INTERCREDITOR AGREEMENT
(Credit Parties)
THE BANK OF NOVA SCOTIA
as Bank Agent
FIRST TRUST NATIONAL ASSOCIATION
as Mortgage Notes Indenture Trustee
GMAC COMMERCIAL MORTGAGE CORPORATION
as Interim Mall Lender
FIRST UNION NATIONAL BANK
as Subordinated Notes Trustee
and
THE BANK OF NOVA SCOTIA
as Intercreditor Agent
November 14, 1997
Table of Contents
RECITALS.................................................................... 1
A. The Project....................................................... 1
B. The Bank Credit Facility.......................................... 1
C. The Interim Mall Facility......................................... 1
D. The Mortgage Notes Indenture...................................... 2
E. The Subordinated Notes Indenture.................................. 2
F. Financing Development of the Project.............................. 2
G. Funding and Security Agreements................................... 3
H. Intercreditor Agreement........................................... 4
1. Definitions and General Provisions....................................... 4
1.1 Definitions....................................................... 4
1.1.1 Disbursement Agreement Terms............................... 4
1.1.2 Other Terms................................................ 5
1.2 Interpretation.................................................... 15
2. Collateral, Priority of Liens, Subordination and Release................. 15
2.1 Liens and Security Interests...................................... 15
2.1.1 Collateral for Bank Secured Obligations.................... 15
2.1.2 Collateral for Mortgage Notes Secured Obligations.......... 16
2.1.3 Collateral for Interim Mall Secured Obligations............ 16
2.2 Liens on the Mall................................................. 17
2.2.1 Prior to Mall Parcel Creation Date......................... 17
2.2.2 Upon Creation of Mall Parcel............................... 19
2.3 Shared Collateral................................................. 19
2.4 Tranche B Collateral.............................................. 20
2.5 Separate Proceeds Accounts Collateral............................. 20
2.6 No Other Collateral............................................... 20
2.7 Confirmation of Liens............................................. 21
2.8 Phase II Release.................................................. 22
2.9 Mall Release...................................................... 22
2.10 Effect............................................................ 22
2.11 Mall Space Leases................................................. 23
3. Permitted Facility Amendments; Protective Advances....................... 23
3.1 Bank Credit Facility Amendments................................... 23
3.2 Interim Mall Facility Amendments.................................. 25
3.3 Note Holders...................................................... 27
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3.4 Waivers............................................................ 27
3.5 Protective Advances................................................ 28
3.6 No Other Facility Amendments....................................... 28
3.7 Additional Capital Indebtedness.................................... 28
3.8 No Approval Rights of Subordinated Note Indenture Trustee.......... 30
4. Events of Default; Remedies; Certain Actions by Intercreditor Agent....... 30
4.1 Declaration of Event of Default.................................... 30
4.2 Required Protective Advances....................................... 30
4.3 Standstill......................................................... 31
4.4 Waivers............................................................ 32
4.5 Shared Collateral.................................................. 33
4.6 Requirements Regarding Exercise of Remedies........................ 33
4.6.1 Prior to Mall Release Date.................................. 33
4.6.2 Remedies After Mall Release Date............................ 34
4.7 Exercise of Rights Under Security Agreements....................... 35
4.7.1 Related Collateral Agreements by Intercreditor Agent........ 35
4.7.2 Separate Realization........................................ 36
4.7.3 Foreclosure of Deeds of Trust............................... 38
4.8 Allocation of Shared Collateral Proceeds........................... 38
4.9 Other Duties of and Actions by Intercreditor Agent................. 40
5. Representations and Warranties............................................ 41
5.1 Organization....................................................... 41
5.2 Authorization...................................................... 41
5.3 Binding Agreement.................................................. 41
5.4 No Consent Required................................................ 41
5.5 No Conflict........................................................ 41
6. Appointment of Intercreditor Agent........................................ 42
6.1 Appointment........................................................ 42
6.2 Authority.......................................................... 42
6.3 Amendment of Agreements............................................ 43
6.4 Responsibility..................................................... 43
6.5 Liability.......................................................... 43
6.6 Capacity........................................................... 44
6.7 Resignation; Appointment of Additional Intercreditor Agents........ 44
7. Miscellaneous Provisions.................................................. 45
7.1 Notices; Addresses................................................. 45
7.2 Further Assurances................................................. 48
7.3 Delay and Waiver................................................... 48
7.4 Entire Agreement................................................... 48
7.5 Governing Law...................................................... 49
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7.6 Severability....................................................... 49
7.7 Headings........................................................... 49
7.8 Limitations on Liability........................................... 49
7.9 Consent of Jurisdiction............................................ 49
7.10 Successors and Assigns............................................. 49
7.11 Counterparts....................................................... 50
7.12 No Third Party Beneficiaries....................................... 50
7.13 Amendment for New Credit Parties................................... 50
7.14 Trust Indenture Act................................................ 50
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INTERCREDITOR AGREEMENT
(Credit Parties)
THIS AGREEMENT is made as of November 14, 1997, by and among THE BANK
OF NOVA SCOTIA, a Canadian chartered bank ("Scotiabank"), as the Administrative
Agent acting on behalf of itself and the Bank Lenders pursuant to the Bank
Credit Agreement (in such capacity, the "Bank Agent"), FIRST TRUST NATIONAL
ASSOCIATION, a national banking association in its capacity as Trustee under the
Mortgage Notes Indenture (in such capacity, the "Mortgage Notes Indenture
Trustee"), GMAC COMMERCIAL MORTGAGE CORPORATION, a California corporation, as
lender with respect to the Interim Mall Credit Agreement (in such capacity, the
"Interim Mall Lender"), FIRST UNION NATIONAL BANK, a national banking
association, in its capacity as Trustee under the Subordinated Notes Indenture
(in such capacity, the "Subordinated Notes Indenture Trustee"), and SCOTIABANK,
as Intercreditor Agent hereunder and under the Related Collateral Agreements (in
such capacity, the "Intercreditor Agent").
RECITALS:
A. The Project. Las Vegas Sands, Inc., a Nevada corporation ("LVSI"),
Venetian Casino Resort, LLC, a Nevada limited liability company ("Venetian"),
and Grand Canal Shops Mall Construction, LLC, a Delaware limited liability
company ("Mall Construction Subsidiary") which is a wholly owned subsidiary of
Venetian (LVSI, Venetian and Mall Construction Subsidiary are collectively
referred to herein as the "Company;" provided, however, that after the Mall
Release Date, "Company" shall mean and refer to LVSI and Venetian only), propose
to develop, construct and operate the Venetian Casino Resort, a large-scale,
Venetian-themed hotel/casino/retail and entertainment complex with a related
heating, ventilation and air-conditioning central plant, related common parking
facilities and related central electrical sub-station facilities, all as part of
the redevelopment on the site of the former Las Vegas Sands Hotel and Casino.
B. The Bank Credit Facility. Concurrently herewith, LVSI, Venetian,
the Bank Agent, ▇▇▇▇▇▇▇ ▇▇▇▇▇ Credit Partners L.P. and the Bank Lenders have
entered into the Bank Credit Agreement pursuant to which the Bank Lenders have
agreed, subject to the terms thereof and hereof, to provide the Bank Credit
Facility to LVSI and Venetian.
C. The Interim Mall Facility. Concurrently herewith, the Company and
the Interim Mall Lender have entered into the Interim Mall Credit Agreement
pursuant to which the Interim Mall Lender has agreed, subject to terms thereof
and hereof, to provide the Interim Mall Facility to the Company.
D. The Mortgage Notes Indenture. Concurrently herewith LVSI,
Venetian, certain guarantors named therein and the Mortgage Notes Indenture
Trustee have entered into the Mortgage Notes Indenture pursuant to which LVSI
and Venetian will issue the Mortgage Notes.
E. The Subordinated Notes Indenture. Concurrently herewith, LVSI,
Venetian, certain guarantors named therein and the Subordinated Notes Indenture
Trustee have entered into the Subordinated Notes Indenture pursuant to which
LVSI and Venetian will issue the Subordinated Notes.
F. Financing Development of the Project. The Company is financing the
development of the Project, in part, with the proceeds of the Bank Credit
Facility, the Interim Mall Facility, the Mortgage Notes and the Subordinated
Notes. Venetian and LVSI are constructing and developing the Project. As of the
date hereof, fee title to the entire Project is owned by Venetian, provided that
the retail mall portion of the Project (the "Mall") is leased to Mall
Construction Subsidiary by Venetian under the Mall Lease. On the Mall Parcel
Creation Date, Mall Construction Subsidiary is to acquire fee title to the Mall
Parcel from Venetian as provided for herein and the portion of the Project other
than the Mall will thereafter continue to be owned by Venetian. In addition to
certain other collateral and security interests (which other collateral and
security interests are more particularly described in this Agreement):
(1) the Interim Mall Facility is secured by a first priority
lien on Mall Construction Subsidiary's interest in the Mall, as more
particularly described in Section 2.1 and Section 2.2 hereof;
(2) the Bank Credit Facility is secured (i) by a first priority
lien on Hotel/Casino Collateral (including Venetian's interest in the
Mall), and (ii), until the Mall Release Date, by a second priority lien on
Mall Construction Subsidiary's interest in the Mall as more particularly
described in Section 2.1 and Section 2.2 hereof;
(3) the Mortgage Notes are secured (i) by a second priority
lien on Hotel/Casino Collateral and Venetian's interest in the Mall, and
(ii), until the Mall Release Date, by a third priority lien on the Mall
Construction Subsidiary's interest in Mall, as more particularly described
in Section 2.1 and Section 2.2 hereof; and
(4) certain contract rights, disbursement accounts and other
Shared Collateral applicable to the construction of the Project will be
subject to security interests (i) with first lien priority to secure the
Bank Secured Obligations and the Interim Mall Secured Obligations, and
(ii) with second lien priority to secure the Mortgage Notes Secured
Obligations, as more particularly described in Section 2.1 and Section 2.3
hereof.
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The Subordinated Notes are and will remain an unsecured obligation of Venetian
and LVSI. Upon the Mall Release Date, (i) the liens on the Mall securing the
Bank Credit Facility and the Mortgage Notes will be released, (ii) the liens on
LVSI's and Venetian's interests in the Shared Collateral securing the Interim
Mall Facility will be released, (iii) this Agreement will no longer apply to the
Mall or the Interim Mall Lender, except with respect to certain rights in the
Shared Collateral, and (iv) this Agreement will remain in full force and effect
among Bank Agent, Mortgage Note Indenture Trustee and Subordinated Note
Indenture Trustee, all as more particularly provided for herein.
G. Funding and Security Agreements. In connection with the matters
provided for herein, the parties have entered into, among other agreements, the
following additional agreements:
(1) Disbursement Agreement. LVSI, Venetian, Mall Construction
Subsidiary, the Bank Agent, the Mortgage Notes Indenture Trustee, the
Interim Mall Lender, Atlantic-Pacific, Las Vegas LLC, a Delaware limited
liability company (the "HVAC Provider"), and Scotiabank, as Disbursement
Agent thereunder, have entered into that Funding Agents' Disbursement and
Administration Agreement as of even date herewith (the "Disbursement
Agreement"), in order to set forth, among other things, (a) the mechanics
for and allocation of the Company's request for advances under the various
Facilities and from the Company's Funds Account, (b) the conditions
precedent to the initial advance and conditions precedent to subsequent
advances, (c) certain common representations, warranties and covenants of
the Company in favor of the Funding Agents and (d) common Events of
Default and remedies during construction of the Project.
(2) Borrower Security Agreement. LVSI, Venetian and Mall
Construction Subsidiary, as Debtors thereunder, and Scotiabank, as
Intercreditor Agent thereunder, have entered into that Borrower Security
Agreement as of even date herewith (the "Borrower Security Agreement"), to
provide for, among other things, (a) the creation of security interests in
certain "Shared Intangible Collateral" defined therein (which includes,
without limitation, rights of Venetian or LVSI under certain contracts
relating to the construction and development of the Project and insurance
proceeds) granted to the Intercreditor Agent (i) to secure the Bank
Secured Obligations and the Interim Mall Secured Obligations, with first
lien priority, and (ii) to secure the Mortgage Notes Secured Obligations,
with second lien priority, and (b) the creation of security interests in
all of the other Collateral described therein granted to the Intercreditor
Agent to secure the Bank Secured Obligations, with first lien priority,
and to secure the Mortgage Notes Secured Obligations, with second lien
priority.
(3) Mall Security Agreement. Mall Construction Subsidiary, as
Debtor thereunder, and Scotiabank, as Intercreditor Agent thereunder, have
entered into that Mall Construction Subsidiary Security Agreement as of
even date herewith
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(the "Mall Security Agreement"), to provide for, among other things, the
creation of security interests in certain personal property described
therein granted to the Intercreditor Agent to secure the Interim Mall
Secured Obligations, with first lien priority, to secure the Bank Secured
Obligations, with second lien priority, and to secure the Mortgage Notes
Secured Obligations, with third lien priority.
(4) Account Agreements. As provided for in the Disbursement
Agreement and the Borrower Security Agreement, in connection with the
development and financing of the Project, the collateral account
agreements described in Exhibit B attached hereto have been entered into
as of even date herewith among the Company or the other Persons shown
thereon as Debtors, Scotiabank as Disbursement Agent, and Scotiabank as
Securities Intermediary (except under the Mortgage Proceeds Collateral
Account Agreement), to provide for the creation of security interests in
the accounts described in each of such Account Agreements to secure the
Obligations to the Secured Lenders, as summarized on Exhibit B, and to
provide for the administration of such accounts by Disbursement Agent.
H. Intercreditor Agreement. The Credit Parties desire to enter into
this Agreement in order to appoint Scotiabank as the Intercreditor Agent
hereunder and under the Related Collateral Agreements, and to set forth certain
provisions relating to their respective rights in the Collateral, the exercise
of remedies in the event of default, the application of proceeds of enforcement
and certain other matters.
NOW, THEREFORE, with reference to the foregoing recitals and in
reliance thereon, and for other good and valuable consideration, the receipt and
sufficiency of which is hereby acknowledged, the Credit Parties agree as
follows:
1. Definitions and General Provisions.
1.1 Definitions. Except as otherwise expressed and provided herein,
all capitalized terms used in this Agreement and its Exhibits shall have the
meanings provided for in this Section 1.1.
1.1.1 Disbursement Agreement Terms. The following terms shall
have the meanings set forth in the Disbursement Agreement:
Accounts Approved Equipment Funding
Additional Company Equity Commitments
▇▇▇▇▇▇▇ Bank Credit Agreement
Advance Bank Credit Facility
Advance Confirmation Notice Bank Security Documents
Affiliate Banking Day
Billboard Master Lease
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Commitment Mall I LLC
Company's Funds Account Mall I Subsidiary
Completion Date Mall Lease
Construction Consultant Mall Parcel
Contractor Mall Space
Deeds of Trust Mortgage Note(s)
Equipment Component Mortgage Note Holders
Final Completion Mortgage Notes Indenture
Financing Agreements Mortgage Notes Security Documents
Financing Date Obligations
Funding Agents Permanent Mall Lender
GECC Commitment Person
Guaranty Deposit Account Phase II Land
Indebtedness Phase II Release Conditions
Interim Mall Credit Agreement Potential Event of Default
Interim Mall Facility Project
Interim Mall Security Documents Project Costs
Interim Mall Space Fee Deed of Trust Project Security
Interim Mall Leasehold Deed of Trust Security Documents
Lien Scope Change
Stop Funding Notice
Subordinated Note(s)
Subordinated Notes Indenture
Tranche B Collateral
1.1.2 Other Terms. The following terms shall have the meanings
set forth below:
"Acceleration Event" means the acceleration of the maturity of all
Obligations under a Facility Agreement in accordance with the terms and
conditions of such Facility Agreement.
"Account Agreements" means, collectively, the Collateral Account
Agreements listed on Exhibit B attached hereto and incorporated herein by
reference and more particularly described as follows:
(1) that Mortgage Notes Proceeds Collateral Account Agreement
dated as of even date herewith (the "Mortgage Notes Proceeds Account
Agreement") among Venetian, LVSI and Mall Construction Subsidiary, as
Pledgor, Scotiabank as Disbursement Agent, as Secured Party, and ▇▇▇▇▇▇▇,
Sachs & Co., as Securities Intermediary;
(2) that HVAC Collateral Account Agreement dated as of even
date herewith (the "HVAC Account Agreement") among the HVAC Provider, as
Pledgor,
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Scotiabank as Disbursement Agent, as Secured Party, and Scotiabank, as
Securities Intermediary;
(3) that Completion Guaranty Collateral Account Agreement dated
as of even date herewith (the "Completion Guaranty Account Agreement")
among ▇▇▇▇▇▇▇, as Pledgor, Scotiabank as Disbursement Agent, as Secured
Party, and ▇▇▇▇▇▇▇, Sachs & Co., as Securities Intermediary; and
(4) that Disbursement Collateral Account Agreement dated as of
even date herewith (the "Disbursement Account Agreement") among Venetian,
LVSI and Mall Construction Subsidiary, as Pledgor, ScotiaBank as
Disbursement Agent, as Secured Party, and ScotiaBank, as Securities
Intermediary.
