Noteholder Completion Guaranty
GUARANTY OF PERFORMANCE AND COMPLETION
THIS GUARANTY OF PERFORMANCE AND COMPLETION, dated as of February 26, 1998
is made by LONDON CLUBS INTERNATIONAL PLC, a company registered in England and
Wales under company number 2862479 ("London Clubs"), THE TRUST UNDER ARTICLE
SIXTH U/W/O SIGMUND SOMMER (the "Trust") and ALADDIN BAZAAR HOLDINGS, LLC, a
Nevada limited liability company ("ABH"; ABH, the Trust and London Clubs are
individually called a "Guarantor" and collectively called the "Guarantors"), in
favor of State Street Bank and Trust Company (the "Discount Note Indenture
Trustee"), for the benefit of the Noteholders (as defined below).
WITNESSETH:
WHEREAS, the Discount Note Indenture Trustee, Aladdin Gaming
Holdings, LLC ("Holdings") and Aladdin Capital Corp. ("Capital," and together
with Holdings, collectively, the "Note Issuers") have entered into an indenture
(the "Indenture") dated as of even date herewith; and
WHEREAS, certain Discount Notes will be issued pursuant to the
Indenture; and
WHEREAS, pursuant to that certain credit agreement, dated as of even
date herewith (together with all amendments and other modifications, if any,
from time to time thereafter made thereto, the "Credit Agreement"), among
Aladdin Gaming, LLC, a Nevada limited liability company (the "Borrower"), the
various lending institutions (individually a "Lender" and collectively the
"Lenders") as are, or may from time to time become, parties thereto and The Bank
of Nova Scotia ("Scotiabank") as the Administrative Agent for the Lenders,
Merrill Lynch Capital Corporation ("Merrill Lynch") as the Syndication Agent for
the Lenders, CIBC Oppenheimer Corp. as the Documentation Agent for the Lenders,
and Scotiabank and Merrill Lynch as Arrangers, the Lenders have extended
Commitments to make Loans to the Borrower and to issue Letters of Credit for the
account of the Borrower; and
WHEREAS, the proceeds from the issuance of the Discount Notes and
the Loans are to be advanced to the Borrower pursuant to the terms of that
certain Disbursement Agreement dated of even date herewith (together with all
amendments and other modifications, if any, from time to time thereafter made
thereto, the "Disbursement Agreement") among the Borrower, Holdings, Scotiabank,
as the Administrative Agent, the Discount Note Indenture Trustee and Scotiabank,
as the Disbursement Agent and the initial Securities Intermediary and U.S. Bank
National Association as the Servicing Agent; and
WHEREAS, as a condition precedent to the effectiveness of the Credit
Agreement, the Guarantors are required to execute and deliver a Guaranty of
Performance and Completion dated as of even date herewith (the "Completion
Guaranty") in favor of each of the
Administrative Agent and the Lenders and certain subsidiaries of London Clubs
(the "Subsidiary Guarantors") have agreed to guarantee fully and unconditionally
the payment of London Clubs' obligations under the Completion Guaranty pursuant
to a separate guaranty agreement of even date herewith (the "Subsidiary Bank
Guaranty"; together with the Completion Guaranty, collectively, the "Bank
Guaranty"); and
WHEREAS, as a condition precedent to the effectiveness of the
Indenture and the issuance of the Discount Notes, the Guarantors are required to
execute and deliver this Guaranty of Performance and Completion and the
Subsidiary Guarantors have agreed to guarantee fully and unconditionally the
payment of London Clubs' obligations under this Guaranty of Performance and
Completion pursuant to a separate guaranty agreement of even date herewith (the
"Subsidiary Guaranty"; together with this Guaranty of Performance and
Completion, this "Noteholder Completion Guaranty"); and
WHEREAS, the Guarantors have duly authorized the execution, delivery
and performance of this Guaranty of Performance and Completion and the
Subsidiary Guarantors have duly authorized the execution, delivery and
performance of the Subsidiary Guaranty; and
WHEREAS, it is in the best interests of the Guarantors to execute
this Guaranty of Performance and Completion and the Subsidiary Guarantors to
execute the Subsidiary Guaranty inasmuch as the Guarantors and the Subsidiary
Guarantors will derive substantial direct and indirect benefits from the
issuance of the Discount Notes.
NOW THEREFORE, for good and valuable consideration, the receipt of
which is hereby acknowledged, and in order to induce the Discount Note Indenture
Trustee to enter into the Indenture, the Guarantors agree, for the benefit of
the Discount Note Indenture Trustee (for the benefit of the Noteholders), as
follows:
1. Definitions. Capitalized terms not otherwise defined in this Noteholder
Completion Guaranty shall have the meanings set forth in Appendix A
hereto. As used herein, the following terms shall have the meanings set
forth below.
"Additional Amounts" is defined in Section 15(a)(iii).
"Approved Plans and Specifications" shall mean "Plans and Specifications."
"Bank Guaranty" is defined in the eighth recital.
"Bankruptcy Code" shall mean Title 11 of the United States Code as amended
from time to time.
"Consolidated Intangibles" means, at a particular date, all assets of a
Guarantor and its consolidated Subsidiaries, determined on a consolidated
basis, that would, in conformity
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with GAAP, as applicable, be classified as intangible assets, including,
without limitation, unamortized debt discount and expense, unamortized
organization and reorganization expense, costs in excess of the fair
market value of acquired companies, patents, trade or service marks,
franchises, trade names, goodwill and, from and after March 30, 1997, the
amount of all write-ups in the book value of assets resulting from any
revaluation thereof.
"Consolidated Tangible Assets" means, at a particular date, the amount
equal to (a) the amount which would be included as assets on the
consolidated balance sheet of a Guarantor and its consolidated
Subsidiaries as at such date in accordance with GAAP, minus (b)
Consolidated Intangibles.
"Construction Benchmark Schedule" means the schedule attached hereto as
Schedule 7.
"Credit Agreement" is defined in the sixth recital.
"Dormant Subsidiary" means any Subsidiary of a Guarantor which has no
operating assets or property and conducts no business.
"Enforcement Costs" means all reasonable out-of-pocket costs and expenses
of the Discount Note Indenture Trustee in connection with the enforcement
of the rights and remedies of the Discount Note Indenture Trustee under
this Noteholder Completion Guaranty and any amendment, waiver or consent
relating hereto including, without limitation, reasonable attorneys' fees
and costs and expenses, court costs and filing fees in addition to all
other amounts due hereunder whether or not such Enforcement Costs are
incurred in one or more proceedings.
"Funding Cessation" means any time that funds are unavailable to the
Borrower (from any source whatsoever) to fund draws under the Credit
Agreement in an amount equal to 75% of the draw request in question or the
Construction Consultant fails to deliver the On Schedule Certificate as
contemplated by the Construction Consultant Engagement Agreement and the
Disbursement Agreement.
"GAAP" means the generally accepted accounting principles as in effect
from time to time in the United Kingdom with respect to London Clubs and
in the United States with respect to the other Guarantors, as the case may
be.
"Guaranteed Obligations" means the obligations of the Guarantors under
Section 2.
"Guarantor" is defined in the preamble.
"Guaranty Deposit Account" is defined in Section 4(a).
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"Indenture" is defined in the first recital.
"Insolvency Proceeding" means any case or proceeding, voluntary or
involuntary, under the Bankruptcy Code, or any similar existing or future
law of any jurisdiction, foreign, state or federal, relating to
bankruptcy, insolvency, reorganization or relief of debtors.
"Leases" means, collectively, all agreements relating to the use,
occupancy and possession of space with respect to the Main Project entered
into by the Borrower and a tenant from time to time.
"Material" means material in relation to the business, operations,
affairs, financial condition, assets, properties, or prospects of a
Guarantor and its Subsidiaries taken as a whole.
"Material Subsidiary" means each of the Subsidiaries of London Clubs that
are party to that certain Subsidiary Guaranty dated as of June 30, 1997
guaranteeing the obligations of London Clubs under the Note Agreements.
Each Material Subsidiary of London Clubs as of the date hereof is listed
on Schedule 1 hereof.
"Minimum Aladdin Facilities" has the meaning ascribed to it in the
Indenture.
"Note Agreements" means the several identical Note Purchase Agreements
dated as of June 30, 1997 among London Clubs and the purchasers named
therein relating to London Clubs' $50,000,000 aggregate principal amount
of 7.74% Guaranteed Senior Notes due 2004 and as the same may be modified
by amendments that would not, in the aggregate, have the effect of making
London Clubs' obligations thereunder materially more onerous (it being
understood and agreed that any amendment, supplement or modification that
increases the amount of the obligations of London Clubs thereunder shall
be deemed material).
"Noteholder Completion Guaranty" is defined in the ninth recital
"Noteholders" means the holders of the Discount Notes.
"NRS" is defined in Section 4(a).
"Operating Deadline" means the date which is 28 months following the
Effective Date, provided, that if a Force Majeure Event occurs, the
Operating Deadline shall be extended for the amount of time such Force
Majeure Event exists but in no event shall the Operating Deadline be
extended past the date which is 40 months after the Effective Date.
"Release Date" is defined in Section 3(a)(ii).
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"Subsidiary Bank Guaranty" is defined in the eighth recital.
"Subsidiary Guarantors" is defined in the eighth recital.
"Subsidiary Guaranty" is defined in the ninth recital.
"Taxes" is defined in Section 15(a).
"Tax Refund" is defined in Section 15(c).
"Trigger Days" means
(i) an aggregate of 60 calendar days during any period in which
the Lenders have disbursed more than $1 and up to and
including $35.0 million of the Commitments to the Borrower;
(ii) an aggregate of 90 calendar days during any period in which
the Lenders have disbursed more than $35.0 million and up to
and including $70.0 million of the Commitments to the
Borrower;
(iii) an aggregate of 120 calendar days during any period in which
the Lenders have disbursed more than $70.0 million and up to
and including $110.0 million of the Commitments to the
Borrower; and
(iv) an aggregate of 180 calendar days during any period in which
the Lenders have disbursed more than $110.0 million of the
Commitments to the Borrower.
