EXHIBIT 10.02
INTERCREDITOR AGREEMENT
THIS INTERCREDITOR AGREEMENT (this "AGREEMENT") is made
and entered into as of the 30th day of June, 1998 by and among
THE BANK OF NOVA SCOTIA ("SCOTIABANK"), a Canadian chartered
bank, as the administrative agent (in such capacity, the
"ADMINISTRATIVE AGENT") for the Senior Lenders (as such term is
defined in SECTION 1.1; each capitalized term (whether or not
italicized) when used in this Agreement, including this preamble
and the recitals, shall, except where the context otherwise
requires, have the meaning set forth in SECTION 1.1), GENERAL
ELECTRIC CAPITAL CORPORATION ("GE CAPITAL"), a New York
corporation, for itself and as agent (in such capacity, the "FF&E
AGENT") for the Participants, and ALADDIN GAMING, LLC, a Nevada
limited-liability company ("ALADDIN GAMING").
WITNESSETH:
WHEREAS, Aladdin Gaming is the fee owner of the Site; and
WHEREAS, Aladdin Gaming, Scotiabank, individually and as the
Administrative Agent, various financial institutions
(collectively, the "SENIOR LENDERS"), ▇▇▇▇▇▇▇ ▇▇▇▇▇ Capital
Corporation, as the syndication agent for the Senior Lenders, and
CIBC ▇▇▇▇▇▇▇▇▇▇▇ Corp., as the documentation agent for the Senior
Lenders, entered into the Senior Credit Agreement pursuant to
which the Senior Lenders agreed, INTER ALIA, to make the senior
credit facility described therein (the "SENIOR CREDIT FACILITY")
available to Aladdin Gaming to finance a portion of the cost of
construction of the Aladdin Hotel and Casino; and
WHEREAS, Aladdin Gaming and GE Capital, individually
and as the FF&E Agent for the Participants, entered into that
certain facilities agreement (as the same may be amended from
time to time, the "FACILITIES AGREEMENT") pursuant to which GE
Capital and the Participants agreed, INTER ALIA, to enter into
(x) the Term Loan Facility with Aladdin Gaming to finance a
portion of the cost of the Gaming Equipment described on the
Collateral Schedules and (y) the Lease Facility with Aladdin
Gaming to finance a portion of the cost of the Equipment leased
under and described on the Equipment Schedules; and
WHEREAS, Aladdin Gaming, the Administrative Agent, on
behalf of the Senior Lenders, and the FF&E Agent,
on behalf of GE Capital and the Participants, wish to enter into
this Agreement in order to set forth certain agreements relating
to (x) the acquisition, operation, management and disposition of
the Equipment leased under and described on the Equipment
Schedules and the Gaming Equipment described on the Collateral
Schedules and (y) the exercise of rights, remedies and options by
the Senior Lenders, GE Capital and the Participants and Aladdin
Gaming.
NOW, THEREFORE, for good and valuable consideration,
the receipt and sufficiency of which are hereby acknowledged, the
parties hereto, intending to be legally bound hereby, agree as
follows:
ARTICLE I
DEFINITIONS; PRINCIPLES OF CONSTRUCTION
SECTION 1.1 DEFINED TERMS. All capitalized terms
(whether or not italicized) when used in this Agreement without
definition shall have the meanings ascribed to such terms in the
Facilities Agreement. The following terms (whether or not
italicized) when used in this Agreement, including its preambles
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):
"ACQUISITION PRICE" shall mean, on any date, the sum of
(a)(1) the then outstanding principal balance of the Term
Loan Note and (2) all accrued and unpaid interest at the
applicable rate set forth in Section 2 of the Facilities
Agreement through but not including the date that the
Purchaser actually purchases the Interest in the Facilities
in accordance with this Agreement; and
(b) (1) the Unamortized Lessor's Cost for the Equipment
leased under and described in the Equipment Schedules and
(2) all accrued and unpaid Rent, together with interest
thereon at the Default Rate (such Default Rate interest
commencing on the date on which such Rent became due and
ending on the date immediately preceding the date on which
the Purchaser actually purchases the Interest in the
Facilities); and
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(c) all reasonable out-of-pocket expenses incurred by the
FF&E Agent, GE Capital or the Participants, in connection
with such purchase other than attorneys' fees and costs and
expenses and any taxes imposed on the FF&E Agent, GE Capital
or any of the Participants with respect to the transfer and
assignment of the Interest in the Facilities.
"INTEREST IN THE FACILITIES" shall mean the interest of GE
Capital and the Participants in the Facilities, the Facilities
Agreement and the other Operative Documents.
"LOAN DOCUMENTS" is defined in the Senior Credit Agreement.
"PURCHASE DATE" shall mean the date specified in the
Purchase Notice from the Administrative Agent to the FF&E Agent
which shall be no less than 10 Business Days after delivery by
the Administrative Agent of the Purchase Notice in accordance
with SECTION 7.2.
"PURCHASE EVENT" shall mean any one or more of the
following:
(a) the occurrence of an Event of Default under Section 12
of the Facilities Agreement (subject to Schedule A of this
Agreement) and the expiration of the cure rights of the
Senior Lenders under ARTICLE VI;
(b) if the Term Loan Note is not paid in full on the
maturity date (whether on the stated maturity date as set
forth in clause (a) of Section 3 of the Facilities Agreement
or the earlier acceleration of such stated maturity date
pursuant to the Facilities Agreement); or
(c) if all amounts due under the Master Lease Agreement are
not paid upon the expiration of the Term of each Schedule
(whether on the stated expiration date as set forth on the
applicable Schedule or the earlier expiration pursuant to
the Master Lease Agreement).
"PURCHASE NOTICE" shall mean the written notice given
by the Administrative Agent to the FF&E Agent in accordance with
SECTION 7.2 that a Purchase Event has occurred and that the
Purchaser is going to purchase the Interest in the Facilities
from GE Capital and the
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Participants in exchange for the Acquisition Price on the
Purchase Date.
"PURCHASER" shall mean (x) the Administrative Agent,
(y) the Senior Lenders or (z) any nominee or designee of the
Administrative Agent or the Senior Lenders, whichever is
designated to be the purchaser of the Interest in the Facilities
on the Purchase Date, as the context may require.
"SENIOR CREDIT AGREEMENT" shall mean the Credit
Agreement dated as of February 26, 1998, among Aladdin Gaming,
the Senior Lenders, Scotiabank, ▇▇▇▇▇▇▇ ▇▇▇▇▇ and CIBC and as
thereafter from time to time amended, supplemented, amended and
restated or otherwise modified.
"SENIOR CREDIT FACILITY EVENT OF DEFAULT" is an "Event
of Default" as such term is defined in the Senior Credit
Agreement.
"TERMINATION DATE" shall mean the date on which the
parties hereto have performed in all material respects their
obligations hereunder.
SECTION 1.2 CROSS-REFERENCES. Unless otherwise specified,
references in this Agreement to any Article or Section are
references to such Article or Section of this Agreement or such
other specified document, as the case may be, and, unless
otherwise specified, references in any Article, Section or
definition to any item or clause are references to such item or
clause of such Article, Section or definition. Unless otherwise
specified, the words "hereof", "herein" and "hereunder" and words
of similar import when used in this Agreement shall refer to this
Agreement as a whole and not to any particular provision of this
Agreement.