"Accounts" means, collectively, the accounts described in the
Account Agreements, including:
(1) the Mortgage Notes Proceeds Account described in the
Mortgage Notes Proceeds Account Agreement (the "Mortgage Notes Proceeds
Account");
(2) the HVAC Collateral Accounts described in the HVAC
Collateral Account Agreement (the "HVAC Accounts");
(3) the Completion Guaranty Account described in the Completion
Guaranty Account Agreement (the "Completion Guaranty Account");
(4) the Bank Proceeds Account described in the Disbursement
Account Agreement (the "Bank Proceeds Account"); and
(5) the Collection Account, the Company Funds Account, the
Disbursement Account, the HC/Mall Component Cash Management Account, the
HVAC Component Cash Management Account, the Interest Payment Account and
the Pre-Completion Revenues Account described in the Disbursement Account
Agreement, together with any other account which may hereafter be
established pursuant to the Disbursement Account Agreement (other than the
Bank Proceeds Account) or the Disbursement Agreement (collectively, the
"Project Development Accounts").
"Account Collateral" or "Accounts Collateral" means, collectively,
all of the Accounts and the amounts on deposit therein, any interest earned
thereon, and any investments of such amounts made pursuant to the Accounts
Agreements and any proceeds of the foregoing. When the term "Collateral" is used
in conjunction with any of the Accounts (e.g., the "Mortgage Notes Proceeds
Account Collateral" or the "HVAC Accounts Collateral"), said Account Collateral
means the specified Account and all amounts on deposit therein, any interest
earned thereon, and any investments of such amounts made pursuant to
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the applicable Account Agreement, and any proceeds of the foregoing except to
the extent such proceeds are deposited into another Account pursuant to the
terms of the Disbursement Agreement or the Account Agreements.
"Additional Bank Proceeds" means the proceeds advanced by the Bank
Lenders pursuant to any Facility Amendment which increases the maximum amount of
the existing commitments under the Bank Credit Facility, subject to the
limitations on the amount thereof provided for in Section 3.1.1 or Section 3.1.6
hereof; provided, however, that Additional Bank Proceeds shall not include (i)
any amounts advanced by the Bank Lenders, or any of them, pursuant to Approved
Equipment Funding Commitments, or (ii) any amounts advanced or re-advanced by
the Bank Lenders under the Revolving Bank Loan Commitment under the Bank Credit
Facility (but any Facility Amendment of the Bank Credit Facility to increase the
$20,000,000 maximum amount of the Revolving Bank Loan Commitment shall be
subject to the provisions of Section 3.1.1 or Section 3.1.6 below).
"Additional Capital Indebtedness" means additional indebtedness
issued by Venetian or LVSI pursuant to Section 3.7 of this Agreement.
"Additional Mall Proceeds" means the proceeds advanced by the Interim
Mall Lender pursuant to any Facility Amendment which increases the maximum
amount of the existing commitments under the Interim Mall Facility, subject to
the limitations on the amount thereof provided for in Section 3.2.1 or Section
3.2.4 hereof.
"▇▇▇▇▇▇▇ Relative" means (i) any spouse, child, grandchild, or
sibling of ▇▇▇▇▇▇▇, (ii) any other natural Person having a relationship by
blood, marriage or adoption not more remote than second cousin with ▇▇▇▇▇▇▇ or
any Person referenced in clause (i) of this definition, or (iii) any other
Person directly or indirectly controlled by ▇▇▇▇▇▇▇ or any other Person
referenced in clause (i) or clause (ii) of this definition. For purposes of this
definition, "control" shall mean the possession, directly or indirectly, of the
power to direct or cause the direction of the management or policies of any
other Person whether through the ownership of voting securities or by agreement
or otherwise.
"Applicable Margin" shall have the meaning ascribed thereto in the
Bank Credit Agreement or the Interim Mall Credit Agreement, as the context
requires.
"Bank Agent" means Scotiabank or its successor or assignee in its
capacity as Administrative Agent under the Bank Credit Agreement.
"Bank Deed of Trust (Venetian)" means that certain Deed of Trust,
Assignment of Leases and Rents, Security Agreement and Fixture Filing dated as
of even date herewith, made by Venetian, as trustor, to Lawyers Title of Nevada,
Inc., as trustee, for the benefit of the Bank Agent, as beneficiary.
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"Bank Deed of Trust (Mall Parcel)" means that certain Deed of Trust,
Assignment of Leases and Rents, Security Agreement and Fixture Filing to be
executed in accordance with the terms and conditions of the Disbursement
Agreement on the Mall Parcel Creation Date by Mall Construction Subsidiary, as
trustor, to Lawyers Title of Nevada, Inc., as trustee, for the benefit of Bank
Agent, as beneficiary.
"Bank Leasehold Deed of Trust (Mall)" means that certain Deed of
Trust, Assignment of Leases and Rents, Security Agreement and Fixture Filing
dated as of even date herewith, made by Mall Construction Subsidiary, as
trustor, to Lawyers Title of Nevada, Inc., as trustee, for the benefit of Bank
Agent, as beneficiary.
"Bank Lenders" means the Bank Lenders pursuant to the Bank Credit
Agreement or their successors or assignees in such capacity as lenders under the
Bank Credit Agreement.
"Bank Secured Obligations" means all Obligations under the Bank
Credit Facility, the Bank Security Documents and the other Bank Financing
Agreements.
"Bankruptcy Code" means Title 11 of the United States Code entitled
"Bankruptcy," as now and hereafter in effect, or any successor statute.
"Base Rate Loan" shall have the meaning ascribed thereto in the Bank
Credit Agreement.
"Collateral" means the following unique and separate categories of
property encumbered to secure the Obligations to any of the Secured Lenders: (i)
the Hotel/Casino Collateral, (ii) the Mall Collateral, (iii) the Shared
Collateral, and (iv) the Separate Proceeds Accounts Collateral; provided,
however, that for purposes of this Agreement, the Collateral shall exclude the
Tranche B Collateral. Attached hereto as Exhibit C and incorporated herein by
reference is a schedule setting forth the allocation of certain Collateral into
said separate categories. To the extent that the definitions of "Hotel/Casino
Collateral" and "Mall Collateral," by reason of the references therein to
property encumbered under the Bank Security Documents and the Interim Mall
Security Documents, respectively, would result in any property being classified
as both Hotel/Casino Collateral and Mall Collateral, reference shall be made to
the allocations of Collateral set forth in Exhibit C to resolve such ambiguity.
"Consents" means the agreements described on Exhibit D attached
hereto and incorporated herein by reference.
"Company Group" means the Company and any Affiliate of the Company,
and references herein to "any of the Company Group" or words to that effect mean
any of the entities comprising the Company or any Affiliate of any of them.
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"Controlling Party" means one or more Secured Credit Parties with the
right to direct the Intercreditor Agent with respect to any decisions or action
made or taken or to be made or taken with respect to Collateral pursuant to any
of the Related Collateral Documents (including, without limitation, the matters
provided for in Section 4.7.1 and Section 4.9), determined in accordance with
the following:
(1) except with respect to Specified Actions, the Controlling
Party with respect to any Collateral shall be the Secured Credit Party or
Parties which, at the time any direction or consent is required or may be
given, has the most senior liens on or security interests in such
Collateral as established pursuant to Section 2.1; provided that, in the
event one or more Secured Credit Parties have pari passu liens on or
security interest in Collateral, the Controlling Party shall refer to both
such Secured Credit Parties and decisions shall be deemed to be made by
the Controlling Party only to the extent consented to or approved by both
such Secured Credit Parties; and
(2) with respect to Specified Actions, the Controlling Party
shall mean all of the Secured Credit Parties;
provided, however, that in the event ▇▇▇▇▇▇▇ or any ▇▇▇▇▇▇▇ Relative directly or
indirectly owns an interest (other than a participation) in excess of fifteen
percent (15%) of the aggregate Indebtedness under the Bank Credit Facility, the
Interim Mall Facility or the Mortgage Notes Facility (the percentage of the
total Indebtedness attributable to ▇▇▇▇▇▇▇ or any ▇▇▇▇▇▇▇ Relative shall be
determined in accordance with the procedure demonstrated by the following
example: a direct or indirect 50% interest in a $70 million portion of a $140
million Indebtedness would equal a 25% interest in such Indebtedness), then the
Secured Credit Party with respect to such Indebtedness (an "Ineligible Credit
Party") shall not have the right to act as a Controlling Party in accordance
with the foregoing, and the Controlling Party shall be the Credit Party or
Parties determined in accordance with such provisions among the Secured Credit
Parties other than the Ineligible Credit Party (the foregoing provisions shall
not, however, limit or restrict the other rights of a Secured Credit Party under
this Agreement, including, without limitation, exercise of the rights provided
for in Section 4.6.1 or Section 4.6.2 and in Section 4.7.2, whether or not such
Secured Credit Party is an Ineligible Credit Party in accordance with the
foregoing).
"Credit Parties" means the Bank Agent, the Mortgage Notes Indenture
Trustee, the Subordinated Notes Indenture Trustee and, until the Mall Release
Date, the Interim Mall Lender.
"Disbursement Agent" means Scotiabank or its successor or assignee in
its capacity as Disbursement Agent under the Disbursement Agreement, acting in
such capacity under the Disbursement Agreement, the Account Agreements and the
Consents.
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"Disbursement Agreement Default" means the occurrence and continuance
of an Event of Default under the Disbursement Agreement.
"Disbursement Agreement Default Date" the date upon which a
Disbursement Agreement Default occurs.
"Eurodollar Rate Loans" shall have the meaning ascribed thereto in
the Bank Credit Agreement.
"Event of Default" means, as the context requires, (i) a Disbursement
Agreement Default, or (ii) the occurrence and continuance of an "Event of
Default" by or with respect to the Company under the applicable Financing
Agreement; provided, however, that notwithstanding the provisions of Section 1.2
of this Agreement, any matter which would have constituted an "Event of Default"
under a Facility Agreement but for the waiver thereof by the Credit Party to
such Facility Agreement, or but for the termination of such Facility Agreement,
shall not constitute an Event of Default for purposes of this Agreement.
"Exercise Remedies" or the "Exercise of Remedies" means the recording
of a Notice of Default under any of the Deeds of Trust, the commencement of an
action for judicial foreclosure, the appointment of a receiver, the enforcement
of personal property foreclosure proceedings (whether judicial or non-judicial),
the filing of a complaint or other action to enforce any Obligations,
realization on Collateral or the enforcement of other remedies under any Related
Collateral Agreement or any Facility Agreement, or the exercise of set off, or
any combination of the foregoing, by or for the benefit of any Credit Party
hereto; provided, however, that "Exercise Remedies" or the "Exercise of
Remedies" shall exclude, without limitation, the following: (i) the giving of
notices of default (as distinguished from recording a Notice of Default), (ii)
any declaration of an Acceleration Event, and (iii) actions taken by any Secured
Credit Party or the Intercreditor Agent to perfect, or to extend or confirm the
perfection or effectiveness of, any lien provided for herein or in the
applicable Facility Agreements.
"Facility or Facilities" means, as the context requires, any or all
of the Bank Credit Facility, the Interim Mall Facility, the Mortgage Notes
Proceeds and the Subordinated Notes Proceeds.
"Facility Agreements" means, collectively, the Bank Credit Agreement,
the Interim Mall Credit Agreement, the Mortgage Notes Indenture and the
Subordinated Notes Indenture.
"Facility Amendment" means any amendment, modification, extension or
renewal of any Facility or Facility Agreement.
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"Hotel/Casino" means the entire Project other than the Mall;
provided, however, that after the release of the Phase II Land in accordance
with Section 2.8 below, the Hotel/Casino shall exclude the Phase II Land.
"Hotel/Casino Collateral" means all real and personal property
encumbered to secure the Bank Secured Obligations under the Bank Security
Documents other than: (a) the Shared Collateral, (b) the Separate Proceeds
Accounts Collateral, and (c) Mall Construction Subsidiary's interest in the Mall
Collateral; provided, however, that:
(1) until the creation and conveyance of the Mall Parcel and
the termination of the Mall Lease, all in accordance with the terms of
this Agreement and the Disbursement Agreement on the Mall Parcel Creation
Date, the Hotel/Casino Collateral shall include, without limitation, (A)
fee title to the real property leased to Mall Construction Subsidiary
pursuant to the Mall Lease (the "Pre-Separation Underlying Mall Fee"), and
(B) the interest of Venetian as lessor under the Mall Lease;
(2) after the Mall Parcel Creation Date, the Hotel/Casino
Collateral shall not include the Mall Parcel;
(3) prior to the Mall Release Date, any Shared Collateral
allocated to the Hotel/Casino pursuant to Section 4.8 shall become
Hotel/Casino Collateral as provided for therein,
(4) upon the Mall Release Date, all Shared Collateral shall
become Hotel/Casino Collateral (except any then-pending allocations of
Shared Collateral Proceeds in accordance with Section 4.8), and
(5) after the Phase II Land has been released from the liens
and security interests securing the Bank Credit Facility and the Mortgage
Notes, in accordance with Section 2.8 hereof, the Hotel/Casino Collateral
shall not include the Phase II Land.
"Intercreditor Agent" means Scotiabank as the Intercreditor Agent
pursuant to Section 6 of this Agreement, its permitted successor or assignee in
such capacity, and any Additional Intercreditor Agent appointed pursuant to said
Section 6.
"Interim Mall Lender" means GMAC Commercial Mortgage Corporation or
its successor or assignee in its capacity as lender under the Interim Mall
Credit Agreement.
"Interim Mall Secured Obligations" means all Obligations under the
Interim Mall Loan Facility, the Interim Mall Security Documents and the other
Interim Mall Financing Agreements.
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"Mall Collateral" means all real and personal property encumbered to
secure the Interim Mall Secured Obligations under the Interim Mall Security
Documents other than: (a) the Shared Collateral (other than Shared Collateral
allocated to the Mall pursuant to Section 4.8), (b) the Separate Proceeds
Accounts Collateral, (c) the Tranche B Collateral, and (d) the Pre-Separation
Underlying Mall Fee (encumbered under the Interim Mall Space Fee Deed of Trust
provided for herein); provided, however, that after the Mall Parcel Creation
Date, the Mall Collateral shall include the Mall Parcel. The Mall Collateral
shall include, without limitation, the interest of Mall Construction Subsidiary
as lessee under the Billboard Master Lease and (i) the interest of Mall
Construction Subsidiary as lessee under the Mall Lease until the creation and
conveyance of the Mall Parcel, and the termination of the Mall Lease, all in
accordance with the terms of this Agreement and the Disbursement Agreement on
the Mall Parcel Creation Date, and (ii), following such event, the Mall Parcel.
(The interest of Venetian as lessor under the Master Billboard Lease, and fee
title to the real property leased to Mall Construction Subsidiary under the
Billboard Master Lease, are, however, Hotel/Casino Collateral.)
"Mall Parcel Creation Date" means the date on which the transactions
provided for in Section 5.16(b) of the Disbursement Agreement occur in
connection with the creation of the Mall Parcel as a separate legal parcel of
real property under applicable Nevada law.
"Mall Release Date" means the date upon which the transactions
provided for in Section 5.16(c) of the Disbursement Agreement have occurred.
"Mortgage Notes Deed of Trust (Mall Parcel)" means that certain Deed
of Trust, Assignment of Leases and Rents, Security Agreement and Fixture Filing
to be executed in accordance with the terms and conditions of the Disbursement
Agreement on the Mall Parcel Creation Date by Mall Construction Subsidiary, as
trustor, to Lawyers Title of Nevada, Inc., as trustee, for the benefit of the
Mortgage Notes Indenture Trustee, as beneficiary.
"Mortgage Notes Deed of Trust (Venetian)" means that certain Deed of
Trust, Assignment of Leases and Rents, Security Agreement and Fixture Filing
dated as of even date herewith, made by Venetian, as trustor, to Lawyers Title
of Nevada, Inc., as trustee, for the benefit of the Mortgage Notes Indenture
Trustee, as beneficiary.
"Mortgage Notes Leasehold Deed of Trust (Mall)" means that certain
Deed of Trust, Assignment of Leases and Rents, Security Agreement and Fixture
Filing dated as of even date herewith, made by Mall Construction Subsidiary, as
trustor, to Lawyers Title of Nevada, Inc., as trustee, for the benefit of the
Mortgage Notes Indenture Trustee, as beneficiary.