2. Guaranty of Completion and Performance. The Guarantors, jointly and
severally, absolutely, unconditionally and irrevocably, on the terms and
subject to the conditions set forth herein, covenant and guarantee to the
Discount Note Indenture Trustee (for the benefit of the Noteholders) and
covenants and agrees to make any and all payments to or on behalf of the
Borrower as may be necessary in order to permit and assure that:
(i) the Borrower shall (A) prosecute the Work and the construction
of the Main Project to Final Completion with due diligence and
continuity, in an expeditious and first-class workmanlike manner,
(B) cause the Work and the construction of the Main Project to be
performed and the Main Project to be constructed, equipped and
completed in compliance with the Plans and Specifications in all
material respects and in compliance in all material respects with
the provisions of the Reciprocal Easement Agreement, the Site Work
Agreement, all Environmental Laws and all Legal Requirements, and
(C) correct or cause to be corrected as soon as possible any
material defect in the Main Project and the
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Work (including, without limitation, any material defect in
workmanship or quality of construction or materials) or any material
departure or variation from the Final Plans and Specifications, the
requirements of the Reciprocal Easement Agreement and/or the Site
Work Agreement not made pursuant to Change Orders approved in
writing by the Construction Consultant and the Administrative Agent
in accordance with the Credit Agreement and the Disbursement
Agreement; and
(ii) the Borrower shall punctually pay, discharge and/or contribute,
as appropriate, (A) any and all costs, expenses and liabilities
incurred by the Borrower for or in connection with the Final
Completion of the Work and the Main Project, (B) all claims and
demands for labor, materials and services incurred by the Borrower
for or in connection with the Final Completion of the Work and the
Main Project which are or may become due and payable, or, if unpaid,
are or may become Liens on the portion of the Site or any portion
thereof owned by the Borrower, (C) all payments to be made for work
to be performed by the Borrower under Leases or under the Reciprocal
Easement Agreement or the Site Work Agreement for Tenant
Improvements, (D) Impositions and premiums for insurance prior to
the Final Completion of the Work, (E) all amounts which the Borrower
may be required to pay from time to time in order to keep the Main
Project Budget In Balance, and (F) all amounts needed to cause the
Work to be performed within the Construction Benchmark Schedule; and
(iii) the Borrower shall perform the Work and complete construction
of the required Minimum Aladdin Facilities on schedule and in
accordance with the Plans and Specifications Lien-free other than
Permitted Liens and the portion of the Site owned by the Borrower
shall be and remain free and clear of all Liens arising from the
furnishing of materials, labor or services for or in connection with
the performance of the Work and the Main Project; and
(iv) the Borrower shall provide the expertise necessary to supervise
performance of the Main Project and the Final Completion of Work at
no cost to the Discount Note Indenture Trustee; and
(v) in the event the Guarantors hereunder shall fail or refuse to
pay or perform the Guaranteed Obligations under this Noteholder
Completion Guaranty, the Discount Note Indenture Trustee (in
addition to any other rights and remedies afforded by applicable
law) may pay or perform or cause the payment and performance of the
Guaranteed Obligations on behalf of the Guarantors hereunder in
which case the Guarantors, upon demand by the Discount Note
Indenture Trustee, shall pay any and all costs, expenses and
liabilities for such costs and expenses in connection with the
performance of the Final Completion of the Main Project, or cause
any Lien in connection with the Final Completion thereof or any
claim or demand for the payment of the cost of the Final Completion
of the main Project to be bonded,
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discharged, released or paid, and shall reimburse the Discount Note
Indenture Trustee for all sums paid and all costs, expenses or
liabilities incurred by the Discount Note Indenture Trustee in
connection therewith; and
(vi) the Guarantors shall pay the Enforcement Costs.
3. Restrictions on Exercise of Rights and Remedies by the Discount Note
Indenture Trustee.
(a) Except as expressly set forth in this Section 3(a), the Guarantors
shall have no obligation to pay and/or perform any of the Guaranteed
Obligations and the Discount Note Indenture Trustee covenants and
agrees not to demand payment and/or performance of any of the
Guaranteed Obligations or exercise any rights, remedies or options
under this Noteholder Completion Guaranty or commence any
enforcement proceedings hereunder during any period that the Bank
Guaranty is in effect and the Guarantors have not been released in
writing by the Lenders; provided, however, the Discount Note
Indenture Trustee shall be permitted to demand payment and/or
performance of the Guaranteed Obligations and exercise all rights,
remedies and options and commence enforcement proceedings under this
Noteholder Completion Guaranty:
(i) at any time prior to the date on which any funds have been
advanced or disbursed to the Borrower pursuant to the Credit
Agreement and the Disbursement Agreement;
(ii) at any time prior to Completion and, from and after the date
(a "Release Date") on which all of the indebtedness evidenced
and secured by the Loan Documents has been indefeasibly paid
in full and the Lenders have released the Guarantors in
writing from their obligations under the Bank Guaranty;
(iii) at any time after the date on which all of the following
events have occurred and are continuing:
(A) an event of default under the Bank Guaranty has occurred
and is continuing and such event of default has remained
uncured for the number of applicable Trigger Days;
(B) a Funding Cessation has occurred and is continuing for
the aggregate number of applicable Trigger Days set
forth in the definition of Trigger Days; provided,
however, in no event shall aggregate Funding Cessations
exceed 180 days in the aggregate (which shall be
extended for the number of days during which a Force
Majeure Event and/or an Insolvency Proceeding of the
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Borrower which impairs the Lenders directly or
indirectly from enforcing the Bank Guaranty has occurred
and is continuing, which such extension shall terminate
upon the filing by the Lenders of any action against the
Guarantors under the Bank Guaranty to enforce the
obligations of the Guarantors thereunder which are
susceptible of performance notwithstanding such
Insolvency Proceeding) in any consecutive 365 day
period; and
(C) the Work which has been substantially completed in
accordance with the Plans and Specifications (as
certified by the Construction Consultant) on the date in
question has not progressed to the stage of completion
set forth for such date (subject to any extensions based
upon Force Majeure Events or an Insolvency Proceeding of
the Borrower which impairs the Lenders directly or
indirectly from enforcing the Bank Guaranty, which such
extension shall terminate upon the filing by the Lenders
of any action against the Guarantors under the Bank
Guaranty to enforce the obligations of the Guarantors
thereunder which are susceptible of performance
notwithstanding such Insolvency Proceeding) in the
Construction Benchmark Schedule.
(b) Notwithstanding anything to the contrary in this Noteholder
Completion Guaranty, performance in all material respects of the
obligations of the Guarantors under Section 2 of the Bank Guaranty
(as in effect on the date hereof, or as may be amended from time to
time so long as in connection with each such amendment the
Construction Consultant certifies to the Discount Note Indenture
Trustee that, after giving effect to such amendment, (i) the Minimum
Aladdin Facilities are still capable of being completed by the
Operating Deadline and (ii) the Guarantors have consented to such
amendment) shall be deemed to be performance of the Guaranteed
Obligations hereunder and performance in all material respects of
the Guaranteed Obligations of the Guarantors hereunder shall be
deemed to be performance of the corresponding obligations under the
Bank Guaranty.
(c) As a material inducement to the Lenders to consent to the delivery
of this Noteholder Completion Guaranty by the Guarantors, the
Discount Note Indenture Trustee covenants and agrees that (i) the
right of the Discount Note Indenture Trustee to demand payment
and/or performance of the Guaranteed Obligations, to exercise any
rights, remedies and options and/or to commence enforcement
proceedings under this Noteholder Completion Guaranty shall be
subject in all events to the delivery of a written notice to the
Administrative Agent no later than 10 Business Days prior to the
making of such demand for payment and/or performance, exercise of
rights, remedies and options, or commencement of
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enforcement proceedings, as applicable, (ii) the Lenders shall have
all rights at law and equity including, without limitation, the
right to seek an injunction or other extraordinary remedy to prevent
or prohibit the making of any demand for payment and/or performance,
exercise of rights, remedies and options, or commencement of
enforcement proceedings by the Discount Note Indenture Trustee which
is in contravention of Section 3(a), and (iii) this Noteholder
Completion Guaranty shall not be amended, modified, and/or amended
and restated without the prior written consent of the Administrative
Agent in its sole discretion provided that the consent of the
Administrative Agent shall not be required in connection with
corrective amendments required to be made to this Noteholder
Completion Guaranty as and when corresponding amendments are made to
the Bank Guaranty.
4. Payment Provisions. Subject to Nevada Gaming Laws (once the Borrower has
been licensed), all payments required to be made by the Guarantors
pursuant to Section 2 hereof shall be deemed to be capital contributions
to Holdings and shall be made subject to the following terms:
(a) The Guarantors shall make cash payments in the amounts required
under Section 2 hereof into an interest-bearing deposit account
designated and controlled exclusively by the Discount Note Indenture
Trustee (the "Guaranty Deposit Account") in which the Discount Note
Indenture Trustee is hereby granted a security interest. The
Guaranty Deposit Account is intended to be a "deposit account" for
the purposes of Nevada Revised Statutes ("NRS") 40.430.4(g) and
Section 9301(g) of the California Uniform Commercial Code. Such
funds shall be held in the Guaranty Deposit Account as collateral
for the Guaranteed Obligations of the Guarantors under this
Noteholder Completion Guaranty and shall be applied to payment of
the Guaranteed Obligations.
(b) The cash payments into the Guaranty Deposit Account and the funds
therein for the purpose of paying the Guaranteed Obligations under
this Noteholder Completion Guaranty shall be free and clear of any
third party claims thereto, including any claims by the Borrower as
a third party beneficiary under this Noteholder Completion Guaranty.
The Guarantors and the Discount Note Indenture Trustee specifically
agree that the Borrower is not an intended third party beneficiary
to this Noteholder Completion Guaranty and that neither the Borrower
nor any other Person which is not party to this Noteholder
Completion Guaranty (other than successors and assigns of the
Discount Note Indenture Trustee) shall have any rights under this
Noteholder Completion Guaranty.
5. Continuation of Guaranty. In the event that Holdings or its subsidiaries
are in default under the Indenture or the Noteholders have exercised their
acceleration rights thereunder, this Noteholder Completion Guaranty shall
remain in full force and effect.
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Subject to the provisions of Section 11 hereof, upon the indefeasible
payment and performance of the Guaranteed Obligations by the Guarantors,
this Noteholder Completion Guaranty shall terminate.
6. Proof of Damages. If the Guarantors shall at any time or from time to time
fail to perform or comply with any of the Guaranteed Obligations contained
herein, then in each such case (i) it shall be assumed conclusively
without necessity of proof that such failure by the Guarantors was the
sole and direct cause of the Discount Note Indenture Trustee failing to
receive such payment when due (to the extent of the failure of the
Guarantors to perform the Guaranteed Obligations contained herein)
irrespective of any other contributing or intervening cause whatsoever,
and (ii) the Guarantors further irrevocably waive to the fullest extent
permitted by law any right or defense the Guarantors may have to cause the
Discount Note Indenture Trustee to prove the cause or amount of such
damages or to mitigate the same.
7. Rights of the Discount Note Indenture Trustee. To the extent permitted by
the Nevada Gaming Laws, each Guarantor authorizes the Discount Note
Indenture Trustee in its sole discretion to perform any or all of the
following acts during such time as the Discount Note Indenture Trustee has
the right to demand payment and performance of the Guaranteed Obligations,
all without notice to the Guarantors (but with notice being given to the
Administrative Agent as required by Section 3(c) of this Noteholder
Completion Guaranty) and without affecting the payment and performance of
the Guaranteed Obligations by the Guarantors:
(a) From and after the time that the Discount Note Indenture Trustee is
permitted to demand payment or performance of the Guaranteed
Obligations under the Noteholder Completion Guaranty, the Discount
Note Indenture Trustee may take and hold security for the Guaranteed
Obligations and for the Note Issuer's obligations under the
Indenture and the Discount Notes, accept additional or substituted
security for any of the foregoing, and subordinate, exchange,
enforce, waive, release, compromise, fail to perfect and sell or
otherwise dispose of any such security.
(b) The Discount Note Indenture Trustee may direct the order and manner
of any sale of all or any part of any security now or later to be
held for this Noteholder Completion Guaranty and may also bid at any
such sale.