ARTICLE II
REPRESENTATIONS AND COVENANTS BY ALADDIN GAMING
SECTION 2.1 STATUS OF THE SENIOR CREDIT FACILITY AND THE
FACILITIES. In order to induce the Administrative Agent and the
FF&E Agent to execute and deliver this Agreement, Aladdin Gaming
makes the representations and warranties set forth below:
(a)(i) the Senior Credit Agreement and all of the other Loan
Documents (A) have been duly authorized by
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all necessary action on the part of Aladdin Gaming, (B) have
been duly executed and delivered by Aladdin Gaming and (C)
constitute the legal, valid and binding obligation of
Aladdin Gaming enforceable against Aladdin Gaming in
accordance with their terms (except as such enforceability
may be limited by applicable bankruptcy, insolvency,
reorganization or similar laws affecting creditors' rights
generally and by principles of equity), (ii) the maximum
principal amount of the Senior Credit Facility evidenced and
secured by the Senior Credit Agreement and the other Loan
Documents is $410,000,000 (as such amount may be increased
in accordance with the terms of the Senior Credit
Agreement), together with interest and other amounts due
thereon, (iii) as of the date hereof, the outstanding
principal balance of the Senior Credit Facility is
$265,000,000, together with interest thereon, (iv) no Senior
Credit Facility Event of Default exists under the Senior
Credit Agreement or the other Loan Documents (nor has any
event occurred which is continuing and which, with the
giving of notice and/or passage of time, would constitute a
Senior Credit Facility Event of Default under the Senior
Credit Agreement or the other Loan Documents), (v) Aladdin
Gaming has no offsets or defenses to its obligations under
the Senior Credit Agreement or the other Loan Documents and
(vi) Aladdin Gaming has no claims or counterclaims against
the Senior Lenders or the Administrative Agent with respect
to the Senior Credit Facility, the Senior Credit Agreement
or the other Loan Documents;
(b)(i) the Facilities Agreement and the Operative Documents
(A) have been duly authorized by all necessary action on the
part of Aladdin Gaming, (B) have been duly executed and
delivered by Aladdin Gaming and (C) constitute the legal,
valid and binding obligation of Aladdin Gaming enforceable
against Aladdin Gaming in accordance with their respective
terms (except as such enforceability may be limited by
applicable bankruptcy, insolvency, reorganization or similar
laws affecting creditors' rights generally and by principles
of equity), (ii) the maximum principal amount of the Lease
Facility is $60,000,000 and the maximum amount of the Term
Loan Facility is $20,000,000, (iii) as of the date hereof,
no portion of the Lease Facility or the Term Loan Facility
has been advanced and no interest is accruing thereon, (iv)
no Event of Default has occurred under the
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Facilities Agreement or the Operative Documents (nor has any
event occurred which, with the giving of notice and/or
passage of time, would constitute an Event of Default under
the Facilities Agreement or the Operative Documents), (v)
Aladdin Gaming has no offsets or defenses to its obligations
under the Facilities Agreement or the Operative Documents
and (vi) Aladdin Gaming has no claims or counterclaims
against GE Capital, individually or as the FF&E Agent, or
any of the Participants with respect to the Lease Facility,
the Term Loan Facility, the Facilities Agreement or the
Operative Documents;
(c) all representations made by Aladdin Gaming in the
Facilities Agreement are true, correct and complete in all
material respects and the Administrative Agent is hereby
entitled to rely thereon; and
(d) all representations made by Aladdin Gaming in the Senior
Credit Agreement as of the date when made were true, correct
and complete in all material respects and the FF&E Agent is
hereby entitled to rely thereon but without any obligation
on the part of Aladdin Gaming to update said representations
and in no event shall this representation be deemed to be a
restatement of said representations as of the date hereof.
SECTION 2.2 COVENANTS BY ALADDIN GAMING. In order to induce
the Administrative Agent and the FF&E Agent to enter into this
Agreement, Aladdin Gaming covenants and agrees that:
(a) it shall look solely to the Senior Lenders and the
Administrative Agent for the performance of all obligations,
covenants and agreements to be performed on the part of the
Senior Lenders under the Senior Credit Agreement and the
other Loan Documents, subject to and upon the conditions set
forth in the Senior Credit Agreement and the other Loan
Documents;
(b) it shall look solely to GE Capital, the Participants and
the FF&E Agent for the performance of all obligations,
covenants and agreements to be performed on the part of GE
Capital and the Participants under the Facilities Agreement
and the Operative Documents, subject to and upon the
conditions set forth in the Facilities Agreement and the
Operative Documents;
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(c) it shall give copies of all notices given or received by
it in connection with the Senior Credit Agreement and the
Facilities Agreement to each of the parties to this
Agreement (other than the party which gave the notice) on
the day that such notice is given by Aladdin Gaming or
within two (2) Business Days after such notice is received
by Aladdin Gaming, as the case may be (all notices shall be
given in the manner set forth in SECTION 9.1); and
(d) it shall deliver to the Administrative Agent (i) the
information set forth in clauses (b)(4), (5), (6), (7) and
(8) of Section 7 of the Facilities Agreement, (ii) copies of
all monthly statements received from the FF&E Agent pursuant
to clause (e) of Section 3 of the Facilities Agreement,
(iii) all financial information required to be delivered to
the FF&E Agent pursuant to clause (a) of Section 10 of the
Facilities Agreement (except for such financial information
which is also required by the Senior Credit Agreement and
delivered in accordance with the terms thereof) and (iv) all
insurance information required by clause (e) of Section 10
of the Facilities Agreement (except for such financial
information which is also required by the Senior Credit
Agreement and delivered in accordance with the terms
thereof).
ARTICLE III
THE LOAN DOCUMENTS
SECTION 3.1 RECORDING AND FILING OF DOCUMENTS. The Loan
Documents have been executed and delivered and, as appropriate,
filed and recorded in the manner described in the Senior Credit
Agreement. The Administrative Agent covenants and agrees that
the Liens and other security interests created and perfected by
the Loan Documents and the filing and recording thereof (if
required) cover only the collateral described in the Loan
Documents and not the Equipment leased under and described on the
Equipment Schedules and the Gaming Equipment described on the
Collateral Schedules. The Administrative Agent, on behalf of the
Senior Lenders, does not have and shall not claim a Lien or other
security interest in or with respect to the Equipment leased
under and described on the Equipment Schedules or the Gaming
Equipment described on the Collateral Schedules.
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SECTION 3.2 PERFORMANCE OF SENIOR CREDIT FACILITY. The FF&E
Agent consents to the payment and performance by Aladdin Gaming
of its obligations under the Senior Credit Facility in accordance
with the terms of the Senior Credit Agreement and the other Loan
Documents.
SECTION 3.3 AMENDMENTS TO THE LOAN DOCUMENTS AND EXERCISE
OF RIGHTS AND REMEDIES. The FF&E Agent covenants and agrees that
the Senior Lenders and Aladdin Gaming may from time to time after
notice to or, if required under this Agreement, obtaining the
consent of the FF&E Agent, GE Capital or the Participants:
(a) extend, amend, modify, supplement, replace and/or renew
the Senior Credit Facility, the Senior Credit Agreement and
the other Loan Documents, as the case may be;
(b) increase the principal amount of the Senior Credit
Facility in accordance with the terms of the Senior Credit
Agreement;
(c) waive any of the terms, covenants and conditions in the
Senior Credit Agreement and the other Loan Documents, in
whole or in part, and grant such indulgences in relation to
the obligations evidenced and secured by the Senior Credit
Agreement and the other Loan Documents as the Administrative
Agent and the Senior Lenders may determine; and
(d) exercise all rights and remedies under the Senior Credit
Agreement and the other Loan Documents and take any action
which may affect all or a portion of the Aladdin Hotel and
Casino including, without limitation, (i) all self-help
remedies under the Senior Credit Agreement and the other
Loan Documents, (ii) all rights (statutory or otherwise)
relating to a sale under power of sale, (iii) accepting a
deed-in-lieu of foreclosure or otherwise take title to the
Premises or (iv) appointing a receiver.
The parties acknowledge and agree that, notwithstanding the
foregoing, none of the FF&E Agent, GE Capital or the Participants
shall be deemed to have consented to the incorporation into the
Facility Agreement or any other Operative Document of any such
extension, amendment, modification, supplement, replacement,
renewal, waiver or grant of indulgence, made by the
Administrative
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Agent with respect to the Senior Credit Facility, the Senior
Credit Agreement and/or the other Loan Documents.
SECTION 3.4 ADMINISTRATION OF SENIOR CREDIT FACILITY.
The FF&E Agent acknowledges that the Administrative Agent is
responsible for monitoring and administering the Senior Credit
Facility. Notwithstanding anything to the contrary in this
Agreement, the Senior Credit Agreement or the Facilities
Agreement, neither the FF&E Agent, GE Capital nor the
Participants shall have any right to participate in any approval,
consent or review process which has been granted to the
Administrative Agent pursuant to the Loan Documents (whether or
not such right to approve, consent or review is expressly granted
to the FF&E Agent or GE Capital and the Participants under the
Facilities Agreement and the other Operative Documents) other
than the approvals and consents listed on SCHEDULE A annexed
hereto and all approvals, consents and waivers made by the
Administrative Agent pursuant to the Loan Documents, other than
the approvals and consents listed on SCHEDULE A annexed hereto,
shall be binding on the FF&E Agent until the expiration of the
period described in SECTION 7.2 during which the Senior Lenders
have the exclusive right to purchase the Facilities, the
Facilities Agreement and the Operative Documents. The right of
GE Capital and the Participants to declare a Default or Event of
Default or terminate their Commitments shall be subject to
SCHEDULE A.
