General
Conditions annexed to the Design/Build Contract as Attachment D. Following
the review and approval of such submissions as aforesaid, no material
modifications to the Plans and Specifications may be made without the prior
written consent of the Administrative Agent, which consent shall not be
unreasonably withheld or delayed if, after giving effect thereto, such
modifications will not (w) cause a breach under the
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Discount Note Indenture, (x) extend the Completion Date beyond the Outside
Completion Deadline, (y) require any adjustment to the Guaranteed Maximum
Price or the Design/Build Contract Time and (z) the Completion Guarantors
have consented in writing to such modifications. The Borrower shall
provide Final Plans and Specifications for the Hotel/Casino no later than
six months prior to the estimated Completion Date and "as built" Plans and
Specifications for the Hotel/Casino no later than three months after the
Completion Date.
SECTION 7.1.17. Construction Consultant. The Borrower shall:
(a) cooperate and cause the Design/Builder and the Architect of
Record to cooperate with the Construction Consultant in the
performance of the Construction Consultant's duties hereunder and
under the Construction Consultant Engagement Agreement. Without
limiting the generality of the foregoing, the Borrower shall and shall
instruct the Design/Builder and the Architect of Record to: (w)
communicate with and promptly provide or make available to the
Construction Consultant all invoices, documents, shop drawings,
schedules, reports, diagrams, layouts, setting plans, cuts,
explanations, catalogue references, samples and other data and
information reasonably requested by the Construction Consultant with
respect to the construction of the Main Project and, if applicable,
the renovation of the Theater (x) provide the Construction Consultant
with access to the Site and, subject, however, to required safety
precautions, the construction areas (the Owner Representative shall
accompany the Construction Consultant on any such visits), (y) provide
the Construction Consultant with reasonable working space and access
to telephone, copying and telecopying equipment (at no cost to the
Lenders, the Construction Consultant, the Administrative Agent or the
Disbursement Agent) and (z) otherwise facilitate the Construction
Consultant's review of the construction of the Main Project and
preparation of the certificates required hereby and by the
Disbursement Agreement.
(b) pay or cause to be paid to the Construction Consultant (or
the Administrative Agent for the account of the relevant Lenders for
reimbursement of payments advanced to the Construction Consultant) out
of the Loans made hereunder (to the extent not otherwise paid from the
Accounts or any other sources) all amounts required hereunder and
under the Construction Consultant Engagement Agreement (and, in the
case of any such reimbursement, to the extent so advanced by the
Administrative Agent).
(c) in addition to any other consultation required hereunder,
following the end of each Fiscal Quarter, upon the reasonable request
of the Administrative Agent, consult with any Person (other than
Contractors or Subcontractors) regarding any adverse event or
condition identified in any report prepared by the Construction
Consultant or the Owner Representative, as the case may be.
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SECTION 7.1.18. Proper Legal Forms. The Borrower shall take all
action within its control required or advisable to ensure that each of the
Operative Documents is in proper legal form.
SECTION 7.1.19. Preserving the Main Project Security. The Borrower
shall:
(a) Subject to clauses (b) and (c), undertake all actions which
are necessary or appropriate in the reasonable judgment of the
Administrative Agent and (from and after the date that the Borrower
holds a Gaming License) as required by the Nevada Gaming Laws to (x)
maintain the Secured Parties' respective security interests under the
Loan Documents in the Main Project Security in full force and effect
at all times (including the priority thereof) and (y) preserve and
protect the Main Project Security and protect and enforce the
Borrower's rights and title and the respective rights of the Secured
Parties to the Main Project Security, including the making or delivery
of all filings and recordations, the payments of fees and other
charges, the issuance of supplemental documentation, the discharge of
all claims or other Liens (other than the Permitted Liens and the
Permitted Encumbrances) adversely affecting the respective rights of
the Secured Parties to and under the Main Project Security (except to
the extent same is being contested in good faith by appropriate
governmental proceedings promptly instituted and diligently contested,
so long as (1) such reserve or other appropriate provision, if any, as
shall be required in conformity with generally accepted accounting
principles shall have been made therefor and (2) in case of any charge
or claim which has or may become a Lien against any of the Main
Project Security, such contested proceedings conclusively operate to
stay the sale of any portion of the Main Project Security to satisfy
such charge or claim which has of may become a Lien against any of the
Main Project Security, such contested proceedings conclusively operate
to stay the sale of any portion of the Main Project Security to
satisfy such charge or claim) and the publication or other delivery of
notice to third parties.
(b) Take all actions and do all things as may be reasonably
necessary under NRS Chapter 278 and the applicable provisions of the
Clark County Code, Clark County, Nevada (the "Clark County Code"), to
cause the Mall Project Parcel to become a separate legal parcel as
promptly as practicable. The Borrower shall, upon creation of the
Mall Project Parcel as a separate legal parcel, deliver a notice to
such effect to the Administrative Agent. Promptly thereafter, at the
Borrower's sole cost and expense, in substantially concurrent
transactions:
(i)the Borrower, in accordance with the Mall Project Ground
Lease, shall transfer all of its right, title and interest in and
to the Mall Project Parcel to Aladdin Bazaar by executing,
delivering and recording at the Clark County, Nevada, Recorder's
Office a Grant, Bargain and Sale Deed substantially in the form
of Exhibit J hereto;
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(ii) the Borrower and Aladdin Bazaar shall terminate the
Mall Project Ground Lease;
(iii) the Mall Project Parcel shall be released from the
Deed of Trust and reconveyed by the Lenders to Aladdin Bazaar,
which release shall be recorded at the Clark County, Nevada,
Recorder's Office; and
(iv) substantially concurrently with the foregoing, and as a
condition precedent thereto, the Borrower shall deliver to the
Administrative Agent: (A) a legal opinion from counsel reasonably
acceptable to the Administrative Agent to the effect that (after
giving effect to the amendments and re-recordations contemplated
by this clause (b)) (1) the Mall Project Parcel has been legally
created as a separate legal parcel under NRS Chapter 278 and the
applicable provisions of the Clark County Code, and (2) the Deed
of Trust remains enforceable in accordance with its terms and
continues to be effective to create the security interests
described therein, together with such other legal opinions as the
Administrative Agent may reasonably request, each in form and
substance reasonably satisfactory to the Administrative Agent,
(B) endorsements, or commitments by the Title Insurer to issue
endorsements, to the Title Policies, in each case in form and
substance satisfactory to the Administrative Agent, insuring the
continuing perfection and priority of the respective Liens on the
Main Project Security and (C) any amendments to the Reciprocal
Easement Agreement, the Site Work Agreement and the Common
Parking Area Use Agreement necessary to allow continued
performance by the parties thereto of their obligations
thereunder.
(c) Take all actions and do all things as may be reasonably
necessary under NRS Chapter 278 and the applicable provisions of the
Clark County Code, to cause the Music Project Parcel to become a
separate legal parcel as promptly as practicable. The Borrower shall,
upon creation of the Music Project Parcel as a separate legal parcel,
deliver a notice to such effect to the Administrative Agent. Promptly
thereafter, at the Borrower's sole cost and expense, in substantially
concurrent transactions:
(i) The Borrower, in accordance with the Music Project
Ground Lease, shall transfer all of its right, title and interest
in and to the Music Project Parcel to Aladdin Music by executing,
delivering and recording at the Clark County, Nevada, Recorder's
Office a Grant, Bargain and Sale Deed substantially in the form
of Exhibit J hereto;
(ii) the Borrower and Aladdin Music shall terminate the
Music Project Ground Lease;
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(iii) the Music Project Parcel shall be released from the
Deed of Trust and reconveyed by the Lenders to Aladdin Music,
which release shall be recorded at the Clark County, Nevada,
Recorder's Office; and
(iv) substantially concurrently with the foregoing, and as a
condition precedent thereto, the Borrower shall deliver to the
Administrative Agent: (A) a legal opinion from counsel reasonably
acceptable to the Administrative Agent to the effect that (after
giving effect to the amendments and re-recordations contemplated
by this clause (c)) (1) the Music Project Parcel has been legally
created as a separate legal parcel under NRS Chapter 278 and the
applicable provisions of the Clark County Code, and (2) the Deed
of Trust remains enforceable in accordance with its terms and
continues to be effective to create the security interests
described therein, together with such other legal opinions as the
Administrative Agent may reasonably request, each in form and
substance reasonably satisfactory to the Administrative Agent,
(B) endorsements, or commitments by the Title Insurer to issue
endorsements, to the Title Policies, in each case, in form and
substance satisfactory to the Administrative Agent, insuring the
continuing perfection and priority of the respective Liens on the
Main Project Security and (C) any amendments to the Reciprocal
Easement Agreement, the Site Work Agreement and the Common
Parking Area Use Agreement necessary to allow continued
performance by the parties thereto of their obligations
thereunder.
SECTION 7.1.20. Application of Insurance and Condemnation Proceeds.
(a) As a material inducement to the Lenders to enter into this
Agreement, if any Event of Loss shall occur with respect to the
Complex or any part thereof, the Borrower shall (x) promptly upon
discovery or receipt of notice thereof provide written notice thereof
to the Administrative Agent, (y) diligently pursue all its rights to
compensation against all relevant insurers, reinsurers and/or
Governmental Instrumentalities, as applicable, in respect of such
event and (z) not, without consent of the Administrative Agent (which
consent shall not be unreasonably withheld or delayed), compromise or
settle any claim involving an amount in excess of $100,000 per claim.
(b) All awards, amounts, damages, compensation, payments,
settlements and proceeds (including instruments) in respect of any
Event of Loss including the proceeds of any insurance policy required
to be maintained by the Borrower hereunder and awards or settlements
from any condemnation (collectively, "Loss Proceeds") shall be applied
as provided in this Section, subject, however, to the applicable
provisions of the Reciprocal Easement Agreement. All Loss Proceeds
shall be paid by the insurers, reinsurers, Governmental
Instrumentalities or other payors directly to the Administrative Agent
for deposit in the Loss Proceeds Account. If any Loss Proceeds are
paid directly to the Borrower, any other Aladdin Party, LCNI, London
Clubs Holdings or London Clubs or
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any Affiliate of any of the foregoing by any insurer, reinsurer,
Governmental Instrumentality or such other payor, (x) such Loss
Proceeds shall be received in trust for the Administrative Agent, (y)
such Loss Proceeds shall be segregated from other funds of such Person
and (z) such Person shall pay (or, if applicable, Borrower shall cause
the Aladdin Parties or, if applicable, LCNI, London Clubs Holdings or
London Clubs to pay) such Loss Proceeds over to the Administrative
Agent in the same form as received (with any necessary endorsement)
for deposit in the Loss Proceeds Account. In the event that for a
period of 60 days after any Loss Proceeds are deposited in the Loss
Proceeds Account, the Borrower is not permitted pursuant to the terms
of the Disbursement Agreement to obtain Advances of such Loss
Proceeds, then the Borrower shall use such proceeds to prepay the
Loans in accordance with this Agreement, subject, however, to the
applicable provisions of the Reciprocal Easement Agreement.
SECTION 7.1.21. Shoulder Space Encroachments.
(a) The Borrower shall construct or cause to be constructed the
Hotel/Casino and the Energy Project within the Main Project Parcel;
provided, however, that (x) portions of the Hotel/Casino and other
improvements constituting the Main Project may encroach onto the Mall
Project Parcel or the Music Project Parcel, (y) portions of the Mall
Project may encroach onto the Main Project Parcel or the Music Project
Parcel and (z) portions of the Music Project may encroach onto the
Mall Project Parcel or the Main Project Parcel, so long as: (1) none
of such encroachments extends beyond the limitations set forth in the
Reciprocal Easement Agreement and the Final Plans and Specifications
and (2) the Borrower complies in all material respects with the
provisions set forth in Section 7.2.17 in implementing any Scope
Change that causes such encroachment.
(b) Promptly after the creation of the Mall Project Parcel and
the Music Project Parcel in accordance with this Agreement and the
other Operative Documents, the Borrower shall implement such lot line
adjustments as may be necessary to ensure that (x) all improvements
which are to be constructed on the Mall Project are located on the
Mall Project Parcel or on a parcel as to which Aladdin Bazaar has a
permanent easement, (y) all improvements which are to be constructed
on the Main Project are located on the Main Project Parcel or on a
parcel as to which the Borrower has a permanent easement and (z) all
improvements which are to be constructed on the Music Project are
located on the Music Project Parcel or on a parcel as to which Aladdin
Music has a permanent easement.
SECTION 7.1.22. GECC Intercreditor Agreement. On or before the
earlier of June 30, 1998 or the applicable date set forth in the GECC
Commitment, the Borrower shall provide the Administrative Agent with the
final form of documents to be used with respect to the FF&E Financing
including the GECC Intercreditor Agreement. Such documents shall be in
form and substance satisfactory to the Administrative Agent as determined
in good faith in its sole discretion. The GECC Intercreditor Agreement
shall provide, in relevant part, that the
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Administrative Agent shall receive all notices given or received by GECC
with respect to the FF&E Financing, that the Administrative Agent, on
behalf of the Lenders, shall have the right but not the obligation to cure
defaults of the Borrower under the FF&E Financing and such other rights,
remedies and options as are customary for senior secured lenders to receive
in transactions of this type.
SECTION 7.1.23. Compliance with Material Main Project Documents and
the Approved Equipment Funding Commitment. The Borrower shall comply duly
and promptly, in all material respects, with its obligations, and enforce
all of its respective rights, under all Material Main Project Documents,
except where the failure to comply or enforce such rights, as the case may
be, could not reasonably be expected to have a Material Adverse Effect.
The Borrower shall comply duly and promptly, in all material respects, with
its obligations, and enforce all of its respective rights, under the
Approved Equipment Funding Commitment.
SECTION 7.2. Negative Covenants. The Borrower agrees with the
Agents, the Issuer and each Lender that, until all Commitments have
terminated and all Obligations have been indefeasibly paid and performed in
full, the Borrower will perform the obligations set forth in this
Section 7.2.
SECTION 7.2.1. Business Activities. The Borrower and Subsidiaries
will not engage in any business activity, except those described in the
recitals and such activities as are reasonably incidental or substantially
similar thereto.
SECTION 7.2.2. Indebtedness. The Borrower and Subsidiaries will not
directly or indirectly, create, incur, assume or suffer to exist or
otherwise become or be liable in respect of any Indebtedness or issue any
shares of Preferred Stock, other than, without duplication, the following:
(a) Indebtedness in respect of the Credit Extensions and other
Obligations;
(b) Existing Indebtedness;
(c) Indebtedness of the Borrower comprised of Hedging
Liabilities; provided, however, that the notional principal amount of
any such Hedging Liabilities does not exceed the principal amount of
Indebtedness to which such Hedging Liabilities relate;
(d) Indebtedness of the Borrower incurred under the FF&E
Financing; provided, however, that (x) the principal amount of such
Indebtedness does not exceed the cost (including sales and excise
taxes, installation and delivery charges and other direct costs of,
and other direct and transaction expenses paid or charged in
connection with, such purchase including reasonable transaction costs)
of the FF&E purchased or leased with the proceeds thereof and (y) the
aggregate principal amount of such Indebtedness, including any
Permitted Refinancing Indebtedness incurred to refinance or replace
any
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Indebtedness incurred pursuant to this clause (d), does not exceed
$80,000,000 (including obligations characterized as operating leases
or other off-balance sheet financing arrangements) outstanding at any
time;
(e) Indebtedness (to the extent that the incurrence thereof does
not result in incurrence by the Borrower of any obligation for the
payment of borrowed money of others) solely in respect of performance
bonds; provided, that such Indebtedness was incurred in the ordinary
course of business of the Borrower and in an aggregate principal
amount outstanding under this clause (e) at any one time of not more
than $10,000,000;
(f)Indebtedness of the Borrower comprised of (x) at any time
prior to the Outside Completion Deadline, additional Indebtedness
under clause (d) of this Section in an aggregate amount not to exceed
$40,000,000, plus (y) after a Default of the "In Balance" requirements
in Section 7.1.14 and at any time prior to the Outside Completion
Deadline, additional Indebtedness under clause (d) in an aggregate
amount not to exceed $50,000,000 (provided that Indebtedness incurred
pursuant to this clause (f)(y) is matched, dollar for dollar, by
additional equity investments; provided, however, that the foregoing
amounts shall be reduced by any amounts which the Lenders have agreed
by amendment to this Agreement to lend pursuant to clause (a);
(g) the Borrower may incur Permitted Refinancing Indebtedness in
exchange for, or the net proceeds of which are used to refinance,
renew, replace, substitute or refund, Indebtedness that was permitted
to be incurred under clauses (b), (d) and (h) of this covenant;
(h) after the Hotel/Casino is Operating, Indebtedness of the
Borrower under any Working Capital Facility in an aggregate amount at
any time outstanding not to exceed $20,000,000; and
(i) Indebtedness of Aladdin Music in respect of the construction
of the Music Project, the terms of which and the Instruments which
evidence and secure such Indebtedness shall be satisfactory to the
Administrative Agent as determined in good faith in its sole
discretion.
Accrual of interest, the accretion of the accreted value or principal and
the payment of interest in the form of additional Indebtedness and the
issuance of the Borrower Series A Preferred Membership Interests, will not
be deemed to be an incurrence of Indebtedness for purposes of this
covenant.
SECTION 7.2.3. Liens. The Borrower and Subsidiaries will not create,
incur, assume or suffer to exist any Lien upon any of its property,
revenues or assets, whether now owned or hereafter acquired, or any
proceeds, income or profits therefrom, or assign or convey any right to
receive income therefrom, excluding, however, Liens securing (x) the
Obligations,
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(y) Permitted Refinancing Indebtedness which is incurred to refinance
Indebtedness which has been secured by a Lien and is permitted under
Section 7.2.2 and which has been incurred in accordance with such Section;
provided, however, that such Liens do not extend to cover any property or
assets of the Borrower not already securing the Indebtedness so refinanced
and (z) Permitted Liens, Permitted Encumbrances and Permitted Exceptions.
SECTION 7.2.4. Financial Condition and Operations. The Borrower will
not, as of the close of any Fiscal Quarter, commencing with the close of
the Fiscal Quarter in which the Conversion Date occurs, permit:
(a) Total Debt to EBITDA Ratio. The Total Debt to EBITDA Ratio
at the close of any such Fiscal Quarter set forth below to exceed the
ratio set forth opposite such Fiscal Quarter:
Such FQ Closing Total Debt to EBITDA
after Conversion Date Ratio
--------------------- --------------------
FQ 1 4.1:1
FQ 2 4.0:1
FQ 3 4.0:1
FQ 4 3.75:1
FQ 5 3.75:1
FQ 6 3.60:1
FQ 7 3.60:1
FQ 8 3.25:1
FQ 9 3.25:1
FQ 10 2.85:1
FQ 11 2.85:1
FQ 12 2.55:1
FQ 13 2.55:1
FQ 14 2.40:1
FQ 15 2.40:1
FQ 16 2.25:1
FQ 17 2.25:1
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Such FQ Closing Total Debt to EBITDA
after Conversion Date Ratio
--------------------- --------------------
FQ 18 2.15:1
FQ 19 2.15:1
FQ 20 and thereafter 2.00:1
(b) Interest Coverage Ratio. The Interest Coverage Ratio as of
the close of any such Fiscal Quarter to be less than 2.0:1.0.