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"Mortgage Notes Indenture Trustee" means First Trust National
Association or its successor or assignee in its capacity as Trustee under the
Mortgage Notes Indenture.
"Mortgage Notes Proceeds" means the proceeds from the issuance of the
Mortgage Notes (net of any underwriter's discount and expenses).
"Mortgage Notes Secured Obligations" means all Obligations under the
Mortgage Notes Facility, the Mortgage Notes Security Documents and the other
Mortgage Notes Financing Agreements.
"Notice of Default" means a notice of default which must be recorded
in the official real property records of ▇▇▇▇▇ County, Nevada, in order to
commence non-judicial foreclosure of a Deed of Trust in accordance with
applicable Nevada law.
"Permitted Facility Amendment" means a Facility Amendment of the Bank
Credit Facility or the Interim Mall Loan Facility, or the applicable Facility
Agreement of either, which is expressly permitted pursuant to Section 3 of this
Agreement.
"Project Security Agreements" means the Borrower Security Agreement
and the Mall Security Agreement, together with any security agreement hereafter
entered into by any Affiliates of the Company for the benefit of one or more of
the Secured Lenders.
"Protective Advances" means any Advances with respect to (i) the
payment of any delinquent taxes or insurance premiums owed by the any of the
Company Group with respect to the Project, (ii) the removal of any lien or
encumbrance on the Project or the defense of Company's title thereto or of the
validity, enforceability, perfection or priority of the liens and security
interests granted pursuant to the Security Documents, (iii) the payment of
Project Costs after delivery of a Stop Funding Notice by the Disbursement Agent,
or (iv) the repair, maintenance, protection or preservation of the value of the
Project or any portion thereof, including, without limitation, for payment of
(A) heating, gas, electric and other utility bills (including any payments due
under those Energy Services Agreements each dated as of May 1, 1997, between
Venetian and the HVAC Provider and between Mall Construction Subsidiary and the
HVAC Provider), or (B) amounts reasonably necessary to prevent the provider of
any financing pursuant to an Approved Equipment Funding Commitment (i) from
terminating its agreement to advance funds thereunder, or (ii) from exercising
rights under the documentation applicable to its financing commitment so as to
deprive the Project of the equipment procured with advances made pursuant to
such financing commitment.
"REA" means that certain Amended and Restated Reciprocal Easement,
Use and Operating Agreement dated as of the date hereof among Venetian, LVSI,
Mall Construction Subsidiary and Interface Group-Nevada, Inc.
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"Related Collateral Agreements" means the Project Security
Agreements, the Account Agreements and the Consents.
"Required Protective Advance" means any Protective Advance made by
the Secured Lenders pursuant to Section 4.2 hereof.
"Revolving Bank Loan Commitment" shall have the meaning ascribed to
the term "Revolving Loan Commitment" in the Bank Credit Agreement.
"Secured Credit Parties" means the Bank Agent, the Mortgage Notes
Indenture Trustee, and, until the Mall Release Date, the Interim Mall Lender.
"Secured Lenders" means the Bank Agent and the Bank Lenders, the
Mortgage Notes Indenture Trustee and the Mortgage Note Holders, and, until the
Mall Release Date, the Interim Mall Lender.
"Secured Obligations" means the Bank Secured Obligations, the Interim
Mall Secured Obligations or the Mortgage Notes Secured Obligations, as the
context requires.
"Securities Intermediary" means Scotiabank or its successor or
assignee in its capacity as Securities Intermediary under any Account Agreement,
except that under the Mortgage Notes Proceeds Account Agreement, "Securities
Intermediary" means ▇▇▇▇▇▇▇, ▇▇▇▇▇ & Co. or its successor or assignee in such
capacity.
"Separate Proceeds Accounts Collateral" means the Mortgage Notes
Proceeds Account Collateral and the Bank Proceeds Account Collateral.
"Shared Accounts Agreements" means the HVAC Accounts Agreement, the
Completion Guaranty Account Agreement and the Disbursement Account Agreement.
"Shared Accounts Collateral" means (i) the HVAC Accounts Collateral,
(ii) the Completion Guaranty Account Collateral, and (iii) the Project
Development Accounts Collateral.
"Shared Collateral" means the Shared Accounts Collateral and the
Shared Intangible Collateral.
"Shared Collateral Proceeds" means the portion of the Shared
Collateral constituting proceeds received or held by the Disbursement Agent, the
Intercreditor Agent, the Securities Intermediary, any Secured Credit Party or
any Secured Lender.
"Shared Intangible Collateral" means the agreements, insurance
proceeds and other intangible property of Venetian or LVSI described as "Shared
Intangible Collateral" in
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the Borrower Security Agreement; provided, however, that the Shared Intangible
Collateral shall not include (i) the Mortgage Notes Proceeds Account Collateral,
(ii) the Tranche B Collateral, or (iii) the Bank Proceeds Account Collateral.
"Specified Actions" means any of the following except to the extent
required under the Disbursement Agreement, this Agreement or the Related
Collateral Agreements or required by law: (i) the release of any Collateral,
(ii) the release of any lien under the Related Collateral Agreements, or (iii)
any change in the priority of such liens.
"Subordinated Notes Indenture Trustee" means First Union National
Bank or its successor or assignee in the capacity of Trustee under the
Subordinated Notes Indenture.
"Subordinated Notes Proceeds" means the proceeds from the issuance of
the Subordinated Notes (net of any underwriter's discount and expenses).
"Standstill Period" means a period of forty-five (45) days commencing
upon the occurrence of a specified default, which period may be extended for an
additional fifteen (15) days upon written notice given to the other Credit
Parties within such 45-day period by Bank Agent or, prior to the Mall Release
Date only, by Interim Mall Lender.
1.2 Interpretation. To the extent that reference is made in this
Agreement to any term defined in, or to any other provision of, any other
agreement, such term or provision shall continue to have the original meaning
thereof notwithstanding any termination, expiration or amendment of such other
agreement; provided, however, that upon any formal written amendment of the
Disbursement Agreement or any other agreement to which all of the Credit Parties
are parties, to the extent such amendment modifies terms defined therein or
other provisions thereof which are referred to in this Agreement, then such
references herein shall be to such terms or provisions as so amended.
2. Collateral, Priority of Liens, Subordination and Release.
2.1 Liens and Security Interests. The Credit Parties agree that each
Secured Lender shall have the benefit of the following liens on and security
interests in the Collateral:
2.1.1 Collateral for Bank Secured Obligations. The Bank Secured
Obligations shall be secured:
(1) by a first priority lien on the Bank Proceeds Account
Collateral,
(2) by first priority liens on and security interests in
the Hotel/Casino Collateral,
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(3) together with the Interim Mall Secured Obligations, by
first priority liens on and security interests in the
Shared Collateral, and
(4) prior to the Mall Release Date, by second priority
liens on and security interests in the Mall Collateral,
which second priority liens and security interests
shall be subject and subordinate to the liens and
security interests in the Mall Collateral securing the
Interim Mall Secured Obligations;
2.1.2 Collateral for Mortgage Notes Secured Obligations. The
Mortgage Notes Secured Obligations shall be secured:
(1) by a first priority lien on and security interest in
the Mortgage Notes Proceeds Account Collateral,
(2) by second priority liens on and security interests in
the Hotel/Casino Collateral, which second priority
liens and security interests shall be subject and
subordinate to the liens and security interests in the
Hotel/Casino Collateral securing the Bank Secured
Obligations,
(3) by a second priority lien on and security interest in
the Shared Collateral, which second priority lien and
security interest shall be subject and subordinate to
the liens and security interests in the Shared
Collateral securing the Bank Secured Obligations and
securing the Interim Mall Secured Obligations, and
(4) prior to the Mall Release Date, by third priority liens
on and security interests in the Mall Collateral, which
third priority liens and security interests shall be
subject and subordinate to the liens and security
interests in the Mall Collateral securing the Interim
Mall Secured Obligations and securing the Bank Secured
Obligations, respectively; and
2.1.3 Collateral for Interim Mall Secured Obligations. The
Interim Mall Secured Obligations shall be secured:
(1) by a first priority lien on and security interest in
the Mall Collateral,
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(2) together with the Bank Secured Obligations, by a first
priority lien on and security interest in the Shared
Collateral, and
(3) prior to the earlier of the Mall Release Date or the
Mall Parcel Creation Date, by a third priority lien on
and security interest in the Pre-Separation Underlying
Mall Fee encumbered under the Interim Mall Space Fee
Deed of Trust, which third priority lien and security
interest shall be subject and subordinate to the liens
on and security interests in the Hotel/Casino
Collateral securing the Bank Secured Obligations and
securing the Mortgage Notes Secured Obligations,
respectively.
The Credit Parties further acknowledge and agree that the Subordinated Notes
shall be and remain unsecured obligations of LVSI and Venetian. Under the
Related Collateral Agreements, the liens and security interests in the
Collateral described therein have been granted to Intercreditor Agent on behalf
of the Secured Credit Parties, with the lien priorities provided for in this
Section 2.1. In addition to the liens and security interests securing the Bank
Secured Obligations as described in Section 2.1.1 above, advances may be made
under the Revolving Bank Loan Commitment under the Bank Credit Facility in
accordance with Section 2.2.3(b) of the Disbursement Agreement to finance
acquisition of portions of the Equipment Component prior to initial funding
under an Approved Equipment Funding Commitment, and in connection therewith the
Bank Agent on behalf of the Bank Lenders shall also have (in addition to the
liens described above) a first lien security interest in the portions of the
Equipment Component acquired with such advances, to secure such advances and all
other Bank Secured Obligations, which additional lien and security interest
shall be released by Bank Agent upon the date such advances by the Bank Lenders
are repaid from the proceeds of the initial funding under an Approved Equipment
Funding Commitment for such property (whether the GECC Commitment or otherwise);
no other Credit Party shall have a lien or security interest in such additional
collateral.
2.2 Liens on the Mall.
2.2.1 Prior to Mall Parcel Creation Date. Prior to the Mall
Parcel Creation Date, the Credit Parties agree as follows:
2.2.1.1 The Credit Parties agree that the Bank Deed of
Trust (Venetian) and the Mortgage Notes Indenture Deed of Trust (Venetian)
shall be subject and subordinate to the Mall Lease and the Billboard
Master Lease, such that the Mall Lease and the Billboard Master Lease will
survive any judicial or non-judicial foreclosure of either such Deed of
Trust, but in the event of the termination of the Mall Lease or the
Billboard Master Lease, such Deeds of Trust will remain in full
17
force and effect (if such termination is a result of the rejection of the
Mall Lease or the Billboard Master Lease , subject to the obligations in
Section 2.2.1.2 below).
2.2.1.2 The Bank Agent and the Mortgage Note Indenture
Trustee agree that in the event that (i) the Mall Lease or the Billboard
Master Lease is rejected by the tenant in a proceeding under the
Bankruptcy Code, and (ii) the Bank Agent and/or the Mortgage Notes
Indenture Trustee, as the case may be, have thereafter succeeded to the
estate or interest of the Person which had been the landlord under the
Mall Lease and the Billboard Master Lease by foreclosure or otherwise and
upon such succession have the legal right to lease the premises previously
leased under the Mall Lease or the Billboard Master Lease, as the case may
be, free of claims of subsequent tenants and others holding interests
therein, then, upon a request of the Interim Mall Lender within thirty
(30) days following notice of such succession, the Bank Agent or the
Mortgage Notes Indenture Trustee, as the case may be, shall execute and
deliver a new Mall Lease or a new Billboard Master Lease with Interim Mall
Lender upon the same terms and conditions, for a term equal to what would
have been the remaining term of the Mall Lease or the Billboard Master
Lease, as applicable, but for such rejection. The Bank Agent and the
Mortgage Notes Indenture Trustee further agree that in the event that (i)
the Mall Lease or the Billboard Master Lease is rejected by the landlord
thereunder in a proceeding under the Bankruptcy Code, (ii) the Bank Agent
and/or the Mortgage Notes Indenture Trustee, as the case may be, have
thereafter succeeded to the estate or interest of the landlord under the
Mall Lease and the Billboard Master Lease by foreclosure or otherwise, and
(iii) the Interim Mall Lender has the right to possession of the premises
pursuant to the terms of the Interim Mall Leasehold Deed of Trust and the
Mall Lease or the Billboard Master Lease, as the case may be, then on the
request of the Interim Mall Lender within thirty (30) days following
notice of such succession, the Bank Agent or the Mortgage Notes Indenture
Trustee, as the case may be, shall execute and deliver a new Mall Lease or
a new Billboard Master Lease, as applicable, with Interim Mall Lender upon
the same terms and conditions, for a term equal to what would have been
the remaining term of the Mall Lease or the Billboard Master Lease but for
such rejection. Notwithstanding the foregoing, however, neither the Bank
Agent nor the Mortgage Notes Trustee shall have any obligation to enter
into a new Billboard Master Lease in accordance with this Section 2.2.1.2
prior to the Mall Parcel Creation Date unless either (i) the Interim Mall
Lender then simultaneously enters into a new Mall Lease in accordance with
the foregoing, or (ii) the Mall Lease (including any new Mall Lease
previously entered into in accordance with this Section 2.2.1.2) is then
in effect.
2.2.1.3 The Interim Mall Lender agrees (i) that the
Interim Mall Space Fee Deed of Trust constitutes a lien on the
Pre-Separation Underlying Mall Fee only, (ii) that the Interim Mall Space
Fee Deed of Trust shall be subject and subordinate to the liens on and
security interests in the Pre-Separation Underlying Mall
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Fee and the other Hotel/Casino Collateral created by the Bank Security
Documents and the Mortgage Notes Indenture Security Documents, (iii) that
the Interim Mall Space Fee Deed of Trust may not be foreclosed except with
the prior written consent of the Bank Agent and the Mortgage Notes
Indenture Trustee, (iv) that the Interim Mall Lender shall not contest the
validity or priority of the liens and security interests created thereby
or seek to enjoin, delay or otherwise interfere with any foreclosure
(whether judicial or non-judicial) of the Bank Deed of Trust (Venetian) or
the Mortgage Notes Indenture Deed of Trust (Venetian), as the case may be,
and (v) that the Interim Mall Lender shall not be entitled to any proceeds
arising from or in connection with any such foreclosure of the Bank Deed
of Trust (Venetian) or the Mortgage Notes Indenture Deed of Trust
(Venetian), as the case may be.
2.2.1.4 The Interim Mall Lender further acknowledges and
agrees (i) that all of the Collateral encumbered under the Borrower
Security Agreement other than the Shared Intangible Collateral is
Hotel/Casino Collateral which secures only the Bank Credit Facility and
the Mortgage Notes Facility (with the lien priority provided for in
Section 2.1 above, and none of such Collateral secures the Interim Mall
Facility, and (ii) that except for the lien and security interest created
by the Interim Mall Space Fee Deed of Trust on the Pre-Separation
Underlying Mall Fee, which shall be subject to the provisions of Section
2.2.1.3, no portion of the Hotel/Casino Collateral secures or shall secure
the Interim Mall Facility.
2.2.2 Upon Creation of Mall Parcel. On the Mall Parcel Creation
Date, pursuant to Section 5.16(b) of the Disbursement Agreement: (i) Venetian
shall convey the Mall Parcel to Mall Construction Subsidiary, (ii) Venetian and
Mall Construction Subsidiary shall terminate the Mall Lease, and (iii) the
Secured Credit Parties, subject to obtaining the legal opinions and title policy
endorsements provided for in Section 5.16(b), shall take the actions provided
for in said Section 5.16(b). Upon the occurrence of such events, the fee
ownership of the Mall Parcel shall no longer be Hotel/Casino Collateral, but
shall then become Mall Collateral. The provisions of Section 2.1 hereof with
respect to the validity, priority, perfection, and subordination of all liens on
and security interests in the Collateral shall continue to apply upon and
following the Mall Parcel Creation Date.
2.3 Shared Collateral. With respect to the Shared Collateral, (a) the
respective priorities of the liens and security interests securing the
Obligations to the Secured Lenders shall be as provided for in Section 2.1
above, and (b) the respective rights of the Secured Credit Parties shall be as
provided for in the Disbursement Agreement, the Borrower Security Agreement, the
Shared Account Agreements and this Agreement, including the provisions for
certain allocation of Shared Collateral Proceeds pursuant to Section 4.8 hereof.