SECTION 3.5 DUE EXECUTION BY THE ADMINISTRATIVE AGENT.
The Administrative Agent represents that this Agreement (x) has
been duly authorized by all necessary action on the part of the
Administrative Agent, (y) has been duly executed and delivered by
the Administrative Agent, and (z) constitutes the legal, valid
and binding obligation of the Administrative Agent enforceable
against it in accordance with its terms (except as such
enforceability may be limited by applicable bankruptcy,
insolvency, reorganization or similar laws affecting creditors'
rights generally and by principles of equity).
SECTION 3.6 NOTICES. The Administrative Agent
covenants and agrees to give the FF&E Agent prompt written notice
of (x) any Senior Credit Facility Event of Default, (y) any act
or condition which, in the Administrative Agent's reasonable
judgment could reasonably be expected to have a "MATERIAL ADVERSE
EFFECT" (as such term is defined under the Senior Credit
Agreement) and (y) the taking of any action described in Section
3.3 of this Agreement but
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only if such action is taken pursuant to a written notice or
written Instrument.
ARTICLE IV
THE TERM LOAN FACILITY AND THE LEASE FACILITY
SECTION 4.1 THE FACILITIES AGREEMENT. The Administrative
Agent agrees that the Operative Documents may be filed and
recorded in the manner and at the time described in the
Facilities Agreement and the Operative Documents. The FF&E Agent
covenants and agrees that the Liens and other security interests
to be created and perfected by the documents evidencing and
securing the Term Loan Facility and the filing and recording
thereof (if required) are to cover only the Equipment leased
under and described on the Equipment Schedules and the Gaming
Equipment described on the Collateral Schedules. The FF&E Agent,
on behalf of GE Capital and the Participants, does not have and
shall not claim a Lien or other security interest in or with
respect to the collateral described in the Loan Documents covered
by the Liens and security interests created thereby. In no event
whatsoever do the Liens and other security interests to be
created and perfected by the documents evidencing and securing
the Facilities attach to any revenues generated by the Aladdin
Hotel and Casino, the Gaming Equipment described on the
Collateral Schedules or the Equipment leased under and described
on the Equipment Schedules (other than proceeds from the
disposition of the such Gaming Equipment or Equipment in
accordance with the documents evidencing and securing the
Facilities). Notwithstanding anything to the contrary in the
Senior Credit Agreement, the Loan Documents, the Facilities
Agreement or the Operative Documents, in no event is there any
intention on the part of the Administrative Agent and the FF&E
Agent to share any collateral or security for their respective
facilities.
SECTION 4.2 DELIVERY OF PAYMENTS TO THE FF&E AGENT. The
Administrative Agent consents to the payment and performance by
Aladdin Gaming of its obligations under the Facilities in
accordance with the terms of the Facilities Agreement and this
Agreement.
SECTION 4.3 CONDITIONS PRECEDENT. The FF&E Agent confirms
for the benefit of the Administrative Agent that the status of
the conditions precedent set forth in clause (a) of Section 7 of
the Facilities Agreement is as follows:
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(a) the conditions precedent in clauses (a)(1), (2), (9),
(10), (11), (12), (13), (14), (17), (19) and (20) have been
satisfied in all respects and shall not be subject to
further review by the FF&E Agent;
(b) the conditions precedent in clauses (a)(3), (5), (6),
(15) and (16) have been satisfied in all respects as of the
date of this Agreement but the status of such conditions
precedent shall be subject to further review by the FF&E
Agent with respect to the initial Funding;
(c) the condition in clause (a)(7) has been satisfied in all
respects as of the date of this Agreement and, although the
status of such condition precedent shall be subject to
further review by the FF&E Agent with respect to the initial
Funding, satisfaction shall be deemed to have occurred if,
on the date of the initial Funding, the nature and status of
the matters set forth in said clause have not materially
changed from the nature and status of such matters on the
date of this Agreement (and the FF&E Agent shall deliver a
notice of any such material change promptly after it has
determined that such change has occurred);
(d) the condition in clause (a)(8) has been satisfied in all
respects as of the date of this Agreement and, although the
status of such condition precedent shall be subject to
further review by the FF&E Agent with respect to the initial
Funding, satisfaction shall be deemed to have occurred if,
on the date of the initial Funding, the Administrative Agent
has not delivered a notice that a Senior Credit Facility
Event of Default has occurred and is continuing (and if any
such notice has been delivered, the provisions of ARTICLES
VI and VII shall apply); and
(e) the conditions in clauses (a)(4) and (18) have not been
satisfied as of the date of this Agreement and remain
subject to further review by the FF&E Agent with respect to
the initial Funding.
SECTION 4.4 DUE EXECUTION BY THE FF&E AGENT. The FF&E Agent
represents that this Agreement (x) has been duly authorized by
all necessary action on the part of the FF&E Agent, (y) has been
duly executed and delivered by the FF&E Agent and (z) constitutes
the legal, valid and binding obligation of the FF&E Agent
enforceable against it in accordance with its terms (except as
such enforceability
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may be limited by applicable bankruptcy, insolvency,
reorganization or similar laws affecting creditors' rights
generally and by principles of equity).
SECTION 4.6 NOTICES. The FF&E Agent covenants and
agrees to give the Administrative Agent prompt written notice of
(x) any Event of Default under the Facilities Agreement or any of
the Operative Documents, (y) any act or condition which, in the
reasonable judgment of the FF&E Agent could reasonably be
expected to have a Material Adverse Effect or result in the
failure of a Funding condition and (y) the delivery of a copy of
the confirmation with Aladdin Gaming pursuant to clause (n) of
Section 10 of the Facilities Agreement (together with a copy of
such confirmation).
ARTICLE V
PERFORMANCE OF OBLIGATIONS BY ALADDIN GAMING
SECTION 5.1 PERFORMANCE UNDER THE FACILITIES AGREEMENT AND
THE OPERATIVE DOCUMENTS. Aladdin Gaming covenants and agrees:
(a) to give prompt notice to the Administrative Agent
of any notice of default given or received with respect to
the Facilities Agreement and any of the Operative Documents,
together with an accurate and complete copy of any such
notice;
(b) at the sole cost and expense of Aladdin Gaming, to
enforce (short of termination of the Facilities Agreement
and the Operative Documents, as applicable) or secure the
performance of the obligations, covenants, conditions and
agreements to be performed by GE Capital, the Participants
and the FF&E Agent under the Facilities Agreement and the
Operative Documents; and
(c) that, without the Administrative Agent's prior
written consent, Aladdin Gaming shall not (i) modify or
amend in any material respect the Credit Facilities
Agreement or the Operative Documents, (ii) terminate the
Facilities Agreement or the Operative Documents or accept a
surrender thereof, (iii) waive, excuse, condone or in any
manner release or discharge GE Capital, the Participants or
the FF&E Agent from any material obligation, covenant,
condition or agreement to be performed by it under the
Facilities
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Agreement or the Operative Documents, (iv) fail to exercise
promptly and diligently material rights that it may have
under the Facilities Agreement or the Operative Documents or
(vi) fail to deliver to the Administrative Agent a copy of
each demand or notice given or received by it relating in
any way to a material provision of the Facilities Agreement
and the Operative Documents.
SECTION 5.2 NO MODIFICATION. Any modification or amendment
of the Facilities Agreement or the Operative Documents which
violates any material term or provision of the Senior Credit
Agreement, the other Loan Documents or this Agreement or the
termination or surrender of the Facilities Agreement or the
Operative Documents without the prior written consent of the
Administrative Agent shall constitute a Senior Credit Facility
Event of Default. Any waiver, release or discharge by Aladdin
Gaming of GE Capital, the Participants or the FF&E Agent from any
material obligation, covenant, condition and agreement to be
performed by any of them under the Facilities Agreement or the
Operative Documents or the failure to exercise promptly and
diligently material rights that Aladdin Gaming may have under the
Facilities Agreement and the Operative Documents without the
prior written consent of the Administrative Agent (which consent
shall not be withheld or delayed if the Administrative Agent
determines in its sole discretion that such waiver, release,
discharge or failure to exercise is commercially reasonable)
shall constitute a Senior Credit Facility Event of Default. The
FF&E Agent hereby confirms that this Section does not violate the
provisions of clause (l) of Section 11 of the Facilities
Agreement.