(c) Net Worth. Net Worth as of the close of any such Fiscal
Quarter to be less than the sum of $100,000,000 plus 85% of positive
Net Income (after giving effect to the amount of Restricted Payments
made by the Borrower in cash in accordance with clauses (a) and (c) of
Section 7.2.6, subject to the terms thereof for the period, treated as
one accounting period) from the Closing Date through the close of such
Fiscal Quarter.
(d) EBITDA. EBITDA at the close of any such Fiscal Quarter
(determined for such Fiscal Quarter and the three immediately
preceding such Fiscal Quarters or such lesser number of Fiscal
Quarters to have elapsed since the Conversion Date) during any period
set forth below to be less than the amount set forth below opposite
such period:
Period of FQs after
Conversion Date Amount
------------------- ------------
FQ1 through FQ4 $105,000,000
FQ5 through FQ8 $110,000,000
FQ9 through FQ12 $120,000,000
FQ13 through FQ16 $125,000,000
FQ17 through FQ20 $130,000,000
FQ21 and each
Fiscal Quarter
thereafter $140,000,000
(e) Minimum Fixed Charge Coverage. The Minimum Fixed Charge
Coverage Ratio as of the close of any such Fiscal Quarter to be less
than 1.10:1.0.
SECTION 7.2.5. Investments. The Borrower and Subsidiaries will not
make, incur, assume or suffer to exist any Investment in any other Person,
except:
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(a) Ongoing Investments;
(b) Cash Equivalent Investments;
(c) without duplication, Investments to the extent permitted as
Indebtedness pursuant to Section 7.2.2;
(d) without duplication, Investments permitted as Capital
Expenditures pursuant to Section 7.2.7;
(e) Investments by way of contributions to capital or purchases
of interests (directly or indirectly) (i) by the Borrower in AMH and
Aladdin Music or by such Subsidiary in any of its Subsidiaries,
subject to the limitations and the satisfaction of the conditions set
forth in Section 2.2.7 of the Disbursement Agreement;
(f) Investments constituting (x) accounts receivable arising,
(y) trade debt granted or (z) deposits made in connection with the
purchase price of goods or services, in each case in the ordinary
course of business;
(g) the grant by the Borrower to Bazaar of the Mall Project
Ground Lease and, upon the subdivision of the Site, the transfer by
the Borrower to Aladdin Bazaar of the fee interest in the Mall Project
Parcel and the Mall Project Easements, subject to, however subsection
(b) of Section 7.1.22;
(h) the grant of the Energy Project Ground Lease;
(i) (x) the grant by the Borrower to AMH of the Music Project
Ground Lease by the Borrower to Aladdin Music, (y) upon the
subdivision of the Site, the transfer by the Borrower to Aladdin Music
of the fee interest in the Music Project Parcel and the Music Project
Easements, subject to, however subsection (c) of Section 7.1.19 and
(z) upon consummation of the Music Project financing, an Investment
not to exceed $21,250,000 in consideration for preferred Membership
Interests in Aladdin Music pursuant to the Organizational Documents of
Aladdin Music;
provided, however, that
(j) any Investment which when made complied with the requirements
of clauses (w), (x) or (y) of the definition of the term "Cash
Equivalent Investment" may continue to be held notwithstanding that
such Investment if made thereafter would not comply with such
requirements; and
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(k) no Investment otherwise permitted by clauses (c), (d), (e),
(f) or (i)(z) shall be permitted to be made if any Default has
occurred and is continuing or would result therefrom.
SECTION 7.2.6. Restricted Payments, etc. On and at all times after
the date hereof:
(a) the Borrower will not declare, pay or make any dividend or
distribution (in cash, property or obligations) on any Membership
Interests (now or hereafter outstanding) of the Borrower or on any
warrants, options or other rights with respect to any shares of any
Membership Interests (now or hereafter outstanding) of the Borrower
(other than dividends or distributions payable in its Membership
Interests or warrants to purchase its Membership Interests or splitups
or reclassifications of its Membership Interests into additional or
other shares of its Membership Interests ) or apply, or permit any of
its Subsidiaries to apply, any of its funds, property or assets to the
purchase, redemption, sinking fund or other retirement of, or agree or
permit any of its Subsidiaries to purchase or redeem, any shares of
any Membership Interests (now or hereafter outstanding) of the
Borrower, or warrants, options or other rights with respect to any
shares of any Membership Interests (now or hereafter outstanding) of
the Borrower;
(b) the Borrower will not, and will not permit any of its
Subsidiaries to
(i) make any payment or prepayment of principal of, or make
any payment of interest on, (x) any subordinated debt on any day
other than the stated, scheduled date for such payment or
prepayment set forth in the documents and instruments
memorializing such subordinated debt, or which would violate the
subordination provisions of such subordinated debt or (y) any
Discount Note; or
(ii) redeem, purchase or defease, any subordinated debt or
any Discount Note or make any payment for purposes of funding any
of the foregoing;
(the foregoing prohibited acts referred to in clauses (a) and (b) being
herein collectively referred to as "Restricted Payments"); provided,
however, that
(c) notwithstanding the provisions of clause (a) above, for so
long as the Borrower is treated as a pass-through entity, or the
Borrower is not treated as a separate entity, for United States
federal income tax purposes (as evidenced by an opinion of counsel
subject to usual qualifications and in reliance on customary
representations, at least annually), the Borrower shall be permitted
to make Restricted Payments to equity holders of the Borrower, in an
amount not to exceed the Tax Amount for such period; provided,
however, that (x) prior to any distributions of Tax Amounts, the
Borrower shall deliver an officers' certificate to the Administrative
Agent to the effect that the Borrower is a limited-liability company
taxable as a partnership or other substantially similarly
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treated pass-through entity, or the Borrower is not treated as a
separate entity, for United States federal income tax purposes and,
after giving effect to any such distribution of such Tax Amount, the
Borrower will continue to be in compliance with the covenants in
Sections 7.2.4 and (y) at the time of such distributions, the most
recent audited financial statements of the Borrower required to have
been furnished pursuant to clause (c) of Section 7.1.1 reflect that
the Borrower is treated as a limited-liability company taxable as a
partnership or other substantially similarly treated pass-through
entity or the Borrower, is not treated as a separate entity for United
States federal income tax purposes for the period covered by such
financial statements;
(d) notwithstanding the provisions of clause (a) above, from and
after March 1, 2003, the Borrower shall be permitted to make
Restricted Payments on the Borrower Series A Preferred Membership
Interests to Holdings from time to time in an amount sufficient to
enable Holdings to make payments of interest on the Discount Notes
which are then due and payable, such amount not to exceed the amount
payable thereunder in accordance with the terms thereof in effect on
the Effective Date;
(e) notwithstanding the provisions of clause (a) above, the
Borrower shall be permitted to make Restricted Payments in respect of
the Management Fee pursuant to the Salle Privee Management Agreement
as in effect on the Effective Date to Holdings, which shall in turn
utilize all of any such Restricted Payment to make a distribution or
dividend to LCNI, which shall in turn utilize all of any such
Restricted Payment to make a distribution and/or dividend to London
Clubs Holdings, which shall in turn utilize all of any such
distribution or dividend to make a distribution and/or dividend to
London Clubs;
(f) notwithstanding the provisions of clause (a), the Borrower
shall be permitted to make Restricted Payments on the Effective Date
in respect of a fee equal to 1% of the amount of Indebtedness
supported and enhanced by the Keep-Well Agreement on the Effective
Date (such amount of Indebtedness being $265,000,000) and payment of
an annual fee equal to 1.5% of the annual average Indebtedness
outstanding under the Bank Credit Facility which is supported and
enhanced by the Keep-Well Agreement, in each case as set forth in the
London Clubs Purchase Agreement as in effect on the Effective Date, to
Holdings, which shall in turn utilize all of any such Restricted
Payment to make a distribution and/or dividend to LCNI, which shall in
turn utilize all of any such Restricted Payment to make a distribution
and/or dividend to London Clubs Holdings, which shall in turn utilize
all of any such distribution or dividend to make a distribution or
dividend to London Clubs;
(g) notwithstanding the provisions of clause (a), the Borrower
shall be permitted to make Restricted Payments with respect to the
Employment Agreements in an aggregate amount not exceeding $2,000,000
in any Fiscal Year; and
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(h) notwithstanding the provisions of clause (a) above, the
Borrower shall be permitted to make Restricted Payments as dividends
or distributions to its stockholders in any Fiscal Quarter following
the Conversion Date, so long as
(i) the Borrower shall have delivered to the Administrative
Agent
(A) financial statements prepared on a pro forma basis
to give effect to such Restricted Payment for the Fiscal
Quarter (the "Base Fiscal Quarter") then last ended for
which financial statements and the Compliance Certificate
relating thereto have been delivered to the Administrative
Agent pursuant to Section 7.1.1, and
(B) a certificate of the Borrower executed by its
chief financial or accounting Authorized Representative
demonstrating that the financial results reflected in such
financial statements would result in a Total Debt to EBITDA
Ratio at the Close of any such Base Fiscal Quarter occurring
during any period set forth below to be less than the ratio
set forth opposite such period:
Period of Fqs Total Debt to
After Conversion Date EBITDA Ratio
--------------------- -------------
FQ1 through FQ4 3.50:1
FQ5 through FQ8 3.25:1
FQ9 and thereafter 3.00:1; and
(ii) the aggregate amount of such Restricted Payment to be
made by the Borrower pursuant to this clause (h), when added to
the aggregate amount of all such Restricted Payments during the
Fiscal Quarter in which such Restricted Payment would be made,
does not exceed the lesser of (A) the sum of (1) 50% of Net
Income for the Base Fiscal Quarter plus (2) the amount of Cash
Contributions to Capital and (B) an amount equal to the excess of
(1) Excess Cash Flow for the Base Fiscal Quarter over (2) the
amount of Mandatory Prepayments required to have been made
pursuant to clause (c) of Section 3.1.1 (without giving effect to
the proviso to such Section) for the Base Fiscal Quarter;
(i) no Restricted Payments otherwise permitted by clause (c),
(d), (e), (f), (g) or (h) shall be made if a Default shall have
occurred and be continuing or if a Default will result after giving
effect thereto.
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SECTION 7.2.7. Capital Expenditures, etc. From and after the
Conversion Date, the Borrower will not make or commit to make Capital
Expenditures, except Capital Expenditures set forth in a budget delivered
by the Borrower in accordance with clause (k) of Section 7.1.1; provided,
however, in no event shall the Borrower make or commit to make any Capital
Expenditures during any Fiscal Year occurring (a) during the period from
the Effective Date through the fourth anniversary thereof in excess of
$12,000,000 or (b) after such anniversary in excess of $18,000,000, in each
case whether or not funded from the FF&E Reserve.
SECTION 7.2.8. Rental Obligations. The Borrower will not, and will
not permit any Subsidiary to, enter into at any time any arrangement (other
than the arrangement described in clause (c) of the fifth recital) which
involves the leasing by the Borrower from any lessor of any real or
personal property (or any interest therein), which does not create a
Capitalized Lease Liability and except arrangements which, together with
all other such arrangements which shall then be in effect, will not require
the payment of an aggregate amount in any Fiscal Year of rentals by the
Borrower and Subsidiary in excess of, in the case of any such arrangements
entered into prior to the 90th day following the Final Completion Date,
$1,000,000 per annum and, in the case of any such arrangement entered into
on or subsequent to such date, $5,000,000 per annum.
SECTION 7.2.9. Take or Pay Contracts. Except for the Energy Project
Service Agreement, the Borrower and Subsidiaries will not enter into or be
a party to any arrangement for the purchase of materials, supplies, other
property or services if such arrangement by its express terms requires that
payment be made by the Borrower or such other Person regardless of whether
such materials, supplies, other property or services are in fact or can be
required to be delivered or furnished to it.
SECTION 7.2.10. Consolidation, Merger, etc. The Borrower and
Subsidiaries will not liquidate or dissolve, consolidate with, or merge
into or with, any other Person, or purchase or otherwise acquire all or
substantially all of the assets of any Person (or of any division thereof).
SECTION 7.2.11. Permitted Dispositions. The Borrower and
Subsidiaries will not sell, transfer, lease, contribute or otherwise convey
(including by way of merger), or grant options, warrants or other rights
with respect to, any of the assets of such Person (including accounts
receivable or capital stock of Subsidiaries) to any Person unless such
disposition is in the ordinary course of its business or otherwise
permitted by this Agreement; provided, however, that the Administrative
Agent will not unreasonably withhold its consent to transfers of minority
interests in the Borrower to members of the management team of the Borrower
so long as such interests are pledged to the Lenders as security for the
Loans.
SECTION 7.2.12. Modification of Certain Agreements. The Borrower
will not, and will not permit any of its Subsidiaries to, directly or
indirectly, enter into, amend (by Change Order or otherwise), modify (by
Change Order or otherwise), terminate, supplement or waive a right under or
permit or consent to the amendment, modification, termination, supplement
or waiver
137
of any of the provisions of, or grant any consent under (v) any Security
Agreement without the consent of the Administrative Agent (provided,
however, that the Administrative Agent shall consent to any such
amendment, termination or supplement which the Borrower is permitted to
enter into pursuant to this Agreement), (w) any Permit, the effect of which
could reasonably be expected to have a Material Adverse Effect, (x) the
Energy Project Service Agreement, the Energy Project Ground Lease, the Mall
Project Ground Lease (other than as set forth in clause (b) of Section
7.1.19), the Music Project Ground Lease (other than as set forth in
clause (c) of Section 7.1.19), the Organizational Documents of the Borrower
and Subsidiaries, the Fluor Guaranty, or the approved Equipment Funding
Commitments (except for the purpose of replacing them with a commitment
described in clause (b) of the definition of "Approved Equipment Funding
Commitments") without obtaining the Administrative Agent's prior written
consent in its sole discretion, (y) the Design/Build Contract or any other
Subcontract entered into with a Subcontractor constituting a Material Main
Project Document except in accordance with the procedures set forth in
Section 7.2.18 and Section 8.1.13, as applicable, below or (z) any other
Material Main Project Document, the effect of which, with respect to such
other Material Main Project Document, could reasonably be expected to have
a Material Adverse Effect with respect to the Borrower or the Complex.
Notwithstanding any of the foregoing, the Borrower may:
(a) enter into Contracts and Subcontracts constituting Material
Main Project Documents consistent with the Plans and Specifications,
the Construction Benchmark Schedule, the Main Project Budget, and the
Design/Build Contract as each is in effect from time to time so long
as such Contract or Subcontract does not increase the Guaranteed
Maximum Price or require an adjustment of the Design/Build Contract
Time. Each such Contract or Subcontract, as the case may be, shall be
in writing and shall become effective when and only when: (i) the
Borrower and such other party thereto have executed and delivered such
Contract or Subcontract (with the effectiveness thereof subject only
to satisfaction of the conditions in clauses (ii), (iii), (iv), (v)
and (vi) below); (ii) the Borrower has submitted to the Administrative
Agent an Additional Contract Certificate together with all exhibits,
attachments and certificates required thereby (including the
Construction Consultant's Certificate), each duly completed and
executed; (iii) if entering into such Contract or Subcontract will
require a Change Order affecting the Main Project Budget, the Borrower
has complied with the requirements of Section 7.2.18; (iv) if entering
into such Contract or Subcontract will require a Change Order
resulting in a Scope Change, the Borrower has complied with the
provisions of Section 7.2.17; (v) if entering into such Contract will
cause the Main Project Budget not to be In Balance, the Borrower has
complied with the requirements of Section 7.1.14; and (vi) the
Administrative Agent has acknowledged receipt of the materials
referenced in clause (ii) above, as contemplated in the Additional
Contract Certificate (which the Administrative Agent agrees to do
promptly upon receipt of said material); and
(b) from time to time, deliver a Change Order or amend any
Contract or Subcontract to effect a Scope Change and may issue a
Pending Item Claim (as referred to
138
in Section 18.11 of the Design/Build Contract). Any such Change Order
or amendment shall be in writing and shall identify with particularity
all changes being made. Each such amendment shall be effective when
and only when: (i) the Borrower and the Design/Builder, the Architect
of Record or such other party to the Design/Build Contract, the
Contract or Subcontract, as the case may be, have executed and
delivered the Change Order or amendment, as the case may be (with the
effectiveness thereof subject only to satisfaction of the conditions
in clauses (ii), (iii), (iv), (v) and (vi) below); (ii) the Borrower
has submitted to the Administrative Agent a Contract Amendment
Certificate together with all exhibits, attachments and certificates
required thereby, each duly completed and executed; (iii) if such
Change Order or amendment will result in an adjustment to the Main
Project Budget, the Borrower has complied with the requirements of
Section 7.2.18; (iv) if such Change Order or amendment will have the
effect of a Scope Change, the Borrower has complied with the
provisions of Section 7.2.17; (v) if such amendment will cause the
Project Budget not to be In Balance, the Borrower has complied with
the requirements of Section 7.1.14 and (vi) the Administrative Agent
has acknowledged its receipt of the materials referenced in clause
(ii) above (which the Administrative Agent agrees to do promptly upon
receipt of said materials).
