EXHIBIT 10.02
FIRST AMENDMENT TO
GUARANTY OF PERFORMANCE AND COMPLETION
Dated as of April 5, 1999
(amending the Guaranty of Performance and Completion
dated as of
February 26, 1998)
by
LONDON CLUBS INTERNATIONAL, PLC,
THE TRUST UNDER ARTICLE SIXTH UNDER
THE WILL OF
SIGMUND SOMMER
and
ALADDIN BAZAAR HOLDINGS, LLC
as the Guarantors,
and
THE BANK OF NOVA SCOTIA,
as the Administrative Agent for various financial institutions
as the Lenders,
FIRST AMENDMENT TO COMPLETION GUARANTY
THIS FIRST AMENDMENT TO COMPLETION GUARANTY (this "FIRST AMENDMENT TO
COMPLETION GUARANTY") dated as of April 5, 1999, effective as of March 10, 1999,
by and among LONDON CLUBS INTERNATIONAL, PLC, a company registered in England
and Wales under company number 2862479 ("LCI"), THE TRUST UNDER ARTICLE SIXTH
UNDER THE WILL OF SIGMUND SOMMER (the "TRUST") and ALADDIN BAZAAR HOLDINGS, LLC,
a Nevada limited-liability company ("ABH"; ABH, the Trust and LCI are
individually called a "COMPLETION GUARANTOR" and collectively called the
"COMPLETION GUARANTORS") and THE BANK OF NOVA SCOTIA, as administrative agent
(together with any successor thereto in such capacity, the "ADMINISTRATIVE
AGENT") for the various financial institutions as are or may become parties
hereto (individually, a "LENDER" and collectively, the "LENDERS").
In consideration of the mutual agreements herein contained and other good
and valuable consideration, receipt of which is hereby acknowledged, the parties
hereto, intending to be legally bound, agree as follows:
W I T N E S S E T H:
WHEREAS, pursuant to a Credit Agreement, dated as of February 26, 1998
(together with that certain First Amendment to Credit Agreement (the "FIRST
AMENDMENT TO CREDIT AGREEMENT") dated as of January 29, 1999 and that certain
Second Amendment to Credit Agreement (the "SECOND AMENDMENT TO CREDIT
AGREEMENT") dated as of even date herewith and all other amendments and other
modifications from time to time hereafter made thereto, the "CREDIT AGREEMENT"),
among Aladdin Gaming, LLC, a Nevada limited-liability company (the "BORROWER"),
the Lenders and the Administrative Agent, Merrill Lynch Capital Corporation as
the syndication agent (together with any successor thereto in such capacity, the
"SYNDICATION AGENT") and CIBC Oppenheimer Corp. as the documentation agent
(together with any successor thereto in such capacity, the "DOCUMENTATION
AGENT"), the Lenders have extended Commitments to make Loans to the Borrower and
to issue Letters of Credit for the account of the Borrower; and
WHEREAS, the Borrower has requested the Lenders to enter into the Second
Amendment to Credit Agreement; and
WHEREAS, the Guarantors executed and delivered a Guaranty of Performance
and Completion (the "COMPLETION GUARANTY") in favor of the Lenders and the
Administrative Agent dated as of February 26, 1998 pursuant to which the
Guarantors agreed, INTER ALIA, to perform the
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"GUARANTEED OBLIGATIONS" (as such term is defined in the Completion Guaranty;
each capitalized term not otherwise defined herein shall have the meaning
ascribed to such term in the Completion Guaranty) and certain subsidiaries of
LCI (the "SUBSIDIARY GUARANTORS") have agreed to fully and unconditionally
guarantee the payment of LCI's obligations under the Completion Guaranty
pursuant to a guaranty agreement dated February 26, 1998 (the "LCI SUBSIDIARY
GUARANTY"); and
WHEREAS, the Borrower has requested the Guarantors to enter into certain
amendments to the Completion Guaranty; and
WHEREAS, the Guarantors have duly authorized the execution, delivery and
performance of this First Amendment to Completion Guaranty and the Subsidiary
Guarantors have duly authorized the execution, delivery and performance of a
ratification, reaffirmation and consent agreement (the "RATIFICATION OF LCI
SUBSIDIARY GUARANTY") with respect to the Subsidiary Guaranty, an executed
counterpart of which is annexed hereto (the LCI Subsidiary Guaranty, together
with the Ratification of LCI Subsidiary Guaranty and all other amendments and