With respect to the Shared Collateral, if the Secured Credit Parties are
entitled to Exercise Remedies with respect thereto prior to the Mall Release
Date, in accordance with Sections 4.6.1 and Section 4.7.1 of this Agreement,
then any Shared Collateral Proceeds shall be allocated between the Hotel/Casino
and the Mall pursuant to Section 4.8, and upon
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such allocation, (i) such Shared Collateral allocated to the Mall shall be
deemed to become Mall Collateral, with the lien priorities in such Mall
Collateral as provided for in Section 2.1 above (i.e., with first lien priority
to secure the Interim Mall Secured Obligations, second lien priority to secure
the Bank Secured Obligations, and third lien priority to secure the Mortgage
Notes Secured Obligations), and (ii) such Shared Collateral so allocated to the
Hotel/Casino shall be deemed to become Hotel/Casino Collateral, with the lien
priorities in such Hotel/Casino Collateral provided for in Section 2.1 (i.e.,
with first lien priority to secure the Bank Secured Obligations and second lien
priority to secure the Mortgage Notes Secured Obligations). Upon the Mall
Release Date, except to the extent of any then pending allocation of Shared
Collateral Proceeds pursuant to Section 4.8 by reason of a right of Interim Mall
Lender to Exercise Remedies against any Shared Collateral prior to the Mall
Release Date, all Shared Collateral shall be and become Hotel/Casino Collateral
for all purposes of this Agreement, with the lien priorities in such
Hotel/Casino Collateral provided for in Section 2.1 (i.e., with first lien
priority to secure the Bank Secured Obligations and second lien priority to
secure the Mortgage Notes Secured Obligations).
2.4 Tranche B Collateral. In addition to the Collateral described in
Section 2.1, the Interim Mall Obligations are secured by the Tranche B
Collateral described in the Disbursement Agreement. The Tranche B Collateral is
not "Collateral" for any purpose of this Agreement, no other Credit Party shall
have any liens thereon or any security interest therein, and the Interim Mall
Lender shall have the right to Exercise Remedies with respect to the Tranche B
Collateral at any time, without reference to the Standstill Periods or other
conditions provided for in this Agreement with respect to Collateral.
2.5 Separate Proceeds Accounts Collateral. The Mortgage Notes
Proceeds Account Collateral secures only the Mortgage Notes Secured Obligations,
and no other Credit Party shall have any liens thereon or any security interest
therein. The Bank Proceeds Account Collateral secures only the Bank Secured
Obligations, and no other Credit Party shall have any liens thereon or any
security interest therein.
2.6 No Other Collateral. Except as provided for in the preceding
provisions of this Section 2 and in this Section 2.6, no Credit Party shall be
entitled to receive and hold, directly or indirectly, any liens on or security
interests in (i) any property or assets owned directly or indirectly by any of
the Company Group, or (ii) any stock, securities, membership interests,
partnership interests or other direct or indirect equity interests in the
Company or in any Affiliate of the Company, except as follows:
2.6.1 The Bank Lenders, or any of them, may provide all or any
portion of financing pursuant to Approved Equipment Funding Commitments,
on similar or dissimilar terms to the GECC Commitment, and may secure such
obligations by liens on and security interests in the Equipment Component.
Unless LVSI, Venetian and the Credit Parties otherwise agree, (i) any
indebtedness owed to the Bank Lenders pursuant to financing by them
pursuant to Approved Equipment Funding Commitments
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shall not be secured by the Collateral, and (ii) the rights of such Bank
Lenders with respect to any financing provided for the Equipment Component
vis a vis the rights of the Credit Parties with respect to the Facilities
shall be governed and controlled by any separate consent and agreement as
may be executed by such parties, and shall not be governed and controlled
by this Agreement.
2.6.2 In connection with any Permitted Facility Amendment, the
Bank Agent may receive and hold liens on and security interests for the
benefit of the Bank Lenders in any other assets or property owned directly
or indirectly by any of the Company Group other than (i) the Mall
Collateral, the Mortgage Notes Proceeds Account Collateral, and the
Tranche B Collateral, and (ii) any stock, securities, membership interests
or other direct or indirect equity interests in the Company or any
Affiliate of the Company; provided, however, that any liens or security
interests shall be permitted in the Equipment Component only to the extent
same do not violate the terms of the Approved Equipment Funding Commitment
or the financing agreements executed pursuant thereto.
2.6.3 In connection with any Permitted Facility Amendment, the
Interim Mall Lender may receive and hold liens on and security interests
in any other assets or property owned directly or indirectly by any of the
Company Group other than (i) the Hotel/Casino Collateral, the Mortgage
Notes Proceeds Account Collateral and the Bank Proceeds Account
Collateral, and (ii) any stock, securities, membership interests or other
direct or indirect equity interests in the Company or any Affiliate of the
Company; provided, however, that any liens or security interests shall be
permitted in the Equipment Component only to the extent same do not
violate the terms of the Approved Equipment Funding Commitment or the
financing agreements executed pursuant thereto.
2.6.4 In connection with any Additional Capital Indebtedness, the
lender(s) thereof, including any Credit Party or Lender, may receive the
liens and security interests provided for in Section 3.7 below.
2.7 Confirmation of Liens. Each Credit Party hereto hereby confirms
and agrees that the liens and security interests held by or for the benefit of
each Secured Lender in the Collateral, as provided for in the preceding
provisions of this Section 2, shall secure all Obligations of the Company Group
or any of them now or hereafter owing to each Secured Lender in connection with
the applicable Facility throughout the term of this Agreement, in each case with
the priority specified in Section 2.1, notwithstanding (i) the availability of
any other collateral to any Secured Lender, (ii) the actual date and time of
execution, delivery, recording, filing and perfection of any of the Security
Documents, (iii) the fact that any lien or security interest created by any of
the Security Documents, or any claim with respect thereto, is or may be
subordinated, avoided or disallowed in whole or in part under the Bankruptcy
Code or other applicable federal or state law, or (iv) that the
21
Mall Lease may be rejected under the Bankruptcy Code or other applicable federal
or state law; provided, however, that any Obligations owed to a Credit Party in
its capacity as the provider of financing pursuant to an Approved Equipment
Funding Commitment shall not be secured by the Hotel/Casino Collateral, the
Separate Proceeds Accounts Collateral, the Tranche B Collateral, the Shared
Collateral or the Mall Collateral. In the event of a proceeding, whether
voluntary or involuntary, for insolvency, liquidation, reorganization,
dissolution, bankruptcy or other similar proceedings pursuant to the Bankruptcy
Code or other applicable federal or state law, each Credit Party further
confirms and agrees that the Obligations due and outstanding under and with
respect to each Facility shall include all principal, additional advances
permitted hereunder, Protective Advances made by such Credit Party, interest,
default interest, LIBOR breakage and swap breakage, post petition interest and
all other amounts due thereunder, for periods before and for periods after the
commencement of any such proceedings, even if the claim for such amounts is
disallowed pursuant to applicable law, and all proceeds from the sale or other
disposition of the Collateral shall be paid to the Secured Lenders in the order
and priority provided for in this Section 2 notwithstanding the disallowance of
any such claim or the invalidity or subordination of any lien on or security
interest in the Collateral under applicable law.
2.8 Phase II Release. The Bank Agent and the Mortgage Notes Indenture
Trustee agree to release their respective liens on and security interests in the
Phase II Land upon compliance with and satisfaction of the Phase II Release
Conditions under the Disbursement Agreement and the conditions to the notice
thereof to be given by the Disbursement Agent under Section 5.16(d) of the
Disbursement Agreement.
2.9 Mall Release. On the Mall Release Date in accordance with Section
5.16(c) of the Disbursement Agreement, the Bank Agent and the Mortgage Notes
Indenture Trustee shall release their respective liens on and security interests
in the Mall Collateral and the Interim Mall Lender shall release LVSI, Venetian,
the Mall Construction Subsidiary and all other members of the Company Group
other than Mall I LLC from all Obligations and liabilities under the Interim
Mall Facility. Upon such releases, the Interim Mall Lender and/or the Permanent
Mall Lender shall not thereafter be parties to, be bound by or be entitled to
the benefits of this Agreement; provided, however, that (i) the provisions of
Section 2.2.2 with respect to a new Mall Lease shall survive until the Mall
Parcel Creation Date and the provisions of Section 2.2.2 with respect to a new
Billboard Master Lease shall survive until the termination of this Agreement
(following termination of the Disbursement Agreement referred to in said Section
2.2.2, the Intercreditor Agent shall replace the Disbursement Agent for purposes
of Section 5.16(b) thereof), and (ii) the provisions of Section 4.8 hereof shall
survive with respect to any then pending allocation of Shared Collateral
Proceeds pursuant to Section 4.8 by reason of a right of Interim Mall Lender to
Exercise Remedies in such Shared Collateral prior to the Mall Release Date.
2.10 Effect. All provisions of this Agreement, including but not
limited to, all matters relating to the creation, validity, perfection,
priority, subordination and release of the
22
liens and security interests intended to be created by the Security Documents
and all provisions regarding the allocation and priority of payments with
respect to any Facility shall survive the filing of a proceeding under the
Bankruptcy Code and be fully enforceable by and against each Credit Party hereto
during any such proceeding.
2.11 Mall Space Leases. To the extent that the Mall Construction
Subsidiary enters into lease agreements for space in the Mall, and such leases
comply with the applicable requirements of the Interim Mall Credit Agreement,
then at the request of the Interim Mall Lender, the Bank Agent and the Mortgage
Notes Trustee shall execute instruments reasonably requested by the Interim Mall
Lender to provide for the survival of such leases in the event of the
foreclosure of any Deed of Trust on the Mall.
3. Permitted Facility Amendments; Protective Advances.
3.1 Bank Credit Facility Amendments. The Bank Agent and the Bank
Lenders shall have the right, at any time and without the consent of the other
Credit Parties, and without affecting the validity and priority of the liens on
and security interests in the Collateral created by the Bank Security Documents,
to enter into a Facility Amendment with respect to the Bank Credit Facility or
the Obligations evidenced thereby provided that, after giving effect to such
Facility Amendment, the following conditions are satisfied:
3.1.1 in the event that the maximum amount of the Commitment
under the Bank Credit Facility is increased pursuant to such Facility
Amendment, then the amount of Additional Bank Proceeds advanced and
outstanding pursuant to such Facility Amendment shall be subject to the
following limitation:
(1) prior to the Mall Release Date, except as
provided for in Section 3.1.6 below, such amount shall not
exceed Twenty Million Dollars ($20,000,000) minus the amount of
any Additional Mall Proceeds theretofore advanced by the
Interim Mall Lender pursuant to Section 3.2.1 hereof (no
Additional Bank Proceeds advanced pursuant to Section 3.1.6 or
any Additional Mall Proceeds advanced pursuant to Section 3.2.4
shall count against said $20,000,000 limitation applicable to
advances of Additional Bank Proceeds under this clause (1) of
Section 3.1.1); but
(2) following the Mall Release Date, except as
provided for in Section 3.1.6 below, such amount shall not
exceed Forty Million Dollars ($40,000,000) minus the aggregate
amount, not to exceed $20,000,000, of Additional Bank Proceeds
theretofore advanced pursuant to this Section 3.1.1(1) or
Section 3.1.6 below and of Additional Mall Proceeds advanced
prior to the Mall Release Date pursuant to Section 3.2.1 or
Section 3.2.4.
23
3.1.2 any Additional Bank Proceeds advanced pursuant to a
Facility Amendment increasing the Commitment under Section 3.1.1 or
Section 3.1.6 shall be used to pay any Project Costs or, after the Mall
Release Date, any amounts for general corporate purposes or working
capital of the Company (in either case including the reasonable fees and
expenses incurred by the Bank Lenders in connection with such Facility
Amendment);
3.1.3 the unfunded Commitment under the Bank Credit Facility
shall not be reduced pursuant to such Facility Amendment prior to the Mall
Release Date except to the extent such reductions are permitted under
Section 6.8 of the Disbursement Agreement;
3.1.4 the weighted average life to maturity (as determined with
reference to scheduled amortization payments) of the Indebtedness under
the Bank Credit Facility (either outstanding or available to be borrowed
under the Bank Credit Facility in effect immediately prior to the Facility
Amendment) shall not be reduced as a result of such Facility Amendment;
3.1.5 such Facility Amendment shall not result in the creation
of a lien or security interest on additional collateral except in
accordance with the provisions of Section 2.6.2 above; and
3.1.6 in the event that a Disbursement Agreement Default or a
Potential Event of Default occurs, at any time thereafter but prior to the
Mall Release Date, the Bank Agent may enter into a Facility Amendment to
further increase the maximum amount of the Commitment under the Bank
Credit Facility in excess of the limitation set forth in Section 3.1.1
above, provided that:
3.1.6.1 the Additional Bank Proceeds advanced pursuant
thereto shall be advanced on or before the Mall Release Date and
shall not exceed the additional sum (i.e., in addition to amounts
advanced in accordance with the limitations provided in Section 3.1.1
above) of Thirty Million Dollars ($30,000,000), which sum shall be
reduced by the amount of any Additional Mall Proceeds theretofore
advanced by the Interim Mall Lender pursuant to Section 3.2.4
(provided, however, that such $30,000,000 sum shall not be reduced by
the amount of any Additional Bank Proceeds as may be advanced
pursuant to Section 3.1.1 above or by the amount of any Additional
Mall Proceeds as may be advanced pursuant to Section 3.2.1 below);
3.1.6.2 the Additional Bank Proceeds advanced pursuant
thereto must be matched, dollar for dollar, by Additional Company
Equity, which shall be deposited in the Company's Funds Account and
disbursed in accordance with the Disbursement Agreement;
24
3.1.6.3 the Applicable Margin with respect to any
Additional Bank Proceeds in connection with such Facility Amendment
shall not exceed (i) 7% per annum for Base Rate Loans or any loan
based on the prime rate or the federal funds rate, and (ii) 8% per
annum for Eurodollar Rate Loans or any loan based on LIBOR, except
that the Bank Lenders may also receive in connection therewith,
contingent or participating interest, warrants, preferred or common
stock, securities or other direct or indirect equity interests in the
Company or its Affiliates so long as any required payments of
interest shall not exceed, in the aggregate, the amounts permitted by
the provisions of this Section 3.1.6.3; and
3.1.6.4 such Facility Amendment shall not increase the
scheduled payments of principal due under the Bank Credit Facility
during the period commencing on the Financing Date and ending on the
date which is the later of three years after the Financing Date, or
one year after the then-scheduled Mall Release Date.
Any Facility Amendment of the Bank Credit Facility in conformity with the
foregoing shall constitute a Permitted Facility Amendment under this Agreement.
The provisions of Section 2 hereof with respect to the validity, priority,
perfection, and subordination of all liens on and security interests in the
Collateral to secure the Bank Secured Obligations shall continue to apply to the
Bank Credit Facility as so amended, modified or refinanced. In addition to such
Facility Amendments, the Bank Lenders shall have the right to provide all or any
portion of the financing pursuant to Approved Equipment Funding Commitments in
accordance with Section 2.6.1 hereof.
3.2 Interim Mall Facility Amendments. The Interim Mall Lender shall
have the right, at any time and without the consent of the other Credit Parties,
and without affecting the validity and priority of the liens on and security
interests in the Collateral created by the Interim Mall Security Documents, to
enter into a Facility Amendment with respect to the Interim Mall Facility or the
Obligations evidenced thereby provided that, after giving effect to any such
Facility Amendment, the following conditions are satisfied:
3.2.1 in the event that the maximum amount of the Commitment
under the Interim Mall Facility is increased pursuant to such Facility
Amendment, then each of the following shall be satisfied:
3.2.1.1 the maximum amount of Additional Mall Proceeds
advanced and outstanding pursuant to such Facility Amendment plus
any the amount of any Additional Bank Proceeds theretofore
advanced by the Bank Lenders pursuant to Section 3.1.1 hereof
shall not exceed Twenty Million Dollars ($20,000,000), except as
provided for in Section 3.2.4 below (no Additional Bank Proceeds
advanced pursuant to Section 3.1.6 or any Additional
25
Mall Proceeds advanced pursuant to Section 3.2.4 shall count
against said $20,000,000 limitation applicable to advances of
Additional Mall Proceeds under this Section 3.2.1);
3.2.1.2 the Additional Mall Proceeds advanced pursuant to a
Facility Amendment increasing the Commitment under Section 3.2.1
or Section 3.2.4 shall be advanced prior to the Mall Release Date
and shall be used to pay any Project Costs as may be designated by
the Interim Mall Lender (including the reasonable fees and
expenses incurred by the Interim Mall Lender in connection with
such Facility Amendment);
3.2.1.3 no principal payments shall be due or be paid with
respect to such Additional Mall Proceeds until at least the Mall
Release Date; and
3.2.1.4 Interim Mall Lender shall confirm that Venetian and
LVSI and all Affiliates of either other than Mall I Subsidiary
shall be released from all obligations with respect to such
Additional Mall Proceeds upon the occurrence of the Mall Release
Date;
3.2.2 the unfunded Commitment under the Interim Mall Facility
shall not be reduced pursuant to such Facility Amendment prior to the Mall
Release Date except to the extent such reductions are permitted under the
Disbursement Agreement;
3.2.3 such Facility Amendment shall not result in the creation of
a lien or security interest on additional collateral except in accordance
with the provisions of Section 2.6.3 above; and
3.2.4 in the event that a Disbursement Agreement Default or a
Potential Event of Default occurs, at any time thereafter but prior to the
Mall Release Date the Interim Mall Lender may enter into a Facility
Amendment to further increase the maximum amount of the Commitment under
the Interim Mall Facility in excess of the limitation set forth in Section
3.2.1.1 above, provided that:
3.2.4.1 the Additional Mall Proceeds advanced pursuant
thereto shall not exceed the additional sum (i.e., in addition to
amounts advanced by the Interim Mall Lender in accordance with the
limitations provided in Section 3.2.1 above) of Thirty Million
Dollars ($30,000,000), which sum shall be reduced by the amount of
any Additional Bank Proceeds theretofore advanced by the Bank
Lenders pursuant to Section 3.1.6 (provided, however, that such
$30,000,000 sum shall not be reduced by the amount of any
Additional Bank Proceeds as may be advanced pursuant to Section
3.1.1 above
26
or by the amount of any Additional Mall Proceeds as may be
advanced pursuant to Section 3.2.1 above);
3.2.4.2 the Additional Mall Proceeds advanced pursuant
thereto must be matched, dollar for dollar, by Additional Company
Equity, which shall be deposited in the Company's Funds Account
and disbursed in accordance with the Disbursement Agreement;
3.2.4.3 the Applicable Margin with respect to any Additional
Mall Proceeds in connection with such Facility Amendment shall not
exceed (i) 7% per annum for any loan based on the prime rate or
the federal funds rate, and (ii) 8% per annum for any loan based
on LIBOR, except that the Interim Mall Lender may also receive in
connection therewith, contingent or participating interest,
warrants, preferred or common stock, securities or other direct or
indirect equity interests in the Company or its Affiliates so long
as any required payments of interest shall not exceed, in the
aggregate, the amounts permitted by the provisions of this
Section 3.2.4.3; and
3.2.4.4 no payments of principal shall be permitted with
respect to such Additional Mall Proceeds in connection with such
Facility Amendment of the Interim Mall Facility prior to the Mall
Release Date.