SECTION 7.2.13. Transactions with Affiliates. The Borrower will not
sell, lease, transfer or otherwise dispose of any of its properties or
assets to, or purchase any property or assets from, or enter into or make
or amend any transaction, contract, agreement, understanding, loan, advance
or guarantee with, or for the benefit of, any Affiliate (each of the
foregoing, an "Affiliate Transaction"), unless (i) such Affiliate
Transaction is on terms that are no less favorable to the Borrower than
those that would have been obtained in a comparable transaction by the
Borrower with an unrelated Person and (ii) the Borrower delivers to the
Administrative Agent (a) with respect to any Affiliate Transaction or
series of related Affiliate Transactions involving aggregate consideration
in excess of $1,000,000, a certificate from an Authorized Representative of
the Borrower certifying that such Affiliate Transaction complies with
clause (i) above, (b) with respect to any Affiliate Transaction or series
of Affiliate Transactions involving aggregate consideration in excess of
$5,000,000, a resolution of the Management Committee set forth in a
certificate from an Authorized Representative of the Borrower certifying
that such Affiliate Transaction complies with clause (i) above and that
such Affiliate Transaction has been approved unanimously by the Management
Committee and (c) with respect to any Affiliate Transactions involving
aggregate consideration in excess of $10,000,000, an opinion as to the
fairness to the Administrative Agent of such Affiliate Transaction from a
financial point of view issued by an accounting, appraisal or investment
banking firm of national standing. The foregoing provisions will not apply
to any payments, transfers or dispositions pursuant to the following:
(i) any employment, indemnification, noncompetition or confidentiality
agreement entered into by the Borrower in the ordinary course of business
on terms customary in the hotel/casino business including the Employment
Agreement; (ii) Restricted Payments permitted by the provisions of Sections
7.2.6; (iii) the Noteholder Completion Guaranty; (iv) the Keep-Well
Agreement; (v) the Salle Privee Management Agreement; (vi) the Reciprocal
Easement Agreement as in effect on the Effective Date; (vii) the
139
Common Parking Area Use Agreement; (viii) any amendments, modifications,
restatements, renewals, supplements and replacements to the Reciprocal
Easement Agreement or the Common Parking Area Use Agreement approved by the
Administrative Agent in its sole discretion; (ix) the Theater Lease after
the Administrative Agent has approved the form and content thereof; (x) the
payment by Aladdin Bazaar to the Borrower of up to $14,200,000 pursuant to
Section 4.5(a) of the Site Work Agreement, (xi) loans or advances to
employees of the Borrower to fund the exercise price of options granted
under employment agreements or stock option plans or agreements of the
Borrower, in each case, as in effect on the Effective Date, not to exceed
$500,000 outstanding at any one time; (xii) the Investments described in
clauses (g), (h) and (i) of Section 7.2.5 and (xiii) the payment of
reasonable fees to members of the Board of Managers or the Board of
Directors, as the case may be, of the Borrower who are not employees of the
Borrower.
SECTION 7.2.14. Negative Pledges, Restrictive Agreements, etc. The
Borrower will not enter into any agreement (excluding, however, (i) this
Agreement and any other Loan Document, or (ii) in the case of clause (a)
below, any agreement governing any Indebtedness permitted by clause (d) of
Section 7.2.2 as to the assets financed with the proceeds of such
Indebtedness) governing any Indebtedness prohibiting
(a) the creation or assumption of any Lien upon its properties,
revenues or assets, whether now owned or hereafter acquired, to the
extent that any such negative pledge would prohibit the creation or
first priority perfection of any Liens of the type described in
clause (x) of Section 7.2.3;
(b) the ability of the Borrower or Subsidiaries to amend or
otherwise modify any Operative Document; or
(c) the ability of any Subsidiary to make any payments, directly
or indirectly, to the Borrower by way of dividends, advances,
repayments of loans or advances, reimbursements of management and
other intercompany charges, expenses and accruals or other returns on
investments, or any other agreement or arrangement which restricts the
ability of any such Subsidiary to make any payment, directly or
indirectly, to the Borrower.
SECTION 7.2.15. Sale and Leaseback. The Borrower will not, and will
not permit any of its Subsidiaries to, enter into any agreement or
arrangement with any other Person providing for the leasing by the Borrower
or any of its Subsidiaries of real or personal property which has been or
is to be sold or transferred by the Borrower or any of its Subsidiaries to
such other Person or to any other Person to whom funds have been or are to
be advanced by such Person on the security of such property or rental
obligations of the Borrower or any of its Subsidiaries.
SECTION 7.2.16. Stock of Subsidiaries. The Borrower will not permit
any Subsidiary to issue any Capital Stock (whether for value or otherwise)
to any Person other than (x) to the
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Borrower or another wholly-owned Subsidiary or (y) up to 50% of the common
Membership Interests of AMH to Planet Hollywood.
SECTION 7.2.17. Scope Changes.
(a) Without obtaining the Required Scope Change Approval, the Borrower
shall not direct, consent to or enter into any Scope Change if such Scope
Change:
(i) will cause an increase in the Guaranteed Maximum Price or
the Main Project Budget not to be In Balance, unless the Borrower
complies with the requirements of Section 7.1.14 or amends the Main
Project Budget as provided in clause (a) of Section 7.2.18 so that,
after giving effect to the proposed Scope Change, the Main Project
Budget will be In Balance;
(ii) in the reasonable judgment of the Administrative Agent, is
reasonably likely to materially and adversely change or affect the
Main Project, the Energy Project, the Mall Project or the Music
Project;
(iii) in the reasonable judgment of the Construction Consultant
(based on its experience, familiarity and review of the Main Project
and representations provided by the Borrower, the Design/Builder, the
Contractors and Subcontractors), could reasonably require an
adjustment to the Design/Build Contract Time, delay the Completion
Date beyond the Outside Completion Deadline, or could reasonably
require the Design/Builder or the Subcontractors to accelerate
performance (except in accordance with the Scope Change) of the Work
pursuant to Section 16.0 of the General Conditions annexed to the
Design/Build Contract as Attachment D;
(iv) in the reasonable judgment of the Construction Consultant,
could reasonably permit or result in any materially adverse
modification or materially impair the enforceability of any warranty
under or any material reduction in the quality standards set forth in
the Design/Build Contract, any Contract or any Subcontract;
(v) is not permitted by a Main Project Document;
(vi) could reasonably present a significant risk of the
revocation or material adverse modification of any Permit;
(vii) could reasonably cause the Main Project, the Mall Project,
the Energy Project or the Music Project not to comply with Legal
Requirements (provided, however, that the Construction Consultant
shall be entitled to determine that no violation of any Legal
Requirement will occur on the basis of a certification by the Borrower
to such effect unless the Construction Consultant is aware of any
inaccuracies in such certification); or
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(viii) could reasonably result in a material adverse
modification, cancellation or termination of any insurance policy
required to be maintained by the Borrower pursuant to Section 7.1.4.
Prior to implementing any Scope Change, the Borrower shall submit an
Additional Contract Certificate or Contract Amendment Certificate and
otherwise comply with the provisions of clauses (a) or (b) of Section
7.2.12, as applicable.
(b) The Borrower shall not permit the Owner Representative to approve
Design/Build Final Completion until the Construction Consultant has
accompanied the Owner Representative on the final inspection of the Work
and confirmed the acceptance thereof, which confirmation shall not be
unreasonably withheld or delayed.
(c) The Borrower may not approve any Change Order setting forth the
amount of Realized Savings as contemplated by the Design/Build Contract
until such Realized Savings have been confirmed by the Construction
Consultant, which confirmation shall not be unreasonably withheld or
delayed.
SECTION 7.2.18. Amendment of Main Project Budget, Construction
Benchmark Schedule; Design/Build Contract Time and Guaranteed Maximum
Price. The Borrower shall not directly or indirectly amend (by Change
Order or otherwise), modify (by Change Order or otherwise), allocate,
reallocate or supplement or permit or consent to the amendment (by Change
Order or otherwise), modification (by Change Order or otherwise),
allocation, reallocation or supplementation of any of the Line Items, Line
Item Categories or other sections of the Main Project Budget, the
Construction Benchmark Schedule, or the Design/Build Contract Time or
adjust the Guaranteed Maximum Price except as follows:
(a) Concurrently with the implementation of any Scope Change,
the Borrower shall submit a Main Project Budget/Schedule Amendment
Certificate and amend the Main Project Budget in accordance with the
provisions of clause (c) of Section 7.2.18 to the extent necessary so
that the amount set forth therein for each Line Item Category and Line
Item therein shall reflect all Scope Changes that have been made
thereto.
(b) The Borrower may from time to time amend the Main Project
Budget in accordance with the provisions of clause (c) of this Section
7.2.18 in order to increase, decrease or otherwise reallocate amounts
allocated to specific Line Item Categories or Line Items. Any such
amendments shall be effective after the Owner Representative and the
Construction Consultant have reviewed and approved the proposed
amendment.
(c) The Borrower shall request an amendment to the Main Project
Budget by delivering to the Disbursement Agent and the Construction
Consultant a Main Project Budget/Schedule Amendment Certificate
together with all exhibits, attachments and certificates required
thereby, each duly completed and executed. Each such Main Project
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Budget/Schedule Amendment Certificate shall describe with
particularity the increases, decreases, contingency allocations, and
other proposed amendments to the Line Item Categories and the Line
Items within each Line Item Category which will be adjusted by such
amendment. Increases to any Line Item Category or Line Item within
such Line Item Category will only be permitted to the extent of (w) a
trade transfer to such Line Item Category or Line Item within such
Line Item Category from a different Line Item Category or Line Item
within such Line Item Category so long as (1) such trade transfer is
for a Main Project Cost which is included in the Line Item Category
and a Line Item within such Line Item Category to which such trade
transfer is being made, (2) after giving effect to such trade
transfer, such Main Project Cost is no longer included in the Line
Item Category or in any Line Item within such Line Item Category from
which such trade transfer was made and (3) after giving effect to any
such trade transfer, the Available Funds allocated to each such Line
Item Category and Line Item equals or exceeds for such Line Item
Category and Line Item the aggregate of (X) the costs required to
complete such Line Item Category and Line Item, as the case may be,
(Y) the Retainage Amount to be paid to Persons who have supplied labor
or materials in connection with such Line Item Category and Line Item
and (Z) with respect to the Line Item Category entitled "Cap.
Interest", the amount required to pay interest and all other amounts
due under this Agreement and the Approved Equipment Funding Commitment
at the maximum rate of interest set forth in the Main Project Budget
through the Conversion Date, (x) allocation of Realized Savings
obtained in a different Line Item Category, (y) allocation of
previously "unallocated contingency" (which allocations shall be
subject to clause (f) of this Section 7.2.18 and, after giving effect
to such allocation, the Unallocated Contingency Balance will equal or
exceed the Required Minimum Contingency), or (z) allocation of an
increase in Available Funds, including additional funds deposited in
to the Accounts. Decreases to any Line Item Category will only be
permitted upon (x) obtaining Realized Savings in such Line Item
Category and (y) a trade transfer from such Line Item Category to a
different Line Item Category so long as (1) such trade transfer is for
a Main Project Cost which is included in the Line Item Category and a
Line Item within such Line Item Category to which such trade transfer
is being made, (2) after giving effect to such trade transfer, such
Project Cost is no longer included in the Line Item Category or in any
Line Item within such Line Item Category from which such trade
transfer was made and (3) after giving effect to any such trade
transfer, the Available Funds allocated to such Line Item Category and
Line Item equals or exceeds for such Line Item Category and Line Item
the aggregate of (X) the costs required to complete such Line Item
Category or Line Item, as the case may be, (Y) the Retainage Amount
to be paid to Persons who have supplied labor or materials in
connection with such Line Item Category and Line Item and (Z) with
respect to the Line Item Category entitled "Cap. Interest", the amount
required to pay interest and all other amounts due under this
Agreement and the Approved Equipment Funding Commitment at the maximum
rate of interest set forth in the Main Project Budget through the
Conversion Date.
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(d) The Borrower may, from time to time, amend the Construction
Benchmark Schedule to extend the Completion Date, but not beyond the
Outside Completion Deadline, by delivering to the Administrative Agent
a Main Project Budget/Schedule Amendment Certificate (x) containing a
revised Construction Benchmark Schedule reflecting the new Completion
Date and (y) complying with the applicable provisions of this Section
7.2.18 with respect to the changes in the Main Project Budget that
will result from the extension of the Completion Date. If a Force
Majeure Event occurs, then the Borrower shall be permitted to extend
the Completion Date for up to one year to the extent that (w) the
Borrower certifies the occurrence and continuation of such Force
Majeure Event in writing, (x) the Construction Consultant confirms
that such extension is reasonably necessary to overcome any delays
caused by the Force Majeure Event, (y) the Borrower has satisfied the
conditions to such extension as set forth in the definition of "Force
Majeure Event", and (z) such extension is permitted by the
Design/Build Contract.
(e) Upon satisfaction of the conditions set forth in this
Section 7.2.18, such Change Order or amendment shall become effective
hereunder.
(f) Allocations of the Line Items in the Line Item Category
entitled "Project Contingency" (x) for each of the first three months
after the Effective Date shall not exceed $1,000,000 in the aggregate
for each such month and (y) thereafter shall not exceed 10% for any
one Line Item Category provided that after giving effect to such
allocation, the Unallocated Contingency Balance will equal or exceed
the Required Minimum Contingency.
SECTION 7.2.19. Hazardous Substances. The Borrower and Subsidiaries
shall not release, emit or discharge into the environment any Hazardous
Substances in material violation of any Environmental Law, Legal
Requirement or Permit.
SECTION 7.2.20. No Other Powers of Attorney. The Borrower and
Subsidiaries shall not execute or deliver any agreement creating any Lien
(other than Permitted Liens), powers of attorney (other than powers of
attorney for signatories of documents permitted or contemplated by the
Operative Documents), or similar documents, instruments or agreements,
except to the extent such documents, instruments or agreements comprise
part of the Loan Documents.
SECTION 7.2.21. Opening. The Borrower shall not begin Operating the
Hotel/Casino unless each of the Opening Conditions has been satisfied and
the Borrower has delivered to the Administrative Agent a certificate in the
form of Exhibit T-1 hereto and the Construction Consultant has delivered to
the Administrative Agent a certificate in the form of Exhibit T-2 hereto.
SECTION 7.2.22. Actions Affecting Energy Provider. The Borrower
shall not take any action, give consent to, approve or fail to object to
the action of any other Person which results
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in the Energy Provider being subject to more extensive or restrictive
regulation under federal or Nevada state law.
ARTICLE VIII
EVENTS OF DEFAULT
SECTION 8.1. Listing of Events of Default. Each of the following
events or occurrences described in this Section 8.1 shall constitute an
"Event of Default".
SECTION 8.1.1. Non-Payment of Obligations. The Borrower shall
default in the payment or prepayment when due of
(a) any Letter of Credit Reimbursement Obligation or any deposit
of cash for collateral purposes pursuant to Section 2.6.2 or
Section 2.6.4, as the case may be;
(b) any principal of or interest on any Loan, and, with respect
to any Default in the payment of interest, such Default shall continue
unremedied for a period of two Business Days; or
(c) any fee described in Article III or of any other Obligation
and such Default shall continue unremedied for a period of five days.
SECTION 8.1.2. Breach of Warranty. Any representation or warranty of
the Borrower and Subsidiaries made or deemed to be made hereunder or in any
other Operative Document executed by it or any other writing or certificate
furnished by or on behalf of any such Person to any Agent, the Issuer or
any Lender for the purposes of or in connection with this Agreement or any
such other Loan Document (including any certificates delivered pursuant to
Article V hereof or Article 3 of the Disbursement Agreement) is or shall
be incorrect when made or deemed to have been made in any material respect.
SECTION 8.1.3. Non-Performance of Certain Covenants and Obligations.
The Borrower and Subsidiaries shall default in the due performance and
observance of any of their respective obligations under Section 7.1.9,
Section 7.1.10 or Section 7.2.
SECTION 8.1.4. Non-Performance of Other Covenants and Obligations.
The Borrower, any of the other Aladdin Parties, LCNI, London Clubs Holdings
or London Clubs shall default in the due performance and observance of any
Operative Document executed by it, and such default shall continue
unremedied for a period of 30 days (or such other period of time during
which performance is required under the applicable Operative Document)
after notice thereof shall have been given to such Person by the
Administrative Agent.
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SECTION 8.1.5. Default on Other Indebtedness. A default shall occur
in the payment when due (subject to any applicable grace period or, whether
by acceleration or otherwise, of any Indebtedness of the Borrower or any of
its Subsidiaries (other than Aladdin Music and AMH) (other than
Indebtedness described in Section 8.1.1 or unsecured Indebtedness of the
Borrower or any such Subsidiary incurred in the ordinary course of business
(including open accounts extended by suppliers on normal trade terms in
connection with purchases of goods and services, but excluding, however,
(x) Indebtedness incurred through the borrowing of money and (y) Contingent
Liabilities in respect of Indebtedness other than Indebtedness of the
nature referred to in clause (d) thereof)) having a principal amount,
individually or in the aggregate, in excess of $2,000,000, or a Default
shall occur in the performance or observance of any obligation or condition
with respect to such Indebtedness (subject to any applicable grace period)
if the effect of such Default is to accelerate the maturity of any such
Indebtedness or such Default shall continue unremedied for any applicable
period of time sufficient to permit the holder or holders of such
Indebtedness, or any trustee or agent for such holders, to cause or declare
such Indebtedness to become due and payable or to require such Indebtedness
to be prepaid, redeemed, purchased or defeased, or to cause an offer to
purchase or redeem such Indebtedness to be required to be made, prior to
its expressed maturity.
SECTION 8.1.6. Outside Completion Deadline. The Borrower shall fail
to achieve the Completion Date on or before the Outside Completion
Deadline.
SECTION 8.1.7. Judgments. Any judgment or order for the payment of
money in excess of $1,000,000 individually or in the aggregate (excluding,
however, any amounts fully covered by insurance (less any applicable
deductible) or indemnification and as to which the insurer or the
indemnifying party, as the case may be, has acknowledged its responsibility
to cover such judgment or order) shall be rendered against the Borrower or
Subsidiaries, (y) or Aladdin Bazaar or ABH prior to completion of the Mall
Project or (z) Aladdin Music or AMH prior to the completion of the Music
Project and such judgment shall not have been vacated or discharged or
stayed or bonded pending appeal within 45 days after the entry thereof.
SECTION 8.1.8. Pension Plans. Any of the following events shall
occur with respect to any Pension Plan
(a) the institution of any steps by the Borrower, any member of
its Controlled Group or any other Person to terminate a Pension Plan
if, as a result of such termination, the Borrower or any such member
could be required to make a contribution to such Pension Plan, or
could reasonably expect to incur a liability or obligation to such
Pension Plan, in excess of $1,000,000; or
(b) a contribution failure occurs with respect to any Pension
Plan sufficient to give rise to a Lien under section 302(f) of ERISA
and such failure continues for 30 days or more.
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SECTION 8.1.9. Change in Control. Any Change in Control shall occur.
