-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, VqMjIqVP5WKVpCO4IiEyV+vDBrq5atItM9GI6wCDsAcWwswMGfOSo1DdmhCBLyKd PJ3UCNhBY1+ObXgGg/HBKA== /in/edgar/work/20000814/0000912057-00-037501/0000912057-00-037501.txt : 20000921 0000912057-00-037501.hdr.sgml : 20000921 ACCESSION NUMBER: 0000912057-00-037501 CONFORMED SUBMISSION TYPE: 10-Q PUBLIC DOCUMENT COUNT: 10 CONFORMED PERIOD OF REPORT: 20000630 FILED AS OF DATE: 20000814 FILER: COMPANY DATA: COMPANY CONFORMED NAME: ALADDIN GAMING ENTERPRISES INC CENTRAL INDEX KEY: 0001059128 STANDARD INDUSTRIAL CLASSIFICATION: [7011 ] IRS NUMBER: 880379695 STATE OF INCORPORATION: NV FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 10-Q SEC ACT: SEC FILE NUMBER: 333-49715 FILM NUMBER: 700719 BUSINESS ADDRESS: STREET 1: 831 PILOT ROAD CITY: LAS VEGAS STATE: NV ZIP: 89119 BUSINESS PHONE: 7027367114 MAIL ADDRESS: STREET 1: 831 PILOT ROAD CITY: LAS VEGAS STATE: NV ZIP: 89119 10-Q 1 a10-q.txt FORM 10-Q SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 FORM 10-Q (Mark One) (X) QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15 (d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended: June 30, 2000 OR ( ) TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from: ________________ To _________________ Commission file number: 333-49715 ALADDIN GAMING ENTERPRISES, INC. - ------------------------------------------------------------------------------- (Exact name of registrant as specified in its charter) Nevada 88-0379695 - --------------------------------- -------------------------------------- (State or other jurisdiction of (I.R.S. Employer Identification No.) incorporation or organization) 831 Pilot Road, Las Vegas, Nevada 89119 - -------------------------------------------------------------------------------- (Address of principal executive offices) (Zip Code) (702) 736-7114 - -------------------------------------------------------------------------------- (Registrant's telephone number, including area code) Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15 (d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. YES X NO --- --- Indicate the number of shares outstanding of the issuer's classes of common stock, as of June 30, 2000. Class A Common Stock, no par value, 2,000,000 shares authorized 1,107,500 issued Class B Common Stock, no par value, Non-voting, 8,000,000 shares authorized 2,215,000 issued
ALADDIN GAMING ENTERPRISES, INC. (A DEVELOPMENT STAGE COMPANY) INDEX
Page No. ---------- PART I FINANCIAL INFORMATION Item 1. Financial Statements Balance Sheets June 30, 2000 and December 31, 1999................. 1 Statements of Operations For the three months ended June 30, 2000 and 1999 and for the period from inception (December 3, 1997) through June 30, 2000 ........... 2 Statements of Stockholders' Equity For the period from inception (December 3, 1997) through June 30, 2000 .............................. 3 Statements of Cash Flows For the six months ended June 30, 2000 and 1999 and for the period from inception (December 3, 1997) through June 30, 2000 ............................... 4 Notes to the Consolidated Financial Statements ........ 5 Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations ................. 7 Item 3. Quantitative and Qualitative Disclosures About Market Risk ......................................... 11 PART II OTHER INFORMATION Item 6. Exhibits and Reports on Form 8-K ...................... 13 Signatures ....................................................... 14 Exhibit Index ....................................................... 15
i PART I. FINANCIAL INFORMATION ITEM 1. FINANCIAL STATEMENTS ALADDIN GAMING ENTERPRISES, INC. (A DEVELOPMENT STAGE COMPANY) BALANCE SHEETS AS OF JUNE 30, 2000 AND DECEMBER 31, 1999 (IN THOUSANDS)
June 30, 2000 December 31, 1999 ------------- ----------------- (unaudited) ASSETS Cash $ 1 $ 1 Investment in unconsolidated affiliate 2,494 8,562 ---------- ---------- 2,495 8,563 ========== ========== LIABILITIES AND MEMBERS' EQUITY Payable to related party $ 6 $ 4 Common Stock: Class A, no par value, 2,000,000 shares authorized, 1,107,500 shares issued and outstanding as of June 30, 2000 and December 31, 1999. Class B, no par value and non-voting 8,000,000 shares authorized, 2,215,000 shares issued and outstanding, and 2,215,000 shares reserved pursuant to the warrant agreement as of June 30, 2000 and December 31, 1999. 13,247 13,247 Additional paid-in capital 14,420 14,420 Deficit accumulated during the development stage (25,178) (19,108) ---------- ---------- 2,495 8,563 ========== ==========