SECTION 5.3 DEFENSE OF CLAIMS. Aladdin Gaming covenants
and agrees to appear in and defend, at its sole cost and expense,
any action or proceeding arising under, growing out of or in any
manner connected with this Agreement or the obligations, duties
or liabilities of Aladdin Gaming hereunder, and to pay all
reasonable costs and expenses of the Senior Lenders, the FF&E
Agent, GE Capital and the Participants including, without
limitation, reasonable attorneys' fees and costs and expenses, in
any such action or proceeding in which the Senior Lenders, the
Administrative Agent, the FF&E Agent, GE Capital or the
Participants may appear.
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ARTICLE VI
RIGHTS OF THE SENIOR LENDERS
SECTION 6.1 ALADDIN GAMING TO PERFORM OBLIGATIONS. Subject
to the terms of this Agreement, the FF&E Agent, GE Capital and
the Participants shall continue to look solely to Aladdin Gaming
for the performance of all obligations under the Facilities
Agreement and the Operative Documents.
SECTION 6.2 PERFORMANCE BY THE SENIOR LENDERS.
(a) The FF&E Agent agrees that it will not commence the
exercise of any rights, remedies or options under the Facilities
Agreement or the Operative Documents (including the termination
or suspension of performance of its obligations thereunder)
without first giving the Administrative Agent notice and
opportunity to cure as provided for in CLAUSE (B) below, subject
to the provisions of CLAUSES (C) through (E) below ; PROVIDED,
HOWEVER, if such exercise of rights, remedies or options under
the Facilities Agreement or the Operative Documents shall arise
by virtue of (x) a bankruptcy or insolvency of Aladdin Gaming or
(y) an Event of Default under the Facilities Agreement or the
Operative Documents relating to an act, event or condition which
is (1) personal to Aladdin Gaming or any other Person, (2) cannot
be performed or cured by the Senior Lenders or the Administrative
Agent, and (3) the continuation of such Event of Default
materially and adversely interferes with the practical
realization of the rights and benefits provided by the Facilities
Agreement and the Operative Documents (other than the economic
consequences of any judicial, administrative or other procedural
delay), then the FF&E Agent shall not be obligated to give the
Administrative Agent an opportunity to cure and the provisions of
ARTICLE VII shall apply. Notwithstanding the foregoing, there
shall be no obligation on the part of GE Capital and the
Participants to make any Funding during any cure period granted
to the Administrative Agent hereunder until such time as the
Administrative Agent has delivered the notice pursuant to which
the Senior Lenders are electing to exercise their right to cure.
(b) If an event or condition exists which, after the
expiration of any applicable grace, notice and cure periods,
constitutes or will constitute an Event of Default and the FF&E
Agent, GE Capital and the Participants shall
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desire to exercise their remedies under the Facilities Agreement
and the Operative Documents, the FF&E Agent shall give notice to
the Administrative Agent of such Event of Default, specifying in
such notice all then existing Events of Default of which it has
knowledge, such notice to be given in accordance with SECTION
9.1. If the Senior Lenders elect to exercise their right to cure
as herein provided, the Administrative Agent shall, within 10
Business Days after the receipt by it of the notice from the FF&E
Agent referred to in the preceding sentence, deliver to the FF&E
Agent a written notice (with a copy to Aladdin Gaming) stating
that the Senior Lenders have elected to exercise such right to
cure, together with a written statement verifying that on behalf
of the Senior Lenders it will promptly commence to cure in all
material respects all such Events of Default which, if not cured,
would materially and adversely interfere with the practical
realization of the rights and benefits provided by the Facilities
Agreement and the Operative Documents (other than the economic
consequences of any judicial, administrative or other procedural
delay). If the Senior Lenders do not elect to exercise their
right to cure as herein provided, the Administrative Agent shall,
within 10 Business Days after the receipt by it of the notice
from the FF&E Agent referred to herein, deliver to the FF&E Agent
a written notice stating whether or not the Senior Lenders have
elected to purchase the Interest in the Facilities within 15
Business Days in accordance with Article VII of this Agreement.
If the Senior Lenders have elected to purchase the Interest in
the Facilities, the provisions of Article VII shall apply to such
purchase. If the Senior Lenders do not elect to purchase the
Interest in the Facilities within such 15 Business Day period,
the obligation of GE Capital and the Participants to sell the
Interest in the Facilities under ARTICLE VII shall terminate and
the FF&E Agent may commence the exercise of rights, remedies and
options under the Facilities Agreement and the other Operative
Documents.
(c) The Senior Lenders and the Administrative Agent shall
have a period of 30 days after the delivery of the notice by the
Administrative Agent referred to in CLAUSE (B) above in which to
cure all Events of Defaults set forth in such notice from the
FF&E Agent which, if not cured, would materially and adversely
interfere with the practical realization of the rights and
benefits provided by the Facilities Agreement and the Operative
Documents (other than the economic consequences of any judicial,
administrative or other procedural delay); PROVIDED,
-15-
HOWEVER, that if the Event of Default is based upon a failure by
Aladdin Gaming to make a payment to GE Capital and the
Participants which is then due and payable, the Lenders and the
Administrative Agent shall have only 10 days to cure such Event
of Default. In the event any such Event(s) of Default (except
payment defaults) shall be curable but not within such 30-day
period, the FF&E Agent shall not exercise any remedies under the
Facilities Agreement or the Operative Documents if, on behalf of
the Senior Lenders, the Administrative Agent shall, within such
30-day period, initiate action to cure such Events of Default and
proceed diligently to the curing thereof in all material respects
within 60 days after delivery of the notice by the FF&E Agent.
Any curing of any Events of Default under the Facilities
Agreement and the Operative Documents shall not be construed as
an assumption by the Senior Lenders or the Administrative Agent
of any obligations, covenants, or agreements of Aladdin Gaming
under the Facilities Agreement or the Operative Documents.
(d) Notwithstanding anything to the contrary in this
Agreement, the Administrative Agent (or its designee or nominee)
shall have only the right to cure Events of Default set forth in
notices delivered on not more than two (2) occasions during the
term of the Facilities after which time the only right of the
Administrative Agent with respect to subsequent Events of Default
will be to purchase the Interest in the Facilities in accordance
with ARTICLE VII hereof.
(e) If the Senior Lenders elect to exercise their right to
cure as herein provided and the Senior Lenders are unable to cure
in accordance with this Article VI, the Administrative Agent
shall, within 10 Business Days after it has determined that it is
unable to complete such cure, deliver to the FF&E Agent a written
notice stating whether or not the Senior Lenders will purchase
the Interest in the Facilities within 15 Business Days in
accordance with Article VII of this Agreement. If the Senior
Lenders have elected to purchase the Interest in the Facilities,
the provisions of Article VII shall apply to such purchase. If
the Senior Lenders do not elect to purchase the Interest in the
Facilities within such 15 Business Day period, the obligation of
GE Capital and the Participants to sell the Interest in the
Facilities shall terminate.
SECTION 6.3 REMEDIES. The Administrative Agent (or its
designee or nominee) may exercise all rights and remedies
hereunder either in person or by agent and Aladdin
-16-
Gaming shall not impair the exercise thereof by the
Administrative Agent whether under this Agreement, the Facilities
Agreement or the Operative Documents. Neither the exercise of
any rights, remedies or options hereunder nor the commission of
any other act by the Administrative Agent pursuant to this
Agreement shall be deemed to cure or waive any default, or to
waive, modify or affect any notice of default under the Senior
Credit Agreement, or to invalidate any act done pursuant to such
notice.
SECTION 6.4 NO OBLIGATION OF THE SENIOR LENDERS. Neither
the Senior Lenders nor the Administrative Agent shall be
obligated to perform or discharge, nor do they hereby undertake
to perform or discharge, any obligation, duty or liability of
Aladdin Gaming under the Facilities Agreement, the Operative
Documents or this Agreement. Should the Administrative Agent,
individually or on behalf of the Senior Lenders, incur any loss,
cost, claim, demand, expense, liability or damage under the
Facilities Agreement, the Operative Documents or this Agreement,
or in the defense against any claims or demands, the amount
thereof, including reasonable costs and expenses and reasonable
attorneys' fees, together with interest thereon at the rate set
forth in Section 3.2.2 of the Senior Credit Agreement, shall be
secured by the Loan Documents, and Aladdin Gaming shall reimburse
the Administrative Agent therefor immediately upon demand.