SECTION 8.1.10. Bankruptcy, Insolvency, etc. The Borrower, any of
the other Aladdin Parties (other than the Trust), LCNI or, prior to the
time that London Clubs has indefeasibly paid and performed its obligations
under the Completion Guaranty and the Keep-Well Agreement or such
Instruments have terminated or otherwise expired by their terms, London
Clubs shall
(a) become insolvent or generally fail to pay, or admit in
writing its inability or unwillingness generally to pay, debts as they
become due;
(b) apply for, consent to, or acquiesce in the appointment of a
trustee, receiver, sequestrator or other custodian for any substantial
part of the property of any thereof, or make a general assignment for
the benefit of creditors;
(c) in the absence of such application, consent or acquiescence,
permit or suffer to exist the appointment of a trustee, receiver,
sequestrator or other custodian for a substantial part of the property
of any thereof, and such trustee, receiver, sequestrator or other
custodian shall not be discharged within 60 days; provided, however,
that the Borrower and Subsidiaries each hereby expressly authorizes
the Administrative Agent and each Lender to appear in any court
conducting any relevant proceeding during such 60-day period to
preserve, protect and defend their rights under this Agreement and the
other Loan Documents;
(d) permit or suffer to exist the commencement of any bankruptcy,
reorganization, debt arrangement or other case or proceeding under any
bankruptcy or insolvency law, or any dissolution, winding up or
liquidation proceeding, in respect thereof, and, if any such case or
proceeding is not commenced by the Person which is the subject of such
case or proceeding, such case or proceeding shall be consented to or
acquiesced in by such Person or shall result in the entry of an order
for relief or shall remain for 60 days undismissed; provided, however,
that the Borrower and Subsidiaries each hereby expressly authorizes
the Administrative Agent and each Lender to appear in any court
conducting any such case or proceeding during such 60-day period to
preserve, protect and defend their rights under the Loan Documents and
the other Operative Documents; or
(e) take any action authorizing, or in furtherance of, any of the
foregoing.
SECTION 8.1.11. Impairment of Security, etc. Any Loan Document, or
any Lien granted thereunder, shall (except in accordance with its terms),
in whole or in part, terminate, cease to be effective or cease to be the
legally valid, binding and enforceable obligation of any Obligor party
thereto; the Borrower, any other Obligor or any other Person shall,
directly or indirectly, contest in any manner such effectiveness, validity,
binding nature or enforceability; or,
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except as permitted under any Loan Document, any Lien securing any
Obligation shall, in whole or in part, cease to be a perfected first
priority Lien.
SECTION 8.1.12. Advance Requests. The failure, for 30 consecutive
days, of the Borrower to submit an Advance Request or if an Advance Request
is submitted, the failure for 30 consecutive days, of the Borrower to
satisfy, in all material respects, the conditions to the approval of such
Advance Request by the Disbursement Agent.
SECTION 8.1.13. Breach of Main Project Documents. The Borrower, any
other Aladdin Party or any other Person thereto shall breach or default
under any term, condition, provision, covenant, representation or warranty
contained in any Material Main Project Document or any other agreement
(other than the Loan Documents and the Discount Note Trust Indenture) to
which such Person is a party if the effect of such breach or default could
reasonably be expected to have a Material Adverse Effect and such breach or
default shall continue unremedied for 30 days after notice from the
Administrative Agent to the Borrower; provided, however, that in the case
of any Main Project Document,
(a) if the breach or default is reasonably susceptible to cure
within 90 days but cannot be cured within such 30 day period despite
the Borrower's or such other Person's, as the case may be, good faith
and diligent efforts to do so, the cure period shall be extended as is
reasonably necessary beyond such 30 day period (but in no event longer
than 90 days) if remedial action reasonably likely to result in cure
is promptly instituted within such 30 day period and is thereafter
diligently pursued until the breach or default is corrected; and
(b) if the breach is by a Person other than the Borrower or any
of the other Aladdin Parties, then no Event of Default shall be deemed
to have occurred as a result of such breach if the Borrower provides
written notice to the Administrative Agent immediately upon (but in no
event more than 2 Business Days after) such Person becoming aware of
such breach that such Main Project Document shall be replaced (or that
replacement is not necessary) and (x) a replacement obligor or
obligors reasonably acceptable to the Borrower (after consultation
with the Construction Consultant) for the affected Person (if in the
reasonable judgment of the Borrower (after consultation with the
Construction Consultant) a replacement is necessary), (y ) the
Borrower enters into a replacement Main Project Document in accordance
with Section 7.2.12 on terms no less beneficial to the Borrower and
the Lenders in any material respect than the Main Project Document so
terminated (if in the reasonable judgment of the Borrower (after
consultation with the Construction Consultant) a replacement is
necessary) and (z) such termination, after considering any replacement
obligor and replacement Main Project Document and the time required to
implement such replacement, has not had and would not reasonably be
expected to have a Material Adverse Effect.
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(c) if the breach is by the Energy Project Provider under the
Energy Project Ground Lease and, if applicable, the Energy Service
Agreement and the Energy Project Guarantor is not performing its
obligations under the Energy Project Guaranty, no Event of Default
shall be deemed to have occurred as a result of such breach if (w) the
Borrower provides written notice to the Administrative Agent
immediately upon (but in no event more than 2 Business Days after) the
Borrower becoming aware of such breach that the Borrower will commence
and diligently and continuously prosecute to completion the
enforcement of the obligations of the Energy Project Provider under
the Energy Project Ground Lease and, if applicable, the Energy Service
Agreement and the Energy Project Guarantor under the Energy Project
Guaranty, (x ) the Borrower has made arrangements to obtain reliable
electrical and other utility services at appropriate levels required
to start-up, operate and maintain the Hotel/Casino in a safe,
efficient and reliable manner, (y) if the Energy Project Ground Lease
or the Energy Service Agreement is terminated as a result of such
breach the Borrower replaces the Energy Project Ground Lease and
Energy Service Agreement so terminated in accordance with Section
7.2.12 on terms no less beneficial to the Borrower and the Lenders in
any material respect than the Energy Project Ground Lease or Energy
Service Agreement so terminated and (z) any such termination, after
considering any replacement obligor and replacement to the Energy
Project Ground Lease or Energy Service Agreement, as the case be, and
the time required to implement such replacement, has not had and would
not reasonably be expected to have a Material Adverse Effect.
SECTION 8.1.14. Termination or Invalidity of Main Project Documents;
Abandonment of Main Project.
(a) The Design/Build Contract shall have terminated, become invalid
or illegal or otherwise ceased to be in full force and effect or if any of
the other Material Main Project Documents shall have terminated (except
with respect to the Energy Project as provided in clause (c) of Section
8.1.13), become invalid or illegal, or otherwise ceased to be in full force
and effect if the effect thereof could reasonably be expected to have a
Material Adverse Effect with respect to the Borrower or the Main Project;
provided, however, that, with respect to any Material Main Project Document
other than the Design/Build Contract and the Fluor Guaranty, no Event of
Default shall be deemed to have occurred as a result of such termination if
the Borrower provides written notice to the Administrative Agent,
immediately upon (but in no event more than two Business Days after) the
Borrower becoming aware of such Main Project Document ceasing to be in full
force or effect that the Borrower intends to replace such Main Project
Document (or that replacement is not necessary) and (x) the Borrower
obtains a replacement obligor or obligors reasonably acceptable to the
Borrower (after consultation with the Construction Consultant) for the
affected party (if in the reasonable judgment of the Borrower (after
consultation with the Construction Consultant) a replacement is necessary),
(y) the Borrower enters into a replacement Main Project Document in
accordance with Section 7.2.12, on terms no less beneficial to the Borrower
and the Lenders in any material respect than the Main Project Document so
terminated, within 60 days of such termination (if in the
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reasonable judgment of the Borrower (after consultation with the
Construction Consultant) a replacement is necessary) and (z) such
termination, after considering any replacement obligor and replacement Main
Project Document and the time required to implement such replacement, has
not had and would not reasonably be expected to have a Material Adverse
Effect;
(b) The Borrower shall cease to own the Site (excluding, however, the
Mall Project Parcel and the Music Project Parcel to the extent permitted by
clause (b) of Section 7.1.19 and clause (c) of Section 7.1.19) and all
parcels and subdivisions comprising the Site, the Improvements or the Site
Easements for the purpose of owning, constructing, maintaining and
operating the Main Project in the manner contemplated by the Operative
Documents; or
(c) The Borrower shall abandon the Main Project or otherwise cease
construction of the Main Project or, after Final Completion, cease to
pursue the operations of the Main Project in accordance with standard
industry practice or shall sell or otherwise dispose of its interest in the
Main Project.
SECTION 8.1.15. Government Authorizations. Any Permit necessary for
the ownership, construction, maintenance, financing or operation of the
Main Project shall be modified, refused, rejected, suspended, revoked or
canceled, or allowed to lapse (including casino, gaming or gambling
business) or a notice of a material violation is issued under any Permit,
by the issuing agency or other Governmental Instrumentality having
jurisdiction, or any proceeding is commenced by any Governmental
Instrumentality for the purpose of modifying, suspending, revoking or
canceling any Permit and such modification, refusal, rejection, revocation
or loss of such Permit or such notice of a material violation or proceeding
is reasonably likely to have a Material Adverse Effect.
SECTION 8.2. Action if Bankruptcy. If any Event of Default described
in clauses (a) through (e) of Section 8.1.10 shall occur, the Commitments
(if not theretofore terminated) shall automatically terminate and the
outstanding principal amount of all outstanding Loans and all other
Obligations (including Letter of Credit Reimbursement Obligations) shall
automatically be and become immediately due and payable without notice or
demand and the Borrower shall automatically and immediately be obligated to
deposit with the Administrative Agent cash collateral in an amount equal to
all Letter of Credit Outstandings in accordance with Section 2.6.4.
SECTION 8.3. Action if Other Event of Default. If any Event of
Default (other than any Event of Default described in clauses (a) through
(e) of Section 8.1.10) shall occur for any reason, whether voluntary or
involuntary, and be continuing, the Administrative Agent, upon the
direction of the Required Lenders, shall by notice to the Borrower declare
all or any portion of the outstanding principal amount of the Loans and
other Obligations (including Letter of Credit Reimbursement Obligations) to
be due and payable or the Commitments (if not theretofore terminated) to be
terminated, whereupon the full unpaid amount of such Loans and other
Obligations which shall be so declared due and payable shall be and become
immediately due
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and payable, without further notice, demand or presentment, or, as the case
may be, the Commitments shall terminate and the Borrower shall
automatically and immediately be obligated to deposit with the
Administrative Agent cash collateral in an amount equal to all Letter of
Credit Outstandings in accordance with Section 2.6.4. In addition to the
foregoing, the Administrative Agent upon direction of the Required Lenders
may, without further notice of default, presentment or demand for payment,
protest or notice of non-payment or dishonor, or other notices or demands
of any kind, all such notices and demands being waived (to the extent
permitted by applicable law), exercise any or all rights and remedies at
law or in equity (in any combination or order that the Lenders may elect,
subject to the foregoing), including, without prejudice to the Lenders'
other rights and remedies, the following:
(a) refuse, and the Lenders shall not be obligated, to consent to
or direct that any payments be made from any Account or other funds
held by the Disbursement Agent by or on behalf of the Borrower and may
suspend or terminate the Lenders' obligation to make additional
Advances (other than obligatory Advances hereunder pursuant to Section
2.6.1 and Section 2.6.4), to process requests by the Borrower and to
perform any other obligations of the Lenders which are expressly
subject to there not being a Default under this Agreement shall be
terminated; the remedy set forth in this Section 8.3(a) shall be
exercised automatically upon an Event of Default with respect to the
Borrower described in Section 8.1.10;
(b) make or do the same in such manner and to such extent as the
Lenders may deem necessary to protect the security hereof, the Lenders
being authorized to enter upon and take possession of the portion of
the Site owned by the Borrower for such purposes, and any sums
expended for such purposes shall become part of the Indebtedness
evidenced and secured by the Deed of Trust;
(c) commence, appear in and/or defend any action or proceedings
purporting to affect the security hereof, and/or any additional or
other security therefor, the interests, rights, powers or duties of
the Lenders hereunder, whether brought by or against the Borrower or
the Lenders;
(d) pay, purchase, contest or compromise any claim, debt, lien,
charge or encumbrance that in the judgment of the Lenders may impair
or reasonably appear to impair the security of the Deed of Trust or
the other Loan Documents, the interests of the Lenders or the rights,
powers and/or duties of the Lenders hereunder and any sums expended
for such purposes shall become part of the Indebtedness evidenced and
secured by the Loan Documents;
(e) the Lenders (and their nominee and/or designee) are
authorized either by themselves or by their agents or by a receiver
appointed by a court of competent jurisdiction, to enter into and upon
and take and hold possession of any portion or all of the Main
Project, both real and personal, and exclude the Borrower and all
other Persons
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therefrom and thereupon the Lenders (or their nominee or designee)
may, (u) use, operate, manage, control, insure, maintain, repair,
restore and otherwise deal with all and every part of the Main Project
and conduct business thereat, (v) take possession of all materials,
supplies, tools, equipment and construction facilities and appliances
located on the portion of the Site owned by the Borrower and perform
any and all work and labor necessary to complete the construction of
the Main Project in accordance with the Plans and Specifications, the
Reciprocal Easement Agreement, the other Operative Documents and any
agreements relating to the Main Project existing at the time the
Lenders (or their nominee and/or designee) enter into possession of
the Main Project and perform any and all work and labor necessary to
complete the Main Project or to operate and maintain the Main Project,
and all sums expended in so doing, together with interest on such
total amount at the rate set forth in Section 3.2.2, shall be repaid
by the Borrower to the Lender upon demand and shall be secured by the
Loan Documents, (w) employ watchmen to protect the Main Project,
(x) make alterations, additions, renewals, replacements and
improvements to the Main Project and, if required by the Reciprocal
Easement Agreement, the Operative Documents or any agreements relating
to the portion of the Site owned by the Borrower, (y) exercise all
rights and powers of the Borrower with respect to the portion of the
Site owned by it and pursuant to or under the Reciprocal Easement
Agreement, the Operative Documents or any agreements relating to the
portion of the Site owned by the Borrower, whether in the name of the
Borrower or otherwise, including the right to make, cancel, enforce or
modify the Reciprocal Easement Agreement, the Operative Documents or
any agreements relating to the portion of the Site owned by the
Borrower, obtain and evict tenants and other Persons, and demand, sue
for, collect and receive all earnings, revenues, rents, issues,
profits and other income from the Main Project, and every part
thereof, the Reciprocal Easement Agreement, the Operative Documents or
any agreements relating to the portion of the Site owned by the
Borrower and (z) apply the receipts therefrom to the payment of the
Indebtedness evidenced and secured by the Loan Documents in accordance
with this Agreement, after deducting therefrom all expenses (including
reasonable attorneys' fees and costs and expenses) incurred in
connection with the aforesaid operations and all amounts to pay the
Impositions, assessments, insurance and other charges in connection
with the Main Project as well as just and reasonable compensation for
the services of the Administrative Agent, the Lenders and their
counsel, agents and employees;
(f) exercise all rights and remedies under the Deed of Trust and
the other Loan Documents;
(g) institute an action, suit or proceeding in equity for the
specific performance by the Borrower of any covenant, condition, or
agreement contained herein or in any of the other Loan Documents;
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(h) recover judgment on the Completion Guaranty or the Keep-Well
Agreement either before, during or after any proceedings for the
enforcement of the Lenders' rights and remedies hereunder or under the
other Loan Documents;
(i) apply, ex parte and without notice to any Person, for the
appointment of a custodian, receiver, liquidator or conservator of the
portion of the Site owned by the Borrower, without regard for the
adequacy of the security for the Indebtedness evidenced and secured by
the Loan Documents;
(j) set off and apply all monies on deposit in any Account or any
amounts paid under the Completion Guaranty or any other monies of the
Borrower on deposit with the Disbursement Agent to the satisfaction of
the Obligations under all of the Loan Documents; and
(k) exercise any and all rights and remedies available to it
under applicable law or any of the Operative Documents.
Except as otherwise set forth herein, all sums expended by the Lenders for
any of the purposes described above shall be deemed to have been advanced
to the Borrower under and pursuant to the provisions of this Agreement,
shall bear interest at the rate of interest set forth in Section 3.2.2 and
shall be secured by the Deed of Trust. The Administrative Agent or the
Lenders (or their nominee or designee) may at any time discontinue any
action or remedy commenced by it or them, as the case may be, or change any
course of action undertaken by it or them, and in such event, the
Administrative Agent and the Lenders (or their nominee or designee) shall
not be bound by any requirements or limitations of time contained in the
Deed of Trust or the other Loan Documents. For the foregoing purposes, the
Borrower to the fullest extent permitted by law, hereby constitute and
appoint the Administrative Agent (or its nominee or designee) as the true
and lawful agent and attorney-in-fact of the Borrower with full power of
substitution and hereby empowers the Administrative Agent (and its nominee
or designee) to take such action and require such performance as its or
they deem necessary or desirable. This agency and power of attorney shall
be deemed to be coupled with an interest and shall be irrevocable.
ARTICLE IX
THE ADMINISTRATIVE AGENT
SECTION 9.1. Actions. Each Lender hereby appoints Scotiabank as its
Administrative Agent under and for purposes of this Agreement, the Notes
and each other Loan Document. Each Lender authorizes the Administrative
Agent to act on behalf of such Lender under this Agreement, the Notes and
each other Loan Document and, in the absence of other written instructions
from the Required Lenders received from time to time by the Administrative
Agent (with respect to which the Administrative Agent agrees that it will
comply, except as otherwise provided in this Section or as otherwise
advised by counsel in order to avoid contravention of
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applicable law), to exercise such powers hereunder and thereunder as are
specifically delegated to or required of the Administrative Agent by the
terms hereof and thereof, together with such powers as may be reasonably
incidental thereto. Each Lender hereby indemnifies (which indemnity shall
survive any termination of this Agreement) the Administrative Agent, pro
rata according to such Lender's Percentage, from and against any and all
liabilities, obligations, losses, damages, claims, costs or expenses of any
kind or nature whatsoever which may at any time be imposed on, incurred by,
or asserted against, the Administrative Agent in any way relating to or
arising out of this Agreement, the Notes and any other Loan Document,
including reasonable attorneys' fees, consultants' fees and as to which the
Administrative Agent is not reimbursed by the Borrower; provided, however,
that no Lender shall be liable for the payment of any portion of such
liabilities, obligations, losses, damages, claims, costs or expenses which
are determined by a court of competent jurisdiction in a final proceeding
to have resulted solely from the Administrative Agent's gross negligence or
wilful misconduct. The Administrative Agent shall not be required to take
any action hereunder, under the Notes or under any other Operative
Document, or to prosecute or defend any suit in respect of this Agreement,
the Notes or any other Operative Document, unless it is indemnified
hereunder to its satisfaction. If any indemnity in favor of the
Administrative Agent shall be or become, in the Administrative Agent's
determination, inadequate, the Administrative Agent may call for additional
indemnification from the Lenders and cease to do the acts indemnified
against hereunder until such additional indemnity is given.