Any Facility Amendment of the Interim Mall Facility in conformity with the
foregoing shall constitute a Permitted Facility Amendment under this Agreement.
The provisions of Section 2 hereof with respect to the validity, priority,
perfection, and subordination of all liens on and security interests in the
Collateral to secure the Interim Mall Secured Obligations shall continue to
apply to the Interim Mall Facility as so amended, modified or refinanced.
3.3 Note Holders. The Mortgage Note Holders or the Subordinated Note
Holders or any of them may provide the Additional Capital Indebtedness in
accordance with the terms and conditions of Section 3.7 below; no other
provision of this Agreement shall be construed to constitute the consent of the
Bank Lenders or the Interim Mall Lender to any Facility Amendment with respect
to the Mortgage Notes Indenture or the Subordinated Notes Indenture, and any
such Facility Amendment which violates the terms and conditions of the Bank
Financing Agreements or the Interim Mall Financing Agreements shall permit Bank
Agent or the Interim Mall Lender to declare an Event of Default with respect to
the Company thereunder.
3.4 Waivers. Any Credit Party may, without the consent of the other
Credit Parties, defer any payments due under its Facility or waive any
provisions thereof.
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3.5 Protective Advances. Prior to the Mall Release Date, in the event
that a Disbursement Agreement Default or Potential Event of Default occurs,
thereafter any Secured Credit Party may, without the consent of the other Credit
Parties and without affecting the validity or priority of any liens on or
security interests in the Collateral created by the Security Documents, make
Protective Advances (in addition to Required Protective Advances) provided that
(i) such Protective Advances shall be deemed to be Advances under the
Disbursement Agreement, (ii) the Credit Party making any such Protective Advance
shall have the right to specify the costs to be paid from the proceeds of such
Advance, (iii), if made by the Bank Lenders, to the extent the maximum amount of
the Bank Credit Facility has been advanced, then the amount of any Additional
Bank Proceeds shall be subject to the limitations in Section 3.1 above, and
(iv), if made by the Interim Mall Lender, to the extent the maximum amount of
the Interim Mall Facility has been advanced, then the amount of any Additional
Mall Proceeds shall be subject to the limitations in Section 3.2 above.
3.6 No Other Facility Amendments. Any Facility Amendment of the Bank
Credit Facility or the Interim Mall Facility that does not comply with the
provisions set forth in this Section 3 shall not be effective unless the prior
written consent of the other Secured Credit Parties shall have been obtained, in
which event such Facility Amendment shall constitute a Permitted Facility
Amendment.
3.7 Additional Capital Indebtedness. Prior to the Mall Release Date,
upon the occurrence of a Disbursement Agreement Default or Potential Event of
Default and so long as such default is continuing, each Credit Party agrees
that, in addition to the Permitted Facility Amendments referred to above, LVSI
and Venetian shall have the right to issue additional indebtedness ("Additional
Capital Indebtedness") without the consent of the Bank Agent or the Interim Mall
Lender so long as such Additional Capital Indebtedness complies with each of the
following conditions (and each Credit Party hereby confirms to the other Credit
Parties that such Additional Capital Indebtedness in accordance with the
provisions of this Section 3.7 is permitted pursuant to the terms of its
Facility Agreement):
3.7.1 The maximum principal amount of any Additional Capital
Indebtedness shall not exceed Fifty Million Dollars ($50,000,000) and all
proceeds of such Additional Capital Indebtedness must be matched, dollar
for dollar, by Additional Company Equity, which shall be deposited in the
Company's Funds Account and disbursed in accordance with Article 2 of the
Disbursement Agreement.
3.7.2 The proceeds of the Additional Capital Indebtedness and
Additional Company Equity shall be used solely to pay Project Costs
(including reasonable fees, costs and expenses incurred in connection the
issuance thereof) pursuant to the Disbursement Agreement.
3.7.3 The Additional Capital Indebtedness may be unsecured or may
be secured by liens on and security interests in the Collateral (other
than the Mortgage
28
Notes Proceeds Account Collateral or the Bank Proceeds Account Collateral)
so long as all such liens and security interests (i) are subject and
subordinate to the liens and security interests in favor of the Bank
Lenders and the Interim Mall Lender, and (ii) are pari-passu with or are
subject and subordinate to the liens on and security interests in the
Collateral held by the Mortgage Notes Indenture Trustee. If so secured,
then the Secured Lenders must receive endorsements to their respective
title policies confirming, in form reasonably satisfactory to Bank Agent,
Interim Mall Lender and the Mortgage Notes Indenture Trustee, the lien
priority of their respective liens on the real property comprising the
Collateral, in accordance with the foregoing.
3.7.4 The issuance of such Additional Capital Indebtedness, and
any related amendments to the Mortgage Notes Indenture and to the
Subordinated Notes Indenture, shall be approved by (i) the holders of a
majority (in aggregate principal amount) of the Mortgage Notes pursuant
the Mortgage Note Indenture and (ii) the holders of a majority (in
aggregate principal amount) of the Subordinated Notes pursuant to the
Subordinated Notes Indenture.
3.7.5 No cash payment of principal or interest shall be permitted
on any Additional Capital Indebtedness prior to the first to occur of the
Mall Release Date or the date the Interim Mall Facility is repaid in full;
after said date, no cash payment of principal shall be permitted on any
Additional Capital Indebtedness for so long as any portion of the Bank
Credit Facility remains outstanding.
3.7.6 Such Additional Capital Indebtedness shall have a maturity
date at least six months after the maturity date of the Bank Credit
Facility.
3.7.7 The holders of any such indebtedness (if other than the
Mortgage Note Holders) shall agree to become parties to and be bound by
this Agreement.
3.7.8 The terms and conditions of such Additional Capital
Indebtedness (including financial and other covenants, events of default,
provisions relating to notice and opportunities to cure) shall not be less
favorable to the Company than the terms and conditions of the Mortgage
Notes Indenture and provided further that the holders of any such
indebtedness shall not be entitled to Exercise Remedies against any of the
Company Group or with respect to the Collateral or file a petition in
Bankruptcy unless and to the extent such actions are permitted to be taken
hereunder by the Mortgage Notes Indenture Trustee; provided, however, that
with respect to their Exercise of Remedies, the holders of any such
Additional Capital Indebtedness shall be subject to the time periods
provided for Additional Capital Indebtedness under Exhibit A.
3.7.9 LVSI and Venetian shall pay all costs and expenses incurred
by the Credit Parties, the Disbursement Agent, the Intercreditor Agent,
the Securities
29
Intermediary or the Secured Lenders, including, but not limited to,
attorney's fees, title insurance premiums and other costs incurred in
connection therewith.
3.8 No Approval Rights of Subordinated Note Indenture Trustee. Except
as expressly set forth in Section 3.7.4 hereof, neither the Subordinated Notes
Indenture Trustee nor any Subordinated Note Holder, in such capacity, shall have
the right to approve or withhold its consent (a) to any provision or action
permitted to be taken by the other Credit Parties hereunder, or (b) to any
amendment, supplement or waiver of any provisions of any Security Agreement.
4. Events of Default; Remedies; Certain Actions by Intercreditor Agent.
4.1 Declaration of Event of Default. If a Disbursement Agreement
Default has occurred and is continuing, each Credit Party may declare an Event
of Default under its Facility Agreement and accelerate all Obligations due
thereunder, to the extent and on the terms and conditions provided for in such
Facility Agreement; provided, however, that (a) no Credit Party shall be
entitled to Exercise Remedies against any of the Company Group or with respect
to the Collateral except as set forth in Section 4.3, and (b) in the case of an
acceleration prior to the Mall Release Date, each Credit Party agrees to
reinstate its Facility and to recommence funding thereunder if the conditions
provided for in Section 4.6.1.3 are satisfied.
4.2 Required Protective Advances. No Secured Lender shall be required
to advance any additional amounts under its Facility in the event that either:
(1) a Disbursement Agreement Default has occurred and is
continuing; or
(2) a Stop Funding Notice has been delivered by the Disbursement
Agent pursuant to the Disbursement Agreement and the
Disbursement Agent has not delivered an Advance Confirmation
Notice countermanding such Stop Funding Notice in accordance
with the Disbursement Agreement;
provided, however, that notwithstanding the existence of a Disbursement
Agreement Default or of any other fact or circumstance which would permit the
Disbursement Agent to issue a Stop Funding Notice under the Disbursement
Agreement, upon approval of the Bank Agent (acting solely upon the direction of
the Requisite Lenders, as defined in the Bank Credit Facility) and the Interim
Mall Lender, acting jointly, the Secured Lenders shall be obligated to make
Required Protective Advances, pro rata in accordance with the Disbursement
Agreement, for the following purposes:
30
4.2.1 to repair, maintain, preserve and protect the Project, in
each case, as certified to be reasonably necessary by the Construction
Consultant;
4.2.2 to pay all interest, principal repayments and other amounts
then due on any financing pursuant to an Approved Equipment Commitment
(whether the GECC Commitment or otherwise) to the extent reasonably
necessary to prevent the provider of such Approved Equipment Financing
Commitment (i) from terminating its commitment to advance funds
thereunder, or (ii) from exercising rights under the documentation
applicable to its financing commitment so as to deprive the Project of the
equipment procured with the advances made pursuant to such financing
commitment; and
4.2.3 only in the event (a) such Disbursement Agreement Default
was declared solely under Section 7.1.2 of the Disbursement Agreement
(captioned "Failure to Demonstrate Balancing"), or (b) such Stop Funding
Notice was issued solely as a result of the failure by the Company to
satisfy the condition set forth in Section 3.2.18 of the Disbursement
Agreement (captioned "In Balance Requirement") (but all other conditions
as set forth in Section 3.2 of the Disbursement Agreement have been
satisfied), then to pay for Project Costs incurred in respect of work
completed or materials purchased on or prior to the date on which the
Disbursement Agent delivers notice that such Disbursement Agreement
Default has occurred or delivers such Stop Funding Notice, in which event
each such Required Protective Advance shall be made subject to receipt by
the Disbursement Agent of (i) a certificate from the Construction Manager
or the applicable Contractor(s) that such work was completed prior to such
date, or (ii) an invoice dated prior to such date for any material
purchased prior to such date, as appropriate and, in each case, confirmed
by the Construction Consultant;
provided further, however, that (A) the aggregate amount of all Required
Protective Advances pursuant to Section 4.2.1 and Section 4.2.2 shall not exceed
Twenty-Five Million Dollars ($25,000,000), (B) the obligation of the Mortgage
Notes Indenture Trustee and the Mortgage Note Holders to make Required
Protective Advances shall be satisfied solely out of the Mortgage Notes Proceeds
Account Collateral, and said parties shall have no obligation to make any
further Required Protective Advances from and after exhaustion of the Mortgage
Notes Proceeds Account Collateral, and (C) the Bank Lenders and the Interim Mall
Lender shall have no obligation to make any Required Protective Advances except
to the extent of the unfunded Commitments under their respective Facility
Agreements.
4.3 Standstill. Until and unless a Disbursement Agreement Default
shall occur and be continuing and the Standstill Period with respect thereto
shall have expired, no Credit Party shall Exercise Remedies against any of the
Company Group or with respect to the Collateral, except that (i) scheduled
payments of interest on the Mortgage Notes shall be paid out of the Mortgage
Notes Proceeds Account, unless otherwise agreed by the Mortgage
31
Notes Indenture Trustee, and (ii) the Bank Agent and the Interim Mall Lender,
acting jointly, pursuant to Section 4.5 below, may direct the Disbursement
Agent, the Intercreditor Agent or the Securities Intermediary with respect to
the enforcement of or other actions with respect to the Shared Collateral. If
and when a Disbursement Agreement Default shall occur and be continuing and the
Standstill Period with respect thereto shall have expired, the Credit Parties
and the Intercreditor Agent may Exercise Remedies only in accordance with
Section 4.6.1 or Section 4.7.1 below.
4.4 Waivers. The Credit Parties agree that the Bank Agent and the
Interim Mall Lender, acting jointly, shall have the right, without the consent
of the other Credit Parties, (a) to waive any default or event of default by or
with respect to any of the Company Group under the Disbursement Agreement (i.e.,
any Potential Event of Default or Disbursement Agreement Default), any Project
Security Agreement or any Account Agreement, or (b) to waive any condition to
disbursements under the Disbursement Agreement; provided, however, that without
the consent of the holders of a majority (in aggregate principal amount) of the
Mortgage Notes, (i) such waiver of a Disbursement Agreement Default must be made
not later than one hundred eighty (180) days following the applicable
Disbursement Agreement Default Date, and any waiver of an event of default under
any Project Security Agreement or Account Agreement must similarly be made not
later than one hundred eighty (180) days following the date such event of
default was declared under such Agreement, (ii) the Bank Agent and the Interim
Mall Lender shall not waive any default or event of default which otherwise
independently (not by cross-default or cross-reference to another agreement)
constitutes a default or event of default under the Mortgage Notes Indenture,
and (iii) the Bank Agent and the Interim Mall Lender shall not waive any default
or event of default resulting from, or any condition relating to, implementation
of a Scope Change for which a Required Scope Change Approval is required
pursuant to Section 6.2.1 of the Disbursement Agreement. In addition to the
foregoing, in the event ▇▇▇▇▇▇▇ or any ▇▇▇▇▇▇▇ Relative directly or indirectly
owns any interest in the Indebtedness under the Bank Credit Facility or the
Interim Mall Facility, then:
(1) if either Bank Agent or Interim Mall Lender is an Ineligible Credit
Party, then neither the Bank Agent nor the Interim Mall Lender shall
have the right to waive any default or event of default pursuant to
this Section 4.4; and
(2) even if neither Bank Agent nor Interim Mall Lender is an Ineligible
Credit Party, any waiver by Bank Agent or Interim Mall Lender under
this Section 4.4 must be made, if at all, with the approval the
holders of a majority (in aggregate principal amount) of such
Indebtedness excluding the portion of such Indebtedness so attributed
to ▇▇▇▇▇▇▇ or any ▇▇▇▇▇▇▇ Relative;
provided, however, that neither Bank Agent nor Interim Mall Lender shall be
obligated to make inquiry beyond the records held by each as to the ownership of
the applicable Facility.