SECTION 6.5 INSTRUCTIONS FROM THE ADMINISTRATIVE AGENT.
Aladdin Gaming hereby authorizes and directs the FF&E Agent to
accept performance by the Administrative Agent in accordance with
this ARTICLE VI of Aladdin Gaming's obligations under the
Facilities Agreement and the Operative Documents and during the
performance of such cure rights by the Administrative Agent, its
designee or nominee, to act in accordance with any and all
instructions received therefrom with respect to the Facilities
Agreement, the Operative Documents and this Agreement.
ARTICLE VII
SALE AND PURCHASE OF THE INTEREST IN THE FACILITIES
SECTION 7.1 SALE AND PURCHASE. From and after the date of
this Agreement until the expiration of the period described in
SECTION 7.2, GE Capital and the Participants hereby irrevocably
grant the Administrative Agent, on behalf of the Senior Lenders,
the exclusive right to
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purchase the Interest in the Facilities in exchange for the
Acquisition Price from and after the occurrence of a Purchase
Event. After the occurrence of a Purchase Event and the delivery
of the Purchase Notice in accordance with SECTION 7.2 (with a
copy to Aladdin Gaming), in exchange for the Acquisition Price,
GE Capital and the Participants covenant and agree to sell,
transfer and convey to the Purchaser and the Purchaser, in turn,
shall (x) purchase from GE Capital and the Participants on the
Purchase Date and (y) assume, from and after the Purchase Date,
all of the rights and obligations of GE Capital and the
Participants under the Facilities Agreement and the Operative
Documents arising from and after the Purchase Date. From and
after the Purchase Date, the Purchaser shall be bound under the
Facilities Agreement and the Operative Documents to perform and
observe all of the covenants and obligations on the part of GE
Capital and the Participants thereunder arising from and after
the Purchase Date, and GE Capital and the Participants shall be
relieved and released from all such obligations. In no event
shall any right of offset, defense, claim or counterclaim by
Aladdin Gaming against GE Capital and the Participants be binding
against the Administrative Agent or the Senior Lenders.
SECTION 7.2 PURCHASE NOTICE. The FF&E Agent shall give the
Administrative Agent written notice of the occurrence of one or
more Purchase Events within 10 Business Days after the occurrence
thereof (unless the provisions of Section 6.2 are applicable
thereto in which case such provisions of Section 6.2 shall
apply). The obligation of the FF&E Agent hereunder is a present,
continuing, irrevocable and independent obligation of the FF&E
Agent and is not conditioned upon the performance by Aladdin
Gaming, GE Capital, the Participants or the FF&E Agent of their
respective obligations under the Facilities Agreement or the
Operative Documents whether before, on or after the Purchase
Date. The Purchaser shall have 15 Business Days after delivery
of such notice from the FF&E Agent within which to elect to
purchase the Interest in the Facilities, which election shall be
made by delivery of the Purchase Notice to the FF&E Agent (with a
copy to Aladdin Gaming) prior to the expiration of such 15
Business Day period. If the Purchaser does not elect to purchase
the Interest in the Facilities within such 15 Business Day
period, the obligation of GE Capital and the Participants to sell
the Interest in the Facilities shall terminate.
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SECTION 7.3 FORBEARANCE BY GE CAPITAL AND THE PARTICIPANTS.
From and after the occurrence of an Event of Default and
continuing until the expiration of the period described in
SECTION 7.2 if the Administrative Agent does not timely deliver
the Purchase Notice to the FF&E Agent in accordance with this
Agreement, GE Capital and the Participants covenant and agree
with the Senior Lenders that neither they nor the FF&E Agent,
without the consent of the Administrative Agent, shall (x)
exercise any rights or remedies under the Facilities Agreement or
the Operative Documents (other than the giving of notices or the
declaration of default thereunder) or take any action which may
adversely affect the Facilities including, without limitation,
(1) all self-help remedies under the Facilities Agreement and the
Operative Documents, (2) all rights (statutory or otherwise)
relating to a sale under power of sale, (3) accepting a transfer
of title to any of the Gaming Equipment described on the
Collateral Schedules or any of the Equipment leased under and
described on the Equipment Schedules in lieu of the exercise of
remedies or otherwise taking title thereto, or (4) appointing a
receiver or taking any other action to obtain possession or
control of any of the Gaming Equipment described on the
Collateral Schedule or any of the Equipment leased under and
described on the Equipment Schedules, (y) commence any proceeding
or take any action which might impair the lien or priority of the
Facilities Agreement or hinder or delay payment or performance of
the obligations evidenced and secured by the Facilities
Agreement, or (z) seek to have Aladdin Gaming adjudicated
insolvent or bankrupt or commence any other proceeding under any
reorganization, insolvency or liquidation or similar law in
effect relating to Aladdin Gaming.
SECTION 7.4 PAYMENT OF THE ACQUISITION PRICE. At such time
as payment of the Acquisition Price becomes due hereunder, the
Purchaser shall pay the Acquisition Price to the FF&E Agent on
behalf of GE Capital and the Participants by federal wire
transfer of immediately available funds to the account specified
in clause (b) of Section 3 of the Facilities Agreement or such
other account or accounts as may be specified in writing by the
FF&E Agent.
SECTION 7.5 TRANSFER AND ASSIGNMENT DOCUMENTATION. Upon
receipt of the Acquisition Price, the FF&E Agent shall deliver to
the Purchaser all original executed counterparts of the
Facilities Agreement and the Operative Documents as are then in
the possession of GE Capital and the Participants, together with
such documents and instruments
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as are prepared by the Administrative Agent at its expense, as
reasonably required to effect the conveyance of the Interest in
the Facilities (which documents and instruments shall be
reasonably satisfactory to the FF&E Agent) including, without
limitation (x) an assignment to the Purchaser of the Facilities
Agreement and the Operative Documents, each in recordable form
sufficient to transfer all right, title and interest therein,
(y) UCC Statements of Assignment assigning to the Purchaser the
UCC-1 Financing Statements which have been executed and delivered
by Aladdin Gaming in connection with the Facilities, and (z) such
other documents that the parties deem reasonably necessary or
advisable. The Administrative Agent covenants and agrees to
cause the Purchaser to execute and deliver such documents which
are reasonably necessary in order for GE Capital and the
Participants (acting through the FF&E Agent) to transfer and
assign the Facilities Agreement and the Operative Documents to
the Purchaser. To the extent that any original documents cannot
be located by the FF&E Agent for delivery on the Purchase Date,
the FF&E Agent shall deliver an affidavit to the Purchaser with
respect to any such missing documents which affidavit shall
include a covenant by the FF&E Agent on behalf of GE Capital and
the Participants, to deliver any such missing documents to the
Purchaser if, as and when located by any of them and which shall
include an indemnity by the FF&E Agent on behalf of GE Capital
and the Participants in favor of the Purchaser against any loss,
cost or expense by the Purchaser in the event of any exercise of
rights and remedies by the Purchaser or any other party under
such missing Instrument. The documents transferring and
assigning the Interest in the Facilities to the Purchaser shall
provide, in relevant part, that the FF&E Agent on behalf of GE
Capital and the Participants represent and warrant that (x) GE
Capital and the Participants are the owners of the Facilities,
the Facilities Agreement and the Operative Documents, (y) the
FF&E Agent on behalf of GE Capital and the Participants have all
requisite power and authority to execute and deliver such
documents, and (z) the Facilities, the Facilities Agreement and
the Operative Documents are not subject to any encumbrance,
pledge, hypothecation or security interest whatsoever and shall
otherwise be in form and content reasonably satisfactory to the
Administrative Agent and the Purchaser. Such representations and
warranties shall survive the delivery of the documents
transferring and conveying the Interest in the Facilities, the
Facilities Agreement and the Operative Documents to the
Purchaser.
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ARTICLE VIII
DEFAULTS
SECTION 8.1 DEFAULTS BY THE SENIOR LENDERS, THE FF&E AGENT,
GE CAPITAL AND THE PARTICIPANTS. If the Senior Lenders or the
FF&E Agent, GE Capital or the Participants fail to perform their
respective obligations hereunder after the expiration of
applicable grace, notice or cure periods, at all times thereafter
and until such time as the defaulting Person has performed its
obligations, the non-defaulting Persons shall have all rights,
remedies and options at law and in equity.