other modifications from time to time hereafter made thereto, the "SUBSIDIARY
GUARANTY"); and
WHEREAS, it is in the best interests of the Guarantors to execute this
First Amendment to Completion Guaranty and the Subsidiary Guarantors to execute
the Ratification of LCI Subsidiary Guaranty inasmuch as the Guarantors and the
Subsidiary Guarantors have and will continue to derive substantial direct and
indirect benefits from the Loans made to the Borrower by the Lenders pursuant to
the Credit Agreement and the Letters of Credit issued for the account of the
Borrower under the Credit Agreement; and
WHEREAS, each of the parties hereto is willing, on the terms and subject to
the conditions hereinafter set forth, to so amend the Completion Guaranty upon
the terms and conditions set forth below.
NOW, THEREFORE, in consideration of the agreements contained herein, the
parties hereto agree as follows:
ARTICLE I
LETTERS OF CREDIT
SECTION 1.1. LETTERS OF CREDIT. On or about November 30, 1998, the
Guarantors delivered letters of credit to the Administrative Agent in the
aggregate amount of $6,574,000 in order to bring the Main Project Budget In
Balance. The Guarantors hereby direct the Administrative Agent to draw such
letters of credit and deposit the proceeds thereof into the
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Guaranty Deposit Account for disbursement in accordance with the Disbursement
Agreement. The Guarantors agree that such demand or draw under the letter of
credit delivered by each of them shall be based upon the first certification
or statement contained in each such letter of credit.
SECTION 1.2. RESERVATION OF RIGHTS. The Guarantors agree that neither
this First Amendment to Completion Guaranty nor the making of any Advance by the
Disbursement Agent and the Administrative Agent's consent thereto shall
constitute (w) an approval of all or any portion of any Advance Request, (x) a
waiver or forbearance by the Disbursement Agent or the Administrative Agent
under any of the Loan Documents, except as expressly set forth in the Second
Amendment to Credit Agreement, (y) the acceptance by the Disbursement Agent or
the Administrative Agent of any course of conduct by the Borrower or either of
the Guarantors or (z) an agreement by the Administrative Agent to amend any of
the Loan Documents without the required approval from the Required Lenders and a
corresponding amendment of the Facilities Agreement. The Guarantors further
agree that the Administrative Agent and the Disbursement Agent reserve all
rights, remedies and options under the Loan Documents to require the Borrower
and, if applicable, the Guarantors to satisfy in all respects the conditions
relating to each Advance and perform all of its obligations under the Loan
Documents which are then due and owing or are susceptible of performance, as the
case may be.
ARTICLE II
AMENDMENT
SECTION 2.1. AMENDMENT. The parties hereto hereby agree that provided
each of the Guarantors have delivered an opinion of counsel which conforms to
the requirements of CLAUSE (H) of SECTION 3.1 and expressly provides, in
relevant part, that no approval is required under the "GECC FACILITIES
AGREEMENT" (as defined in the Second Amendment to Credit Agreement), the "GECC
INTERCREDITOR AGREEMENT" (as defined in the Second Amendment to Credit
Agreement) for the amendment set forth below, ITEM (F) of CLAUSE (II) of SECTION
2 of the Completion Guaranty shall be amended in its entirety to read as set
forth below:
"(F) the obligation of the Borrower to keep the Bank Credit Facility
In Balance and to perform its covenants in SECTION 7.2.23 of the
Credit Agreement (which was added thereto by CLAUSE (J) of SECTION 3.1
of the Second Amendment to Credit Agreement)"
ARTICLE III
CONDITIONS PRECEDENT AND COVENANT
SECTION 3.1. CONDITIONS TO EFFECTIVENESS. This First Amendment to
Completion
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Guaranty shall be and become effective as of March 10, 1999 (the "EFFECTIVE
DATE") on the date (the "FIRST AMENDMENT DATE") on which each of the
following conditions precedent shall have been satisfied.