32
4.5 Shared Collateral. With respect to the Shared Collateral:
4.5.1 any Shared Collateral Proceeds received by the Disbursement
Agent, the Intercreditor Agent or the Securities Intermediary shall be
retained by the Disbursement Agent, the Intercreditor Agent or the
Securities Intermediary and (i) shall be deposited into the Company's
Funds Account pursuant to Section 5.1.1 of the Disbursement Agreement
(except as otherwise specifically required by the terms of any Account
Agreement), or (ii), if received after the date of Final Completion, shall
be retained in an account maintained by the Intercreditor Agent for the
benefit of the Bank Lenders and the Mortgage Note Holders; provided,
however, that any unused insurance proceeds available for application to
the Secured Obligations pursuant to Section 5.20 of the Disbursement
Agreement (if received prior to the Mall Release Date, such sums shall be
allocated between the Mall and the Hotel/Casino in accordance with Section
4.8) shall be applied to repayment of the Obligations of the Secured
Lenders in the order of priority of their respective liens on the
Hotel/Casino Collateral in accordance with Section 2.1 (and, with respect
to such amounts allocated to the Mall prior to the Mall Release Date, in
the order of priority of their respective liens on the Mall Collateral in
accordance with Section 2.1).
4.5.2 if a Secured Credit Party is entitled to Exercise Remedies
against such Shared Collateral in accordance with the applicable
provisions of Section 4.6.1 or Section 4.6.2 below, such Exercise of
Remedies shall be in accordance with Section 4.7.1 and Section 4.7.1 and
the Shared Collateral shall be allocated between the Mall and the
Hotel/Casino in accordance with Section 4.8 below; and
4.5.3 prior to the Mall Release Date, notwithstanding the
commencement of the Exercise of Remedies against the Shared Collateral, in
the event that all Disbursement Agreement Defaults are cured (or are
waived, as provided for in Section 4.4 of this Agreement), and the
Disbursement Agent delivers an Advance Confirmation Notice to the Secured
Credit Parties, then all Shared Collateral Proceeds (except to the extent
such Shared Collateral Proceeds have been realized upon in accordance with
Section 4.7.1) shall be used to pay Project Costs.
4.6 Requirements Regarding Exercise of Remedies.
4.6.1 Prior to Mall Release Date. Prior to the Mall Release Date,
in the event a Disbursement Agreement Default has occurred and is continuing,
and not cured or waived in accordance with Section 4.4 above, then upon
expiration of the Standstill Period applicable thereto, each Credit Party may
Exercise Remedies against any of the Company Group or with respect to the
Collateral securing the Facility of such Credit Party, to the extent and on the
terms and conditions provided for in the applicable Facility Agreement, except
that:
33
4.6.1.1 No Credit Party shall be entitled to complete a
foreclosure against or other realization upon the Collateral, or to
enforce a judgment against any of the Company Group, earlier than the
earliest date for such Secured Credit Party following the expiration of
the applicable time period provided for on Exhibit A attached hereto and
incorporated herein by reference (for each such Credit Party, its
"Earliest Realization Date"). Such Earliest Realization Dates shall be
tolled and/or extended for any period of time for which an injunction
and/or stay is in effect. Notwithstanding the foregoing provisions of this
Section 4.6.1.1, if two Secured Credit Parties hold pari passu liens on
any Shared Collateral but are subject to different Earliest Realization
Dates, then the Secured Credit Party with the later Earliest Realization
Date may share in any proceeds from a foreclosure sale with respect to
such Shared Collateral (but no other Collateral) that is effected in
accordance with Exhibit A and the other provisions of this Agreement by
the Secured Credit Party with the earlier Earliest Realization Date;
provided, however, that the foregoing provisions of this sentence shall
not be construed as permitting the Secured Credit Party with the later
Earliest Realization Date to effect a foreclosure sale prior to its
respective Earliest Realization Date with respect to any other Collateral
(or to share in any proceeds received by the Secured Credit Party with the
Earliest Realization Date through foreclosure with respect to any other
Collateral).
4.6.1.2 No Credit Party shall be entitled to initiate or
join as a petitioning creditor in an involuntary proceeding in bankruptcy
against the Company or against any Affiliate of the Company until ten (10)
days after the expiration of the Standstill Period.
4.6.1.3 Notwithstanding the expiration of the applicable
Standstill Period and the entitlement of each Credit Party to Exercise
Remedies against any of the Company Group or with respect to the
Collateral securing the Facility of such Credit Party, each Credit Party
agrees to reinstate its Facility and to recommence funding thereunder if,
prior to the completion of the first foreclosure permitted hereunder, all
Disbursement Agreement Defaults either (i) are cured in accordance with
the applicable provisions of the Disbursement Agreement, or (ii) are
waived by the Bank Agent and the Interim Mall Lender pursuant to Section
4.4 hereof, whereupon the time periods set forth in Exhibit A shall be
reinstated with respect to any subsequent default.
4.6.1.4 A Secured Credit Party shall only have the right to
Exercise Remedies in accordance with the foregoing provisions of this
Section 4.6.1 under the Related Collateral Agreements in accordance with
Section 4.7.1 below.
4.6.2 Remedies After Mall Release Date. After the Mall Release
Date, each Credit Party shall be entitled to declare an Acceleration Event and
Exercise Remedies
34
against any of the Company Group or with respect to the Collateral in accordance
with the terms of its Facility Agreement subject to compliance with each of the
following conditions:
4.6.2.1 Such Credit Party shall give written notice to the
other Credit Parties of the matter which constitutes a default by or with
respect to any of the Company Group which would, but for the provisions of
this Agreement, permit such Credit Party to declare an Acceleration Event
or Exercise Remedies.
4.6.2.2 Each Credit Party shall be subject to the Standstill
Period commencing upon the date such notice is given, and until such
Standstill Period shall have expired, no Credit Party shall Exercise
Remedies against any of the Company Group or with respect to the
Collateral, except that if such Acceleration Event is declared prior to
Final Completion, then (i) scheduled payments of interest on the Mortgage
Notes may be paid out of the Mortgage Notes Proceeds Account, and (ii) the
Controlling Party may direct the Disbursement Agent, the Intercreditor
Agent or the Securities Intermediary with respect to the enforcement of
rights against the Shared Collateral, the exercise of other rights under
the applicable agreements, and the taking of protective action with
respect to the Company Group or the Collateral;
4.6.2.3 No Credit Party shall be entitled to initiate or
join as a petitioning creditor in an involuntary proceeding against the
Company or any Affiliate of the Company until ten (10) days after the
expiration of the Standstill Period;
4.6.2.4 Upon expiration of the Standstill Period, each
Credit Party shall be entitled to Exercise Remedies against any of the
Company Group or with respect to the Collateral, provided that: (a) if the
Bank Agent shall accelerate the Indebtedness under the Bank Credit
Facility, then concurrently therewith or thereafter the Bank Agent shall
provide the Mortgage Notes Indenture Trustee with (i) notice of such
acceleration, and (ii) at least ten (10) days notice of the intent of the
Bank Agent to file any Notice of Default; and (b) concurrently with any
foreclosure by the Mortgage Notes Indenture Trustee under the Mortgage
Notes Indenture Deed of Trust (Venetian), all Obligations under the Bank
Credit Facility must be paid in full.
4.6.2.5 If a Secured Credit Party has the right to Exercise
Remedies in accordance with the foregoing provisions of this Section
4.6.2, such exercise of remedies under the Related Collateral Agreements
shall only be made in accordance with Section 4.7.1 below.
4.7 Exercise of Rights Under Security Agreements.
4.7.1 Related Collateral Agreements by Intercreditor Agent.
Notwithstanding any other provision of this Agreement to the contrary, except as
provided for in Section 4.7.2 below, only the Intercreditor Agent shall cause
the Exercise of Remedies
35
or otherwise act with respect to the Collateral encumbered under the Related
Collateral Agreements. The Intercreditor Agent shall be entitled to exercise,
and it shall exercise, rights and remedies and take such action as permitted to
be taken by the Intercreditor Agent under each Related Collateral Agreement as
it may be directed from time to time by the applicable Controlling Party
pursuant to the terms of this Agreement; provided that, such Controlling Party
shall have the right to Exercise Remedies only in accordance with the applicable
provisions of Section 4.6.1 or Section 4.6.2 above. Without limiting the
generality of the foregoing, the Intercreditor Agent shall act in accordance
with any written instructions delivered to the Intercreditor Agent from the
applicable Controlling Party hereunder, and shall refrain from exercising any
right, remedy or powers available to it or conferred on it hereunder or in the
applicable Related Collateral Agreement as set forth in such written
instructions; provided, however, that nothing shall impair the right of the
Intercreditor Agent, in its reasonable discretion, to take or omit to take any
action deemed proper by the Intercreditor Agent and permitted hereunder and
under the applicable Related Collateral Agreement which action or omission is
not inconsistent with any written direction of the Controlling Party.
4.7.2 Separate Realization. With respect to foreclosure against or
other realization upon the Collateral ("Realization"), unless the Secured Credit
Parties agree upon a single or coordinated Realization on all of the Collateral
for the benefit of all of the Secured Credit Parties (and no Secured Credit
Party shall be required to so agree), then notwithstanding the foregoing
provisions of Section 4.7.1 limiting enforcement of the Related Collateral
Documents to the Intercreditor Agent (acting on the direction of the Controlling
Party), any Secured Credit Party holding subordinate liens on any personal
property Collateral encumbered under the Project Security Agreements or the
Account Agreements, so that such Secured Credit Party is not a Controlling Party
with respect to such personal property Collateral, shall have the right to
effect a unified sale of such personal property Collateral together with its
real property Collateral, i.e., simultaneous Realization under the applicable
Deeds of Trust and the applicable Project Security Agreements and the Account
Agreements (a "Separate Unified Realization") in accordance with the following
terms and conditions of this Section 4.7.2:
4.7.2.1 Realization by such Secured Credit Party must be
permitted in accordance with the terms and conditions of Section 4.6.1 or
Section 4.6.2 above, as applicable.
4.7.2.2 The date of such Separate Unified Realization shall
be not earlier than thirty (30) days following the date such Secured
Credit Party has given the other Secured Parties notice of its election to
pursue Separate Unified Realization.
4.7.2.3 With respect to the personal property Collateral to
be sold at such Separate Unified Realization, the electing Secured Credit
Party or an agent on its behalf (other than the Intercreditor Agent) shall
have the right to schedule
36
such sale, the right to give any required notices of such sale, the right
to conduct such sale in conjunction with the foreclosure or other
realization under such Secured Credit Party's Deeds of Trust, and the
right to take any other actions necessary for a secured party to so
foreclose such security interests in accordance with applicable law, but
such Secured Credit Party shall take no other action with respect to such
personal property Collateral, including, without limitation, giving any
other notices or directions to the debtor, the Intercreditor Agent, the
depository or Securities Intermediary with respect to any Account, the
account party on any assigned account or the contract obligor on any
assigned contract; freezing or otherwise taking action against any
Account; seeking the appointment of a receiver; bringing any action
against the Company; or taking any action to Realize on such Collateral
other than at the Separate Unified Realization in accordance with this
Section 4.7.2.
4.7.2.4 The rights of an electing Secured Credit Party
under Section 4.7.2.3 may be exercised by such Secured Credit Party or by
an agent or attorney on behalf of such Secured Credit Party; such rights
shall not be exercised by the Intercreditor Agent.
4.7.2.5 The Intercreditor Agent and the other Secured
Credit Parties shall permit an electing Secured Credit Party to conduct
such Separate Unified Realization; provided, however, that the
Intercreditor Agent shall not be required to conduct or participate in
such Separate Unified Realization. Subject to the obligation to permit the
electing Secured Credit Party to conduct such Separate Unified
Realization, the Controlling Party with respect to such Collateral shall
continue to have the sole right to direct the Intercreditor Agent in
accordance with this Agreement, and in connection therewith, may, without
limitation, cause the Intercreditor Agent to schedule and conduct
Realization on such Collateral at any time and cause the Intercreditor
Agent to take such other actions as may be permitted under the terms of
any of the Related Collateral Agreements.
4.7.2.6 Except for the extinguishment of junior liens and
security interests by operation of law upon any Separate Unified
Realization, no Separate Unified Realization shall operate to terminate
any Project Security Agreement or Account Agreement creating the security
interest then realized upon, or to terminate any other Related Collateral
Agreement, and all security interests, liens and other interests of the
Intercreditor Agent and the other Secured Lenders under each Project
Security Agreement and Account Agreement shall (except to the extent
extinguished by operation of law, as aforesaid) survive such Separate
Unified Realization and shall remain enforceable by the Intercreditor
Agent and the other Secured Lenders. The purchaser at such Separate
Unified Realization, whether the Secured Credit Party conducting same or
any other Person, shall acquire title to any Collateral sold at such sale
subject to the continuing encumbrances, liens and security interests in
favor of the
37
other Secured Lenders (except to the extent extinguished by operation of
law, as aforesaid).
4.7.2.7 The Secured Credit Party conducting any Separate
Unified Realization shall be entitled to receive the proceeds, if any,
from the sale of the Collateral thereunder in accordance with applicable
law (including payment of excess proceeds to secured parties with junior
liens).
4.7.3 Foreclosure of Deeds of Trust. The provisions of the preceding
Section 4.7.1 and Section 4.7.2 shall not restrict the right of a Secured Credit
Party to Exercise Remedies against, and to complete a foreclosure against or
other realization upon, the following, provided that such Exercise of Remedies,
foreclosure or other realization is permitted in accordance with the applicable
provisions of Section 4.6: (a) any Collateral which constitutes an interest in
real property encumbered by a Deed of Trust granted for the benefit of such
Secured Credit Party, or (b) any Separate Proceeds Accounts Collateral in which
such Secured Credit Party holds the only lien and security interest.
4.8 Allocation of Shared Collateral Proceeds. In the event that the
Disbursement Agent, the Intercreditor Agent or the Securities Intermediary
receives or holds Shared Collateral Proceeds (including, but not limited to any
condemnation or casualty insurance proceeds) prior to the Mall Release Date, and
if (i) all Disbursement Agreement Defaults have not been cured or waived in
accordance with Section 4.4 above, and (ii) pursuant to Section 4.6.1.1 the
Secured Credit Parties or the Intercreditor Agent are entitled to Exercise
Remedies with respect to the Shared Collateral, such Shared Collateral Proceeds
shall be allocated between the Mall and the Hotel/Casino in accordance with this
Section 4.8, and upon such allocation, (a) such Shared Collateral Proceeds
allocated to the Mall shall be deemed to constitute Mall Collateral (i.e., the
security interests and lien priorities therein securing the Interim Mall Secured
Obligations, the Bank Secured Obligations and the Mortgage Notes Secured
Obligations shall be the same as the security interests and lien priorities in
the Mall Collateral securing such Secured Obligations pursuant to Section 2.1),
and (b) such Shared Collateral Proceeds allocated to the Hotel/Casino shall be
deemed to constitute Hotel/Casino Collateral (i.e., the security interests and
lien priorities therein securing the Bank Secured Obligations and the Mortgage
Notes Secured Obligations shall be the same as the security interests and lien
priorities in the Hotel/Casino Collateral securing such Secured Obligations
pursuant to Section 2.1). Such allocation between the Mall and the Hotel/Casino
shall be proposed by the Intercreditor Agent, with the advice of the
Construction Consultant, on a fair and reasonable basis taking into account the
following factors:
(1) the extent to which such Shared Collateral Proceeds represent
payment of or other compensation for damage to the Hotel/Casino Collateral
or the Mall Collateral, as the case may be;
38
(2) the amount of Protective Advances, if any, made by the Bank
Lenders or the Interim Mall Lender which were attributable to the
Hotel/Casino Collateral or the Mall Collateral;
(3) the extent to which the amounts deposited in any Account
represent the undisbursed proceeds of any Advance under any Facility;
(4) such other allocation factors as shall be reasonable in light
of the then existing circumstances; and
(5) that to the extent such amounts of Shared Collateral Proceeds
cannot otherwise be specifically allocated between the Mall and the
Hotel/Casino in accordance with the foregoing factors, the parties will
make such allocation on a pro rata basis, based on the ratio of (i) the
aggregate amount of Advances under the Interim Mall Facility, to (ii) the
aggregate amount of Advances under the Bank Credit Facility and the
Mortgage Notes Facility, with such otherwise unallocated Shared Collateral
Proceeds allocated to the Mall and to the Hotel/Casino in such ratio;
provided, however, that notwithstanding the foregoing, any allocation of Shared
Collateral Proceeds pursuant to this Section 4.8 shall be subject to the
reasonable prior approval of the Bank Agent and the Interim Mall Lender. If the
Bank Agent and the Interim Mall Lender (who together for purposes of this
Section 4.8 only shall be referred to as the, "Arbitrating Parties" and each an
"Arbitrating Party") cannot reach an agreement on an allocation of Shared
Collateral Proceeds, then such dispute shall be resolved through arbitration in
accordance with the terms of this Section 4.8. All arbitration conducted under
this Section 4.8 shall be in accordance with the rules of the American
Arbitration Association, to the extent such rules do not conflict with the
procedures herein set forth.
4.8.1 The Arbitrating Parties shall, together, agree on one Person
to serve as an arbitrator, provided, however, that such Person shall (i)
have a minimum of ten (10) years of relevant experience and expertise with
respect to construction of and accounting for large multi-use properties,
and (ii) not be affiliated with any Arbitrating Party, the Company or any
Affiliate of any of them. Any arbitrator meeting such requirements shall
be deemed a "Qualified Arbitrator" for the purposes of this Section 4.8.