SECTION 8.2 DEFAULTS BY ALADDIN GAMING. (a) Any default by
Aladdin Gaming under this Agreement after the giving of notice
and the expiration of a five (5) day cure period shall, at the
option of the Administrative Agent, constitute a default by
Aladdin Gaming under the Senior Credit Agreement and the other
Loan Documents and any Senior Credit Facility Event of Default
shall, at the option of the Administrative Agent, constitute a
default by Aladdin Gaming under this Agreement (without any
additional grace period or opportunity to cure). Upon the
occurrence and during the continuation of a default under this
Agreement by Aladdin Gaming, the Senior Lenders shall have all
rights, remedies and options under the Senior Credit Agreement,
the other Loan Documents and at law and in equity.
(b) Any default by Aladdin Gaming under this Agreement after
the giving of notice the expiration of a five (5) day cure period
shall, at the option of the FF&E Agent, constitute a default by
Aladdin Gaming under the Facilities Agreement and the Operative
Documents and any Event of Default shall, at the option of the
FF&E Agent, constitute a default by Aladdin Gaming under this
Agreement (without any additional grace period or opportunity to
cure). Upon the occurrence and during the continuation of a
default under this Agreement by Aladdin Gaming, GE Capital and
the Participants shall have all rights, remedies and options
under the Facilities Agreement and the Operative Documents and at
law and in equity, subject to the rights of the Senior Lenders
hereunder. To the extent that the Senior Lenders or their
nominee or designee have possession and control of the Aladdin
Hotel and Casino and the FF&E Agent elects to sell the Equipment
or the Gaming Equipment in accordance with clause (b) of Section
12 of the Facilities Agreement, during the period commencing on
the date that
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the Senior Lenders (or their designee or nominee) obtains
possession and control of the Aladdin Hotel and Casino and ending
6 months thereafter, the FF&E Agent shall have the right to sell
the Equipment and the Gaming Equipment at the Aladdin Hotel and
Casino without cost to the FF&E Agent; PROVIDED, HOWEVER, the
Senior Lenders (or their designee or nominee) may relocate all or
a portion of the Equipment and Gaming Equipment to a safe and
secure storage area on or about the Aladdin Hotel and Casino
(provided that in all events the FF&E Agent shall have the right
to inspect the Equipment and the Gaming Equipment and to
demonstrate the operation thereof to potential purchasers) and
shall cause interest which would be due and payable under the
Term Loan Facility and Rent which would be due and payable under
the Lease Facility if the Facilities were in good standing at
such time (without giving effect to any Default Rate, late
payment charge or accelerated payment provision) to be paid until
the earlier of the expiration of such 6-month period or removal
of the Equipment and the Gaming Equipment from the Aladdin Parcel
by the FF&E Agent or other Person (other than the Administrative
Agent).
(c) Subject to the terms and limitations of this Agreement,
no right or remedy conferred upon any Person under this Agreement
is intended to be exclusive of any other right or remedy
contained in this Agreement or any other Instrument and every
such right and remedy shall be cumulative and shall be in
addition to every other right or remedy contained in this
Agreement or such other Instrument as now or hereafter available
to such Person at law or in equity, by statute or otherwise.
ARTICLE IX
GENERAL PROVISIONS
SECTION 9.1. NOTICES. (a) Any notice, demand, request
or other communication which any party hereto may be required or
may desire to give hereunder shall be in writing and shall be
deemed to have been properly given if given in the manner set
forth in Section 15(j) of the Facilities Agreement to the
addresses set forth therein.
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(b) If such notice is to be given to the Administrative
Agent, such notice shall be addressed to:
The Bank of Nova Scotia
▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attn: ▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇▇
Telephone No.: (▇▇▇) ▇▇▇-▇▇▇▇
Facsimile No.: (▇▇▇) ▇▇▇-▇▇▇▇
or at such other address as the Administrative Agent may have
furnished in writing to Aladdin Gaming and the FF&E Agent.
(c) If such notice is to be given to the FF&E Agent, such
notice shall be addressed to:
General Electric Capital Corporation
Capital Funding, Inc.
▇▇▇ ▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇▇ ▇ - 1st Floor
Stamford, Connecticut 06927
Attn: Risk Manager Aladdin Gaming
Telephone No.: (▇▇▇) ▇▇▇-▇▇▇▇
Facsimile No.: (▇▇▇) ▇▇▇-▇▇▇▇
or at such other address as the FF&E Agent may have furnished in
writing to Aladdin Gaming and the Administrative Agent.
(d) If such notice is to be given to Aladdin Gaming, such
notice shall be addressed to:
Aladdin Gaming, LLC
▇▇▇ ▇▇▇▇▇ ▇▇▇▇
▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇ ▇▇▇▇▇
Attn: ▇▇. ▇▇▇▇ ▇▇▇▇▇▇
Telephone No.: (▇▇▇) ▇▇▇-▇▇▇▇
Facsimile No.: (▇▇▇) ▇▇▇-▇▇▇▇
or at such other address as Aladdin Gaming may have furnished in
writing to the FF&E Agent and the Administrative Agent.
SECTION 9.2 ENTIRE AGREEMENT. This Agreement embodies and
constitutes the entire agreement and understanding among the
Senior Lenders, Aladdin Gaming and GE Capital and the
Participants with respect to the subject
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matter of this Agreement, and all other prior agreements,
understandings and statements, oral or written, are merged into
this Agreement. This Agreement shall be binding upon and inure
to the benefit of the parties hereto and their respective
successors and assigns. Neither this Agreement nor any provision
hereof may be changed, waived, discharged or terminated except in
writing executed by the party against whom enforcement of the
change, waiver, discharge or termination is sought.
SECTION 9.3 ESTOPPELS. Aladdin Gaming shall execute and
deliver to the Administrative Agent and the FF&E Agent all instru
ments and certificates as the Administrative Agent or the FF&E
Agent may reasonably request (including, but not limited to,
estoppel certificates certifying to the then current status of
the matters described in this Agreement including, without
limitation, the matters described in SECTION 2.1) to effect,
confirm or assure the rights, remedies and options intended to be
granted to the Senior Lenders and GE Capital and the Participants
under this Agreement.
SECTION 9.4 SEVERABILITY. If any of the provisions of this
Agreement, or the application thereof to any Person or
circumstances, shall, to any extent, be invalid or unenforceable,
the remainder of this Agreement, or the application of such
provisions to Persons or circumstances other than those as to
whom or which it is held invalid or unenforceable, shall not be
affected thereby, and every provision of this Agreement shall be
valid and enforceable to the fullest extent permitted by law.
SECTION 9.5 NO PARTNERSHIP OR JOINT VENTURE. Any provision
hereof to the contrary notwithstanding, the Senior Lenders and GE
Capital and the Participants, by virtue of the issuance of this
Agreement or any action taken pursuant hereto or contemplated
hereby, shall not be deemed to be a partner or joint venturer
with one another or Aladdin Gaming. Aladdin Gaming shall
indemnify and hold the Senior Lenders and GE Capital and the
Participants harmless from and against any and all liabilities,
damages, claims, demands, costs and expenses (including, without
limitation, the costs and expenses of defending or settling any
such claims or demands and all fees and disbursements of legal
counsel engaged or employed by the Senior Lender or GE Capital
and the Participants, as the case may be, in defending or
settling such claims or demands) resulting from the relationship
between the Senior Lenders, GE and
-24-
the Participants or Aladdin Gaming being construed as a part
nership or joint venture.
SECTION 9.6 SURVIVAL OF REPRESENTATIONS AND WARRANTIES AND
THE AGREEMENT. All representations and warranties of Aladdin
Gaming contained in this Agreement shall survive the execution
and delivery of this Agreement. This Agreement shall survive the
exercise and enforcement of remedies under the Senior Credit
Agreement, the other Loan Documents, the Facilities Agreement and
the Operative Documents until such time as the parties have
performed their obligations hereunder in all material respects.
SECTION 9.7 GOVERNING LAW; ENTIRE AGREEMENT. THIS
AGREEMENT SHALL BE DEEMED TO BE A CONTRACT MADE UNDER AND
GOVERNED BY THE INTERNAL LAWS OF THE STATE OF NEW YORK (INCLUDING
FOR SUCH PURPOSE SECTIONS 5-1401 AND 5-1402 OF THE GENERAL
OBLIGATIONS LAW OF THE STATE OF NEW YORK).