The accompanying notes are an integral part of these financial statements. 1 ALADDIN GAMING ENTERPRISES, INC. (A DEVELOPMENT STAGE COMPANY) STATEMENTS OF OPERATIONS FOR THE THREE AND SIX MONTHS ENDED JUNE 30, 2000 AND 1999 AND FOR THE PERIOD FROM INCEPTION (DECEMBER 3, 1997) THROUGH JUNE 30, 2000 (IN THOUSANDS, EXCEPT PER SHARE DATA)
For the period December 3, 1997 For the three For the three For the six For the six (inception) months ended months ended months ended months ended through June 30, 2000 June 30, 1999 June 30, 2000 June 30, 1999 June 30, 2000 (unaudited) (unaudited) (unaudited) (unaudited) (unaudited) ------------- ------------- -------------- ------------- ---------------- Other (income) expense $ - $ - $ 1 $ 1 $ 5 Equity in loss of unconsolidated affiliate 3,687 1,879 6,069 3,848 25,173 Income tax expense - - - - - Net loss accumulated during the development ---------- ------------ ---------- ------------- ---------- stage 3,687 1,879 6,070 3,849 25,178 ---------- ------------ ---------- ------------- ---------- Basic and diluted loss per share $(1.11) $(.57) $(1.83) $(1.16) $(7.58) Shares used in per share calculation 3,322,500 3,322,500 3,322,500 3,322,500 3,322,500
The accompanying notes are an integral part of these financial statements. 2 ALADDIN GAMING ENTERPRISES, INC. (A DEVELOPMENT STAGE COMPANY) STATEMENTS OF STOCKHOLDERS' EQUITY FOR THE PERIOD FROM INCEPTION (DECEMBER 3, 1997) THROUGH JUNE 30, 2000 (IN THOUSANDS) (UNAUDITED)
Common Stock Additional Class A Paid-in Retained and Class B Capital Earnings Total ------------- ------------- ------------ ---------- BALANCE, DECEMBER 3, 1997 $ - $ - $ - $ - Issuance of Class A common stock, 1 share issued - 1 - 1 ------- ------- -------- -------- BALANCE, DECEMBER 31, 1997 - 1 - 1 Net loss for the period - - (10,620) (10,620) Issuance of Class A common stock, 1,107,499 shares issued, and Class B common stock, 2,215,000 shares issued 13,247 - - 13,247 Issuance of Warrants to purchase Class B common stock, 2,215,000 Warrants issued - 15,000 - 15,000 Equity costs from unconsolidated affiliate - (581) - (581) ------- ------- -------- -------- BALANCE, DECEMBER 31, 1998 13,247 14,420 (10,620) 17,047 Net loss for the period - - (8,488) (8,488) ------- ------- -------- -------- BALANCE, DECEMBER 31, 1999 13,247 14,420 (19,108) 8,559 Net loss for the period - - (2,383) (2,383) ------- ------- -------- -------- BALANCE, MARCH 31, 2000 13,247 14,420 (21,491) 6,176 Net Loss for the Period - - (3,687) (3,687) ------- ------- -------- -------- BALANCE, JUNE 30, 2000 $13,247 $14,420 $(25,178) $ 2,489 ======= ======= ======== ========
The accompanying notes are an integral part of these financial statements. 3 ALADDIN GAMING ENTERPRISES, INC. (A DEVELOPMENT STAGE COMPANY) STATEMENTS OF CASH FLOWS FOR THE SIX MONTHS ENDED JUNE 30, 2000 AND 1999 AND FOR THE PERIOD FROM INCEPTION (DECEMBER 3, 1997) THROUGH JUNE 30, 2000 (IN THOUSANDS)
For the period December 3, 1997 For the six For the six (inception) months ended months ended June through June 3 2000 30, 1999 June 30, 2000 (unaudited) (unaudited) (unaudited) -------------------- ----------------------- --------------------- Cash flows used for investing activities: Investment in unconsolidated affiliate - - (15,000) Cash flows from financing activities: Proceeds from the issuance of stock - - 1 Proceeds from the issuance of warrants - - 15,000 Increase in cash and cash equivalents - - 1 Cash and cash equivalents at beginning of period 1 1 - Cash and cash equivalents at end of period $ 1 $ 1 $ 1 ======= ======= ========= SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION: Non-cash investing and financing activities: Equity contributions - non-cash - - $ 13,247