4.8.2 In the event that the Arbitrating Parties shall not be able
to agree on a single Person to serve as an arbitrator, then each
Arbitrating Party shall appoint one Qualified Arbitrator and the two
Qualified Arbitrators so appointed shall, together, decide upon and
appoint another Qualified Arbitrator who shall alone serve as the
arbitrator hereunder. The arbitrator shall resolve the dispute and make a
determination as to the proper allocation of Shared Collateral Proceeds.
39
4.8.3 All determinations of the arbitrator, whether pursuant to
Section 4.8.1 or Section 4.8.2 shall be binding upon the Arbitrating
Parties. The decision of the arbitrator shall be in writing and shall be
made as promptly as possible after the designation of the sole arbitrator,
whether pursuant to Section 4.8.1 or Section 4.8.2, but in no event later
than thirty (30) days from the date such sole arbitrator is so appointed.
A copy of the decision of the arbitrator shall be signed by the arbitrator
and delivered to each Arbitrating Party in the manner provided for in
Section 7.1 of this Agreement for the giving of notice. The decision of
the arbitrators (i) may be entered as a judgment in a court of competent
jurisdiction, and (ii) shall in no event be, nor shall it be deemed to be,
a modification, amendment or supplement of any kind to this Agreement in
any manner.
4.8.4 For each arbitrable dispute the cost and expense of the
arbitrators and arbitration proceeding (except for an Arbitrating Party's
attorney's fees) shall be paid and shared equally by the Arbitrating
Parties, unless the arbitrator assesses such cost and expense unequally
between the Arbitrating Parties.
4.9 Other Duties of and Actions by Intercreditor Agent. To the extent
not otherwise provided for by this Agreement, with respect to the Related
Collateral Agreements, Intercreditor Agent may take and shall take, or refrain
from taking, action in its capacity as Intercreditor Agent thereunder, in
accordance with the following provisions:
4.9.1 Intercreditor Agent shall take such actions as it may be
specifically required to take under the express terms of the Related
Collateral Agreements and as otherwise may be required by law;
4.9.2 Intercreditor Agent may take such action or refrain from
taking such action as it may reasonably deem necessary for the normal
conduct of its business as Intercreditor Agent hereunder and under the
Related Collateral Agreements, or to the extent deemed necessary by
Intercreditor Agent, for purposes of preservation of the Collateral or
rights or interests of Secured Credit Parties thereunder; provided that,
unless instructed in writing by the Controlling Party to the contrary,
Intercreditor Agent shall have no obligation or liability as a result of
its taking or failing to take actions pursuant to this subsection 4.9.2;
4.9.3 with respect to any other action or omission relating to all
or any portion of the Collateral, Intercreditor Agent shall take such
actions or refrain from taking such action as the Controlling Party with
respect to such Collateral may direct in writing;
4.9.4 with respect to any other matter relating to the Related
Collateral Agreements, Intercreditor Agent shall act or refrain from
acting in accordance with the written instructions of (i) prior to the
Mall Release Date, two or more of the Secured
40
Credit Parties, and (ii) thereafter, the Bank Agent until the Bank Secured
Obligations are repaid in full and thereafter the Mortgage Notes Indenture
Trustee; and
4.9.5 beyond its duties set forth herein and in the Related
Collateral Agreements and as may be required by law, the Intercreditor
Agent shall not have any duty to any of the Company Group, to the Credit
Parties or to the Secured Lenders as to the Collateral in its possession
or control under the Related Collateral Agreements or in the possession or
control of any agent or nominee of it or as to the preservation of rights
against prior parties or any other rights pertaining thereto except as
required by applicable law.
5. Representations and Warranties. Each Credit Party represents and
warrants to each other Credit Party as follows:
5.1 Organization. It is duly organized and is validly existing under
the laws of the jurisdiction under which it was organized with full power to
execute, deliver, and perform this Agreement and consummate the transactions
contemplated hereby.
5.2 Authorization. All actions necessary to authorize the execution,
delivery and performance of this Agreement on behalf of such party have been
duly taken, and all such actions continue in full force and effect as of the
date hereof.
5.3 Binding Agreement. It has duly executed and delivered this
Agreement and this Agreement constitutes the legal, valid, and binding agreement
of such party enforceable in accordance with its terms and subject to (i)
applicable bankruptcy, reorganization, insolvency and moratorium laws, and (ii)
principles of equity, which may apply regardless of whether a proceeding is
brought in law or in equity.
5.4 No Consent Required. To the best of its knowledge, no consent of
any other party and no consent, license, approval, or authorization of, or
exemption by, or registration or declaration or filing with, any governmental
authority, bureau or agency is required in connection with the execution,
delivery, or performance by such party of this Agreement or consummation by such
party of the transactions contemplated by this Agreement.
5.5 No Conflict. None of the execution, delivery, and performance of
this Agreement nor the consummation of the transactions contemplated by this
Agreement will (i) violate or conflict with any provision of the organizational
or governing documents, if any, of such party; (ii) to the best of its
knowledge, violate, conflict with, or result in the breach or termination of, or
otherwise give any other contracting party the right to terminate, or constitute
(or with notice or lapse of time, or both, would constitute) a default under the
terms of any contract, mortgage, lease, bond, indenture, agreement, or other
instrument to which such party is a party or to which any of its properties are
subject; (iii) to the best of
41
its knowledge, result in the creation of any lien, charge, encumbrance,
mortgage, lease, claim, security interest, or other right or interest upon the
properties or assets of such party pursuant to the terms of any such contract,
mortgage, lease, bond, indenture, agreement, franchise, or other instrument;
(iv) violate any judgment, order, injunction, decree, or award of any court,
arbitrator, administrative agency, or governmental or regulatory body of which
it has knowledge against, or binding upon such party or upon any of the
securities, properties, assets, or business of such party; or (v) to the best of
its knowledge, constitute a violation by such party of any statute, law, or
regulation that is applicable to such party.
6. Appointment of Intercreditor Agent.
6.1 Appointment. Scotiabank is hereby appointed Intercreditor Agent
hereunder and under the Related Collateral Agreements and each Secured Credit
Party hereby authorizes Intercreditor Agent to enter into the applicable Related
Collateral Agreements which secure Obligations to such Secured Credit Party, to
act as its agent in accordance with the terms of this Agreement and such Related
Collateral Agreement. Intercreditor Agent agrees to act upon the express
conditions contained in this Agreement and the Related Collateral Agreements, as
applicable. The provisions of this Section 6 are solely for the benefit of
Intercreditor Agent and the Secured Credit Parties, and none of the Company, any
Affiliate of the Company, ▇▇▇▇▇▇▇, any ▇▇▇▇▇▇▇ Relative, the Subordinated Notes
Indenture Trustee or the Subordinated Note Holders shall have any rights as a
third party beneficiary of any of the provisions thereof. In performing its
functions and duties under this Agreement, Intercreditor Agent shall act solely
as an agent of the Secured Credit Parties and does not assume and shall not be
deemed to have assumed any obligation towards or relationship of agency or trust
with or for the Company, any Affiliate of the Company, ▇▇▇▇▇▇▇, any ▇▇▇▇▇▇▇
Relative, the Subordinated Notes Indenture Trustee or the Subordinated Note
Holders.
6.2 Authority. Each Secured Credit Party irrevocably authorizes
Intercreditor Agent to take such actions on such Secured Credit Party's behalf
and to exercise such powers, rights and remedies under the Related Collateral
Agreements as are specifically delegated or granted to Intercreditor Agent by
the terms hereof and thereof, together with such powers, rights and remedies as
are reasonably incidental thereto. Intercreditor Agent shall have only those
duties and responsibilities that are expressly specified in this Agreement and
the applicable Related Collateral Agreement. Intercreditor Agent agrees to act
in accordance with instructions of the Controlling Party pursuant to Section
4.7.1. Intercreditor Agent may exercise such powers, rights and remedies and
perform such duties by or through its agents or employees. Intercreditor Agent
shall not have, by reason of this Agreement or the Related Collateral
Agreements, a fiduciary relationship in respect of any Secured Credit Party or
any other Person; and nothing in this Agreement or the Related Collateral
Agreements, expressed or implied, is intended to or shall be so construed as to
impose upon Intercreditor Agent any obligations in respect of this Agreement or
the Related Collateral Agreements except as expressly set forth herein or
therein.
42
6.3 Amendment of Agreements. Without the prior written consent of the
Secured Credit Parties, the Intercreditor Agent (a) shall not amend any of the
Related Collateral Agreements to which it is a party, and (b) shall not direct
the Disbursement Agent to enter into any amendments of the Related Collateral
Agreements to which it is a party. Upon approval by the Secured Credit Parties
of any proposed amendment to the Related Collateral Agreements or to the
Disbursement Agreement, the Intercreditor Agent shall execute and deliver such
amendment, and shall direct the Disbursement Agent to execute and deliver such
amendment, as applicable, in each case in its capacity as Intercreditor Agent
hereunder or as Disbursement Agent under the Disbursement Agreement, as the case
may be.
6.4 Responsibility. Intercreditor Agent shall not be responsible to
any Credit Party for the execution, effectiveness, genuineness, validity,
enforceability, collectibility or sufficiency of this Agreement, any Related
Collateral Agreement or any Collateral or for any representations, warranties,
recitals or statements made herein or therein or made in any written or oral
statements or in any financial or other statements, instruments, reports or
certificates or any other documents furnished to the Secured Credit Parties in
connection with the Collateral and the transactions contemplated hereby or
thereby or any default under any agreement included in the Collateral or for the
financial condition or business affairs of the Company or any other Person
liable for the payment of any Obligations, nor shall the Intercreditor Agent be
required to ascertain or inquire as to the performance or observance of any of
the terms, conditions, provisions, covenants or agreements contained in this
Agreement or any other Financing Agreement or any Collateral or as to the
existence or possible existence of any Event of Default, Potential Event of
Default or any default under any agreement included in this Collateral.
6.5 Liability. Neither Intercreditor Agent nor any of its officers,
directors, employees or agents shall be liable to any Credit Party or any other
Person for any action taken or omitted by Intercreditor Agent under or in
connection with this Agreement, the Disbursement Agreement, the Related
Collateral Agreements, or the Collateral except to the extent caused by
Intercreditor Agent's gross negligence, bad faith or willful misconduct.
Intercreditor Agent shall be entitled to refrain from any act or the taking of
any action (including the failure to take an action) in connection with this
Agreement, the Related Collateral Agreements, or the Collateral or from the
exercise of any power, discretion or authority vested in it hereunder or
thereunder unless and until Intercreditor Agent shall have received instructions
in respect thereof in accordance with this Agreement, and upon such instruction,
Intercreditor Agent shall be entitled to act or (where so instructed) refrain
from acting, or to exercise such power, discretion or authority, in accordance
with such instructions. Without prejudice to the generality of the foregoing,
(i) Intercreditor Agent shall be entitled to rely, and shall be fully protected
in relying, upon any communication, instrument or document believed by it to be
genuine and correct and to have been signed or sent by the proper person or
persons, and shall be entitled to rely and shall be protected in relying on
opinions and judgments of attorneys (who may be attorneys for the Company and
the Affiliates of the Company), accountants, experts and other professional
advisors selected
43
by it; and (ii) no Credit Party shall have any right of action whatsoever
against Intercreditor Agent as a result of Intercreditor Agent acting or (where
so instructed) refraining from acting under this Agreement or any Related
Collateral Agreement in its capacity as Intercreditor Agent to the extent
authorized, permitted, required or instructed in accordance with the terms of
this Agreement.
6.6 Capacity. The agency hereby created shall in no way impair or
affect any of the rights and powers of, or impose any duties or obligations
upon, Intercreditor Agent in its individual capacity as Bank Agent, a Bank
Lender, Disbursement Agent or a Credit Party hereunder. Intercreditor Agent and
its Affiliates may accept deposits from, lend money to and generally engage in
any kind of banking, trust, financial advisory or other business with the
Company or any Affiliate of the Company as if it were not performing the duties
specified herein, and may accept fees and other consideration from any of the
Company Group for services in connection with this Agreement and otherwise
without having to account for the same to other Credit Parties.
6.7 Resignation; Appointment of Additional Intercreditor Agents.
6.7.1 Intercreditor Agent may resign at any time by giving thirty
(30) days' prior written notice thereof to the Secured Credit Parties, and
Intercreditor Agent may be removed at any time, with or without cause, by an
instrument or concurrent instruments in writing signed by any two of the three
Secured Credit Parties prior to the Mall Release Date, or by the Bank Agent
acting alone thereafter, delivered to the other Secured Credit Party and to the
Intercreditor Agent. Upon any such notice of resignation or any such removal,
any two of the three Secured Credit Parties prior to the Mall Release Date, or
the Bank Agent acting alone thereafter, shall have the right, upon seven days'
notice to the other Secured Credit Party to appoint a successor Intercreditor
Agent. Upon the acceptance of any appointment as Intercreditor Agent hereunder
by a successor Intercreditor Agent, that successor Intercreditor Agent shall
thereupon succeed to and become vested with all the rights, powers, privileges
and duties of the retiring or removed Intercreditor Agent. The retiring or
removed Intercreditor Agent shall reasonably cooperate with the successor
Intercreditor Agent upon such appointment, to assist with such transition. Upon
the date of such removal or the effective date of such resignation (but not
later than the date of such succession) the retiring or removed Intercreditor
Agent shall be discharged from its duties and obligations under this Agreement;
provided, however, that commencing upon the date the Intercreditor Agent sends
its notice of resignation, the Intercreditor Agent shall not be required to take
any action hereunder until and unless the Secured Credit Party or Parties
requesting that such action be taken agree to reimburse all costs of the
Intercreditor Agent in connection therewith, and agree to indemnify, defend and
hold the Intercreditor Agent harmless from all claims, liabilities, costs or
expenses (including attorneys' fees) in connection with or arising out of such
actions taken by the Intercreditor Agent.
44
6.7.2 Any Controlling Party may elect to appoint one or more
additional Intercreditor Agents with respect to its interests in the Collateral
(each an "Additional Intercreditor Agent") and Intercreditor Agent shall, upon
receipt of written instructions of such Controlling Party, execute and deliver
all instruments and agreements necessary or proper to appoint the other person
or persons selected by the Controlling Party to act as an Additional
Intercreditor Agent with respect to such Collateral. Upon the written acceptance
of the terms of such appointment and written notice thereof to Credit Parties
and each member of the Company Group party to the Related Collateral Documents,
each such additional or successor Additional Intercreditor Agent shall (i)
thereupon succeed to and become vested with all the rights, powers, privileges
and duties of the Intercreditor Agent with respect to such Collateral and
replace the prior Intercreditor Agent with respect to matters pertaining to such
Collateral, (ii) shall be subject to the terms and provisions of this Agreement
and the other Related Collateral Agreements as they apply to the Intercreditor
Agent and such Collateral and (iii) not have any other rights or duties
hereunder or under the Related Collateral Agreements with respect to any other
Collateral or any other matter.
6.7.3 After any retiring, removed or replaced Intercreditor
Agent's resignation, removal or replacement hereunder as Intercreditor Agent,
the provisions of this Section 6 shall inure to its benefit as to any actions
taken or omitted to be taken by it while it was Intercreditor Agent under this
Agreement.
7. Miscellaneous Provisions.
7.1 Notices; Addresses. Any communications between the Credit Parties
hereto or notices herein to be given may be given to the following addressees:
If to the Bank Agent: The Bank of Nova Scotia
▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attn: ▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇
Phone: (▇▇▇) ▇▇▇-▇▇▇▇
Fax: (▇▇▇) ▇▇▇-▇▇▇▇
with a copy to: The Bank of Nova Scotia
Loan Administration
▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇.▇.
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇
Attn: ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
Phone: (▇▇▇) ▇▇▇-▇▇▇▇
Fax: (▇▇▇) ▇▇▇-▇▇▇▇
45
If to the Mortgage Notes First Trust National Association
Indenture Trustee: ▇▇▇ ▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇. ▇▇▇▇, ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
Attn: Corporate Trust Department
Phone: (▇▇▇) ▇▇▇-▇▇▇▇
Fax: (▇▇▇) ▇▇▇-▇▇▇▇
If to the Interim Mall Lender: GMAC Commercial Mortgage Corporation
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attn: ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
Phone: (▇▇▇) ▇▇▇-▇▇▇▇
Fax: (▇▇▇) ▇▇▇-▇▇▇▇
If to the Subordinated Notes First Union National Bank
Indenture Trustee: Corporate Trust Division
▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇.▇., ▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇
Attn:
Phone:
Fax:
If to the Disbursement Agent: The Bank of Nova Scotia
▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attn: ▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇
Phone: (▇▇▇) ▇▇▇-▇▇▇▇
Fax: (▇▇▇) ▇▇▇-▇▇▇▇
with a copy to: The Bank of Nova Scotia
Loan Administration
▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇.▇.