SECTION 9.8. COUNTERPARTS. This Agreement may be executed
in two or more counterparts, each of which shall be deemed an
original.
Section 9.9 CAPTIONS. The captions and headings of the
various Articles and Sections to this Agreement are for
convenience only and are not to be considered as defining or
limiting in any way the scope or intent of the provisions hereof.
SECTION 9.10 FORUM SELECTION AND CONSENT TO JURISDICTION.
ANY LITIGATION BASED HEREON, OR ARISING OUT OF, UNDER, OR IN
CONNECTION WITH, THIS AGREEMENT OR ANY COURSE OF CONDUCT, COURSE
OF DEALING, STATEMENTS (WHETHER ORAL OR WRITTEN) OR ACTIONS OF
THE ADMINISTRATIVE AGENT, THE SENIOR LENDERS, THE FF&E AGENT, GE
CAPITAL AND THE PARTICIPANTS OR ALADDIN GAMING IN CONNECTION
HEREWITH OR THEREWITH SHALL BE BROUGHT AND MAINTAINED EXCLUSIVELY
IN THE COURTS OF THE STATE OF NEW YORK OR IN THE UNITED STATES
DISTRICT COURT FOR THE SOUTHERN DISTRICT OF NEW YORK. THE
ADMINISTRATIVE AGENT, THE SENIOR LENDERS, THE FF&E AGENT, GE
CAPITAL AND THE PARTICIPANTS AND ALADDIN GAMING HEREBY EXPRESSLY
AND IRREVOCABLY SUBMIT TO THE PERSONAL JURISDICTION OF THE COURTS
OF THE STATE OF NEW YORK AND OF THE UNITED STATES DISTRICT COURT
FOR THE SOUTHERN DISTRICT OF NEW YORK FOR THE PURPOSE OF ANY SUCH
LITIGATION AS SET FORTH ABOVE AND IRREVOCABLY AGREES TO BE BOUND
BY ANY JUDGMENT RENDERED THEREBY IN CONNECTION WITH SUCH
LITIGATION. CT CORPORATION SYSTEM (THE "PROCESS AGENT"), WITH AN
OFFICE ON THE DATE HEREOF AT ▇▇▇▇ ▇▇▇▇▇▇▇▇,
-▇▇-
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇, HAS BEEN APPOINTED BY THE BORROWER TO
BE ITS AGENT TO RECEIVE, ON ITS BEHALF AND ON BEHALF OF ITS
PROPERTY, SERVICE OF COPIES OF THE SUMMONS AND COMPLAINT AND ANY
OTHER PROCESS WHICH MAY BE SERVED IN ANY SUCH ACTION OR
PROCEEDING. SUCH SERVICE MAY BE MADE BY MAILING OR DELIVERING A
COPY OF SUCH PROCESS TO ALADDIN GAMING IN CARE OF THE PROCESS
AGENT AT THE PROCESS AGENT'S ABOVE ADDRESS, AND EACH PARTY HEREBY
IRREVOCABLY AUTHORIZES AND DIRECTS THE PROCESS AGENT TO ACCEPT
SUCH SERVICE ON ITS BEHALF. IN ADDITION TO THE FOREGOING, EACH
PARTY IRREVOCABLY CONSENTS TO THE SERVICE OF PROCESS BY
REGISTERED MAIL, POSTAGE PREPAID, OR BY PERSONAL SERVICE WITHIN
OR WITHOUT THE STATE OF NEW YORK AT THE ADDRESS FOR NOTICES
SPECIFIED IN SECTION 9.1. EACH PARTY HEREBY EXPRESSLY AND
IRREVOCABLY WAIVES, TO THE FULLEST EXTENT PERMITTED BY LAW, ANY
OBJECTION WHICH IT MAY HAVE OR HEREAFTER MAY HAVE TO THE LAYING
OF VENUE OF ANY SUCH LITIGATION BROUGHT IN ANY SUCH COURT
REFERRED TO ABOVE AND ANY CLAIM THAT ANY SUCH LITIGATION HAS BEEN
BROUGHT IN AN INCONVENIENT FORUM. TO THE EXTENT THAT ANY PARTY
HAS OR HEREAFTER MAY ACQUIRE ANY IMMUNITY FROM JURISDICTION OF
ANY COURT OR FROM ANY LEGAL PROCESS (WHETHER THROUGH SERVICE OR
NOTICE, ATTACHMENT PRIOR TO JUDGMENT, ATTACHMENT IN AID OF
EXECUTION OR OTHERWISE) WITH RESPECT TO ITSELF OR ITS PROPERTY,
SUCH PARTY HEREBY IRREVOCABLY WAIVES TO THE FULLEST EXTENT
PERMITTED BY LAW SUCH IMMUNITY IN RESPECT OF ITS OBLIGATIONS
UNDER THIS AGREEMENT, THE SENIOR CREDIT AGREEMENT, THE OTHER LOAN
DOCUMENTS, THE FACILITIES AGREEMENT AND THE OPERATIVE DOCUMENTS.
SECTION 9.11 WAIVER OF JURY TRIAL. THE ADMINISTRATIVE
AGENT, THE SENIOR LENDERS, THE FF&E AGENT, GE CAPITAL AND THE
PARTICIPANTS AND ALADDIN GAMING HEREBY KNOWINGLY, VOLUNTARILY AND
INTENTIONALLY WAIVE TO THE FULLEST EXTENT PERMITTED BY LAW ANY
RIGHTS THEY MAY HAVE TO A TRIAL BY JURY IN RESPECT OF ANY
LITIGATION BASED HEREON, OR ARISING OUT OF, UNDER, OR IN
CONNECTION WITH, THIS AGREEMENT, OR ANY COURSE OF CONDUCT, COURSE
OF DEALING, STATEMENTS (WHETHER ORAL OR WRITTEN) OR ACTIONS OF
THE ADMINISTRATIVE AGENT, THE SENIOR LENDERS, THE FF&E AGENT, GE
CAPITAL AND THE PARTICIPANTS AND ALADDIN GAMING IN CONNECTION
HEREWITH OR THEREWITH. EACH SUCH PERSON ACKNOWLEDGES AND AGREES
THAT IT HAS RECEIVED FULL AND SUFFICIENT CONSIDERATION FOR THIS
PROVISION (AND EACH OTHER PROVISION OF THIS AGREEMENT) AND THAT
THIS PROVISION IS A MATERIAL INDUCEMENT FOR THE ADMINISTRATIVE
AGENT, THE SENIOR LENDERS, THE FF&E AGENT, GE CAPITAL AND THE
PARTICIPANTS AND ALADDIN GAMING ENTERING INTO THIS AGREEMENT.
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SECTION 9.12 NO THIRD PARTY BENEFICIARIES. The provisions
of this Agreement are for the benefit of the Senior Lenders and
GE Capital and the Participants (and the successors and assigns
of the Senior Lenders and GE Capital and the Participants) and no
provision hereof is intended to benefit or inure to the benefit
of any other Person.
-27-
IN WITNESS WHEREOF, the parties have executed this
Agreement as of the day and year first above written.
ADMINISTRATIVE AGENT
THE BANK OF NOVA SCOTIA, as the
Administrative Agent
By:_________________________________
Name:
Title:
FF&E AGENT
GENERAL ELECTRIC CAPITAL
CORPORATION, as the FF&E Agent
By:_________________________________
Name:
Title:
ALADDIN GAMING
ALADDIN GAMING, LLC, a Nevada
limited-liability company
By:_________________________________
Name:
Title:
-28-
SCHEDULE A
A. APPROVALS AND CONSENTS BY THE FF&E AGENT
Prior to the time that the Facilities have been fully Funded, the
Administrative Agent shall have the right to make all approvals
and grant all consents under the Senior Loan Documents with
respect to the construction of the Aladdin Hotel and Casino which
approvals and consents shall be binding on the FF&E Agent, GE
Capital and the Participants to the extent that the FF&E Agent,
GE Capital and the Participants have the right to grant an
approval or consent in a corresponding section of the Facilities
Agreement; PROVIDED, HOWEVER, the FF&E Agent shall have the right
to make the approvals set forth below:
1. Approval of the certificate of the Construction
Consultant to be provided pursuant to Section 7(a)(18)
of the Facilities Agreement which approval will not be
withheld or delayed if the form of such certificate is
in the form attached to the Engagement Letter dated
January 28, 1998 from Rider ▇▇▇▇(NV)L.L.C. to The Bank
of Nova Scotia and State Street Bank and Trust Company,
as trustee.