SECTION 9.2. Funding Reliance, etc. Unless the Administrative Agent
shall have been notified by telephone, confirmed in writing, by any Lender
by 5:00 p.m., New York City time, on the Business Day prior to a Borrowing
that such Lender will not make available the amount which would constitute
its Percentage of such Borrowing on the date specified therefor, the
Administrative Agent may assume that such Lender has made such amount
available to the Administrative Agent and, in reliance upon such
assumption, make available to the Borrower a corresponding amount. If and
to the extent that such Lender shall not have made such amount available to
the Administrative Agent, such Lender and the Borrower severally agree to
repay the Administrative Agent forthwith on demand such corresponding
amount, together with interest thereon, for each day from the date the
Administrative Agent made such amount available to the Borrower to the date
such amount is repaid to the Administrative Agent, at the interest rate
applicable at the time to Loans comprising such Borrowing in the case of
the Borrower and at the Federal Funds Rate (in the case of a Lender) (for
the first two Business Days after which such amount has not been repaid)
and thereafter at the interest rate applicable to Loans comprising such
Borrowing. Nothing in this Section shall affect or impair the rights or
remedies of the Borrower against such Lender so long as such amount and
interest, if any, has been repaid to the Administrative Agent.
SECTION 9.3. Exculpation. Neither the Administrative Agent nor any
of its directors, officers, employees or agents shall be liable to any
Lender for any action taken or omitted to be taken by it under this
Agreement or any other Loan Document, or in connection herewith or
therewith, except for its own wilful misconduct or gross negligence, nor
responsible for any
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recitals or warranties herein or therein, nor for the effectiveness,
enforceability, validity or due execution of this Agreement or any other
Loan Document, nor for the creation, perfection or priority of any Liens
purported to be created by any of the Loan Documents, or the validity,
genuineness, enforceability, existence, value or sufficiency of any
collateral security, nor to make any inquiry respecting the performance by
the Borrower of its obligations hereunder or under any other Loan Document.
Any such inquiry which may be made by the Administrative Agent shall not
obligate it to make any further inquiry or to take any action. The
Administrative Agent shall be entitled to rely upon advice of counsel
concerning legal matters and upon any notice, consent, certificate,
statement or writing which the Administrative Agent believes to be genuine
and to have been presented by a proper Person.
SECTION 9.4. Successor. The Administrative Agent may resign as such
at any time upon at least 30 days' prior notice to the Borrower and all
Lenders. If the Administrative Agent at any time shall resign, the
Required Lenders may appoint another Lender as a successor Administrative
Agent which shall thereupon become the Administrative Agent hereunder. If
no successor Administrative Agent shall have been so appointed by the
Required Lenders, and shall have accepted such appointment, within 30 days
after the retiring Administrative Agent's giving notice of resignation,
then the retiring Administrative Agent may, on behalf of the Lenders,
appoint a successor Administrative Agent, which shall be one of the Lenders
or a commercial banking institution organized under the laws of the U.S.
(or any State thereof) or a U.S. branch or agency of a commercial banking
institution and having (x) a combined capital and surplus of at least
$250,000,000 and (y) a credit rating of AA or better by Moody's or a
comparable rating by S&P; provided, however, that if, after expending all
reasonable commercial efforts, such retiring Administrative Agent is unable
to find a commercial banking institution which is willing to accept such
appointment and which meets the qualifications set forth in item (y), such
retiring Administrative Agent shall be permitted to appoint as its
successor from all available commercial banking institutions willing to
accept such appointment such institution having the highest credit rating
of all such available and willing institutions. Upon the acceptance of any
appointment as Administrative Agent hereunder by a successor Administrative
Agent, such successor Administrative Agent shall be entitled to receive
from the retiring Administrative Agent such documents of transfer and
assignment as such successor Administrative Agent may reasonably request,
and shall thereupon succeed to and become vested with all rights, powers,
privileges and duties of the retiring Administrative Agent, and the
retiring Administrative Agent shall be discharged from its duties and
obligations under this Agreement. After any retiring Administrative
Agent's resignation hereunder as the Administrative Agent, the provisions
of
(a) this Article IX shall inure to its benefit as to any actions
taken or omitted to be taken by it while it was the Administrative
Agent under this Agreement; and
(b) Section 10.3 and Section 10.4 shall continue to inure to its
benefit.
SECTION 9.5. Loans by Scotiabank. Scotiabank shall have the same
rights and powers with respect to (x) the Credit Extensions made by it or
any of its Affiliates, and (y) the Notes
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held by it or any of its Affiliates as any other Lender and may exercise
the same as if it were not the Administrative Agent. Scotiabank and its
Affiliates may accept deposits from, lend money to, and generally engage in
any kind of business with the Borrower, the other Aladdin Parties, LCNI,
London Clubs Holdings or London Clubs or any of the other Project Parties
or any Subsidiary or Affiliate thereof as if Scotiabank were not the
Administrative Agent hereunder.
SECTION 9.6. Credit Decisions. Each Lender acknowledges that it has,
independently of the Administrative Agent and each other Lender, and based
on such Lender's review of the financial information of the Borrower, the
other Aladdin Parties, LCNI, London Clubs Holdings or London Clubs, this
Agreement, the other Loan Documents (the terms and provisions of which
being satisfactory to such Lender) and such other documents, information
and investigations as such Lender has deemed appropriate, made its own
credit decision to extend its Commitments. Each Lender also acknowledges
that it will, independently of the Administrative Agent and each other
Lender, and based on such other documents, information and investigations
as it shall deem appropriate at any time, continue to make its own credit
decisions as to exercising or not exercising from time to time any rights
and privileges available to it under this Agreement or any other Loan
Document.
SECTION 9.7. Copies, etc. The Administrative Agent shall give prompt
notice to each Lender of each notice or request required or permitted to be
given to the Administrative Agent by the Borrower pursuant to the terms of
this Agreement (unless concurrently delivered to the Lenders by the
Borrower). The Administrative Agent will distribute to each Lender each
document or instrument received for its account and copies of all other
communications received by the Administrative Agent from the Borrower for
distribution to the Lenders by the Administrative Agent in accordance with
the terms of this Agreement or any other Loan Document.
SECTION 9.8. Consultants and Reports. (a) The Administrative Agent,
in its sole discretion, may remove from time to time the Independent
Consultants and appoint replacements as the Administrative Agent may choose
after consultation with the Borrower. As soon as practicable, notice of
any replacement Independent Consultant shall be given by the Administrative
Agent to the Borrower and the Independent Consultant being replaced. All
reasonable fees and expenses of the Independent Consultants (whether the
original ones or replacements) shall be paid by the Borrower.
(b) Each of the Independent Consultants shall be contractually
obligated to the Administrative Agent to carry out the activities required
of it in the Loan Documents, the Disbursement Agreement and in the
Construction Consultant Engagement Agreement and as otherwise requested by
the Administrative Agent. The Borrower acknowledges that, except as
provided in the Construction Consultant's Engagement Agreement with respect
to the Construction Consultant, it will not have any cause of action or
claim against any Independent Consultant resulting from any decision made
or not made, any action taken or not taken or any
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advice given by such Independent Consultant in the due performance in good
faith of its duties except for the gross negligence and willful misconduct
of the Independent Consultant.
SECTION 9.9. GECC Intercreditor Agreement. Each Lender hereby
authorizes the Administrative Agent, on behalf of and for the benefit of
such Lender, to enter into the GECC Intercreditor Agreement, and such
Lender agrees to be bound by the terms of the Intercreditor Agreement;
provided that the Administrative Agent shall not enter into or consent to
any amendment, modification, termination or waiver of any provision
contained in the Intercreditor Agreement without the prior consent of the
Required Lenders (or, if such amendment, modification, termination or
waiver would result in a change that under Section 10.1 would require the
consent of all Lenders, then the prior consent of all Lenders).
ARTICLE X
MISCELLANEOUS PROVISIONS
SECTION 10.1. Waivers, Amendments, etc. The provisions of this
Agreement and of each other Loan Document may from time to time be amended,
modified or waived, if such amendment, modification or waiver is in writing
and consented to by the Borrower and the Required Lenders; provided,
however, that no such amendment, modification or waiver shall:
(a) extend any Commitment Termination Date or modify this
Section without the consent of all Lenders;
(b)increase the aggregate amount of any Lender's then existing
Commitment Amounts, increase the aggregate amount of any Loans
required to be made by a Lender pursuant to its Commitments or reduce
any fees described in Article III payable to any Lender without the
consent of such Lender;
(c) extend the Stated Maturity Date for any Lender's Loan, or
reduce the principal amount of or rate of interest on any Lender's
Loan, without the consent of such Lender; provided, however, that any
vote to rescind any acceleration made pursuant to Section 8.2 or 8.3
of amounts owing with respect to the Loans and other Obligations shall
only require the vote of the Required Lenders;
(d) change the definition of "Required Lenders" or any
requirement hereunder that any particular action be taken by all
Lenders without the consent of all Lenders;
(e) increase the Stated Amount of any Letter of Credit unless
consented to by each Issuer;
(f) release the Sponsors under the Keep-Well Agreement, the
Completion Guarantors under the Completion Guaranty, or discharge the
Lien of the Deed of Trust
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(except in accordance with clause (b) or (c) of Section 7.1.19) or
release all or substantially all of the other security interests
granted pursuant to the Loan Documents, in each case without the
consent of all Lenders as expressly provided herein or therein; or
(g) affect adversely the interests, rights or obligations of the
Administrative Agent qua the Administrative Agent, or any Issuer,
unless consented to by the Administrative Agent or such Issuer, as the
case may be.
provided, further, however, that, at any time when no Default shall have
occurred and be continuing, Non-Defaulting Lenders holding more than 50% of
the sum of the aggregate outstanding principal amount of the Loans then
held by such Lenders plus the participation interests of such Lenders in
Letter of Credit Outstandings may authorize the release by the
Administrative Agent of the Music Project Parcel and the common Membership
Interests of Aladdin Music upon the closing of the financing for the Music
Project. No failure or delay on the part of the Administrative Agent, the
Issuer or any Lender in exercising any power or right under this Agreement
or any other Loan Document shall operate as a waiver thereof, nor shall any
single or partial exercise of any such power or right preclude any other or
further exercise thereof or the exercise of any other power or right. No
notice to or demand on the Borrower in any case shall entitle it to any
notice or demand in similar or other circumstances. No waiver or approval
by the Administrative Agent, any Issuer or any Lender under this Agreement
or any other Loan Document shall, except as may be otherwise stated in such
waiver or approval, be applicable to subsequent transactions. No waiver or
approval hereunder shall require any similar or dissimilar waiver or
approval thereafter to be granted hereunder.
SECTION 10.2. Notices. All notices and other communications provided
to any party hereto under this Agreement or any other Loan Document shall
be in writing and addressed, delivered or transmitted to such party at its
address or facsimile number set forth below its signature hereto or set
forth in the Lender Assignment Agreement or at such other address or
facsimile number as may be designated by such party in a notice to the
other parties. All such notices and communications shall be deemed to have
been properly given if (x) hand delivered with receipt acknowledged by the
recipient; (y) if mailed, upon the fifth Business Day after the date on
which it is deposited in registered or certified mail, postage prepaid,
return receipt requested or (z) if by Federal Express or other nationally-
recognized express courier service with instructions to deliver on the
following Business Day, on the next Business Day after delivery to such
express courier service. Notices and other communications may also be
properly given by facsimile but shall be deemed to be received upon
automatic facsimile confirmation of receipt thereof by the intended
recipient machine therefor with the original of such notice or
communication to be given in the manner provided in the second sentence of
this Section; provided, however, that the failure to deliver a copy in
accordance with the second sentence of this Section shall not invalidate
the effectiveness of such facsimile notice.
SECTION 10.3. Payment of Costs and Expenses. The Borrower agrees to
pay on demand all expenses of the Administrative Agent (including the
reasonable fees and out-of-
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pocket expenses of counsel to the Administrative Agent and of local
counsel, if any, who may be retained by counsel to the Administrative
Agent) in connection with
(a) the negotiation, preparation, execution and delivery of this
Agreement and of each other Loan Document, including schedules and
exhibits, and any amendments, waivers, consents, supplements or other
modifications to this Agreement or any other Loan Document as may from
time to time hereafter be required, whether or not the transactions
contemplated hereby are consummated;
(b) the filing, recording, refiling or rerecording of any Loan
Document or any Uniform Commercial Code financing statements relating
thereto and all amendments, supplements, amendments and restatements
and other modifications to any thereof and any and all other documents
or instruments of further assurance required to be filed or recorded
or refiled or rerecorded by the terms hereof or the terms of any Loan
Document;
(c) the preparation and review of the form of any document or
instrument relevant to this Agreement or any other Loan Document; and
(d) the preparation of any information or response required with
respect to any investigative request or inquiry, approval, findings of
suitability or any other response or communication involving a
Governmental Instrumentality arising out of this Agreement, any other
Operative Documents or any Obligation evidenced and secured by the
Loan Documents or the participation in any public or investigatory
hearing or meeting.
The Borrower further agrees to pay, and to save the Administrative Agent, the
Issuer and the Lenders harmless from all liability for, any stamp or other
taxes which may be payable in connection with the execution or delivery of
this Agreement, the Credit Extensions hereunder, or the issuance of the
Notes, the Letters of Credit or any other Loan Documents. The Borrower also
agrees to reimburse the Administrative Agent and, following a Default of the
nature set forth in Section 8.1.10 or an Event of Default, the Issuer and
each Lender upon demand for all reasonable out-of-pocket expenses (including
reasonable attorneys' fees and legal expenses of counsel and fees and
expenses of consultants to the Administrative Agent, the Issuer and the
Lenders, and, based upon the written advice of legal counsel, a copy of which
shall be provided to the Borrower, that in such counsel's judgment having a
common counsel for the Administrative Agent, the Issuer and the Lenders would
present such counsel with a conflict of interest, of one other counsel
selected by the Required Lenders (other than the Administrative Agent))
incurred by the Administrative Agent, the Issuer or such Lenders in
connection with (x) the negotiation of any restructuring or "work-out" with
the Borrower, whether or not consummated, of any Obligations and (y) the
enforcement of any Obligations.
SECTION 10.4. Indemnification. In consideration of the execution and
delivery of this Agreement by each Lender and the extension of the
Commitments, the Borrower hereby
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indemnifies, exonerates and holds the Administrative Agent, the Issuer and
each Lender and each of their respective officers, directors, employees and
agents (collectively, the "Indemnified Parties") free and harmless from and
against any and all actions, causes of action, suits, losses, costs,
liabilities and damages, and expenses incurred in connection therewith
(irrespective of whether any such Indemnified Party is a party to the
action for which indemnification hereunder is sought), including reasonable
attorneys' fees and disbursements, whether incurred in connection with
actions between or among the parties hereto or the parties hereto and third
parties (collectively, the "Indemnified Liabilities"), incurred by the
Indemnified Parties or any of them as a result of, or arising out of, or
relating to
(a) any transaction financed or to be financed in whole or in
part, directly or indirectly, with the proceeds of any Credit
Extension, including all Indemnified Liabilities arising in connection
with the Transaction;
(b) the entering into and performance of this Agreement and any
other Loan Document by any of the Indemnified Parties (including any
action brought by or on behalf of the Borrower as the result of any
determination by the Required Lenders pursuant to Article V not to
fund any Credit Extension); provided, however, that any such action is
resolved in favor of such Indemnified Party;
(c) any investigation, litigation or proceeding related to any
acquisition or proposed acquisition by the Borrower or any Subsidiary
of all or any portion of the stock or assets of any Person, whether or
not the Administrative Agent, the Issuer or any Lender is party
thereto;
(d) any investigation, litigation or proceeding related to any
environmental cleanup, audit, compliance or other matter relating to
the protection of the environment or the Release by the Borrower or
any other Aladdin Party which owns or leases a portion of the Site of
any Hazardous Substances;
(e) the presence on or under, or the escape, seepage, leakage,
spillage, discharge, emission, discharging or releases from, any real
property owned or operated by the Borrower or any other Aladdin Party
which owns or leases a portion of the Site of any Hazardous Substances
(including any losses, liabilities, damages, injuries, costs, expenses
or claims asserted or arising under any Environmental Law), regardless
of whether caused by, or within the control of, the Borrower or any
other Aladdin Party which owns or leases a portion of the Site;
(f) each Lender's Environmental Liability (the indemnification
herein for any Environmental Claim shall survive repayment of the
Notes and any transfer of the property of the Borrower by foreclosure
or by a deed in lieu of foreclosure, regardless of whether caused by,
or within the control of, the Borrower); or
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(g) the liability of any of the Indemnified Parties with respect
to the Reciprocal Easement Agreement, the Site Work Agreement and the
Common Parking Area Use Agreement;
except for, in each case, (x) any such Indemnified Liabilities arising for
the account of a particular Indemnified Party by reason of the relevant
Indemnified Party's gross negligence or wilful misconduct and (ii) any such
Indemnified Liabilities arising from actions, occurrences, or events that
take place after conveyance of the portion of the Site by foreclosure or
deed in lieu of foreclosure. The Borrower and its successors and assigns
hereby waive, release and agree not to make any claim or bring any cost
recovery action against the Administrative Agent, the Issuer or any Lender
under CERCLA or any state equivalent, or any similar law now existing or
hereafter enacted. It is expressly understood and agreed that to the
extent that any of the Indemnified Parties is strictly liable under any
Environmental Laws, the Borrower's obligation to such Person under this
indemnity shall likewise be without regard to fault on the part of the
Borrower with respect to the violation or condition which results in
liability of such Person. If and to the extent that the foregoing
undertaking may be unenforceable for any reason, the Borrower hereby agrees
to make the maximum contribution to the payment and satisfaction of each of
the Indemnified Liabilities which is permissible under applicable law.
SECTION 10.5. Survival. The obligations of the Borrower under
Sections 4.3, 4.4, 4.5, 4.6, 10.3 and 10.4, and the obligations of the
Lenders under Section 9.1, shall in each case survive any assignment from
one Lender to another (in the case of Sections 10.3 and 10.4) and any
termination of this Agreement, the payment in full of all the Obligations
and the termination of all the Commitments. The representations and
warranties made by the Borrower and each other Obligor in this Agreement
and in each other Loan Document shall survive the execution and delivery of
this Agreement and each such other Loan Document.
SECTION 10.6. Severability. Any provision of this Agreement or any
other Loan Document which is prohibited or unenforceable in any
jurisdiction shall, as to such provision and such jurisdiction, be
ineffective to the extent of such prohibition or unenforceability without
invalidating the remaining provisions of this Agreement or such Loan
Document or affecting the validity or enforceability of such provision in
any other jurisdiction.
SECTION 10.7. Headings. The various headings of this Agreement and
of each other Loan Document are inserted for convenience only and shall not
affect the meaning or interpretation of this Agreement or such other Loan
Document or any provisions hereof or thereof.
SECTION 10.8. Execution in Counterparts, Effectiveness, etc. This
Agreement may be executed by the parties hereto in several counterparts,
each of which shall be an original and all of which shall constitute
together but one and the same agreement. This Agreement shall become
effective when counterparts hereof executed on behalf of the Borrower, the
Administrative Agent and each Lender (or notice thereof satisfactory to the
Administrative
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Agent) shall have been received by the Administrative Agent and notice
thereof shall have been given by the Administrative Agent to the Borrower
and each Lender.