The accompanying notes are an integral part of these financial statements. 4 ALADDIN GAMING ENTERPRISES, INC. (A DEVELOPMENT STAGE COMPANY) NOTES TO CONSOLIDATED FINANCIAL STATEMENTS JUNE 30, 2000 1. ORGANIZATION AND BUSINESS Aladdin Gaming Enterprises, Inc., a Nevada corporation ("Enterprises"), was formed on December 3, 1997. Enterprises owns a 25% interest in Aladdin Gaming Holdings, LLC ("Gaming Holdings"). Enterprises is wholly owned by Sommer Enterprises, LLC, a Nevada limited liability company ("Sommer Enterprises"). Aladdin Holdings, LLC, a Delaware limited liability company ("Holdings"), holds a majority interest in Sommer Enterprises. The members of Holdings are the Trust Under Article Sixth u/w/o Sigmund Sommer ("Sommer Trust") which holds a 95% interest in Holdings, and GW Vegas, LLC, a Nevada limited liability company ("GW"), a wholly owned subsidiary of Trust Company of the West ("TCW"), which holds a 5% interest in Holdings. Enterprises' interest in Gaming Holdings has been accounted for under the equity method. Enterprises has no other business or activities other than its investment in Gaming Holdings, which is a development stage company. Gaming Holdings is a holding company, the material assets of which are 100% of the outstanding common membership interests and 100% of the outstanding Series A preferred interests of Aladdin Gaming, LLC, ("Gaming"). Gaming is developing, constructing and will operate a new hotel and casino, the Aladdin Resort and Casino as the centerpiece of an approximately 35-acre resort, casino and entertainment complex in Las Vegas, Nevada. The resort will be located at the center of Las Vegas Boulevard. Gaming Holdings, through its subsidiaries, also owns 100% of Aladdin Music, LLC ("Aladdin Music"). Aladdin Music plans to construct a second hotel and casino with a music and entertainment theme ("Aladdin Music Project") on the southeast corner of the 35-acre parcel. Aladdin Music is currently seeking a joint venture partner and financing for the Aladdin Music Project. This information should be read in conjunction with the financial statements set forth in Enterprises' Annual Report on Form 10-K for the year ended December 31, 1999. Accounting policies utilized in the preparation of the financial information herein presented are the same as set forth in Enterprises' annual financial statements except as modified for interim accounting policies. The interim consolidated financial information is unaudited. In the opinion of management, all adjustments (consisting only of normal recurring adjustments necessary for a fair presentation of the results for the interim periods) have been included. Interim results of operations are not necessarily indicative of the results of operations for the full year. Certain prior period amounts have been reclassified to conform with the current period's presentation. 2. INCOME TAXES Enterprises accounts for income taxes using the liability method as set forth in the Statement of Financial Accounting Standards No. 109, ACCOUNTING FOR INCOME TAXES. Under the liability method, deferred taxes are provided based on the temporary differences between the financial reporting basis and the tax basis of Enterprises' assets and liabilities. 5 There was no income tax expense or benefit recorded for the period from inception (December 3, 1997) through June 30, 2000 as Enterprises is a development stage company and the realization of any deferred tax asset is uncertain. 3. IMPACT OF RECENTLY ISSUED ACCOUNTING STANDARDS In June 1998, the Financial Accounting Standards Board ("FASB") issued Statement of Financial Accounting Standards ("SFAS") No. 133, "Accounting for Derivative Instruments and Hedging Activities." SFAS No. 133 requires that entities record all derivatives as assets or liabilities measured at fair value, with the change in fair value recognized in earnings or in other comprehensive income, depending on the use of the derivative and whether it qualifies for hedge accounting. SFAS 133 amends or supercedes several current accounting statements. In July, 1999, the FASB issued SFAS No. 137 which delays the effective date of SFAS No. 133 from fiscal year 2000 to fiscal year 2001. Enterprises is in the process of analyzing SFAS No. 133 and the impact on its consolidated financial position and results of operations. 6 ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS The following discussion should be read in conjunction with, and is qualified in its entirety by, the various other reports which have been previously filed with the United States Securities and Exchange Commission ("SEC"), which may be inspected, without charge, at the Public Reference Section of the SEC located at 450 Fifth Street, N.W., Washington, D.C. 20549 or the SEC internet site address: http://www.sec.gov. DEVELOPMENT ACTIVITIES Aladdin Gaming Enterprises, Inc., a Nevada corporation ("Enterprises"), was formed on December 3, 1997. Enterprises owns a 25% interest in Aladdin Gaming Holdings, LLC ("Gaming Holdings"). Enterprise is wholly owned by Sommer Enterprises, LLC, a Nevada