(c) The Discount Note Indenture Trustee may substitute, add or release
any one or more Guarantors or endorsers.
(d) The Discount Note Indenture Trustee may release the Note Issuers of
their liability for their obligations under the Indenture.
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(e) The Discount Note Indenture Trustee may extend other credit to the
Note Issuers, their Affiliates and any of the Guarantors or their
respective Affiliates and may take and hold security for the credit
so extended, all without affecting the Guarantors' liability under
this Noteholder Completion Guaranty.
(f) The Discount Note Indenture Trustee and the Noteholders may advance
additional funds to the Note Issuers, the Guarantors and their
respective Affiliates for any purpose.
8. Noteholder Completion Guaranty to be Absolute. The Guarantors expressly
agree that for as long as the obligations of the Guarantors under the Bank
Guaranty and the Guaranteed Obligations hereunder remain unperformed, the
Guarantors shall not be released from the Guaranteed Obligations hereunder
by or because of:
(a) Any act or event which might otherwise discharge, reduce, limit or
modify the Guaranteed Obligations;
(b) Any waiver, extension, modification, forbearance, delay or other act
or omission of the Discount Note Indenture Trustee, or any failure
to proceed promptly or otherwise as against the Note Issuers, any
Guarantor or any security; or
(c) Any action, omission or circumstance which might increase the
likelihood that the Guarantors may be called upon to perform under
this Noteholder Completion Guaranty or which might affect the rights
or remedies of the Guarantors as against the Note Issuers or any
Guarantor; or
(d) Any dealings occurring at any time between the Borrower, the Note
Issuers, the Lenders, the Discount Note Indenture Trustee, the
Noteholders or the Guarantors with respect to amendments to the Bank
Guaranty, the Credit Agreement, the other Loan Documents, the Loans,
the Indenture, the Discount Notes or otherwise, as the case may be.
The Guarantors hereby expressly waive and surrender any defense to their
liability under this Noteholder Completion Guaranty based upon any of the
foregoing acts, omissions, agreements, waivers or matters.
9. Guarantors' Waivers. The Guarantors waive:
(a) All statutes of limitations as a defense to any action or proceeding
brought against the Guarantors by the Discount Note Indenture
Trustee, to the fullest extent permitted by law;
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(b) Any right they may have to require the Discount Note Indenture
Trustee to proceed against the Note Issuers or to pursue any other
remedy in their power to pursue;
(c) Any defense based on any claim that the Guaranteed Obligations
exceed or are more burdensome than those of the Note Issuers under
the Indenture;
(d) Any defense based on: (i) any legal disability of the Note Issuers,
(ii) any discharge, modification, impairment or limitation of the
liability of the Note Issuers under the Indenture from any cause,
whether consented to by the Discount Note Indenture Trustee or
arising by operation of law or from any Insolvency Proceeding, (iii)
any rejection or disaffirmance of the Discount Notes or any security
held for the Discount Notes in any Insolvency Proceeding and (iv)
the Guarantors' rights under NRS 104.3605, the Guarantors
specifically agreeing that this clause (iv) shall constitute a
waiver of discharge under NRS 104.3605;
(e) Any defense based on any action taken or omitted (other than gross
negligence or willful misconduct) by the Discount Note Indenture
Trustee in any Insolvency Proceeding involving the Note Issuers,
including any election to have a claim allowed as being secured,
partially secured or unsecured, any extension of credit by the
Discount Note Indenture Trustee to the Note Issuers in any
Insolvency Proceeding, and the taking and holding by the Discount
Note Indenture Trustee of any security for any such extension of
credit;
(f) All presentments, demands for performance, notices of
nonperformance, protests, notices of protest, notices of dishonor,
notices of acceptance of this Noteholder Completion Guaranty and of
the existence, creation, or incurring of new or additional
indebtedness, and demands and notices of every kind;
(g) Any defense based on or arising out of any defense that the Note
Issuers may have to the payment or performance of their obligations
under the Indenture or any portion of such obligations; and
(h) Any defense or benefit based on NRS 40.430 and judicial decisions
relating thereto and NRS 40.451 et seq. and judicial decisions
relating thereto, the Guarantors agreeing that the waiver in this
clause (h) is intended to take advantage of the two (2) waivers
permitted by NRS 40.495 (1) and (2) to the maximum extent permitted.
10. Waivers of Subrogation and Other Rights.
(a) Upon the occurrence of any event of default hereunder, the Discount
Note Indenture Trustee in its sole discretion, without prior notice
to or consent of the
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Guarantors, may elect to: (i) foreclose either judicially or
nonjudicially against any real or personal property security, if
any, for the obligations under the Indenture, (ii) accept a transfer
of any such security in lieu of foreclosure, (iii) make any
accommodation with the Note Issuers or any Guarantor, or (iv)
exercise any other remedy against the Note Issuers or any Guarantor
or any security. No such action by the Discount Note Indenture
Trustee shall release or limit the liability of the Guarantors, who
shall remain liable under this Noteholder Completion Guaranty after
the action, even if the effect of the action is to deprive the
Guarantors of any subrogation rights, rights of indemnity, or other
rights to collect reimbursement for any sums paid to the Discount
Note Indenture Trustee, whether contractual or arising by operation
of law or otherwise. The Guarantors expressly waive any defenses or
benefits that may be derived from NRS Section 40.451, et seq. and
judicial decisions relating thereto, or comparable provisions of
Nevada law which are comparable to California Civil Procedure ss.ss.
580a, 580b, 580d, or 726 or comparable provisions of the laws of any
other jurisdiction, and all other suretyship defenses they otherwise
might or would have under Nevada law or other applicable law. The
Guarantors expressly agree that under no circumstances shall they be
deemed to have any right, title, interest or claim in or to any real
or personal property, if any, to be held by the Discount Note
Indenture Trustee or any third party after any foreclosure or
transfer in lieu of foreclosure of any security for the Guaranteed
Obligations or the obligations under the Indenture.
(b) Regardless of whether the Guarantors may have made any payments to
the Discount Note Indenture Trustee under this Noteholder Completion
Guaranty, the Guarantors hereby waive: (i) all rights of
subrogation, all rights of indemnity, and any other rights to
collect reimbursement from the Note Issuers for any sums paid to the
Discount Note Indenture Trustee, whether contractual or arising by
operation of law (including the Bankruptcy Code) or otherwise, (ii)
all rights to enforce any remedy that the Discount Note Indenture
Trustee may have against the Note Issuers or any other Person, and
(iii) all rights to participate in any security now or later to be
held by the Discount Note Indenture Trustee for the obligations
under the Indenture. The waivers given in this Section 10(b) shall
be effective until the obligations under the Indenture have been
indefeasibly paid and performed in full.
(c) The Guarantors understand and acknowledge that if the Discount Note
Indenture Trustee forecloses judicially or nonjudicially against any
real property or personal security, if any, for the Guaranteed
Obligations or the obligations under the Indenture, that foreclosure
could impair or destroy any ability that the Guarantors may have to
seek reimbursement, contribution or indemnification from the
Borrower or the Note Issuers or others based on any right the
Guarantors may have of subrogation, reimbursement, contribution or
indemnification for any
13
amounts paid by the Guarantors under this Noteholder Completion
Guaranty. The Guarantors further understand and acknowledge that in
the absence of this Section 10, such potential impairment or
destruction of the Guarantors' rights, if any, may entitle the
Guarantors to assert a defense to this Noteholder Completion
Guaranty. By executing this Noteholder Completion Guaranty, the
Guarantors freely, irrevocably and unconditionally: (i) waive and
relinquish that defense and agree that the Guarantors will be fully
liable under this Noteholder Completion Guaranty even though the
Discount Note Indenture Trustee may foreclose judicially or
nonjudicially against any real property security, if any, for the
obligations under the Indenture; (ii) agree that the Guarantors will
not assert that defense in any action or proceeding which the
Discount Note Indenture Trustee may commence to enforce this
Noteholder Completion Guaranty; and (iii) acknowledge and agree that
this waiver is a material part of the consideration which they are
receiving for entering into the transactions contemplated hereby.
11. Revival and Reinstatement. If the Discount Note Indenture Trustee is
required to pay, return or restore to any of the Guarantors any amounts
previously paid with respect to the Guaranteed Obligations because of any
Insolvency Proceeding of any of the Guarantors, any stop notice or any
other reason, the Guaranteed Obligations shall be reinstated and revived
and the rights of the Discount Note Indenture Trustee shall continue with
regard to such amounts, as though they had never been paid.
12. Representations and Warranties. Each Guarantor hereby represents and
warrants unto the Discount Note Indenture Trustee (for the benefit of the
Noteholders) as follows:
(a) The most recent audited consolidated balance sheet of London Clubs
and ABH and its respective consolidated Subsidiaries (in the case of
ABH, as of December 31, 1996 and in the case of London Clubs, as of
March 30, 1997) and the related consolidated statements of earnings
and stockholders' equity (or profit and loss in the case of London
Clubs) and of cash flows for the fiscal year ended on such date,
reported on by such Guarantor's independent public accountants,
copies of which have heretofore been furnished to the Discount Note
Indenture, are complete and correct and present fairly (or give a
true and fair view of in the case of London Clubs) the consolidated
financial condition of such Guarantor and its consolidated
Subsidiaries as at such date, and the results of their operations
(or consolidated profit and loss in the case of London Clubs) and
their consolidated cash flows for the fiscal year then ended. The
unaudited consolidated balance sheet of such Guarantor and its
consolidated Subsidiaries as at September 30, 1997 and the related
unaudited consolidated statements of earnings and of cash flows for
the nine-month period (or, in the case of London Clubs, six month
period) ended on such date, certified by a Authorized Representative
of such Guarantor, are complete and correct and present fairly (or
give a true and fair view of in the case of London Clubs) the
consolidated financial condition of such
14
Guarantor and its consolidated Subsidiaries as at such date, and the
consolidated results of their operations and their consolidated cash
flows for the nine-month period (or, in the case of London Clubs,
six-month period) then ended (subject to normal year-end audit
adjustments). All such financial statements, including the related
schedules and notes thereto, have been prepared in accordance with
GAAP or UK GAAP, as applicable, applied consistently throughout the
periods involved (except as approved by such accountants or
Authorized Representative, as the case may be, and as disclosed
therein).
(b) Since December 31, 1996, in the case of ABH and since March 30, 1997
in the case of the Trust, there has been no development or event
which has had or could reasonably be expected to have a Material
Adverse Effect.
(c) Each of such Guarantor and its Subsidiaries (a) is duly organized,
and, to the extent applicable, validly existing and in good standing
under the laws of the jurisdiction of its organization, (b) has the
corporate or other power and authority, and the legal right, to own
and operate its property, to lease the property it operates as
lessee and to conduct the business in which it is currently engaged,
(c) to the extent applicable, is duly qualified as a foreign
corporation or company or trust and in good standing, under the laws
of each jurisdiction where its owner ship, lease or operation of
property or the conduct of its business requires such qualification
and (d) by Opening Date, is in compliance with all material Legal
Requirements except where failure to comply with any of the
foregoing could not individually or in the aggregate reasonably be
expected to have a Material Adverse Effect.