SECTION 10.9. Governing Law; Entire Agreement. THIS AGREEMENT, THE
NOTES AND EACH OTHER LOAN DOCUMENT (INCLUDING PROVISIONS WITH RESPECT TO
INTEREST, LOAN CHARGES AND COMMITMENT FEES) SHALL EACH BE DEEMED TO BE A
CONTRACT MADE UNDER AND GOVERNED BY THE INTERNAL LAWS OF THE STATE OF
NEW YORK (INCLUDING FOR SUCH PURPOSE SECTIONS 5-1401 AND 5-1402 OF THE
GENERAL OBLIGATIONS LAW OF THE STATE OF NEW YORK), EXCEPT TO THE EXTENT
THAT THE VALIDITY OR PERFECTION OF A SECURITY INTEREST OR DEED OF TRUST
HEREUNDER, OR REMEDIES HEREUNDER, IN RESPECT OF ANY PARTICULAR COLLATERAL
ARE GOVERNED BY THE LAWS OF A JURISDICTION OTHER THAN THE STATE OF NEW
YORK. This Agreement, the Notes, the other Loan Documents and the Fee
Letters constitute the entire understanding among the parties hereto with
respect to the subject matter hereof and thereof and supersede any and all
prior agreements, written or oral, with respect thereto including the
Commitment Letter.
SECTION 10.10. Successors and Assigns. This Agreement shall be
binding upon and shall inure to the benefit of the parties hereto and their
respective successors and assigns; provided, however, that:
(a) the Borrower may not assign or transfer its rights or
obligations hereunder without the prior written consent of the
Administrative Agent and all Lenders, which consent shall be
determined in good faith in their sole discretion; and
(b) the rights of sale, assignment and transfer of the Lenders
are subject to Section 10.11.
SECTION 10.11. Sale and Transfer of Loans and Notes; Participations
in Loans and Notes. Each Lender may assign, or sell participations in, its
Loans, Letters of Credit and Commitments to one or more other Persons in
accordance with this Section 10.11.
SECTION 10.11.1. Assignments. Upon prior notice to the Borrower and
the Administrative Agent, any Lender,
(a) with the consent of the Borrower, the Issuer and the
Administrative Agent (which consents shall not be unreasonably delayed
or withheld; provided, however, that in the event of a proposed
assignment of any Commitment to an assignee, the obligations of which
do not satisfy the credit ratings set forth in Section 9.4, any of the
Administrative Agent, the Issuer or the Borrower may withhold such
consent in its sole discretion), may at any time assign and delegate
to one or more commercial banks, funds or other financial
institutions, and
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(b) with notice to the Borrower and the Administrative Agent, but
without the consent of the Borrower or the Administrative Agent, may
assign and delegate to any of its Affiliates, any other Lender, any
Approved Fund or any other institution set forth in Schedule X hereto
so long as such assignment and delegation to such institution is made
within ten Business Days of the Closing Date,
(each Person described in either of the foregoing clauses as being the
Person to whom such assignment and delegation is to be made, being
hereinafter referred to as an "Assignee Lender"), all or any fraction of
such Lender's total Loans, Letter of Credit Outstandings and Commitments in
a minimum aggregate amount of $5,000,000 (or, if less, the entire remaining
amount of such Lender's Loans, Letter of Credit Outstandings and
Commitments). The Borrower and each other Obligor and the Administrative
Agent shall be entitled to continue to deal solely and directly with such
Lender in connection with the interests so assigned and delegated to an
Assignee Lender until
(c) notice of such assignment and delegation, together with
(i) payment instructions, (ii) the Internal Revenue Service Forms or
other statements contemplated or required to be delivered pursuant to
Section 4.6 and (iii) addresses and related information with respect
to such Assignee Lender, shall have been delivered to the Borrower and
the Administrative Agent by such Lender and such Assignee Lender;
(d) such Assignee Lender shall have executed and delivered to the
Borrower and the Administrative Agent a Lender Assignment Agreement,
accepted by the Administrative Agent; and
(e) the processing fees described below shall have been paid.
From and after the date that the Administrative Agent accepts such Lender
Assignment Agreement (and records the information therein in the Register,
if applicable), (x) the Assignee Lender thereunder shall be deemed
automatically to have become a party hereto and to the extent that rights
and obligations hereunder have been assigned and delegated to such Assignee
Lender in connection with such Lender Assignment Agreement, shall have the
rights and obligations of a Lender hereunder and under the other Loan
Documents, and (y) the assignor Lender, to the extent that rights and
obligations hereunder have been assigned and delegated by it in connection
with such Lender Assignment Agreement, shall be released from its
obligations hereunder and under the other Loan Documents. Within five
Business Days after its receipt of notice that the Administrative Agent has
received and accepted an executed Lender Assignment Agreement, subject,
however, to clause (d), the Borrower shall execute and deliver to the
Administrative Agent (for delivery to the relevant Assignee Lender) a new
Note evidencing such Assignee Lender's assigned Loans and Commitments and,
if the assignor Lender has retained Loans and Commitments hereunder, a
replacement Note in the principal amount of the Loans and Commitments
retained by the assignor Lender hereunder (such Note to be in exchange for,
but not in payment of, the Note then held by such assignor Lender). Each
such Note shall be
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dated the date of the predecessor Note. The assignor Lender shall mark
each predecessor Note "exchanged" and deliver each of them to the Borrower.
Accrued interest on that part of each predecessor Note evidenced by a new
Note, and accrued fees, shall be paid as provided in the Lender Assignment
Agreement. Accrued interest on that part of each predecessor Note
evidenced by a replacement Note shall be paid to the assignor Lender.
Accrued interest and accrued fees shall be paid at the same time or times
provided in the predecessor Note and in this Agreement. Such assignor
Lender or such Assignee Lender must also pay a processing fee in the amount
of $3,500 to the Administrative Agent upon delivery of any Lender
Assignment Agreement. Any attempted assignment and delegation not made in
accordance with this Section 10.11.1 shall be null and void.
Notwithstanding anything to the contrary set forth above, any Lender may
(without requesting the consent of the Borrower or the Administrative
Agent) pledge its Loans to a Federal Reserve Bank in support of borrowings
made by such Lender from such Federal Reserve Bank, and any Lender that is
an investment fund that invests in bank loans may, without the consent of
the Administrative Agent or Borrower, pledge all or any portion of its
interest and rights (but may not delegate any of its duties or obligations
hereunder or under any other Loan Document, including its Commitment(s), if
any) to any trustee or any other representative of holders of obligations
owed or securities issued by such investment fund as security for such
obligations or securities.
SECTION 10.11.2. Participations. Upon prior written notice to the
Borrower and the Administrative Agent, any Lender may at any time sell to
one or more commercial banks or other Persons (other than an Obligor or an
Affiliate of an Obligor) (each of such commercial banks and other Persons
being herein called a "Participant") participating interests in any of the
Loans, Commitments, or other interests of such Lender hereunder; provided,
however, that
(a) no participation contemplated in this Section shall relieve
such Lender from its Commitments or its other obligations hereunder or
under any other Loan Document;
(b) such Lender shall remain solely responsible for the
performance of its Commitments and such other obligations;
(c) the Borrower and each other Obligor and the Administrative
Agent shall continue to deal solely and directly with such Lender in
connection with such Lender's rights and obligations under this
Agreement and each of the other Loan Documents;
(d) no Participant, unless such Participant is an Affiliate of
such Lender or an Approved Fund or is itself a Lender, shall be
entitled to require such Lender to take or refrain from taking any
action hereunder or under any other Loan Document, except that such
Lender may agree with any Participant that such Lender will not,
without such Participant's consent, take any actions of the type
described in clause (a), (b), (f) or, to the extent requiring the
consent of such Lender, clause (c) of Section 10.1; and
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(e) the Borrower shall not be required to pay any amount under
this Agreement that is greater than the amount which it would have
been required to pay had no participating interest been sold.
The Borrower acknowledges and agrees that each Participant, for purposes of
Sections 4.3, 4.4, 4.5, 4.6, 4.8 or 4.9 shall be considered a Lender. Each
Participant shall only be indemnified for increased costs pursuant to
Section 4.3, 4.4, 4.5 or 4.6 if and to the extent that the Lender which
sold such participating interest to such Participant concurrently is
entitled to make, and does make, a claim on the Borrower for such increased
costs. Any Lender that sells a participating interest in any Loan,
Commitment or other interest to a Participant under this Section 10.11.2
shall indemnify and hold harmless the Borrower and the Administrative Agent
from and against any taxes, penalties, interest or other costs or losses
(including reasonable attorneys' fees and expenses) incurred or payable by
the Borrower or the Administrative Agent as a result of the failure of the
Borrower or the Administrative Agent to comply with its obligations to
deduct or withhold any Taxes from any payments made pursuant to this
Agreement to such Lender or the Administrative Agent, as the case may be,
which Taxes would not have been incurred or payable if such Participant had
been a Lender organized under the laws of a jurisdiction other than the
United States that was entitled to deliver to the Borrower, the
Administrative Agent or such Lender, and did in fact so deliver, a duly
completed and valid Form W-8 or W-9 or Form 1001 or 4224 (or applicable
successor form) entitling such Participant to receive payments under this
Agreement without deduction or withholding of any United States federal
taxes.
SECTION 10.11.3. Assignment of Registered Notes. A Registered Note
and the Obligation(s) evidenced thereby may be assigned or otherwise
transferred in whole or in part pursuant to the terms of Section 10.11.1
and only by registration of such assignment or transfer of such Registered
Note and the Obligation(s) evidenced thereby on the Register (and each
Registered Note shall expressly so provide). Any assignment or transfer of
all or part of such Obligation(s) and the Registered Note(s) evidencing the
same shall be registered on the Register only upon surrender for
registration of assignment or transfer of the Registered Note(s) evidencing
such Obligation(s), duly endorsed by (or accompanied by a written
instrument of assignment or transfer duly executed by) the Registered
Noteholder thereof, and thereupon one or more new Registered Note(s) in the
same aggregate principal amount shall be issued to the designated Assignee
Lender, and the old Registered Note shall be returned by the Administrative
Agent to the Borrower marked "Replaced". Prior to the due presentment for
registration of assignment or transfer of any Registered Note, the Borrower
and the Administrative Agent shall treat the Person in whose name such
Obligation(s) and the Registered Note(s) evidencing the same is registered
as the owner thereof for the purpose of receiving all payments thereon and
for all other purposes, notwithstanding any notice to the contrary.
SECTION 10.12. Other Transactions. Nothing contained herein shall
preclude the Agents, the Issuer or any other Lender from engaging in any
transaction, in addition to those contemplated by this Agreement or any
other Loan Document, with the Borrower or any of its
165
Affiliates in which the Borrower or such Affiliate is not restricted hereby
from engaging with any other Person.
SECTION 10.13. Execution by Authorized Representative. Any signature
by any Authorized Representative on this Agreement, any Loan Document and
any other instrument and certificate executed or to be executed pursuant to
or in connection with this Agreement or such other Loan Documents is
provided only in such Authorized Representative's capacity as an officer or
member of the Person in question, and not in any way in such Authorized
Representative's personal capacity.
SECTION 10.14. Forum Selection and Consent to Jurisdiction. ANY
LITIGATION BASED HEREON, OR ARISING OUT OF, UNDER, OR IN CONNECTION WITH,
THIS AGREEMENT OR ANY OTHER LOAN DOCUMENT, OR ANY COURSE OF CONDUCT, COURSE
OF DEALING, STATEMENTS (WHETHER ORAL OR WRITTEN) OR ACTIONS OF THE
ADMINISTRATIVE AGENT, THE LENDERS, THE ISSUER OR THE BORROWER IN CONNECTION
HEREWITH OR THEREWITH SHALL BE BROUGHT AND MAINTAINED EXCLUSIVELY IN THE
COURTS OF THE STATE OF NEW YORK OR IN THE UNITED STATES DISTRICT COURT FOR
THE SOUTHERN DISTRICT OF NEW YORK; PROVIDED, HOWEVER, THAT ANY SUIT SEEKING
ENFORCEMENT AGAINST ANY COLLATERAL OR OTHER PROPERTY MAY BE BROUGHT, AT THE
ADMINISTRATIVE AGENT'S OPTION, IN THE COURTS OF ANY JURISDICTION WHERE SUCH
COLLATERAL OR OTHER PROPERTY MAY BE FOUND. THE BORROWER HEREBY EXPRESSLY
AND IRREVOCABLY SUBMITS TO THE PERSONAL JURISDICTION OF THE COURTS OF THE
STATE OF NEW YORK AND OF THE UNITED STATES DISTRICT COURT FOR THE SOUTHERN
DISTRICT OF NEW YORK FOR THE PURPOSE OF ANY SUCH LITIGATION AS SET FORTH
ABOVE AND IRREVOCABLY AGREES TO BE BOUND BY ANY JUDGMENT RENDERED THEREBY
IN CONNECTION WITH SUCH LITIGATION, SUBJECT TO THE BORROWER'S RIGHT TO
CONTEST SUCH JUDGMENT BY MOTION OR APPEAL ON ANY GROUNDS NOT EXPRESSLY
WAIVED IN THIS SECTION 10.14. THE BORROWER HEREBY IRREVOCABLY APPOINTS
CT CORPORATION SYSTEM (THE "PROCESS AGENT"), WITH AN OFFICE ON THE DATE
HEREOF AT 1633 BROADWAY, NEW YORK, NEW YORK 10019, UNITED STATES, AS ITS
AGENT TO RECEIVE, ON THE BORROWER'S BEHALF AND ON BEHALF OF THE BORROWER'S
PROPERTY, SERVICE OF COPIES OF THE SUMMONS AND COMPLAINT AND ANY OTHER
PROCESS WHICH MAY BE SERVED IN ANY SUCH ACTION OR PROCEEDING. SUCH SERVICE
MAY BE MADE BY MAILING OR DELIVERING A COPY OF SUCH PROCESS TO THE BORROWER
IN CARE OF THE PROCESS AGENT AT THE PROCESS AGENT'S ABOVE ADDRESS, AND THE
BORROWER HEREBY IRREVOCABLY AUTHORIZES AND DIRECTS THE PROCESS AGENT TO
ACCEPT SUCH SERVICE ON ITS BEHALF. AS AN ALTERNATIVE METHOD OF SERVICE,
THE BORROWER FURTHER IRREVOCABLY CONSENTS TO THE SERVICE OF
166
PROCESS BY REGISTERED MAIL, POSTAGE PREPAID, OR BY PERSONAL SERVICE WITHIN
OR WITHOUT THE STATE OF NEW YORK AT THE ADDRESS FOR NOTICES SPECIFIED IN
SECTION 10.2. THE BORROWER HEREBY EXPRESSLY AND IRREVOCABLY WAIVES, TO THE
FULLEST EXTENT PERMITTED BY LAW, ANY OBJECTION WHICH IT MAY HAVE OR
HEREAFTER MAY HAVE TO THE LAYING OF VENUE OF ANY SUCH LITIGATION BROUGHT IN
ANY SUCH COURT REFERRED TO ABOVE AND ANY CLAIM THAT ANY SUCH LITIGATION HAS
BEEN BROUGHT IN AN INCONVENIENT FORUM. TO THE EXTENT THAT THE BORROWER HAS
OR HEREAFTER MAY ACQUIRE ANY IMMUNITY FROM JURISDICTION OF ANY COURT OR
FROM ANY LEGAL PROCESS (WHETHER THROUGH SERVICE OR NOTICE, ATTACHMENT PRIOR
TO JUDGMENT, ATTACHMENT IN AID OF EXECUTION OR OTHERWISE) WITH RESPECT TO
ITSELF OR ITS PROPERTY, THE BORROWER HEREBY IRREVOCABLY WAIVES TO THE
FULLEST EXTENT PERMITTED BY LAW SUCH IMMUNITY IN RESPECT OF ITS OBLIGATIONS
UNDER THIS AGREEMENT AND THE OTHER LOAN DOCUMENTS.
SECTION 10.15. Waiver of Jury Trial. THE ADMINISTRATIVE AGENT, THE
LENDERS, THE ISSUER AND THE BORROWER HEREBY KNOWINGLY, VOLUNTARILY AND
INTENTIONALLY WAIVE TO THE FULLEST EXTENT PERMITTED BY LAW ANY RIGHTS THEY
MAY HAVE TO A TRIAL BY JURY IN RESPECT OF ANY LITIGATION BASED HEREON, OR
ARISING OUT OF, UNDER, OR IN CONNECTION WITH, THIS AGREEMENT OR ANY OTHER
LOAN DOCUMENT, OR ANY COURSE OF CONDUCT, COURSE OF DEALING, STATEMENTS
(WHETHER ORAL OR WRITTEN) OR ACTIONS OF THE ADMINISTRATIVE AGENT, THE
LENDERS, THE ISSUER OR THE BORROWER IN CONNECTION HEREWITH OR THEREWITH.
THE BORROWER ACKNOWLEDGES AND AGREES THAT IT HAS RECEIVED FULL AND
SUFFICIENT CONSIDERATION FOR THIS PROVISION (AND EACH OTHER PROVISION OF
EACH OTHER LOAN DOCUMENT TO WHICH IT IS A PARTY) AND THAT THIS PROVISION IS
A MATERIAL INDUCEMENT FOR THE ADMINISTRATIVE AGENT, THE LENDERS AND EACH
ISSUER ENTERING INTO THIS AGREEMENT AND EACH SUCH OTHER LOAN DOCUMENT.
SECTION 10.16. Maximum Rate of Interest. Nothing contained in this
Agreement or in any other Loan Documents shall be construed to permit the
Lenders to charge or receive at any time interest, fees or other charges in
excess of the amounts which the Lenders are legally entitled to charge and
receive under any law to which such interest, fees or charges are subject.
In no contingency or event whatsoever shall the compensation payable to the
Lenders by any Person, howsoever characterized or computed, hereunder or
under any of the other Loan Documents, exceed the highest rate permissible
under any law to which such compensation is subject. There is no intention
that the Lenders shall contract for, charge or receive compensation in
excess of the highest lawful rate, and, in the event it should be
determined that the Lenders
167
have contracted for any rate of interest in excess of the highest lawful
rate, then ipso facto such rate shall be reduced to the highest lawful rate
so that no amounts shall be charged or received which are in excess
thereof, and, in the event it should be determined that any excess over
such highest lawful rate has been charged or received, the Lenders shall
promptly refund such excess to the Person entitled thereto; provided,
however, that, if lawful, any such excess shall be paid by the Borrower to
the Lenders as additional interest (accruing at a rate equal to the maximum
legal rate minus the rate provided for hereunder) during any subsequent
period when regular interest is accruing hereunder at less than the maximum
legal rate.