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇
Attn: ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
Phone: (▇▇▇) ▇▇▇-▇▇▇▇
Fax: (▇▇▇) ▇▇▇-▇▇▇▇
46
If to the Intercreditor Agent: The Bank of Nova Scotia
▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attn: ▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇
Phone: (▇▇▇) ▇▇▇-▇▇▇▇
Fax: (▇▇▇) ▇▇▇-▇▇▇▇
with a copy to: The Bank of Nova Scotia
Loan Administration
▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇.▇.
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇
Attn: ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
Phone: (▇▇▇) ▇▇▇-▇▇▇▇
Fax: (▇▇▇) ▇▇▇-▇▇▇▇
If to the Securities
Intermediary: The Bank of Nova Scotia
▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attn: ▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇
Phone: (▇▇▇) ▇▇▇-▇▇▇▇
Fax: (▇▇▇) ▇▇▇-▇▇▇▇
with a copy to: The Bank of Nova Scotia
Loan Administration
▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇.▇.
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇
Attn: ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
Phone: (▇▇▇) ▇▇▇-▇▇▇▇
Fax: (▇▇▇) ▇▇▇-▇▇▇▇
All notices or other communications required or permitted to be given hereunder
shall be in writing and shall be considered as properly given (a) if delivered
in person, (b) if sent by reputable overnight delivery service, (c) in the event
overnight delivery services are not readily available, if mailed by first class
mail, postage prepaid, registered or certified with return receipt requested or
(d) if sent by prepaid telex, or by telecopy with correct answer back received.
Notice so given shall be effective upon receipt by the addressee, except that
any communication or notice so transmitted by telecopy or other direct written
electronic means shall be deemed to have been validly and effectively given on
the day (if a Banking Day and, if not, on the next following Banking Day) on
which it is validly transmitted if transmitted before 4 p.m., recipient's time,
and if transmitted after that time, on the next following Banking Day; provided,
however, that if any notice is tendered to an addressee and the delivery thereof
is refused by such addressee, such notice shall be effective upon such
47
tender. Any party shall have the right to change its address for notice
hereunder to any other location by giving of no less than twenty (20) days'
notice to the other parties in the manner set forth hereinabove.
7.2 Further Assurances. Each Credit Party (i) shall deliver to each
other Credit Party, to the Disbursement Agent, to the Intercreditor Agent and to
the Securities Intermediary such instruments, agreements, certificates and
documents as any such Person may reasonably request to confirm the validity and
priority of the liens on and security interests in the Collateral granted
pursuant to the Security Documents as affected hereby, (ii) shall fully
cooperate with each other, with the Disbursement Agent, with the Intercreditor
Agent and with the Securities Intermediary, and (iii) shall perform all
additional acts reasonably requested by any such Person to effect the purposes
of this Agreement.
7.3 Delay and Waiver. No delay or omission to exercise any right,
power or remedy accruing upon the occurrence of any Potential Event of Default
or Event of Default or any other breach or default of the Company Group or any
of them under any Facility Agreement, the Disbursement Agreement or any Related
Collateral Agreement shall impair any such right, power or remedy of the Credit
Parties, the Disbursement Agent, the Intercreditor Agent or the Securities
Intermediary, nor shall it be construed to be a waiver of any such breach or
default, or an acquiescence therein, or in any similar breach or default
thereafter occurring, nor shall any waiver of any single Potential Event of
Default, Event of Default or other breach or default be deemed a waiver of any
other Potential Event of Default, Event of Default or other breach or default
theretofore or thereafter occurring. Any waiver, permit, consent or approval or
any kind or character on the part of any of the Credit Parties, the Disbursement
Agent, the Intercreditor Agent or the Securities Intermediary of any Potential
Event of Default, Event of Default or other breach or default under this
Agreement, any Related Collateral Agreement or any other Financing Agreement, or
any waiver on the part of any of the Credit Parties, the Disbursement Agent, the
Intercreditor Agent or the Securities Intermediary, of any provision or
condition of this Agreement or any other operative document, must be in writing
and shall be effective only to the extent in such writing specifically set
forth. All remedies, either under this Agreement, under any Related Collateral
Agreement or any other Financing Agreement or by law or otherwise afforded to
any of the Credit Parties, the Disbursement Agent, the Intercreditor Agent or
the Securities Intermediary shall be cumulative and not alternative (subject to
any limitations on the exercise of such remedies imposed under this Agreement).
7.4 Entire Agreement. This Agreement and any agreement, document or
instrument attached hereto or referred to herein integrate all the terms and
conditions mentioned herein or incidental hereto and supersede all oral
negotiations and prior writings in respect to the subject matter hereof, all of
which negotiations and writings are deemed void and of no force and effect. As
among the Credit Parties, in the event of any conflict between the terms of this
Agreement and the terms of the Disbursement Agreement or the Related Collateral
Agreements, the terms of this Agreement shall control.
48
7.5 Governing Law. This Agreement shall be governed by the laws of
State of New York of the United States of America and shall for all purposes be
governed by and construed in accordance with the laws of such state without
regard to the conflict of law rules thereof other than Section 5-1401 of the New
York General Obligations Law.
7.6 Severability. In case any one or more of the provisions contained
in this Agreement should be invalid, illegal or unenforceable in any respect,
the validity, legality and enforceability of the remaining provisions shall not
in any way be affected or impaired thereby, and the parties hereto shall enter
into good faith negotiations to replace the invalid, illegal or unenforceable
provision.
7.7 Headings. Section headings have been inserted in this Agreement
as a matter of convenience for reference only and it is agreed that such
headings are not a part of this Agreement and shall not be used in the
interpretation of any provision of this Agreement.
7.8 Limitations on Liability. No claim shall be made by any Credit
Party or any of its Affiliates against any other Credit Party, the Disbursement
Agent, the Intercreditor Agent, the Securities Intermediary or any of their
respective Affiliates, directors, employees, attorneys or agents for any
special, indirect, consequential or punitive damages (whether or not the claim
therefor is based on contract, tort or duty imposed by law), in connection with,
arising out of or in any way related to the transactions contemplated by this
Agreement or any act or omission or event occurring in connection therewith; and
each Credit Party hereby waives, releases and agrees not to ▇▇▇ upon any such
claim for any such special, indirect, consequential or punitive damages, whether
or not accrued and whether or not known or suspected to exist in its favor.
7.9 Consent of Jurisdiction. Any legal action or proceeding arising
out of this Agreement may be brought in or removed to the courts of the State of
New York, in and for the County of New York, or of the United States of America
for the Southern District of New York. By execution and delivery of this
Agreement, each Credit Party, accepts, for its and in respect of its property,
generally and unconditionally, the jurisdiction of the aforesaid courts for
legal proceedings arising out of or in connection with this Agreement and
irrevocably consents to the appointment of the ▇▇▇▇▇▇▇▇-▇▇▇▇ Corporation System
Inc. as its agent to receive service of process in New York, New York. Nothing
herein shall affect the right to serve process in any other manner including
judicial or non-judicial foreclosure of real property interests which are part
of the Collateral. Each Credit Party hereby waives any right to stay or dismiss
any action or proceeding under or in connection with any or all of the Project,
this Agreement or any other operative document brought before the foregoing
courts on the basis of forum non-conveniens.
7.10 Successors and Assigns. The provision of this Agreement shall be
binding upon and inure to the benefit of the parties hereto and their respective
successors and
49
assigns; provided, however, this Agreement shall terminate upon the last to
occur of (i) the Mall Release Date, or (ii) the date of payment in full of all
Obligations under the Bank Credit Facility.
7.11 Counterparts. This Agreement may be executed in one or more
duplicate counterparts and when signed by all of the Credit Parties listed below
shall constitute a single binding agreement.
7.12 No Third Party Beneficiaries. Except for the Bank Lenders, the
Mortgage Note Holders and the Subordinated Note Holders, the Credit Parties do
not intend the benefits of this Agreement to inure to the benefit of nor shall
it be enforceable by any third party (including, without limitation, any other
Funding Agent, the Company, any of its Affiliates, ▇▇▇▇▇▇▇ or any ▇▇▇▇▇▇▇
Relative) nor shall this Agreement be construed to make or render any Credit
Party liable to any third party (including, without limitation, any other
Funding Agent, the Company, any of its Affiliates, ▇▇▇▇▇▇▇ or any ▇▇▇▇▇▇▇
Relative) for the performance or failure to perform any obligations hereunder.
Notwithstanding the foregoing, however, the Permanent Mall Lender shall be
entitled to the benefits of the covenants in its favor set forth in Section
2.2.1.2 above.
7.13 Amendment for New Credit Parties. Upon any refinancing of any
Facility, or the incurring of other Indebtedness of the Company (subject to the
rights of the existing Credit Parties under their respective Financing
Agreements with respect to any such refinancing or other Indebtedness), the
applicable lender shall be bound by the terms of this Agreement and such lender,
or an agent or trustee on its behalf, and the Credit Parties shall execute and
deliver an amendment to this Agreement to make such Person a Credit Party
hereunder.
7.14 Trust Indenture Act. The parties do not intend that the
provisions of this Agreement violate the requirements of the Trust Indenture Act
of 1939, as amended.
50
IN WITNESS WHEREOF, the Credit Parties hereto have caused this
Agreement to be executed by their respective officers or agents thereunto duly
authorized as of the day and year first above written.
Bank Agent:
THE BANK OF NOVA SCOTIA, a
Canadian chartered bank
By: /s/ ▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇
----------------------------------------
Name: ▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇
Title: Relationship Manager
Interim Mall Lender:
GMAC COMMERCIAL MORTGAGE CORPORATION,
a California corporation
By: /s/ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
----------------------------------------
Name: ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
Title: Senior Vice President
Mortgage Notes Indenture Trustee:
FIRST TRUST NATIONAL ASSOCIATION,
a national banking association
By: /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
----------------------------------------
Name: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
Title: Assistant Vice President
Subordinated Notes Indenture Trustee:
FIRST UNION NATIONAL BANK,
a national banking association
By: /s/ ▇▇▇▇▇ ▇. ▇▇▇▇
----------------------------------------
Name: ▇▇▇▇▇ ▇. ▇▇▇▇
Title: VICE PRESIDENT
S-1
Intercreditor Agent:
THE BANK OF NOVA SCOTIA, a
Canadian chartered bank
By: /s/ ▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇
----------------------------------------
Name: ▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇
Title: Relationship Manager
S-2
Exhibit A
Credit Party: Earliest Realization Date:
Bank Agent 180 days after Disbursement
Agreement Default Date
Mortgage Notes Indenture Trustee 195 days after Disbursement
Agreement Default Date
Interim Mall Lender 210 days after Disbursement
Agreement Default Date
Subordinated Notes Indenture Trustee 240 days after Disbursement
Agreement Default Date
Holders of Additional Capital Indebtedness 210 days after Disbursement
Agreement Default Date
Exhibit A-1
Exhibit B
Accounts and Account Agreements
----------------------------------------------------------------------------------------------------
Account Agreement Accounts Pledgor Secured Party
----------------------------------------------------------------------------------------------------
Mortgage Notes Proceeds Mortgage Notes Proceeds Account Company Disbursement Agent
Collateral Account Agreement
----------------------------------------------------------------------------------------------------
HVAC HVAC Collateral Accounts HVAC Provider Disbursement Agent
Collateral Account Agreement
----------------------------------------------------------------------------------------------------
Completion Guaranty Completion Guaranty Account ▇▇▇▇▇▇▇ Disbursement Agent
Collateral Account Agreement
----------------------------------------------------------------------------------------------------
Disbursement Bank Proceeds Account Company Disbursement Agent
Collateral Account Agreement
----------------------------------------------------------------------
Collections Account Company Disbursement Agent
Company's Funds Account
Disbursement Account
HC/Mall Component
Cash Management Account
HVAC Component
Cash Management Account
Interest Payment Account
Pre-Completion Revenues Account
----------------------------------------------------------------------------------------------------
-----------------------------------------------------------------------------------------
Account Agreement Secured Obligations Securities
Intermediary
-----------------------------------------------------------------------------------------
Mortgage Notes Proceeds Mortgage Notes Secured Obligations ▇▇▇▇▇▇▇, ▇▇▇▇▇
Collateral Account Agreement & Co.
-----------------------------------------------------------------------------------------
HVAC 1. Bank Secured Obligations and Scotiabank
Collateral Account Agreement Interim Mall Secured Obligations
2. Mortgage Notes Secured Obligations
-----------------------------------------------------------------------------------------
Completion Guaranty 1. Bank Secured Obligations and ▇▇▇▇▇▇▇, Sachs
Collateral Account Agreement Interim Mall Secured Obligations & Co.
2. Mortgage Notes Secured Obligations
-----------------------------------------------------------------------------------------
Disbursement Bank Secured Obligations Scotiabank
Collateral Account Agreement
-----------------------------------------------------------
1. Bank Secured Obligations and Scotiabank
Interim Mall Secured Obligations
2. Mortgage Notes Secured Obligations
-----------------------------------------------------------------------------------------
Exhibit B -- Page 1
Exhibit C
Allocation of Collateral
------------------------------------------------------------------------------------------------------------------------------------
Category: Security Document: Collateral: Classification:
------------------------------------------------------------------------------------------------------------------------------------
Deeds of Trust Bank Deed of Trust (Venetian) all Hotel/Casino Collateral
(prior to Mall Parcel
Creation Date):
-------------------------------------------------------------------------------------------------------
Bank Leasehold Deed of Trust (Mall) all Mall Collateral
-------------------------------------------------------------------------------------------------------
Interim Mall Leasehold Deed of Trust all Mall Collateral
-------------------------------------------------------------------------------------------------------
Interim Mall Space Fee Deed of Trust all Hotel/Casino Collateral
-------------------------------------------------------------------------------------------------------
Mortgage Notes Deed of Trust (Venetian) all Hotel/Casino Collateral
-------------------------------------------------------------------------------------------------------
Mortgage Notes Leasehold Deed of Trust all Mall Collateral
(Mall)
------------------------------------------------------------------------------------------------------------------------------------
Deeds of Trust Bank Deed of Trust (Venetian) all Hotel/Casino Collateral
(after Mall Parcel Creation
Date):
-------------------------------------------------------------------------------------------------------
Bank Leasehold Deed of Trust (Mall) all Mall Collateral
-------------------------------------------------------------------------------------------------------
Bank Deed of Trust (Mall Parcel) all Mall Collateral
-------------------------------------------------------------------------------------------------------
Interim Mall Leasehold Deed of Trust all Mall Collateral
-------------------------------------------------------------------------------------------------------
Interim Mall Space Fee Deed of Trust [Mall all Mall Collateral
Parcel]
-------------------------------------------------------------------------------------------------------
Mortgage Notes Deed of Trust (Venetian) all Hotel/Casino Collateral
-------------------------------------------------------------------------------------------------------
Mortgage Notes Leasehold Deed of Trust all Mall Collateral
(Mall)
-------------------------------------------------------------------------------------------------------
Mortgage Notes Deed of Trust (Mall Parcel) all Mall Collateral
Exhibit C -- Page 1
------------------------------------------------------------------------------------------------------------------------------------
Category: Security Document: Collateral: Classification:
------------------------------------------------------------------------------------------------------------------------------------
Project Security Borrower Security Agreement Shared Intangible Shared Collateral
Agreements: Collateral
-------------------------------------------------------
all other Collateral Hotel/Casino Collateral
-------------------------------------------------------------------------------------------------------
Mall Construction Subsidiary Security all Mall Collateral
Agreement
------------------------------------------------------------------------------------------------------------------------------------
Account Agreements: Mortgage Notes Proceeds Account all Separate Proceeds Accounts
Agreement Collateral
-------------------------------------------------------------------------------------------------------
HVAC Accounts Agreement all Shared Collateral
-------------------------------------------------------------------------------------------------------
Completion Guaranty Account Agreement all Shared Collateral
-------------------------------------------------------------------------------------------------------
Disbursement Account Agreement Bank Proceeds Account Separate Proceeds Accounts
Collateral
-------------------------------------------------------
all other Collateral Shared Collateral
------------------------------------------------------------------------------------------------------------------------------------
Exhibit C -- Page 2
Exhibit D
Consents
1. Consent to Mall Management Agreement
2. GECC Consent (The GECC Consent will be part of the GECC
Intercreditor Agreement)
3. P & O Guaranty Consent
4. Bovis Guaranty Consent
5. Consent to Construction Agreement
6. Consent to Architect's Agreement
7. Consent to ▇▇▇▇▇▇▇▇ Agreement
8. Consent to Energy Services Agreement
Exhibit D - Page 1