(d) Each of such Guarantors has the corporate or other power and
authority, and the legal right, to make, deliver and perform this
Noteholder Completion Guaranty and to provide the undertakings
hereunder and has taken all necessary corporate or other action to
authorize the execution, delivery and performance of this Noteholder
Completion Guaranty. No consent or authorization of, filing with or
other act by or in respect of, any Governmental Instrumentality or
any other Person is required to be obtained or made, as the case may
be, by such Guarantor in connection with this Noteholder Completion
Guaranty or with the execution, delivery, performance, validity or
enforceability of this Noteholder Completion Guaranty by or against
such Guarantor, except as has been obtained and remains in full
force and effect on the date hereof, other than certain Nevada
Gaming Laws approvals, as applicable. This Noteholder Completion
Guaranty has been duly executed and delivered on behalf of such
Guarantor. This Noteholder Completion Guaranty constitutes a legal,
valid and binding obligation of such Guarantor enforceable against
it in accordance with its terms, except as enforceability may be
limited by applicable bankruptcy, insolvency, reorganization,
moratorium or similar laws affecting the enforcement of creditors'
rights generally and by
15
general equitable principles (whether enforcement is sought by
proceedings in equity or at law).
(e) Each Subsidiary Guarantor has the corporate power and authority, and
the legal right, to make, deliver and perform the Subsidiary
Guaranty and to provide the undertakings thereunder and has taken
all necessary corporate action to authorize the execution, delivery
and performance of the Subsidiary Guaranty. No consent or
authorization of, filing with or other act by or in respect of, any
Governmental Instrumentality or any other Person is required to be
obtained or made, as the case may be, by such Subsidiary Guarantor
in connection with the Subsidiary Guaranty or with the execution,
delivery, performance, validity or enforceability of the Subsidiary
Guaranty by or against such Subsidiary Guarantor, except as has been
obtained and remains in full force and effect on the date hereof,
other than certain Nevada Gaming Laws approvals, as applicable. The
Subsidiary Guaranty has been duly executed and delivered on behalf
of each Subsidiary Guarantor. The Subsidiary Guaranty constitutes a
legal, valid and binding obligation of each Subsidiary Guarantor
enforceable against it in accordance with its terms, except as
enforceability may be limited by applicable bankruptcy, insolvency,
reorganization, moratorium or similar laws affecting the enforcement
of creditors' rights generally and by general equitable principles
(whether enforcement is sought by proceedings in equity or at law).
(f) The execution, delivery and performance of this Noteholder
Completion Guaranty by the Guarantors and the execution, delivery
and performance by the Subsidiary Guarantors of the Subsidiary
Guaranty will not (i) violate any Legal Requirement or obligation of
such Guarantor or Subsidiary Guarantor, (ii) result in, or require,
the creation or imposition of any Lien on any of its properties or
revenues pursuant to any such Legal Requirement or obligation or
(iii) conflict with or result in a breach of any of the terms,
conditions or provisions of any order, judgment, decree or ruling of
any court, arbitrator or Governmental Instrumentality applicable to
such Guarantor or Subsidiary Guarantor.
(g) Schedule 2 contains (except as noted therein) complete and correct
lists of each of London Clubs' and ABH's Subsidiaries (other than
Dormant Subsidiaries), showing, as to each Subsidiary, the correct
name thereof, the jurisdiction of its organization, and the
percentage of shares of each class of its capital stock or similar
equity interests outstanding owned by such Guarantor and each other
Subsidiary of such Guarantor. All of the outstanding shares of
capital stock or similar equity interests of each Subsidiary shown
in Schedule 2 as being owned by such Guarantor and its Subsidiaries
have been validly issued, are fully paid and nonassessable and are
owned by such Guarantor or another Subsidiary free and clear of any
Lien (except as otherwise disclosed in Schedule 2). Each Subsidiary
identified in Schedule 2 is a corporation or other legal entity duly
organized,
16
validly existing and in good standing under the laws of its
jurisdiction of organization, and is duly qualified as a foreign
corporation or other legal entity and is in good standing in each
jurisdiction in which such qualification is required by law, other
than those jurisdictions as to which the failure to be so qualified
or in good standing could not, individually or in the aggregate,
reasonably be expected to have a Material Adverse Effect on the
business, assets, debt service capacity, property or financial
condition, operations or prospects of such Subsidiary. Each such
Subsidiary has the corporate or other power and authority to own or
hold under lease the properties it purports to own or hold under
lease and to transact the business it transacts and proposes to
transact. No Subsidiary identified in Schedule 2 is a party to, or
otherwise subject to any legal restriction or any agreement (other
than this Noteholder Completion Guaranty, the agreements listed on
Schedule 2, restrictions imposed by and approvals required under the
Nevada gaming Laws and customary limitations imposed by corporate
law statutes) restricting the ability of such Subsidiary to pay
dividends out of profits or make any other similar distributions of
profits to its Guarantor parent or any of such Guarantor's
Subsidiaries that owns outstanding shares of capital stock or
similar equity interests of such Subsidiary.
(h) Except as disclosed in Schedule 3, there are no actions, suits or
proceedings pending or, to the knowledge of any Guarantor,
threatened against or affecting such Guarantor or any Subsidiary or
any property of such Guarantor or any Subsidiary in any court or
before any arbitrator of any kind or before or by any Governmental
Instrumentality that, individually or in the aggregate, could
reasonably be expected to have a Material Adverse Effect. Neither
any Guarantor nor any Subsidiary is in default under any term of any
agreement or instrument to which it is a party or by which it is
bound, or any order, judgment, decree or ruling of any court,
arbitrator or Governmental Instrumentality or is in violation of any
applicable law, ordinance, rule or regulation (including without
limitation Environmental Laws) of any Governmental Instrumentality,
which default or violation, individually or in the aggregate, could
reasonably be expected to have a Material Adverse Effect.
(i) Except as disclosed in Schedule 3A, each Guarantor and its
Subsidiaries have filed all material tax returns that are required
to have been filed in any jurisdiction, and have paid all material
taxes shown to be due and payable on such returns and all other
material taxes and assessments levied upon them or their properties,
assets, income or franchises, to the extent such taxes and
assessments have become due and payable and before they have become
delinquent, except for any taxes and assessments (i) the non-payment
of which could not reasonably be expected to have a Material Adverse
Effect or (ii) the amount, applicability or validity of which is
currently being contested in good faith by appropriate proceedings
and with respect to which such Guarantor or a Subsidiary, as the
case
17
may be, has established adequate reserves in accordance with GAAP.
Each Guarantor knows of no basis for any other tax or assessment
that could reasonably be expected to have a Material Adverse Effect.
The charges, accruals and reserves on the books of each Guarantor
and its Subsidiaries in respect of governmental or other taxes for
all fiscal periods are adequate.
(j) Each Guarantor and its Subsidiaries have adequate and appropriate
insurance with respect to their respective properties and businesses
against such casualties and contingencies, of such types, on such
terms and in such amounts (including deductibles, co-insurance and
self-insurance) to the extent this is customary in the case of
entities of established reputations engaged in the same or a similar
business and similarly situated, except where the failure to so
maintain insurance, individually or in the aggregate, could not
reasonably be expected to have a Material Adverse Effect.
(k) Each of London Clubs, ABH and its Subsidiaries have good and
sufficient title to their respective properties that individually or
in the aggregate are Material, including all such properties
reflected in the most recent audited balance sheet referred to in
clause (a) hereof or purported to have been acquired by such
Guarantor or any Subsidiary after said date (except as sold or
otherwise disposed of in the ordinary course of business), in each
case free and clear of Liens prohibited by this Noteholder
Completion Guaranty. All leases that individually or in the
aggregate are material are valid and subsisting and are in full
force and effect in all material respects.
(l) Except as disclosed in Schedule 4,
(i) each Guarantor and its Subsidiaries own or possess all
licenses, permits, franchises, authorizations, patents,
copyrights, service marks, trademarks and trade names, or
rights thereto, that individually or in the aggregate are
material, without known conflict with the rights of others;
(ii) to the best knowledge of each Guarantor, no product or such
Guarantor infringes in any material respect on any license,
permit, franchise, authorization, patent, copyright, service
mark, trademark, trade name or other right owned by any other
Person; and
(iii) to the best knowledge of each Guarantor, there is no material
violation by any Person of any right of such Guarantor or any
of its Subsidiaries with respect to any patent, copyright,
service mark, trademark, trade name or other right owned or
used by such Guarantor or any of its Subsidiaries.
18
(m) Except as described therein, Schedule 5 sets forth a complete and
correct list of all outstanding Indebtedness of each of London Clubs
and ABH and its Subsidiaries as of September 30, 1997, since which
date there has been no material changes in the amounts, interest
rates, sinking funds, installment payments or maturities of the
Indebtedness of such Guarantor or its Subsidiaries. Neither any such
Guarantor nor any Subsidiary is in default and no waiver of default
is currently in effect, in the payment of any principal or interest
on any Indebtedness of such Guarantor or such Subsidiary and no
event or condition exists with respect to any Indebtedness of any
such Guarantor or any Subsidiary in an aggregate principal amount in
excess of $1,500,000 that would permit (or that with notice or the
lapse of time, or both, would permit) one or more Persons to cause
such Indebtedness to become due and payable before its stated
maturity or before its regularly scheduled dates of payment. Except
as disclosed in Schedule 5, neither any such Guarantor nor any
Subsidiary has agreed or consented to cause or permit in the future
(upon the happening of a contingency or otherwise) any of its
property, whether now owned or hereafter acquired, to be subject to
a Lien not permitted by Section 14(a), as applicable.
(n) Neither any Guarantor nor any Subsidiary is subject to regulation
under the Investment Company Act of 1940, as amended, the Public
Utility Holding Company Act of 1935, as amended, or the Federal
Power Act, as amended.
(o) Neither any Guarantor nor any Subsidiary has knowledge of any claim
or has received any notice of any claim, and no proceeding has been
instituted raising any claim against such Guarantor or any of its
Subsidiaries or any of their respective real properties now or
formerly owned, leased or operated by any of them or other assets,
alleging any damage to the environment or violation of any
Environmental Laws, except, in each case, such as could not
reasonably be expected to result in a Material Adverse Effect.
(p) Each Guarantor's ownership interest in the Borrower as of the date
hereof is set forth on Schedule 6.
(q) London Clubs has delivered to the Administrative Agent true, correct
and complete copies of all material documents, instruments, opinions
and certificates with respect to the Existing Senior Debt.