SECTION 10.17. Time of Essence. Time is of the essence as to all
times and dates set forth in or applicable to this Agreement with respect
to all payments to be made by or on behalf of the Borrower hereunder;
provided, however, that whenever any payment to be made under the Loan
Documents shall be stated to be due on a day other than a Business Day,
such payment may be made on the next succeeding Business Day and such
extension of time shall in such case be included in the computation of
interest payable hereunder.
SECTION 10.18. Consent or Approval of the Administrative Agent and
the Lenders.
(a) Any request by the Borrower for consent or approval by the
Administrative Agent and/or the Lenders under this Agreement or any of the
other Operative Documents shall be given in writing in accordance with
Section 10.2. Except where a specific time period for response is provided
in this Agreement, the Administrative Agent and the Lenders, as applicable,
shall have 30 days to grant or deny any such request. If the
Administrative Agent or the Lenders, as applicable, fail to respond to any
such request in writing within such 30 day period, the Borrower's request
shall be deemed disapproved.
(b) No Claims may be made by the Borrower or any other Person against
the Agents, the Lenders, any Affiliate of the foregoing, or the officers,
directors, employees, attorneys, consultants or agents of any of them for
consequential or punitive damages in respect of any Claim for breach or
contract or any other theory of liability arising out of or related to the
transactions contemplated by this Agreement or by the other Operative
Documents, or an act, omission, or event occurring in connection therewith;
and the Borrower, the other Aladdin Parties, LCNI, the London Clubs
Holdings and London Clubs each for itself and for all Persons claiming by,
through and under each of them, waives, releases, and agrees not to sue
upon any Claim for any such damages, whether or not accrued and whether or
not known or suspected to exist in its favor.
SECTION 10.19. No Third Party Beneficiary. All conditions of the
obligations of the Lenders to make Loans hereunder and Advances under the
Disbursement Agreement are imposed solely and exclusively for the benefit
of the Lenders, and neither the Design/Builder nor the Main Project
Architect or any other Contractor, Subcontractor or any other Person (x)
shall have standing to require satisfaction of such conditions or be
entitled to assume that the Lenders will refuse to make Loans in the
absence of strict compliance with any or all of such conditions
168
or (y) shall, under any circumstances, be deemed to be a beneficiary under
this Agreement or the Disbursement Agreement or of such conditions, any or
all of which may be waived in whole or in part by the Administrative Agent
or the Lenders at any time if they, in their sole discretion, deem it
advisable to do so. The waiver by the Lenders at any time of any of such
conditions shall be deemed to be made pursuant to, and not in modification
of, this Agreement.
SECTION 10.20. Cumulative Remedies. No right or remedy conferred
upon the Administrative Agent or the Lenders in this Agreement is intended
to be exclusive of any other right or remedy contained in the other Loan
Documents or at law and equity and every such right and remedy shall be
cumulative and shall be in addition to every other right or remedy
contained in the other Loan Documents and as now or hereafter available to
the Lenders at law or in equity, by statute or otherwise.
SECTION 10.21. Estoppel Certificates. The Borrower shall execute and
deliver, or cause to be executed and delivered, to the Administrative
Agents all instruments and certificates as the Administrative Agent may
reasonably request (including estoppel certificates certifying that the
Loans and each of the Loan Documents are in full force and effect and that
there are no defenses or offsets, claims or counterclaims with respect
thereto or if there are, stating the nature of such defenses, offsets,
claims or counterclaims) to effect, confirm or assure the rights, remedies
and Liens intended to be granted to the Lenders under the Loan Documents.
SECTION 10.22. Claims of Discount Noteholders. Subject to the
provisions of Article 12 of the Discount Note Indenture, the Discount Note
Indenture Trustee and the Discount Noteholders will be entitled in any
insolvency proceeding in which Holdings and the Borrower were substantively
consolidated (other than any consolidated proceeding resulting following
assertion of substantive consolidation by the Trustee or any Discount
Noteholder in violation of the provisions of Article 12 of the Discount
Note Indenture) to exercise all rights available to the Discount
Noteholders, as creditors or otherwise, and none of the Lenders, the Issuer
or the Administrative Agent shall (x) contest the involvement in such
proceeding of the Discount Note Indenture Trustee or any Discount
Noteholder or (y) seek an equitable subordination of the Discount
Noteholders' claims. Notwithstanding anything to the contrary in Section
10.1, this Section shall not be amended without the consent of the Discount
Note, Indenture Trustee or the holders of a majority of the Accreted Value
of the Discount Notes.
169
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to
be executed by their respective officers thereunto duly authorized as of
the day and year first above written.
ALADDIN GAMING, LLC
By: /s/ Richard Goeglein
----------------------
Title: President, CEO
Address: 831 Pilot Road
Las Vegas, NV 89119*
Facsimile No.: (702) 736-7107
Attention: Ronald Dictrow
with a copy to: Skadden, Arps, Slate, Meagher
& Flom LLP
Address: 919 Third Avenue
New York, NY 10022
Facsimile No.: (212) 735-2000
Attention: Wallace L. Schwartz
*after Conversion Date:
3667 Las Vegas Blvd. So.
Las Vegas, NV 89109
Facsimile No: (702) 736-7107
Attention: Ronald Dictrow
170
THE BANK OF NOVA SCOTIA, as
Administrative Agent
By: /s/ Alan Pendergast
-------------------------
Name: Alan Pendergast
Title: Relationship Manager
MERRILL LYNCH CAPITAL
CORPORATION, as Syndication Agent
By: /s/ Christopher Birosak
--------------------------
Name: Christopher Birosak
Title: Vice President
CIBC OPPENHEIMER CORP., as
Documentation Agent
By: /s/ Mark W.B. Harms
---------------------------
Name: Mark W.B. Harms
Title: Managing Director
171
Term A Loan Commitment: THE BANK OF NOVA SCOTIA
18.382352941698%
By: /s/ Alan Pendergast
-------------------------
Term B Loan Commitment: Name: Alan W. Pendergast
Title: Relationship Manager
54.142300192983%
Term C Loan Commitment: Address for Notices:
580 California Street
31.611111112500% 21st Floor
San Francisco, CA 94104
Facsimile No.: (415) 397-0791
Attention: Alan W. Pendergast
With a copy of:
The Bank of Nova Scotia
Loan Administration Department
Suite 2700
600 Peachtree Street N.E.
Atlanta, Georgia 30308
Facsimile No.: (404) 888-8998
Attention: Marianne Velker
172
Term A Loan Commitment: MERRILL LYNCH CAPITAL CORPORATION
18.382352941176%
By: /s/ Christopher Birosak
--------------------------
Term B Loan Commitment: Name: Christopher Birosak
Title: Vice President
11.403508771930%
Term C Loan Commitment: Address for Notices:
World Financial Center
12.625000000000% Two Vesey Street
New York, New York 10281
Facsimile No.: (212) 449-8230
Attention: Christopher Birosak
173
Term A Loan Commitment: CIBC INC.
18.382352941176%
Term B Loan Commitment: By: /s/ Dean J. Decker
--------------------------
Name: Dean J. Decker
8.771929824561% Title: Executive Director
CIBC Oppenheimer Corp., AS AGENT
Term C Loan Commitment: Address for Notices:
350 S. Grand Avenue, Suite 2600
0% Los Angeles, CA 90071
Facsimile No.: (213) 346-0157
Attention: Dean J. Decker
174
Term A Loan Commitment: THE INTERNATIONAL COMMERCIAL
BANK OF CHINA, NEW YORK
14.70588235242% AGENCY
Term B Loan Commitment: By: /s/ Robin C. C. Lin
--------------------------------
Name: Robin C. C. Lin
0% Title: Vice President &
Deputy General Manager
Term C Loan Commitment: Address for Notices:
65 Liberty Street, 2nd Floor
0% New York, New York 10005
Facsimile No.: (212) 766-5006
Attention: Mr. M.S. Wu
175
Term A Loan Commitment: FIRST COMMERCIAL BANK
(incorporated in Taiwan, R.O.C.)
11.029411764706% LOS ANGELES BRANCH
Term B Loan Commitment: By: /s/ June Shiong Lu
-------------------------------
Name: June Shiong Lu
0% Title: SVP & General Manager
Term C Loan Commitment: Address for Notices:
515 S. Flower Street, Suite 1050
0% Los Angeles, CA 90071
Facsimile No.: (212) 362-0219
Attention: Jonathan Kuo
176
Term A Loan Commitment: U.S. BANK NATIONAL ASSOCIATION
11.029411764706%
Term B Loan Commitment: By: /s/ Terry A. Gentry
----------------------------------
Name: Terry A. Gentry
0% Title: Assistant Vice President
Term C Loan Commitment: Address for Notices:
U.S. Bank
0% 2300 West Sahara, Suite 120
Las Vegas, NV 89102
Facsimile No.: (703) 386-3903
Attention: Terry A. Gentry
177
Term A Loan Commitment: ERSTE BANK DER
OESTERREICHISCHEN
8.088235294118% SPARKASSEN AG
Term B Loan Commitment: By: /s/ John Runnion
------------------------------
Name: John Runnion
0% Title: First Vice President
Term C Loan Commitment: By: /s/ David Manheim
------------------------------
Name: David Manheim
0% Title: Assistant Vice President
Address for Notices:
280 Park Avenue
West Bldg., 32nd Floor
New York, NY 10017
Facsimile No.: (212) 984-5627
Attention: David Manheim
178
Term A Loan Commitment: ING HIGH INCOME PRINCIPAL
PRESERVATION FUND
0% HOLDINGS, LDC
By: ING Capital Advisors, Inc.
as Investment Advisor
Term B Loan Commitment: By: /s/ Michael D. Hatley
--------------------------------------------
Name: Michael D. Hatley
4.736842105263% Title: Vice President & Portfolio Manager
Term C Loan Commitment: Address for Notices:
ING High Income Principal
6.000000000000% Preservation Fund Holdings, LDC
333 South Grand Avenue, Suite 4250
Los Angeles, CA 90071
Facsimile No.: (212) 346-3995
Attention: Michael Hatley
179
Term A Loan Commitment: THE ING CAPITAL SENIOR SECURED
HIGH INCOME FUND, LP.
0% By: ING Capital Advisors, Inc.
as Investment Advisor
Term B Loan Commitment: By: /s/ Michael D. Hatley
--------------------------------------------
Name: Michael D. Hatley
3.157894736842% Title: Vice President & Portfolio Manager
Term C Loan Commitment: Address for Notices:
The ING Capital Senior Secured
4.000000000000% High Income Fund, LP.
333 South Grand Avenue, Suite 4250
Los Angeles, CA 90071
Facsimile No.: (212) 346-3995
Attention: Michael Hatley
180
Term A Loan Commitment: PPM AMERICA, INC., as Attorney-in-Fact
on behalf of Jackson National Life
0% Insurance Company
Term B Loan Commitment: By: /s/ Michael DiRe
---------------------------
Name: Michael DiRe
17.543859649123% Title: Managing Director
Term C Loan Commitment: Address for Notices:
225 West Wacker Drive, Suite 1200
18.750000000000% Chicago, IL 60606-1228
Facsimile No.: (312) 634-0054
Attention: Private Placement -
Michael DiRe or Mike King
181
Term A Loan Commitment: VAN KAMPEN AMERICAN CAPITAL
PRIME RATE INCOME TRUST
0%
Term B Loan Commitment: By: /s/ Jeffrey W. Maillet
----------------------------------------
Name: Jeffrey W. Maillet
0% Title: Senior Vice President Director
Term C Loan Commitment: Address for Notices:
Van Kampen American Capital
25.625000000000% One Parkview Plaza
Oakbrook, IL 60181
Facsimile No.: (630) 684-6740/6741
Attention:
State Street Bank & Trust
Corporate Trust Department
P.O. Box 778
Boston, MA 02102
Facsimile: (617) 664-5366/5367
Attention: Sean Emerson
182
Term A Loan Commitment: FLOATING RATE PORTFOLIO
By: Chancellor LGT Senior Secured
0% Management Inc., as Attorney-
in-Fact
Term B Loan Commitment: By: /s/ Anthony R. Clemente
----------------------------------------
Name: Anthony R. Clemente
0.243664719298% Title: Authorized Signatory
Term C Loan Commitment: Address for Notices:
Chancellor LGT Asset Management, Inc.
1.388888887500% 50 California Street, 27th Floor
San Francisco, CA 94111-4624
Facsimile No.: (415) 445-7525
Attention: Linda DiNapoli
Chancellor LGT Senior Secured
Management, Inc.
1166 Avenue of the Americas, 27th Floor
New York, NY 10036
Facsimile: (212) 278-9647
Attention: Peter Wollman
183
SCHEDULE I
DISCLOSURE SCHEDULE TO CREDIT AGREEMENT
ITEM 5.1.9 Indebtedness to be Paid.
CREDITOR OUTSTANDING PRINCIPAL AMOUNT
ITEM 6.7 Litigation.
ITEM 6.8 Subsidiaries.
ITEM 6.11 Employee Benefit Plans.
ITEM 6.12 Environmental Matters.
ITEM 6.13 Intellectual Property.
ITEM 6.29 Labor Disputes.
ITEM 7.2.2(b) Existing Indebtedness
CREDITOR OUTSTANDING PRINCIPAL AMOUNT
ITEM 7.2.3(c) Ongoing Liens.
ITEM 7.2.5(a) Ongoing Investments.