(a) EXECUTION OF DOCUMENTS. The Administrative Agent shall have
received counterparts of (i) this First Amendment to Completion Guaranty
executed by Authorized Representative of the parties hereto, (ii) the
Ratification of LCI Subsidiary Guaranty executed by the Authorized
Representatives of the Subsidiary Guarantors and LCI, (iii) the Second
Amendment to Credit Agreement executed by Authorized Representatives of the
Borrower, the Administrative Agent, the Syndication Agent, the
Documentation Agent and the Required Lenders together with all documents
required thereby, (iv) the Excess Contribution Agreement executed by
Authorized Representatives of London Clubs and the Trust and (v) all
documentation required by SECTION 2.1 of the First Amendment to Credit
Agreement.
(b) INCUMBENCY, ETC. The Administrative Agent shall have received
(with copies for each Lender) a certificate, dated the First Amendment
Date, of an Authorized Representative of each Guarantor certifying
(i) as to the incumbency and signatures of the Person or Persons
authorized to execute and deliver this First Amendment to Completion
Guaranty and any instruments or agreements required hereunder,
(ii) as to an attached copy of one or more resolutions or other
authorizations of the Guarantors certified by the Authorized
Representative of each such Guarantor as being in full force and
effect on the date hereof, authorizing the execution, delivery and
performance of this First Amendment to Completion Guaranty and any
instruments or agreements required hereunder, and
(iii) that the Organizational Documents of such Guarantor have
not been modified since the date on which they were last delivered to
the Administrative Agent,
upon which certificate the Administrative Agent, the Syndication Agent, the
Documentation Agent and each Consenting Lender (collectively, the
"FINANCING PARTIES") may conclusively rely until it shall have received a
further certificate of an Authorized Representative of such Completion
Guarantor canceling or amending such prior certificate.
(c) FEES. All reasonable fees and costs and expenses of Mayer, Brown
& Platt and other professionals employed by the Administrative Agent and
all other reasonable expenses of the Administrative Agent in connection
with the negotiation,
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execution and delivery of this First Amendment to Completion Guaranty and
the transactions contemplated herein shall have been paid in full.
(d) SATISFACTORY LEGAL FORM. Each Financing Party and its counsel
shall have received all information, approvals, opinions, documents or
instruments as each Financing Party or its counsel may have reasonably
requested, and all documents executed or submitted pursuant hereto by or on
behalf of the Borrower shall be satisfactory in form and substance to each
Financing Party and its counsel.
(e) DEFAULT. After giving effect to this First Amendment to
Completion Guaranty the following statements shall be true and correct: (i)
to the best knowledge of each Guarantor, no act or condition exists which,
with the giving of notice or passage of time would constitute a "DEFAULT"
or "EVENT OF DEFAULT" (as defined in the Credit Agreement, the GECC
Facilities Agreement and the Facilities Agreement) has occurred and is
continuing as of the date hereof (other than a Default which may result
from the delivery of financial statements containing an Impermissible
Qualification), and (ii) no material adverse change in (A) the financial
condition, business, property, prospects or ability of the Guarantor or the
Borrower to perform in all material respects its respective obligations
under any Operative Document or any of the documents evidencing and
securing the FF&E Financing to which it is a party or (B) the financial
condition, business, property, prospects and ability of any other Aladdin
Party or, to the best knowledge of such Guarantor, LCNI, the Design/Builder
or Fluor to perform in all material respects its obligations under any
Operative Document to which it is a party has occurred since the Closing
Date.