13. Affirmative Covenants. Until all of the Guaranteed Obligations have been
indefeasibly paid and performed, each Guarantor (other than London Clubs)
agrees as follows:
(a) (i) ABH shall furnish to the Discount Note Indenture Trustee:
19
(A) as soon as available, but in any event within 120 days
after the end of each fiscal year of ABH, a copy of the
consolidated and consolidating balance sheet of ABH and
its consolidated Subsidiaries as at the end of such year
and the related consolidated and consolidating
statements of earnings and stockholders' equity and of
cash flows for such year, setting forth in each case in
comparative form the figures for the previous year,
reported on without a "going concern" or like
qualification or exception, or qualification arising out
of the scope of the audit, by independent certified
public accountants of nationally recognized standing;
and
(B) as soon as available, but in any event not later than 60
days after the end of each of the first three quarterly
periods of each fiscal year of ABH, (x) the unaudited
consolidated and consolidating balance sheet of ABH and
its consolidated Subsidiaries as at the end of such
quarter and in comparative form the figures for the end
of the previous fiscal year, (y) the unaudited
consolidated and consolidating statement of earnings of
ABH and its consolidated Subsidiaries for such quarter
and the portion of the fiscal year through the end of
such quarter, and in comparative form the figures for
the previous year and (z) the consolidated and
consolidating statement of cash flows of ABH and its
consolidated Subsidiaries for the portion of the fiscal
year through the end of such quarter, and in comparative
form the figures for the previous year, certified by an
Authorized Representative of ABH as being fairly stated
in all material respects when considered in relation to
the consolidated and consolidating financial statements
of ABH and its consolidated Subsidiaries (subject to
normal year-end audit adjustments);
all such financial statements to be complete and correct in
all material respects and to be prepared in reasonable detail
and in accordance with GAAP applied consistently throughout
the periods reflected therein and with prior periods (except
as approved by such accountants or officer, as the case may
be, and disclosed therein).
(ii) The Trust shall furnish the Discount Note Indenture Trustee all
financial information that the Trust is providing to any other
creditor in connection with the Main Project, the Mall Project,
and/or the Music Project.
(b) Each Guarantor shall furnish to the Discount Note Indenture Trustee,
within thirty days after the same are sent, copies of all financial
statements and reports which such Guarantor sends to its
stockholders, and, within thirty days after the same are
20
filed, copies of all financial statements and reports which such
Guarantor may make to, or file with, the Securities and Exchange
Commission or any successor or analogous Governmental
Instrumentality. Each Guarantor shall furnish to the Discount Note
Indenture Trustee with reasonable promptness such additional
financial and other information as the Discount Note Indenture
Trustee may from time to time reasonably request.
(c) ABH shall keep true and correct books of records and account in
conformity with GAAP and all Legal Requirements and permit the
Discount Note Indenture Trustee:
(i) No Event of Default - if no event of default under this
Noteholder Completion Guaranty or the Bank Guaranty then
exists, at the expense of the Discount Note Indenture Trustee
and upon reasonable prior notice to such Guarantor, to visit
the principal executive office of such Guarantor and to
discuss the affairs, finances and accounts of such Guarantor
and its Subsidiaries with such Guarantor's officers, all at
such reasonable times and as often as may be reasonably
requested in writing; and
(ii) Event of Default - if an event of default under this
Noteholder Completion Guaranty or the Bank Guaranty then
exists, at the expense of such Guarantor to visit and inspect
any of the offices of properties of such Guarantor or any
Subsidiary, to examine their respective books and records and
to make copies and extracts therefrom, and to discuss their
respective affairs, finances and accounts with their
respective officers and independent public accountants, all at
such reasonable times and as often as may be requested.
A Guarantor shall not be under any obligation under this Noteholder
Completion Guaranty to provide information pursuant to the last
sentence of Section 13(b) or pursuant to this Section 13(c) if
disclosure of such information, on the written advice of such
Guarantor's counsel provided to such Guarantor, would be prohibited
by law or by decree of any Governmental Instrumentality or arbitral
body or by the terms of any obligation of confidentiality contained
in any agreement binding upon such Guarantor and not entered into in
contemplation of this Section 13(c).
(d) ABH shall promptly give notice to the Discount Note Indenture
Trustee of:
(i) any breach by ABH of any of the Guaranteed Obligations;
(ii) any (a) default or event of default under any material
obligation of ABH or any of its Subsidiaries or (b)
litigation, investigation or proceeding which
21
may exist at any time between ABH or any of its Subsidiaries
and any Governmental Instrumentality, which in either case, if
not cured or if adversely determined, as the case may be,
could reasonably be expected to have a Material Adverse
Effect;
(iii) any material litigation or proceeding affecting ABH or any of
its Subsidiaries; and
(iv) any development or other event which could reasonably be
expected to have a Material Adverse Effect.
Each notice pursuant to this clause (d) shall be accompanied by a
statement of an Authorized Representative of ABH setting forth
details of the occurrence referred to therein and stating what
action ABH or any of its Subsidiaries proposes to take with respect
thereto.
(e) ABH will cause each of its Subsidiaries to comply with all laws,
ordinances or governmental rules or regulations to which each of
them is subject, including, without limitation, Environmental Laws,
and will obtain and maintain in effect all licenses, certificates,
permits, franchises and other governmental authorizations necessary
to the ownership of their respective properties or to the conduct of
their respective businesses, in each case to the extent necessary to
ensure that non-compliance with such laws, ordinances or
governmental rules or regulations or failures to obtain or maintain
in effect such licenses, certificates, permits, franchises and other
governmental authorizations could not, individually or in the
aggregate, reasonably be expected to have a Material Adverse Effect.
(f) Each Guarantor will and will cause each of its Subsidiaries to
maintain, with institutions it reasonably believes to be financially
sound insurers, insurance with respect to their respective
properties and businesses against such casualties and contingencies,
of such types, on such terms and in such amounts (including
deductibles, co-insurance and self-insurance if adequate reserves
are maintained with respect thereto) as is customary in the case of
entities of established reputations engaged in the same or similar
business and similarly situated.
(g) Each Guarantor will and will cause each of its Subsidiaries to
maintain and keep, or cause to be maintained and kept, their
respective properties in reasonably good repair, working order and
condition (other than ordinary wear and tear), so that the business
carried on in connection therewith may be properly conducted at all
times, provided that this Section shall not prevent a Guarantor from
discontinuing the operation and maintenance of or the liquidation of
any Dormant Subsidiary and shall not prevent a Guarantor or any
Subsidiary from discontinuing the operation and the maintenance of
any of its properties if such discontinuance is
22
desirable in the conduct of its business and such Guarantor has
concluded that such discontinuance could not, individually or in the
aggregate, reasonably be expected to have a Material Adverse Effect.
(h) Each Guarantor will and will cause each of its Subsidiaries to file
all material tax returns required to be filed in any jurisdiction
and to pay and discharge all material taxes, assessments,
governmental charges, or levies shown to be due and payable on such
returns and all other taxes imposed on them or any of their
properties, assets, income or franchises, to the extent such taxes
and assessments have become due and payable and before they have
become delinquent and all claims for which sums have become due and
payable that have or might become a Lien on properties or assets of
such Guarantor or any Subsidiary, provided that neither a Guarantor
nor any Subsidiary need to pay any such tax or assessment or claims
if (i) the amount, applicability or validity thereof is contested by
such Guarantor or such Subsidiary on a timely basis in good faith in
appropriate proceedings and such Guarantor or a Subsidiary has
established adequate reserves therefor in accordance with GAAP on
the books of such Guarantor or such Subsidiary or (ii) the
nonpayment of all such taxes and assessments in the aggregate could
not reasonably be expected to have a Material Adverse Effect.
(i) Each Guarantor will at all times preserve and keep in full force and
effect its corporate or other existence. ABH will at all times
preserve and keep in full force and effect the corporate existence
of each of its Subsidiaries (other than Dormant Subsidiaries or
unless merged into ABH or a Subsidiary) and all licenses, consents,
certificates and authorizations of ABH and its Subsidiaries unless,
in the good-faith judgment of ABH, the termination of or failure to
preserve and keep in full force and effect such corporate existence,
licenses, consents, certificates and authorizations could not,
individually or in the aggregate, have a Material Adverse Effect.
(j) Each Guarantor will, and will cause each of its Subsidiaries to,
keep proper books of record and account in accordance with GAAP as
applied in the jurisdiction of its incorporation as such Guarantor
may deem appropriate from time to time.
(k) Neither ABH nor any of its Subsidiaries will engage in any business
if, as a result, the general nature of the business, taken on a
consolidated basis, which would then be engaged in by ABH and its
Subsidiaries would be materially changed from the general nature of
the business engaged in by ABH and its Subsidiaries as of the date
hereof.
14. Negative Covenants. At all times prior to indefeasible payment and
performance of the Guaranteed Obligations by the Guarantors hereunder:
23
(a) ABH will not, and will not permit any of its Subsidiaries to,
directly or indirectly create, incur, assume or permit to exist
(upon the happening of a contingency or otherwise) any Lien on or
with respect to any property or asset except:
(i) any Lien arising by operation of law (except for real property
taxes) which secures amounts not more than 45 days overdue or,
if so overdue, are being contested on a timely basis in good
faith and in appropriate proceedings;
(ii) any Lien imposed on ABH or any of its Subsidiaries in relation
to its purchase of goods, products or supplies in the ordinary
course of business;
(iii) any rights of set-off in the normal course of trading or of
any bank or financial institution or combination of accounts
arising in favor of such bank or financial institution as a
result of the day-to-day operation of banking arrangements,
including, without limitation, rights of set-off granted to
such bank or financial institution in respect of the issuance
of letters of credit, or as a result of any currency or
interest rate hedging operations carried out in the ordinary
course of business, in each case, provided that there is no
agreement to confer a security interest;
(iv) statutory Liens of landlords, Liens over goods or documents of
title arising in the ordinary course of documentary credit
transactions and Liens of carriers, warehousemen, mechanics,
materialmen and other similar Liens, in each case, incurred in
the ordinary course of business;
(v) Liens for taxes, assessments or other governmental charges
which are not yet due and payable;
(vi) Liens incurred or deposits made in the ordinary course of
business (A) in connection with workers' compensation,
unemployment insurance and other types of social security or
retirement benefits, or (B) to secure (or to obtain letters of
credit that secure) the performance of tenders, statutory
obligations, surety bonds, appeal bonds, bids, leases (other
than capital leases), performance bonds, purchase,
construction or sales contracts and other similar obligations,
in each case not incurred or made in connection with the
borrowing of money, the obtaining of advances or credit or the
payment of the deferred purchase price of property;
(vii) leases or subleases granted to others, easements,
rights-of-way, restrictions and other similar charges or
encumbrances, in each case incidental to, and not interfering
with, the ordinary conduct of business of ABH and its
24
Subsidiaries, provided that such Liens do not, in the
aggregate, materially detract from the value of such property;
(viii) any Lien not otherwise permitted by clauses (i) through (vii)
above, provided that on the date any Indebtedness secured by
any such Lien, is created, incurred, assumed or guaranteed by
ABH or any of its Subsidiaries, and immediately after giving
effect thereto and to the concurrent retirement of any other
Indebtedness, the sum of (A) the aggregate principal amount of
all Indebtedness secured by Liens pursuant to this clause
(viii) plus (B) all unsecured Indebtedness of ABH and its
Subsidiaries that is senior in any respect in right of payment to the
obligations of ABH hereunder, does not exceed 25% of the Consolidated Tangible
Assets of ABH as of such date; and
(ix) any Lien set forth on Schedule 3, in the case ABH.