TABLE OF CONTENTS
ARTICLE I
DEFINITIONS AND ACCOUNTING TERMS
Section Page
- ------- ----
1.1. Defined Terms. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
1.2. Use of Defined Terms . . . . . . . . . . . . . . . . . . . . . . . . . .68
1.3. Cross-References . . . . . . . . . . . . . . . . . . . . . . . . . . . .68
1.4. Accounting and Financial Determinations. . . . . . . . . . . . . . . . .68
ARTICLE II
COMMITMENTS, BORROWING AND ISSUANCE
PROCEDURES, NOTES AND LETTERS OF CREDIT
2.1. Commitments. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .69
2.1.1. Term A Loan Commitment . . . . . . . . . . . . . . . . . . . . . . . .69
2.1.2. Letter of Credit Commitment. . . . . . . . . . . . . . . . . . . . . .69
2.1.3. Term B Loan and Term C Loan Commitments. . . . . . . . . . . . . . . .70
2.1.4. Lenders Not Permitted or Required to Make Loans. . . . . . . . . . . .70
2.1.5. Issuer Not Permitted or Required to Issue Letters of Credit. . . . . .71
2.2. Reduction of the Term A Loan Commitment Amount . . . . . . . . . . . . .71
2.3. Borrowing Procedure. . . . . . . . . . . . . . . . . . . . . . . . . . .71
2.3.1. Borrowing Procedure. . . . . . . . . . . . . . . . . . . . . . . . . .71
2.3.2. Term A Loans . . . . . . . . . . . . . . . . . . . . . . . . . . . . .72
2.3.3. Term B Loans and Term C Loans. . . . . . . . . . . . . . . . . . . . .72
2.3.4. Additional Term B Loans and/or Term C Loans. . . . . . . . . . . . . .72
2.4. Continuation and Conversion Elections. . . . . . . . . . . . . . . . . .73
2.5. Funding. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .73
2.6. Letter of Credit Issuance Procedures . . . . . . . . . . . . . . . . . .74
2.6.1. Other Lenders' Participation . . . . . . . . . . . . . . . . . . . . .74
2.6.2. Letter of Credit Disbursements . . . . . . . . . . . . . . . . . . . .75
2.6.3. Reimbursement. . . . . . . . . . . . . . . . . . . . . . . . . . . . .75
2.6.4. Deemed Letter of Credit Disbursements. . . . . . . . . . . . . . . . .76
2.6.5. Nature of Letter of Credit Reimbursement Obligations . . . . . . . . .76
2.7. Notes. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .77
2.8. Registered Notes . . . . . . . . . . . . . . . . . . . . . . . . . . . .77
i
ARTICLE III
REPAYMENTS, PREPAYMENTS, INTEREST AND FEES
Section Page
- ------- ----
3.1. Repayments and Prepayments; Application. . . . . . . . . . . . . . . . .78
3.1.1. Repayments and Prepayments . . . . . . . . . . . . . . . . . . . . . .78
3.1.2. Application. . . . . . . . . . . . . . . . . . . . . . . . . . . . . .80
3.2. Interest Provisions. . . . . . . . . . . . . . . . . . . . . . . . . . .81
3.2.1. Rates. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .81
3.2.2. Post-Maturity Rates. . . . . . . . . . . . . . . . . . . . . . . . . .81
3.2.3. Payment Dates. . . . . . . . . . . . . . . . . . . . . . . . . . . . .82
3.3. Fees . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .82
3.3.1. Commitment Fee . . . . . . . . . . . . . . . . . . . . . . . . . . . .82
3.3.2. Agency Fee . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .82
3.3.3. Letter of Credit Fee . . . . . . . . . . . . . . . . . . . . . . . . .83
3.3.4. Other Fees . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .83
ARTICLE IV
CERTAIN LIBO RATE AND OTHER PROVISIONS
4.1. LIBO Rate Lending Unlawful . . . . . . . . . . . . . . . . . . . . . . .83
4.2. Deposits Unavailable . . . . . . . . . . . . . . . . . . . . . . . . . .83
4.3. Increased LIBO Rate Loan Costs, etc. . . . . . . . . . . . . . . . . . .84
4.4. Funding Losses . . . . . . . . . . . . . . . . . . . . . . . . . . . . .84
4.5. Increased Capital Costs. . . . . . . . . . . . . . . . . . . . . . . . .85
4.6. Lender's Tax . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .85
4.7. Payments, Computations, etc. . . . . . . . . . . . . . . . . . . . . . .87
4.8. Sharing of Payments. . . . . . . . . . . . . . . . . . . . . . . . . . .88
4.9. Setoff . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .88
4.10. Mitigation. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .89
4.11. Replacement of Lenders. . . . . . . . . . . . . . . . . . . . . . . . .89
ii
ARTICLE V
CONDITIONS TO CREDIT EXTENSIONS
Section Page
- ------- ----
5.1. Initial Credit Extension . . . . . . . . . . . . . . . . . . . . . . . .92
5.1.1. Satisfaction of Conditions Precedent to the Closing Date . . . . . . .92
5.1.2. Delivery of Notes. . . . . . . . . . . . . . . . . . . . . . . . . . .92
5.1.3. Pledge Agreements. . . . . . . . . . . . . . . . . . . . . . . . . . .92
5.1.4. Financial Information, etc.. . . . . . . . . . . . . . . . . . . . . .93
5.1.5. Security Agreement . . . . . . . . . . . . . . . . . . . . . . . . . .94
5.1.6. Trademark Security Agreement . . . . . . . . . . . . . . . . . . . . .94
5.1.7. Deed of Trust. . . . . . . . . . . . . . . . . . . . . . . . . . . . .94
5.1.8. Solvency, etc. . . . . . . . . . . . . . . . . . . . . . . . . . . . .95
5.1.9. Initial Rate Protection Agreement. . . . . . . . . . . . . . . . . . .95
5.1.10. Payment of Outstanding Indebtedness, etc. . . . . . . . . . . . . . .95
5.1.11. Closing Fees, Expenses, etc.. . . . . . . . . . . . . . . . . . . . .95
5.1.12. Opinions of Counsel . . . . . . . . . . . . . . . . . . . . . . . . .95
5.1.13. Satisfactory Form and Substance . . . . . . . . . . . . . . . . . . .95
5.1.14. Other Loan Documents. . . . . . . . . . . . . . . . . . . . . . . . .96
5.1.15. Main Project Documents. . . . . . . . . . . . . . . . . . . . . . . .96
5.1.16. Other Documents . . . . . . . . . . . . . . . . . . . . . . . . . . .96
5.2. All Credit Extensions. . . . . . . . . . . . . . . . . . . . . . . . . .96
5.2.1. Conditions for Advances under the Disbursement Agreement and the
Making of Term A Loans. . . . . . . . . . . . . . . . . . . . . . .97
5.2.2. Conditions for the Making of an Additional Term B Loan and/or Term
C Loan. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .97
5.2.3. Compliance with Warranties, No Default, etc. . . . . . . . . . . . . .98
5.2.4. Credit Extension Request, etc. . . . . . . . . . . . . . . . . . . . .99
5.2.5. Satisfactory Legal Form. . . . . . . . . . . . . . . . . . . . . . . .99
5.2.6. Other Documents. . . . . . . . . . . . . . . . . . . . . . . . . . . .99
ARTICLE VI
REPRESENTATIONS AND WARRANTIES
6.1. Organization, etc. . . . . . . . . . . . . . . . . . . . . . . . . . . .99
6.2. Due Authorization, Non-Contravention, etc. . . . . . . . . . . . . . . 100
6.3. Government Approval, Regulation, etc.. . . . . . . . . . . . . . . . . 100
6.4. Validity, etc. . . . . . . . . . . . . . . . . . . . . . . . . . . . . 100
6.5. Financial Information. . . . . . . . . . . . . . . . . . . . . . . . . 101
6.6. No Material Adverse Change . . . . . . . . . . . . . . . . . . . . . . 101
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Section Page
- ------- ----
6.7. Litigation, Labor Controversies, etc.. . . . . . . . . . . . . . . . . 101
6.8. Subsidiaries . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 101
6.9. Ownership of Properties. . . . . . . . . . . . . . . . . . . . . . . . 101
6.10. Taxes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 102
6.11. Pension and Welfare Plans . . . . . . . . . . . . . . . . . . . . . . 102
6.12. Environmental Warranties. . . . . . . . . . . . . . . . . . . . . . . 103
6.13. Intellectual Property . . . . . . . . . . . . . . . . . . . . . . . . 104
6.14. Regulations G, U and X. . . . . . . . . . . . . . . . . . . . . . . . 104
6.15. Accuracy of Information . . . . . . . . . . . . . . . . . . . . . . . 104
6.16. Permits . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 105
6.17. Security Interests. . . . . . . . . . . . . . . . . . . . . . . . . . 105
6.18. Existing Defaults . . . . . . . . . . . . . . . . . . . . . . . . . . 106
6.19. Design/Build Contract; Construction Contracts . . . . . . . . . . . . 106
6.20. Contingent Liabilities. . . . . . . . . . . . . . . . . . . . . . . . 106
6.21. Business, Debt, Contracts, etc. . . . . . . . . . . . . . . . . . . . 107
6.22. Representations and Warranties. . . . . . . . . . . . . . . . . . . . 107
6.23. Utilities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 107
6.24. In Balance Requirement. . . . . . . . . . . . . . . . . . . . . . . . 107
6.25. Sufficiency of Interests and Main Project Documents . . . . . . . . . 107
6.25.1. Ownership, Title, etc.. . . . . . . . . . . . . . . . . . . . . . . 107
6.25.2. Main Project Documents. . . . . . . . . . . . . . . . . . . . . . . 108
6.25.3. Satisfaction to Main Project Document Conditions. . . . . . . . . . 108
6.26. Main Project Budget; Trade Detail Report. . . . . . . . . . . . . . . 108
6.26.1. Main Project Budget . . . . . . . . . . . . . . . . . . . . . . . . 108
6.26.2. Trade Detail Report . . . . . . . . . . . . . . . . . . . . . . . . 108
6.27. Fees and Enforcement. . . . . . . . . . . . . . . . . . . . . . . . . 109
6.28. ERISA Compliance. . . . . . . . . . . . . . . . . . . . . . . . . . . 109
6.29. Labor Disputes; Acts of God; Casualty and Condemnation. . . . . . . . 109
6.30. Liens . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 109
6.31. Construction Benchmark Schedule; Guaranteed Maximum Price . . . . . . 110
6.31.1. Construction Benchmark Schedule . . . . . . . . . . . . . . . . . . 110
6.31.2. Guaranteed Maximum Price. . . . . . . . . . . . . . . . . . . . . . 110
6.32. Proper Subdivision. . . . . . . . . . . . . . . . . . . . . . . . . . 110
6.33. Offices; Location of Collateral . . . . . . . . . . . . . . . . . . . 110
6.34. Government Regulation . . . . . . . . . . . . . . . . . . . . . . . . 111
6.35. No Brokers. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 111
iv
ARTICLE VII
COVENANTS
Section Page
- ------- ----
7.1. Affirmative Covenants. . . . . . . . . . . . . . . . . . . . . . . . . 111
7.1.1. Financial Information, Reports, Notices, etc.. . . . . . . . . . . . 111
7.1.2. Compliance with Laws, etc. . . . . . . . . . . . . . . . . . . . . . 115
7.1.3. Maintenance of Properties; Operation; Reserves . . . . . . . . . . . 116
7.1.4. Insurance. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 116
7.1.5. Books and Records. . . . . . . . . . . . . . . . . . . . . . . . . . 117
7.1.6. Environmental. . . . . . . . . . . . . . . . . . . . . . . . . . . . 117
7.1.7. Additional Collateral. . . . . . . . . . . . . . . . . . . . . . . . 117
7.1.8. Use of Proceeds. . . . . . . . . . . . . . . . . . . . . . . . . . . 118
7.1.9. Deposits into the Accounts . . . . . . . . . . . . . . . . . . . . . 118
7.1.10. Main Project Costs. . . . . . . . . . . . . . . . . . . . . . . . . 118
7.1.11. Repayment of Indebtedness . . . . . . . . . . . . . . . . . . . . . 119
7.1.12. Diligent Construction of the Main Project . . . . . . . . . . . . . 119
7.1.13. Compliance with Legal Requirements. . . . . . . . . . . . . . . . . 119
7.1.14. In Balance; Borrower Equity . . . . . . . . . . . . . . . . . . . . 120
7.1.15. Security Interest in Newly Acquired Property. . . . . . . . . . . . 120
7.1.16. Plans and Specifications. . . . . . . . . . . . . . . . . . . . . . 120
7.1.17. Construction Consultant . . . . . . . . . . . . . . . . . . . . . . 121
7.1.18. Proper Legal Forms. . . . . . . . . . . . . . . . . . . . . . . . . 122
7.1.19. Preserving the Main Project Security. . . . . . . . . . . . . . . . 122
7.1.20. Application of Insurance and Condemnation Proceeds. . . . . . . . . 124
7.1.21. Shoulder Space Encroachments. . . . . . . . . . . . . . . . . . . . 125
7.1.22. GECC Intercreditor Agreement. . . . . . . . . . . . . . . . . . . . 125
7.1.23. Compliance with Material Main Project Documents and the Approved
Equipment Funding Commitment . . . . . . . . . . . . . . . . . . 126
7.2. Negative Covenants . . . . . . . . . . . . . . . . . . . . . . . . . . 126
7.2.1. Business Activities. . . . . . . . . . . . . . . . . . . . . . . . . 126
7.2.2. Indebtedness . . . . . . . . . . . . . . . . . . . . . . . . . . . . 126
7.2.3. Liens. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 127
7.2.4. Financial Condition and Operations . . . . . . . . . . . . . . . . . 128
7.2.5. Investments. . . . . . . . . . . . . . . . . . . . . . . . . . . . . 129
7.2.6. Restricted Payments, etc.. . . . . . . . . . . . . . . . . . . . . . 131
7.2.7. Capital Expenditures, etc. . . . . . . . . . . . . . . . . . . . . . 133
7.2.8. Rental Obligations . . . . . . . . . . . . . . . . . . . . . . . . . 134
7.2.9. Take or Pay Contracts. . . . . . . . . . . . . . . . . . . . . . . . 134
7.2.10. Consolidation, Merger, etc. . . . . . . . . . . . . . . . . . . . . 134
7.2.11. Permitted Dispositions. . . . . . . . . . . . . . . . . . . . . . . 134
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Section Page
- ------- ----
7.2.12. Modification of Certain Agreements. . . . . . . . . . . . . . . . . 134
7.2.13. Transactions with Affiliates. . . . . . . . . . . . . . . . . . . . 136
7.2.14. Negative Pledges, Restrictive Agreements, etc.. . . . . . . . . . . 137
7.2.15. Sale and Leaseback. . . . . . . . . . . . . . . . . . . . . . . . . 137
7.2.16. Stock of Subsidiaries . . . . . . . . . . . . . . . . . . . . . . . 137
7.2.17. Scope Changes . . . . . . . . . . . . . . . . . . . . . . . . . . . 137
7.2.18. Amendment of Main Project Budget, Construction Benchmark Schedule;
Design/Build Contract Time and Guaranteed Maximum Price. . . . . 139
7.2.19. Hazardous Substances. . . . . . . . . . . . . . . . . . . . . . . . 141
7.2.20. No Other Powers of Attorney . . . . . . . . . . . . . . . . . . . . 141
7.2.21. Opening . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 141
7.2.22. Actions Affecting Energy Provider . . . . . . . . . . . . . . . . . 141
ARTICLE VIII
EVENTS OF DEFAULT
8.1. Listing of Events of Default . . . . . . . . . . . . . . . . . . . . . 141
8.1.1. Non-Payment of Obligations . . . . . . . . . . . . . . . . . . . . . 142
8.1.2. Breach of Warranty . . . . . . . . . . . . . . . . . . . . . . . . . 142
8.1.3. Non-Performance of Certain Covenants and Obligations . . . . . . . . 142
8.1.4. Non-Performance of Other Covenants and Obligations . . . . . . . . . 142
8.1.5. Default on Other Indebtedness. . . . . . . . . . . . . . . . . . . . 142
8.1.6. Outside Completion Deadline. . . . . . . . . . . . . . . . . . . . . 143
8.1.7. Judgments. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 143
8.1.8. Pension Plans. . . . . . . . . . . . . . . . . . . . . . . . . . . . 143
8.1.9. Change in Control. . . . . . . . . . . . . . . . . . . . . . . . . . 143
8.1.10. Bankruptcy, Insolvency, etc.. . . . . . . . . . . . . . . . . . . . 143
8.1.11. Impairment of Security, etc.. . . . . . . . . . . . . . . . . . . . 144
8.1.12. Advance Requests. . . . . . . . . . . . . . . . . . . . . . . . . . 144
8.1.13. Breach of Main Project Documents. . . . . . . . . . . . . . . . . . 144
8.1.14. Termination or Invalidity of Main Project Documents; Abandonment
of Main Project. . . . . . . . . . . . . . . . . . . . . . . . . 146
8.1.15. Government Authorizations . . . . . . . . . . . . . . . . . . . . . 146
8.2. Action if Bankruptcy . . . . . . . . . . . . . . . . . . . . . . . . . 147
8.3. Action if Other Event of Default . . . . . . . . . . . . . . . . . . . 147
vi
ARTICLE IX
THE ADMINISTRATIVE AGENT
Section Page
- ------- ----
9.1. Actions. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 150
9.2. Funding Reliance, etc. . . . . . . . . . . . . . . . . . . . . . . . . 150
9.3. Exculpation. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 151
9.4. Successor. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 151
9.5. Loans by Scotiabank. . . . . . . . . . . . . . . . . . . . . . . . . . 152
9.6. Credit Decisions . . . . . . . . . . . . . . . . . . . . . . . . . . . 152
9.7. Copies, etc. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 152
9.8. Consultants and Reports. . . . . . . . . . . . . . . . . . . . . . . . 153
9.9. GECC Intercreditor Agreement . . . . . . . . . . . . . . . . . . . . . 153
ARTICLE X
MISCELLANEOUS PROVISIONS
10.1. Waivers, Amendments, etc. . . . . . . . . . . . . . . . . . . . . . . 153
10.2. Notices . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 154
10.3. Payment of Costs and Expenses . . . . . . . . . . . . . . . . . . . . 155
10.4. Indemnification . . . . . . . . . . . . . . . . . . . . . . . . . . . 156
10.5. Survival. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 157
10.6. Severability. . . . . . . . . . . . . . . . . . . . . . . . . . . . . 157
10.7. Headings. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 158
10.8. Execution in Counterparts, Effectiveness, etc.. . . . . . . . . . . . 158
10.9. Governing Law; Entire Agreement . . . . . . . . . . . . . . . . . . . 158
10.10. Successors and Assigns . . . . . . . . . . . . . . . . . . . . . . . 158
10.11. Sale and Transfer of Loans and Notes; Participations in Loans and
Notes. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 158
10.11.1. Assignments. . . . . . . . . . . . . . . . . . . . . . . . . . . . 159
10.11.2. Participations . . . . . . . . . . . . . . . . . . . . . . . . . . 160
10.11.3. Assignment of Registered Notes . . . . . . . . . . . . . . . . . . 161
10.12. Other Transactions . . . . . . . . . . . . . . . . . . . . . . . . . 162
10.13. Execution by Authorized Representative . . . . . . . . . . . . . . . 162
10.14. Forum Selection and Consent to Jurisdiction. . . . . . . . . . . . . 162
10.15. Waiver of Jury Trial . . . . . . . . . . . . . . . . . . . . . . . . 163
10.16. Maximum Rate of Interest . . . . . . . . . . . . . . . . . . . . . . 163
10.17. Time of Essence. . . . . . . . . . . . . . . . . . . . . . . . . . . 164
10.18. Consent or Approval of the Administrative Agent and the Lenders. . . 164
10.19. No Third Party Beneficiary . . . . . . . . . . . . . . . . . . . . . 164
vii
Section Page
- ------- ----
10.20. Cumulative Remedies. . . . . . . . . . . . . . . . . . . . . . . . . 165
10.21. Estoppel Certificates. . . . . . . . . . . . . . . . . . . . . . . . 165
10.22. Claims of Discount Noteholders . . . . . . . . . . . . . . . . . . . 165
viii
SCHEDULE I - Disclosure Schedule
SCHEDULE II - Scheduled Amortization
SCHEDULE III - Mandatory Prepayments
SCHEDULE IV - Forms of Opinions
SCHEDULE V - Schedule of Security Filings
SCHEDULE VI - Schedule of Main Project Documents
SCHEDULE VII - Schedule of Plans and Specifications
SCHEDULE VIII - Schedule of Pre-Opening Expenses
SCHEDULE IX - Schedule of Issuance Fees and Expenses
SCHEDULE X - Pre-Approved Assignees
EXHIBIT A-1 - Form of Term A Note
EXHIBIT A-2 - Form of Term B Note
EXHIBIT A-3 - Form of Term C Note
EXHIBIT A-4 - Form of Registered Note
EXHIBIT B - Form of Deed of Trust
EXHIBIT C - Form of Completion Guaranty
EXHIBIT D - Form of Keep-Well Agreement
EXHIBIT E-1 - Form of Borrower Pledge Agreement
EXHIBIT E-2 - Form of AHL Pledge Agreement
EXHIBIT E-3 - Form of AMH Pledge Agreement
EXHIBIT E-4 - Form of Enterprises Pledge Agreement
EXHIBIT E-5 - Form of Holdings Pledge Agreement
EXHIBIT E-6 - Form of LCNI Pledge Agreement
EXHIBIT E-7 - Form of Sommer Enterprises Pledge Agreement
EXHIBIT F - Form of Security Agreement
EXHIBIT G - Form of Mall Project Completion Assignment
EXHIBIT H - Form of Lender Assignment Agreement
EXHIBIT I - Form of Consent to Agreement
EXHIBIT J - Form of Grant, Bargain and Sale Deed
EXHIBIT K - Form of Environmental Indemnity
EXHIBIT L-1 - Form of Borrowing Request
EXHIBIT L-2 - Form of Letter of Credit Issuance Request
EXHIBIT M - Form of Continuation/Conversion Notice
EXHIBIT N-1 - Description of the Site
EXHIBIT N-2 - Description of the Complex
EXHIBIT N-3 - Description of the Main Project Parcel
EXHIBIT N-4 - Description of the Mall Project Parcel
EXHIBIT N-5 - Description of the Music Project Parcel
EXHIBIT N-6 - Description of the Shoulder Space
EXHIBIT N-7 - Description of the Theater Space
EXHIBIT N-8 - Description of the Hotel/Casino Component
EXHIBIT N-9 - Description of the Energy Project Component
ix
EXHIBIT N-10 - Description of the Equipment Component
EXHIBIT O - Description of the Main Project Intended Use
EXHIBIT P - Form of Solvency Certificate
EXHIBIT Q-1 - Form of Borrower's Closing Certificate
EXHIBIT Q-2 - Form of Construction Consultant's Closing Certificate
EXHIBIT Q-3 - Form of Architect's Closing Certificate
EXHIBIT R - Form of Compliance Certificate
EXHIBIT S-1 - Form of Borrower's Completion Certificate
EXHIBIT S-2 - Form of Construction Consultant's Completion Certificate
EXHIBIT T-1 - Form of Borrower's Opening Date Certificate
EXHIBIT T-2 - Form of Construction Consultant's Opening Date Certificate
EXHIBIT U-1 - Form of Borrower's Final Completion Certificate
EXHIBIT U-2 - Form of Construction Consultant's Final Completion
Certificate
EXHIBIT V - Form of Main Project Punchlist Completion Certificate
EXHIBIT W - Form of Realized Savings Certificate
EXHIBIT X-1 - Form of Construction Benchmark Schedule
EXHIBIT X-2 - Form of Main Project Budget
EXHIBIT X-3 - Form of Main Project Budget/Schedule Amendment Certificate
EXHIBIT Y - Form of Additional Contract Certificate
EXHIBIT Z - Form of Contract Amendment Certificate
EXHIBIT AA - Form of On-Schedule Certificate
EXHIBIT BB - Permitted Encumbrances
EXHIBIT CC - Permitted Exceptions
EXHIBIT DD - Trade Detail Report
EXHIBIT EE - Tax Certificate
x