(f) CONSENTS AND APPROVALS. All approvals and consents required to
be taken, given or obtained, as the case may be, by or from any
Governmental Instrumentality or another Person, or by or from any trustee
(including, without limitation, GECC and the Discount Note Indenture
Trustee) or holder of any indebtedness or obligation of the Borrower or the
Guarantor, that are necessary or, in the reasonable opinion of the
Administrative Agent, advisable in connection with the execution, delivery
and performance of this First Amendment to Completion Guaranty by all
parties hereto, shall have been taken, given or obtained, as the case may
be, shall be in full force and effect and the time for appeal with respect
to any thereof shall have expired (or, if an appeal shall have been taken,
the same shall have been dismissed) and shall not be subject to any pending
proceedings or appeals (administrative, judicial or otherwise) and shall be
in form and substance satisfactory to the Administrative Agent.
(g) DELIVERY OF FIRST AMENDMENT TO COMPLETION GUARANTY. The Borrower
shall have delivered this First Amendment to Completion Guaranty to all
Persons entitled thereto under the Operative Documents to receive delivery
hereof.
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(h) OPINIONS. The Administrative Agent shall have received such
opinions of counsel as it deems necessary, dated as of the First Amendment
Date and addressed to the Administrative Agent, the Lenders and, if
applicable, the Disbursement Agent, which shall be in form and substance
satisfactory to the Administrative Agent.
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ARTICLE IV
REPRESENTATIONS AND WARRANTIES
In order to induce each Financing Party to enter into this First Amendment
to Completion Guaranty, each Guarantor, as to itself, reaffirms, as of the First
Amendment Date, its representations and warranties contained in the Completion
Guaranty and additionally represents and warrants, as to itself, unto each
Financing Party as set forth in this ARTICLE IV.
SECTION 4.1. DUE AUTHORIZATION, NON-CONTRAVENTION, ETC. The execution,
delivery and performance by each Guarantor of this First Amendment to Completion
Guaranty and each other document executed or to be executed by it in connection
with this First Amendment to Completion Guaranty are within the Borrower's
powers, have been duly authorized by all necessary action, and do not
(a) contravene such Guarantor's Organizational Documents;
(b) contravene any contractual restriction binding on or affecting
such Guarantor;
(c)contravene any court decree or order or Legal Requirement binding
on or affecting such Guarantor; or
(d) result in, or require the creation or imposition of, any Lien on
any of such Guarantor's properties except as expressly contemplated by the
Operative Documents,
and the Financing Parties may conclusively rely on such representation and
warranty.
SECTION 4.2. GOVERNMENT APPROVAL, REGULATION, ETC. No authorization or
approval or other action by, and no notice to or filing with, any governmental
authority or regulatory body or other Person is required for the due execution,
delivery or performance by the Borrower of this First Amendment to Completion
Guaranty or any other document to be executed by it in connection with this
First Amendment to Completion Guaranty.
SECTION 4.3. VALIDITY, ETC. This First Amendment to Completion Guaranty
constitutes, and each other document executed by the Completion Guarantors in
connection with the Second Amendment to Credit Agreement, on the due execution
and delivery thereof, will constitute the legal, valid and binding obligations
of the Completion Guarantors enforceable in accordance with their respective
terms, except as such enforceability may be limited by applicable bankruptcy,
insolvency or similar laws affecting the enforcement of creditors rights
generally and by general principles of equity.
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SECTION 4.4. LIMITATION. Except as expressly provided hereby, all of the
representations, warranties, terms, covenants and conditions of the Completion
Guaranty and each other Operative Document shall remain unamended and unwaived
and shall continue to be, and shall remain, in full force and effect in
accordance with their respective terms. The amendments and modifications set
forth herein shall be limited precisely as provided for herein, and shall not be
deemed to be a waiver of, amendment or modification of any other term or
provision of the Completion Guaranty or other Instrument referred to therein or
herein, or of any transaction or further or future action on the part of the
Borrower or any other Person which would require the consent of the Agents, the
Lenders, GECC or the Discount Note Indenture Trustee.