(b) ABH will not, and will not permit any of its Subsidiaries to,
directly or indirectly create, incur, assume or suffer to exist any
secured or unsecured Indebtedness that is senior in any respect in
right of payment to the Guaranteed Obligations of ABH hereunder
(excluding any Indebtedness secured by Liens pursuant to clauses (i)
through (vii) of Section 14(a) hereof but including any Indebtedness
secured by Liens pursuant to clause (viii) of Section 14(a) hereof)
if the aggregate amount of all such senior Indebtedness described in
this clause (b) would exceed 25% of the Consolidated Tangible Assets
of ABH as of such date.
15. Payments Free and Clear of Taxes, etc. Each Guarantor hereby agrees that:
(a) All payments by such Guarantor hereunder 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 the Discount Note Indenture Trustee's net
income or receipts (such non-excluded items being called "Taxes").
In the event that any withholding or deduction from any payment to
be made by a Guarantor hereunder is required in respect of any Taxes
pursuant to any applicable law, rule or regulation, then such
Guarantor will
(i) pay directly to the relevant authority the full amount
required to be so withheld or deducted;
(ii) promptly forward to the Discount Note Indenture Trustee an
official receipt or other documentation satisfactory to the
Discount Note Indenture Trustee evidencing such payment to
such authority; and
25
(iii) pay to the Discount Note Indenture Trustee such additional
amount or amounts ("Additional Amounts") as are necessary to
ensure that the net amount actually received will equal the
full amount that would have been received had no such
withholding or deduction been required.
Moreover, if any Taxes are directly asserted against the Borrower or
the Discount Note Indenture Trustee with respect to any payment
received hereunder, the Discount Note Indenture Trustee may pay such
Taxes and the Guarantor will promptly pay such Additional Amounts
(including any penalties, interest or expenses ) as are necessary in
order that the net amount received after the payment of such Taxes
(including any Taxes on such Additional Amounts) shall equal the
amount that would have been received had no such Taxes been
asserted.
(b) If the Guarantor fails to pay any Taxes when due to the appropriate
taxing authority or fails to remit to the Discount Note Indenture
Trustee the required receipts or other required documentary
evidence, the Guarantor shall indemnify the Borrower, the Discount
Note Indenture Trustee for any incremental Taxes, interest or
penalties that may become payable by the Borrower, the Discount Note
Indenture Trustee as a result of any such failure.
(c) In the event that an Additional Amount is paid by a Guarantor for
the account of the Discount Note Indenture Trustee and the Discount
Note Indenture Trustee is entitled to a refund of the Tax (a "Tax
Refund") to which such payment is attributable, then the Discount
Note Indenture Trustee shall take all reasonable steps which are
necessary to obtain such Tax Refund, including filings such forms,
certificates, documents, applications or returns as may be required
to obtain such Tax Refund. If the Discount Note Indenture Trustee
subsequently receives such a Tax Refund, then the Discount Note
Indenture Trustee shall reimburse such amount.
(d) Without prejudice to the survival of any other agreement of the
Guarantors hereunder, the agreements and obligations of the
Guarantors contained in this Section 15 shall survive the payment in
full of the obligations under the Indenture.
16. Judgment. Each Guarantor hereby agrees that:
(a) If, for the purposes of obtaining judgment in any court, it is
necessary to convert a sum due hereunder in United States Dollars
into another currency, such Guarantor agrees, to the fullest extent
permitted by law, that the rate of exchange used shall be that at
which in accordance with normal banking procedures the Discount Note
Indenture Trustee could purchase United States Dollars with such
other currency on the Business Day preceding that on which final
judgment is given.
26
(b) The obligation of each Guarantor in respect of any sum due from it
hereunder shall, notwithstanding any judgment in a currency other
than United States Dollars, be discharged only to the extent that on
the Business Day following receipt by the Discount Note Indenture
Trustee of any sum adjudged to be so due in such other currency the
Discount Note Indenture Trustee may, in accordance with normal
banking procedures, purchase United States Dollars with such other
currency; in the event that the United States Dollars so purchased
are less that the sum originally due to the Discount Note Indenture
Trustee in United States Dollars, the Guarantor, as a separate
obligation and notwithstanding any such judgment, shall indemnify
and hold harmless the Discount Note Indenture Trustee and such
holder against such loss, and if the United States Dollars so
purchased exceed the sum originally due to the Discount Note
Indenture Trustee in United States Dollars, the Discount Note
Indenture Trustee shall remit to such Guarantor such excess.
17. Breaches by Any Guarantor. If, at any time that the Discount Note
Indenture Trustee has the right to demand payment and performance of the
Guaranteed Obligations in accordance with Section 3(a) of this Noteholder
Completion Guaranty and, prior to the indefeasible payment and performance
thereof, any of the Guarantors breaches the Guaranteed Obligations (after
the expiration of applicable grace, notice and/or cure periods), then, at
the option of the Discount Note Indenture Trustee, an event of default
shall exist under this Noteholder Completion Guaranty and the Discount
Note Indenture Trustee, without any further notice to any of the
Guarantors or any other Person, shall be entitled to exercise all rights
and remedies available hereunder but only to the extent permitted under
Section 3(a) hereof, and at law and equity.
18. Miscellaneous Provisions.
(a) This Noteholder Completion Guaranty shall be binding upon the
Guarantors and their permitted successors, transferees and assigns
and shall inure to the benefit of and be enforceable by the Discount
Note Indenture Trustee and its respective successors, transferees
and assigns; provided, however, that the Guarantors may not assign
any of their Guaranteed Obligations hereunder without the prior
written consent of the Discount Note Indenture Trustee, and the
Discount Note Indenture Trustee may not assign this Noteholder
Completion Guaranty or any of its rights, remedies or options
hereunder without the prior written consent of the Administrative
Agent in its sole discretion. The Lenders shall be third party
beneficiaries of this Section 18(a) and shall have all rights at law
and equity to the enforcement hereof.
(b) No amendment to or waiver of any provision of this Noteholder
Completion Guaranty, nor consent to any departure by any Guarantor
herefrom, shall in any event be effective unless the same shall be
in writing and signed by the Discount
27
Note Indenture Trustee and, with respect to amendments, consented to
by the Administrative Agent in its sole discretion, and then such
waiver or consent shall be effective only in the specific instance
and for the specific purpose for which given.
(c) All notices and other communications hereunder to the Guarantors
shall be in writing (including telefacsimile) and mailed or
telecopied or delivered to them, addressed to them at the address
set forth below their signatures hereto or at such other addresses
as shall be designated by such Guarantor in a written notice to the
Discount Note Indenture Trustee at the address set forth below their
signatures hereto complying as to delivery with the terms of this
Section. All such notices and other communications shall, when
mailed or telecopied, respectively, be effective when deposited in
the mails or transmitted, addressed as aforesaid. All notices to the
Administrative Agent under this Noteholder Completion Guaranty shall
be addressed to The Bank of Nova Scotia, 580 California Street, San
Francisco, California 94104, Attn.: Alan Pendergast, Facsimile No.
(415) 397-0791 with a copy to Mayer, Brown & Platt, 1675 Broadway,
New York, NY 10019, Attn: Douglas Wisner, Esq., Facsimile No. (212)
262-1910. A copy of all notices to ABH and the Trust shall be sent
to Skadden, Arps, Slate, Meagher & Flom LLP, 919 Third Avenue, New
York, New York 10022, Attn.: Wallace L. Schwartz, Esq., Facsimile
No. (212) 735-2000. A copy of all notices to London Clubs shall be
sent to Ohrenstein & Brown, LLP, 230 Park Avenue, New York, New York
10169, Attn.: Peter J. Kiernan, Esq., Facsimile No. (212) 557-0910
and to Lionel, Sawyer & Collins, 300 South 4th Street, Suite 1700,
Las Vegas, Nevada 89101, Attn.: Greg Giordano, Esq., Facsimile No.
(702) 383-8845.
(d) No failure on the part of the Discount Note Indenture Trustee to
exercise, and no delay in exercising, any right hereunder shall
operate as a waiver thereof; nor shall any single or partial
exercise of any right hereunder preclude any other or further
exercise thereof or the exercise of any other right. The remedies
herein provided are cumulative and not exclusive of any remedies
provided by law.
(e) Section captions used in this Noteholder Completion Guaranty are for
convenience of reference only, and shall not affect the
construction of this Noteholder Completion Guaranty.
(f) Wherever possible each provision of this Noteholder Completion
Guaranty shall be interpreted in such manner as to be effective and
valid under applicable law, but if any provision of this Noteholder
Completion Guaranty shall be prohibited by or invalid under such
law, such provision shall be ineffective to the extent of such
prohibition or invalidity, without invalidating the remainder of
such provision or the remaining provisions of this Noteholder
Completion Guaranty.
28
(g) THIS NOTEHOLDER COMPLETION GUARANTY SHALL BE GOVERNED BY AND
CONSTRUED IN ACCORDANCE WITH THE INTERNAL LAWS OF THE STATE OF NEW
YORK. THIS NOTEHOLDER COMPLETION GUARANTY AND THE INDENTURE
CONSTITUTE THE ENTIRE UNDERSTANDING AMONG THE PARTIES HERETO WITH
RESPECT TO THE SUBJECT MATTER HEREOF.
(h) ANY LITIGATION BASED HEREON, OR ARISING OUT OF, UNDER, OR IN
CONNECTION WITH, THIS NOTEHOLDER COMPLETION GUARANTY, OR ANY COURSE
OF CONDUCT, COURSE OF DEALING, STATEMENTS (WHETHER ORAL OR WRITTEN)
OR ACTIONS OF THE DISCOUNT NOTE INDENTURE TRUSTEE OR THE GUARANTORS
SHALL BE BROUGHT AND MAINTAINED EXCLUSIVELY IN THE COURTS OF THE
STATE OF NEW YORK IN THE CITY 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 PROPERTY MAY
BE BROUGHT, AT THE OPTION OF THE DISCOUNT NOTE INDENTURE TRUSTEE, IN
THE COURTS OF ANY JURISDICTION WHERE SUCH PROPERTY, IF ANY, MAY BE
FOUND. THE GUARANTORS HEREBY EXPRESSLY AND IRREVOCABLY SUBMIT TO THE
JURISDICTION OF THE COURTS OF THE STATE OF NEW YORK IN THE CITY 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 AGREE TO BE BOUND BY ANY JUDGMENT
RENDERED THEREBY IN CONNECTION WITH SUCH LITIGATION. THE GUARANTORS
FURTHER IRREVOCABLY CONSENT TO THE SERVICE OF PROCESS BY REGISTERED
MAIL, POSTAGE PREPAID, OR BY PERSONAL SERVICE WITHIN OR WITH OUT THE
STATE OF NEW YORK. THE GUARANTORS HEREBY EXPRESSLY AND IRREVOCABLY
WAIVE, TO THE FULLEST EXTENT PERMITTED BY LAW, ANY OBJECTION WHICH
THEY 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 GUARANTORS HAVE 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
29
RESPECT TO THEMSELVES OR THEIR PROPERTY, THE GUARANTORS HEREBY
IRREVOCABLY WAIVE SUCH IMMUNITY IN RESPECT OF THE GUARANTEED
OBLIGATIONS UNDER THIS NOTEHOLDER COMPLETION GUARANTY AND THE
INDENTURE.