2. Approval of use of proceeds pursuant to
Section 10(i)(2) of the Facilities Agreement; PROVIDED,
HOWEVER, so long as no Event of Default exists under
the Facilities Agreement (after giving effect to cure
rights granted to the Administrative Agent pursuant to
this Agreement), the FF&E Agent will permit Aladdin
Gaming to make the election granted to it pursuant to
Section 10(i)(1) of the Facilities Agreement (which
election by Aladdin Gaming shall be subject to the
terms of the Senior Credit Agreement).
3. Approval of an amendment to the Construction Benchmark
Schedule after giving effect to the provisions of
Section 11(o) of the Facilities Agreement.
4. Approval of an amendment, modification, or waiver of
the Opening Requirements as set forth in Section 11(q)
of the Facilities Agreement which
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approval shall not be unreasonably withheld or delayed.
B. FUNDING CONDITIONS
1. The obligation of Aladdin Gaming to make the
representations in the Operative Documents, other than
the representations under Sections 8(a), 8(b), 8(c),
8(d), 8(e), 8(f), 8(g), 8(n), 8(o), 8(p), 8(s) and 8(y)
of the Facilities Agreement, will not constitute a
failure to satisfy the funding condition in Section
7(b)(1) or constitute a Default or Event of Default if
the Administrative Agent has waived the obligation of
Aladdin Gaming to make the corresponding representation
in the Senior Credit Agreement.
2. The obligation of Aladdin Gaming to make the
representation under Section 8(t) of the Facilities
Agreement or to perform the covenant in Section 10(r)
of the Facilities Agreement will not constitute a
failure to satisfy the funding condition in Section
7(b)(1) or constitute a Default or Event of Default if,
after giving effect to the provisions of Sections C. 3
and C. 4.d of this Schedule A, the Main Project Budget
is "In Balance" as such term is defined for purposes of
said Sections.
3. The obligation of Aladdin Gaming to make
representations regarding LCI, LCNI, Bazaar Holdings,
Holdings, the Trust, Aladdin Music, AMH, any other
Aladdin Party, the Energy Project Provider, the Energy
Project Guarantor, the Design Builder, Fluor, the
Architect of Record, each Major Contractor and each
other Person (other than Aladdin Gaming) to a Material
Main Project Document or a Transaction Document will
not constitute a failure to satisfy the funding
condition in Section 7(b)(1) or constitute a Default or
Event of Default if the Administrative Agent has waived
the obligation of Aladdin Gaming to make the
corresponding representation in the Senior Credit
Agreement.
4. Except for LCI with respect to the initial Funding
only, a material adverse change with respect to any
Person (other than Aladdin Gaming) or a change which
has a Material Adverse Effect
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on any Person (other than Aladdin Gaming) will not
constitute a failure to satisfy the funding condition
in Section 7(b) or constitute a Default or Event of
Default if the Administrative Agent has waived the
obligation of Aladdin Gaming to make the corresponding
representation in the Senior Credit Agreement.
5. The condition in Section 7(b)(3) of the Facilities
Agreement shall be deemed to be satisfied if, on the
date of the applicable Funding, the conditions in
clauses 3, 4, 5, 6, 14, 15 and 16 (with respect to
Aladdin Gaming only) have been satisfied by Aladdin
Gaming in all material respects.
6. The representations to be made by Aladdin Gaming in the
certificate to be delivered by it pursuant to Section
7(b)(8) of the Facilities Agreement shall be subject to
the application of this Section B.
7. The representation deemed to be made by Aladdin Gaming
upon the request and acceptance of the proceeds of any
funding shall be subject to the application of this
Section B.
C. BREACHES OF COVENANTS BY ALADDIN GAMING
1. Prior to the initial Funding, the FF&E Agent, GE
Capital and the Participants shall have no right to
declare any Default or Event of Default under the
Operative Documents except for an Event of Default
under Section 12(a)(1) of the Facilities Agreement
(after giving effect to the cure rights granted to the
Administrative Agent pursuant to this Agreement).
2. A breach by Aladdin Gaming of the representations in
the Facilities Agreement, other than the
representations under Sections 8(a), 8(b), 8(c), 8(d),
8(e), 8(f), 8(g), 8(n), 8(o), 8(p), 8(s) and 8(y) of
the Facilities Agreement, will not be a Default or
Event of Default under the Facilities Agreement or have
to be cured by the Administrative Agent so long as such
breach does not materially and adversely interfere with
the practical realization of the rights and benefits
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provided by the Facilities Agreement and the Operative
Documents.
3. For purposes of determining compliance by Aladdin
Gaming with the representation in Section 8(t) of the
Facilities Agreement, the Main Project Budget shall be
deemed to be "In Balance" for purposes of this
Agreement only if (x) the amount required to bring the
Main Project Budget "In Balance" does not exceed
$5,000,000 or (y) such amount is greater than
$5,000,000, the Unallocated Contingency Balance equals
or exceeds the amount required to bring the Main
Project Budget In Balance. Notwithstanding the
foregoing, the Borrower expressly agrees that it shall
be required to satisfy the "In Balance" requirement in
the Senior Credit Facility in addition to the
requirement set forth herein and that the "In Balance"
requirement set forth in the Senior Credit Agreement is
not modified or amended hereby.
4. Breaches by Aladdin Gaming of the covenants listed
below shall be deemed cured by the Administrative Agent
as follows:
a. Breach by Aladdin Gaming of its obligations
under Section 10(a), 10(f) or 10(g) of the
Facilities Agreement shall be deemed cured by the
Administrative Agent upon delivery by the
Administrative Agent of information obtained by it
from Aladdin Gaming pursuant to the Senior Credit
Agreement.
b. Any waiver, reduction or adjustment by the
Administrative Agent of the FF&E Reserves required
by the Senior Credit Agreement shall be binding on
the FF&E Agent, GE Capital and the Participants.
c. Until such time as the Administrative Agent
has declared an Event of Default under the Senior
Credit Agreement for breach of the covenant under
the Senior Credit Agreement that corresponds to
Section 10(q) of the Facilities Agreement, the
FF&E Agent, GE Capital and the Participants shall
have no right to declare a Default or Event of
Default under the Facilities Agreement for
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such breach and all waivers by the Administrative
Agent shall be binding on the FF&E Agent, GE
Capital and the Participants. Notwithstanding the
foregoing, the FF&E Agent, GE Capital and the
Participants shall have the right to declare a
Default or Event of Default if a breach of said
Sections results in a material alteration of the
capital structure of Aladdin Gaming, materially
impairs the ability of Aladdin Gaming to perform
its monetary obligations under this Agreement when
due or results in a material deviation of the
nature or scope of the Aladdin Casino and Hotel
from that which is presently contemplated.
d. For purposes of determining compliance by Aladdin
Gaming with the covenant in Section 10(r) of the
Facilities Agreement the Main Project Budget shall
be deemed to be "In Balance" for purposes of this
Agreement if (x) the amount required to bring the
Main Project Budget "In Balance" does not exceed
$5,000,000 or (y) such amount is greater than
$5,000,000, the Unallocated Contingency Balance
equals or exceeds the amount required to bring the
Main Project Budget "In Balance". In either such
case, the FF&E Agent, GE Capital and the
Participants shall have no right to require any
payment by Aladdin Gaming of any such amount. If
the amount required to bring the Main Project
Budget "In Balance" exceeds $5,000,000 and the
Unallocated Contingency Balance is less the amount
required to bring the Main Project Budget "In
Balance", Aladdin Gaming shall be deemed to have
performed its obligation to bring the Main Project
Budget "In Balance" under Section 10(r) if it
deposits with the Administrative Agent in
accordance with the Senior Credit Agreement an
amount equal to the excess of such amount over
$5,000,000 or the Unallocated Contingency Balance,
whichever is less. Notwithstanding the foregoing,
the Borrower expressly agrees that it shall be
required to satisfy the "In Balance" requirement
in the Senior Credit Facility in addition to the
covenant set forth in the Facilities
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Agreement and that the "In Balance" requirement
set forth in the Senior Credit Agreement is not
modified or amended hereby.
e. No Event of Default will be declared under the
Facilities Agreement for breach of
Section 12(a)(10) if there is a transfer by
Aladdin Gaming in lieu of foreclosure to a Person
which falls within the definition of "Purchaser".
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