SECTION 4.5. OFFSETS AND DEFENSES. The Guarantors have no offsets or
defenses to their obligations under the Loan Documents to which they are a party
and no claims or counterclaims against any of the Agents, the Lenders or the
Construction Consultant.
ARTICLE V
MISCELLANEOUS PROVISIONS
SECTION 5.1. RATIFICATION OF AND REFERENCES TO THE CREDIT AGREEMENT. This
First Amendment to Completion Guaranty shall be deemed to be an amendment to the
Completion Guaranty and the Completion Guaranty, as amended by this First
Amendment to Completion Guaranty, shall continue in full force and effect and is
hereby ratified, approved and confirmed in each and every respect. All
references to the Completion Guaranty in any other document, instrument,
agreement or writing shall hereafter be deemed to refer to the Completion
Guaranty, as amended by this First Amendment to Completion Guaranty.
SECTION 5.2. HEADINGS. The various headings of this First Amendment to
Completion Guaranty are inserted for convenience only and shall not affect the
meaning or interpretation of this First Amendment to Completion Guaranty or any
provisions hereof.
SECTION 5.3. APPLICABLE LAW. THIS FIRST AMENDMENT TO COMPLETION GUARANTY
AND THE RIGHTS AND OBLIGATIONS OF THE PARTIES UNDER THIS FIRST AMENDMENT TO
COMPLETION GUARANTY SHALL BE GOVERNED BY, AND CONSTRUED AND INTERPRETED IN
ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK, INCLUDING SECTION 5-1401 OF
THE NEW YORK GENERAL OBLIGATIONS LAW, BUT EXCLUDING ALL OTHER CHOICE OF LAW AND
CONFLICTS OF LAW RULES OF SUCH STATE.
SECTION 5.4. CROSS-REFERENCES. References in this First Amendment to
Completion Guaranty to any Article or Section are, unless otherwise specified,
to such Article or Section of this First Amendment to Completion Guaranty.
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SECTION 5.5. OPERATIVE DOCUMENT. This First Amendment to Completion
Guaranty is a Loan Document executed pursuant to the Credit Agreement and shall
(unless otherwise expressly indicated therein) be construed, administered and
applied in accordance with the terms and provisions of the Credit Agreement.
SECTION 5.6. SUCCESSORS AND ASSIGNS. This First Amendment to Completion
Guaranty shall be binding upon and inure to the benefit of the parties hereto
and their respective successors and assigns.
SECTION 5.7. COUNTERPARTS. This First Amendment to Completion Guaranty
may be executed by the parties hereto in any number of counterparts and on
separate counterparts, each of which shall be an original but all of which
together shall constitute one and the same instrument.
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IN WITNESS WHEREOF, the parties hereto have executed this First
Amendment to Completion Guaranty as of the day and year first above written.
ALADDIN BAZAAR HOLDINGS, LLC
By: /s/ JACK SOMMER
--------------------------------------
Name: Jack Sommer
Title: President
THE TRUST UNDER ARTICLE SIXTH
UNDER THE WILL OF SIGMUND
SOMMER
By: /s/ VIOLA SOMMER
--------------------------------------
Name: Viola Sommer
Title: Trustee
By: /s/ JACK SOMMER
--------------------------------------
Name: Jack Sommer
Title: Trustee
LONDON CLUBS INTERNATIONAL
PLC
By: /s/ G. BARRY HARDY
--------------------------------------
Name: G. Barry Hardy
Title: Finance Director
THE BANK OF NOVA SCOTIA, as the
Administrative Agent
By: /s/ ALAN PENDERGAST
--------------------------------------
Name: Alan Pendergast
Title: Relationship Manager
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MERRILL LYNCH CAPITAL
CORPORATION, as the Syndication Agent
By: /s/ HOWARD SPLEY
--------------------------------------
Name: Howard Spley
Title: Vice President
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