(i) THE GUARANTORS HEREBY KNOWINGLY, VOLUNTARILY AND INTENTIONALLY WAIVE
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 NOTEHOLDER COMPLETION GUARANTY, OR ANY COURSE OF CONDUCT,
COURSE OF DEALING, STATEMENTS (WHETHER ORAL OR WRITTEN) OR ACTIONS
OF THE DISCOUNT NOTE INDENTURE TRUSTEE OR THE GUARANTORS. THE
GUARANTORS ACKNOWLEDGE AND AGREE THAT THEY HAVE RECEIVED FULL AND
SUFFICIENT CONSIDERATION FOR THIS PROVISION AND THAT THIS PROVISION
IS A MATERIAL INDUCEMENT FOR THE DISCOUNT NOTE INDENTURE TRUSTEE TO
ENTER INTO THE INDENTURE.
(j) Limitation on Liability. Notwithstanding anything to the contrary in
this Noteholder Completion Guaranty, it is understood that no claim
shall be made by the Discount Note Indenture Trustee or any of its
affiliates against the Guarantors or any of their affiliates,
directors, employees, attorneys or agents for any special, indirect,
consequential or punitive damages in respect of any breach or
wrongful conduct (whether or not the claim therefor is based on
contract, tort or duty imposed by law), in connection with, arising
out of or in any way related to the transactions contemplated by
this Noteholder Completion Guarantee or any act or omission or event
occurring in connection therewith.
(k) No Restriction on Rights and Remedies of Administrative Agent and
Lenders. Notwithstanding anything to the contrary in this Noteholder
Completion Guaranty, the Discount Note Indenture Trustee on its own
behalf and on behalf of the Noteholders covenants and agrees that
this Noteholder Completion Guaranty and the rights, remedies and
options of the Discount Note Indenture Trustee hereunder in no way
restrict the rights and remedies of the Administrative Agent and the
Lenders under the Credit Agreement and the other Loan Documents
including, without limitation, the right to commence and prosecute
to completion enforcement of any or all of the Loan Documents. The
Discount Note Indenture Trustee on its own behalf and on behalf of
the Noteholders agrees that no Person shall have any right
whatsoever to interpose a right of offset, defense, claim or
counterclaim with respect to any enforcement of one or more of the
Loan Documents based upon a claim that the Discount Note Indenture
Trustee has the right to performance of the Guaranteed Obligations
before such enforcement can
30
be commenced or prosecuted or judgment thereon can be executed by or
on behalf of the Lenders. The Lenders shall be third party
beneficiaries of this Section 18(k) and shall have all rights at law
and equity to the enforcement hereof.
31
IN WITNESS WHEREOF, the Guarantors have caused this Noteholder Completion
Guaranty to be duly executed and delivered by their officers thereunto duly
authorized as of the date first above written.
ALADDIN BAZAAR HOLDINGS, LLC
By: ALADDIN MANAGEMENT CORPORATION
By: /s/ Jack Sommer
--------------------------------------
Title:
Address: 280 Park Avenue
New York, N.Y. 10017
Attention: Ron Dictrow
Telecopy: 212-661-0844
THE TRUST UNDER ARTICLE SIXTH UNDER THE
WILL OF SIGMUND SOMMER
By: /s/ Viola Sommer
--------------------------------------
Viola Sommer
Title: Trustee
By: /s/ Eugene Landsberg
--------------------------------------
Eugene Landsberg
Title: Trustee
Address: 280 Park Avenue
New York, N.Y. 10017
Attention: Ron Dictrow
Telecopy: 212-661-0844
LONDON CLUBS INTERNATIONAL PLC
By: /s/ G. Barry Hardy
--------------------------------------
G. Barry Hardy
Title: Director
Address: 10 Brick Street
London WI Y 8HQ
England
Attention: Linda M. Lillis
Telecopy: 011-44-171-493-6981
STATE STREET BANK & TRUST COMPANY
AS TRUSTEE
By: /s/ Ruth A. Smith
--------------------------------------
Title: Vice President
Address: Two International Place
Boston, M. A. 02110
Attention: Corporate Trust Department
Telecopy: 617-664-5371
SCHEDULE 1
MATERIAL SUBSIDIARIES
34
SCHEDULE 2
SUBSIDIARIES
(other than Dormant Subsidiaries)
35
SCHEDULE 3
LITIGATION
36
SCHEDULE 4
LICENSES, PERMITS, ETC.
37
SCHEDULE 5
EXISTING INDEBTEDNESS
38
SCHEDULE 6
OWNERSHIP OF BORROWER
39
SCHEDULE 7
CONSTRUCTION BENCHMARK SCHEDULE
40
APPENDIX A
To Guaranty of Performance and Completion
DEFINITIONS
Defined Terms. The following terms (whether or not italicized) when used in the
Guaranty of Performance and Completion, 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.
"Additional Contract Certificate" means an Additional Contract Certificate
substantially in the form of Exhibit Y to the Credit Agreement.
"Administrative Agent" is defined in the preamble of the Credit Agreement
and includes each other Person as shall have subsequently been appointed as the
successor Administrative Agent pursuant to Section 9.4 of the Credit Agreement.
"Affected Lender" is defined in clause(a) of Section 4.11 of the Credit
Agreement.
"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
(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 of the Credit
Agreement.
"Agent" means the Administrative Agent, the Syndication Agent and/or the
Documentation Agent, as the context may require.
A-1
"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 of the Credit Agreement, as originally in effect on the Closing
Date, in substantially the form of Exhibit E-2 to the Credit Agreement 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.
"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 of the Credit Agreement, as originally in effect on the Closing
Date, in substantially the form of Exhibit E-3 to the Credit Agreement and as
thereafter from time to time amended, supplemented, amended and restated or
otherwise modified.
"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
A-2
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:
Applicable Base Rate
Total Debt to EBITDA Ratio Margin
- ----------------------------------------- ----------------------
>= 4.0:1 1.75%
>= 3.5:1 and < 4.0:1 1.50%
>= 3.0:1 and < 3.5:1 1.00%
>= 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:
Applicable LIBO Rate
Total Debt to EBITDA Ratio Margin
- ----------------------------------------- ----------------------
>= 4.0:1 2.75%
>= 3.5:1 and < 4.0:1 2.50%
>= 3.0:1 and < 3.5:1 2.00%
>= 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.
A-3
"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 to the Credit Agreement.
"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 of the Credit Agreement.
"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.
A-4
"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 of the Credit Agreement.
"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 of the Credit Agreement.
"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 of the Credit Agreement.
"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 of the Credit Agreement.
"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.
"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 under the Credit Agreement
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
A-5
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 of the Credit Agreement.
"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 of the Credit Agreement.
"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 of the Credit Agreement, as originally in effect
on the Closing Date, in substantially the form of Exhibit E-1 to the Credit
Agreement and as thereafter from time to time amended, supplemented, amended and
restated or otherwise modified.
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"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 to the Credit Agreement.
"Borrower's Completion Certificate" means a certificate in the form of
Exhibit S-1 to the Credit Agreement.
"Borrower's Final Completion Certificate" means a certificate in the form
of Exhibit U-1 to the Credit Agreement.
"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 of the Credit Agreement.
"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 to the Credit Agreement.
"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
(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.
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"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 of the Credit
Agreement.
"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 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.
"Casino" is defined in clause (a) of the fourth recital of the Credit
Agreement.
"CERCLA" is defined in clause (a) of the definition of "Environmental
Law".
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"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 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
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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 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;
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(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;
(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 of the Credit Agreement.
A-11
"Clark County Code" is defined in clause (b) of Section 7.1.19 of the
Credit Agreement.
"Closing" is defined in Section 5.1 of the Credit Agreement.
"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 of
the Credit Agreement 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 under the Credit Agreement.
"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
(a) the occurrence of any Event of Default described in clauses (a)
through (e) of Section 8.1.10 of the Credit Agreement; 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 of the Credit
Agreement 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 of the
Credit Agreement.
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"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 the Credit 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 to the Credit Agreement, respectively.
"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 to the
Credit Agreement and as thereafter from time to time amended, supplemented,
amended and restated or otherwise modified.
"Complex" is defined in the fourth recital of the Credit Agreement and is
more fully described in Exhibit N-2 to the Credit Agreement.
A-13
"Compliance Certificate" means a certificate duly completed and executed
by an Authorized Representative of the Borrower substantially in the form of
Exhibit R to the Credit Agreement, 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 in the Credit Agreement.
"Consent" means a consent, substantially in the form of Exhibit I to the
Credit Agreement, 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 in substantially the form of Exhibit X-1 to the Credit Agreement (as
amended from time to time in accordance with the terms of the Credit Agreement)
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.
"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 the Credit 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 Closing Certificate" means a closing
certificate in the form of Exhibit Q-2 to the Credit Agreement.
"Construction Consultant's Completion Certificate" means a certificate in
the form of Exhibit S-2 to the Credit Agreement.
A-14
"Construction Consultant's Final Completion Certificate" means a
certificate in the form of Exhibit U-2 to the Credit Agreement.
"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.
"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.
A-15
"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 to the Credit Agreement.
"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 to the Credit Agreement.
"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:
(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 of
A-16
the Credit Agreement. 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 of the Credit Agreement. 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 of the Credit
Agreement (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 to
the Credit Agreement, 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.
"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 of the
Credit Agreement.
"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 of the
Credit Agreement.
"Design/Build Contract Time" is defined in Section 14.1 of the
Design/Build Contract.
"Design/Builder" means Fluor Daniel, Inc., a California corporation.
A-17
"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 of the Credit Agreement.
"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.
"Disclosure Schedule" means the Disclosure Schedule attached to the Credit
Agreement as Schedule I, 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 13 1/2% Series A and B Senior Discount Notes due
2010 of Holdings and Capital issued on the Closing Date for gross proceeds of
$115,000,000.
"Discount Note Indenture" means, on any date, the Indenture relating to
the Discount Notes, as originally in effect on the Effective Date, among
Holdings, Capital and the Discount Note Indenture Trustee and as thereafter from
time to time amended, supplemented, amended and restated or otherwise modified
in accordance with the terms of the Credit Agreement.
"Discount Note Indenture Trustee" means State Street Bank and Trust
Company, in its capacity as the indenture trustee for the Discount Noteholders
under the Discount Note Indenture.
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"Discount Note Offering Circular" means the offering memorandum, dated
February 14, 1998, with respect to the units, consisting of the Discount Notes
offered by Holdings and Capital and the Warrants offered by Enterprises.
"Discount Note Purchase Agreement" means the Purchase Agreement with
respect to the Discount Notes and Warrants, dated as of February 18, 1998, among
Holdings, Capital, Enterprises, AHL, the Trust and Merrill Lynch and First
Boston (as representatives of the several initial purchasers).
"Discount Noteholder" means the duly registered holder of a Discount Note.
"Documentation Agent" is defined in the preamble of the Credit Agreement.
"Dollar" and the symbol "$" mean lawful money of the United States.
"Downgraded Lender" is defined in clause (b) of Section 4.11 of the Credit
Agreement.
"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
(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 of the Credit Agreement, subject to the terms of the
Credit Agreement;
plus
(iii) depreciation of assets of the Borrower;
plus
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(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 of the Credit
Agreement 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 the Credit Agreement becomes effective
pursuant to Section 10.8 thereof.
"Employment Agreement" means, collectively, (u) the Amended Employment and
Consulting Agreement among Holdings, the Borrower and Richard J. Goeglein
effective January 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 of the
Credit Agreement.
"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.
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"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 to the Credit Agreement.
"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 Project Provider and as thereafter from time to time amended,
supplemented, amended and restated or otherwise modified in accordance with the
terms of the Credit Agreement.
"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 of the
Credit Agreement.
"Energy Project Guarantor" means Unicom Corporation, an Illinois
corporation.
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"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 of the Credit
Agreement.
"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 of the Credit Agreement.
"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 of the Credit Agreement, as originally in effect
on the Closing Date, in substantially the form of Exhibit E-4 to the Credit
Agreement 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 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 to the Credit Agreement and as thereafter
from time to time amended, supplemented, amended and restated or otherwise
modified.
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"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.);
(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);
A-23
(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:
(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
A-24
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 to the Credit Agreement.
"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.
"Event of Default" is defined in Section 8.1 of the Credit Agreement.
"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
A-25
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 of the
Credit Agreement 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 of
the Credit Agreement, 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 of the Credit Agreement;
plus
(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-26
(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 of the Credit
Agreement.
"FF&E Lessor" is defined in the definition of "FF&E Lease".
"FF&E Reserve" is defined in Section 7.1.3 of the Credit Agreement.
"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
A-27
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 of the Credit Agreement.
"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 to the Credit Agreement.
"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 (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 of the Credit Agreement.
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"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 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 of the Credit Agreement.
"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
A-29
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.
"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 the Credit 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
A-30
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.
"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 of the Credit Agreement.
"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 of the Credit Agreement, as originally in effect on
the Closing Date, in substantially the form of Exhibit E-5 to the Credit
Agreement and as thereafter from time to time amended, supplemented, amended and
restated or otherwise modified.
A-31
"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 of the Credit
Agreement.
"Hotel/Casino" is defined in clause (a) of the fourth recital of the
Credit Agreement.
"Hotel/Casino Component" means the portion of the Complex described in
Exhibit N-8 to the Credit Agreement.
"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 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 of the Credit Agreement.
"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
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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 the Credit 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.
"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;
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(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 of the Credit
Agreement.
"Indemnified Party" is defined in Section 10.4 of the Credit Agreement.
"Independent Consultant" means the Construction Consultant, the Insurance
Consultant, the Environmental Consultant or their successors engaged pursuant to
the Credit 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 of the Credit Agreement.
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"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.
"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 of the Credit Agreement 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 of the Credit Agreement; provided, however, that
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(a) the Borrower shall not be permitted to select Interest Periods
to be in effect at any one time which have expiration dates,
(a) in the case of Term A Loans made or maintained as
LIBO Rate Loans, occurring on more than eight different dates,
(b) in the case of Term B Loans made or maintained as
LIBO Rate Loans, occurring on more than four different dates, and
(c) 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,
(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
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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 of the Credit Agreement.
"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 to the Credit Agreement.
"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 under the Credit Agreement.
"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 to the Credit Agreement 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.
"Land Equity" is defined in clause (a) of the fifth recital of the Credit
Agreement.
"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 of the Credit Agreement, as originally in effect on the Closing
Date, in substantially the form of Exhibit E-6 to the Credit Agreement 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).
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"Lender" is defined in the preamble of the Credit Agreement and, in
addition, shall include any commercial bank or other financial institution that
becomes a Lender pursuant to Section 10.11.1 of the Credit Agreement.
"Lender Assignment Agreement" means a lender assignment agreement
substantially in the form of Exhibit H to the Credit Agreement.
"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 of the Credit Agreement 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
of the Credit Agreement, 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:
(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 of the Credit Agreement;
(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.
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"Lender's Tax" is defined in Section 4.6 of the Credit Agreement.
"Letter of Credit" is defined in Section 2.1.2 of the Credit Agreement.
"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 of the
Credit Agreement 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 of the Credit Agreement.
"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 of the Credit Agreement.
"Letter of Credit Disbursement" is defined in Section 2.6.2 of the Credit
Agreement.
"Letter of Credit Disbursement Date" is defined in Section 2.6.2 of the
Credit Agreement.
"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 to the Credit Agreement.
"Letter of Credit Outstandings" means, on any date, an amount equal to the
sum of
(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 of
the Credit Agreement.
"Letter of Credit Stated Expiry Date" is defined in Section 2.6 of the
Credit Agreement.
"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.
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"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 = LIBO Rate
(Reserve Adjusted) --------------------------------
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 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;
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(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;
(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, the Credit 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 the Credit Agreement and
such other agreements, whether or not specifically mentioned herein or therein.
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"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 of the
Credit Agreement.
"Loss Proceeds" is defined in Section 7.1.20 of the Credit Agreement.
"Loss Proceeds Account" is defined in the Borrower Collateral Account
Agreement.
"Main Project" is defined in clause (a) of the fourth recital of the
Credit Agreement.
"Main Project Budget" means a budget in substantially the form of Exhibit
X-2 to the Credit Agreement (as amended from time to time in accordance with
Section 7.2.18 of the Credit Agreement) 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.
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"Main Project Budget/Schedule Amendment Certificate" means a Main Project
Budget/Schedule Amendment Certificate substantially in the form of Exhibit X-3
to the Credit Agreement.
"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 the Credit 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 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 of the Credit Agreement) 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;
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(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 of the
Credit Agreement 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 to the Credit Agreement.
"Main Project Parcel" means the portion of the Site described on Exhibit
N-3 to the Credit Agreement together with the Main Project Easements.
"Main Project Punchlist Completion Certificate" means the Main Project
Punchlist Completion Certificate substantially in the form of Exhibit V to the
Credit Agreement.
"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.
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"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 of the
Credit Agreement.
"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 to the
Credit Agreement 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 of the Credit Agreement.
"Mall Project Parcel" means the portion of the Site described on Exhibit
N-4 to the Credit Agreement, together with the Mall Project Easements.
"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 of the
Credit Agreement.
"Mandatory Prepayment" is defined in clause (c) of Section 3.1.1 of the
Credit Agreement.
"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 the
Credit 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,
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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 any other material agreement, certificate, document or Instrument
delivered in connection with or by the Borrower and any other Person 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 of the Credit Agreement.
"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");
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 of the Credit Agreement after
giving effect to any reductions in such scheduled principal
repayments attributable to any optional or
A-46
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 of the Credit
Agreement, 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 of the Credit Agreement 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
of the Credit Agreement;
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 of
the Credit Agreement.
"Music Project" is defined in clause (c) of the fourth recital of the
Credit Agreement.
"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.
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"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 of the Credit Agreement.
"Music Project Parcel" means the portion of the Site described on Exhibit
N-5 to the Credit Agreement, 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 of the
Credit Agreement.
"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".
"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
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from time to time amended, supplemented, amended and restated or otherwise
modified in accordance with the terms of the Credit Agreement.
"NRS" means Nevada Revised Statutes.
"Obligations" means (x) all loans, advances, debts, liabilities and
obligations, howsoever arising, owed by the Borrower under the Credit 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 under the Credit
Agreement 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 the Credit 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 to
the Credit Agreement.
"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
A-49
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, 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
A-50
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 of the Credit Agreement.
"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 to the Credit Agreement 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 of the Credit
Agreement. 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%).
"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 the Credit Agreement and the other Operative
Documents.
A-51
"Permitted Encumbrance" means any encumbrance against all or a portion of
the Site as set forth in Exhibit BB to the Credit Agreement.
"Permitted Exception" means any exception to title to all or a portion of
the Site as set forth in Exhibit CC to the Credit Agreement.
"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;
(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;
A-52
(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 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;
A-53
(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 of the Credit Agreement 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.
"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.
"Plan" means any Pension Plan or Welfare Plan.
A-54
"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 to the Credit
Agreement, as the same may be (x) finalized in a manner that reflects a natural
evolution of their status on the date of the Credit Agreement and in a manner
consistent with the standards set forth in Section 7.2.17 of the Credit
Agreement and (y) amended in accordance with Section 7.2.17 of the Credit
Agreement.
"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 to the Credit Agreement.
"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 of the Credit Agreement.
"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 of the
Credit Agreement.
"Project Party" means the Borrower, AHL, Sommer Enterprises, Capital,
Holdings, London Clubs, LCNI, the Design/Builder or Fluor.
"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 the Credit Agreement under which the counterparty to such
agreement is (or, at the time such Rate
A-55
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
(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;
A-56
in each case, which is documented by the Borrower in a Realized Savings
Certificate substantially in the form of Exhibit W to the Credit Agreement, 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 of the Credit Agreement.
"Register" is defined in clause (b) of Section 2.8 of the Credit
Agreement.
"Registered Note" is defined in Section 2.8 of the Credit Agreement, in
the form of Exhibit A-4 to the Credit Agreement (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 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 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 of the Credit Agreement.
"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
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$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 of the
Credit Agreement.
"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 of the Credit
Agreement.
"Scheduled Amortization" is defined in clause (b) of Section 3.1.1 of the
Credit Agreement.
"Scope Change" means any change in the "Services" or "Work".
"Scotiabank" is defined in the preamble of the Credit Agreement.
"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.
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"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.
"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 of the Credit Agreement, as originally in effect on the Closing
Date, in substantially the form of Exhibit F to the Credit Agreement 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 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 of the Credit Agreement.
"Shoulder Space" means the property and space described in Exhibit N-6 to
the Credit Agreement.
"Site" is defined in the fourth recital of the Credit Agreement and is
more fully described in Exhibit N-1 to the Credit Agreement.
"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 of the Credit Agreement.
"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 to the Credit Agreement.
"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
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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 of the Credit Agreement, as
originally in effect on the Closing Date, in substantially the form of Exhibit
E-7 to the Credit Agreement 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
(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.
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"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 of the Credit Agreement.
"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.
"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.
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"Term A Loan" is defined in Section 2.1.1 of the Credit Agreement.
"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
of the Credit Agreement. 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 to the Credit Agreement or in a
Lender Assignment Agreement.
"Term A Loan Commitment Fee" is defined in Section 3.3.1 of the Credit
Agreement.
"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 to the Credit Agreement
(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.
"Term B and Term C Loan Commitment Fee" is defined in Section 3.3.1 of the
Credit Agreement.
"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.
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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 of the Credit
Agreement.
"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 of the Credit Agreement. 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 to the Credit Agreement 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 to the Credit Agreement
(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 of the Credit
Agreement.
"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 of the Credit Agreement. The Term C Loan Commitment shall not
exceed $160,000,000.
"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 to the Credit Agreement 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 to the Credit Agreement
(as such promissory note may thereafter from time to time be amended,
supplemented, amended and restated, endorsed or
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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 of the Credit
Agreement.
"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 of the Credit Agreement.
"Theater Renovation Completion" means that each of the following has
occurred:
(a) the renovation of the Theater has been completed substantially
in accordance with the Credit 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
to the Credit Agreement.
"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.
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"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 to the Credit Agreement.
"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 of the Credit Agreement, 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.
"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
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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 of the Credit
Agreement.
"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.
"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.
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