limited liability company ("Sommer Enterprises"). Aladdin Holdings, LLC, a Delaware limited liability company ("Holdings") holds a majority interest in Sommer Enterprises. The members of Holdings are the Trust Under Article Sixth u/w/o Sigmund Sommer ("Sommer Trust") which holds a 95% interest in Holdings, and GW Vegas, LLC, a Nevada limited liability company ("GW"), a wholly-owned subsidiary of Trust Company of the West ("TCW"), which holds a 5% interest in Holdings. Enterprises has no business or activities other than its investment in Gaming Holdings, which is a development stage company. Gaming Holdings is a holding company, the material assets of which are 100% of the outstanding common membership interests and 100% of the outstanding Series A preferred membership interests of Aladdin Gaming, LLC ("Gaming"). Aladdin Capital Corp. ("Capital") is a wholly-owned subsidiary of Gaming Holdings and was incorporated solely for the purpose of serving as a co-issuer of Gaming Holdings 13 1/2% Senior Discount Notes ("Notes"). Capital does not have any material operations or assets and does not have any revenues. Gaming Holdings, through its subsidiaries, also owns 100% of Aladdin Music, LLC ("Aladdin Music"). The operations of Gaming Holdings and its subsidiaries have been primarily limited to the design, development, financing and construction of a new Aladdin Resort and Casino ("Aladdin"). The Aladdin will be the centerpiece of an approximately 35-acre resort, casino and entertainment complex ("Complex") located on the site of the former Aladdin hotel and casino in Las Vegas, Nevada, a premier location on Las Vegas Boulevard. The Aladdin has been designed to include a luxury themed hotel of approximately 2,567 rooms ("Hotel"), an approximately 116,000 square foot casino ("Casino") an approximately 1,200 seat production showroom and six restaurants. The Casino's main gaming area will contain approximately 2,800 slot machines, 87 table games, keno and a race and sports book facility. Included on a separate level of the Casino will be a 15,000 square foot luxurious gaming section ("The London Club at Aladdin") that is expected to contain an additional 20 to 30 high denomination table games and approximately 100 high denomination slot machines. The Complex, which has been designed to promote casino traffic and to provide customers with a wide variety of entertainment alternatives, will comprise: (i) the Aladdin; (ii) the themed entertainment shopping mall with approximately 496,000 square feet of retail space ("Desert Passage"); (iii) a planned second hotel and casino with a music and entertainment theme ("Aladdin Music Project"); (iv) the newly renovated 7,000-seat Theater of the Performing Arts ("Theater"); and (v) the approximately 4,800-space car parking facility ("Carpark" and, together with the Desert Passage, hereinafter, "Mall Project"). The Mall Project is separately owned in part by an affiliate of Gaming Holdings and Aladdin Music is currently seeking a joint venture partner and financing for the Aladdin Music Project. Gaming Holdings currently believes that the completion and opening of the Aladdin will occur during August 2000. 7 RESULTS OF OPERATIONS Enterprises has no business or activities or material assets other than its investment in Gaming Holdings, which is a development stage company and has no significant operations to date. Gaming Holdings has capitalized all qualifying construction costs. Accordingly, Gaming Holdings does not have any historical operating income. The capitalized costs consist primarily of land contributed by certain members of Gaming Holdings, design fees, financing and commitment fees, construction costs and interest on debt incurred to finance construction and development of Aladdin. Capitalized costs include approximately $2.2 million related to Aladdin Music for necessary predevelopment costs and expenses of the Aladdin Music Project. Gaming Holdings' operating expenses primarily have consisted of interest, amortization costs, expenses related to the Notes and pre-opening costs. Gaming Holdings' results of operations from inception to the anticipated opening of the Aladdin in August, 2000, have been adversely affected by the expensing of pre-opening costs and interest not qualifying for capitalization and should not be indicative of future operations. Accordingly, historical results will not be indicative of future operating results. Future operating results of Gaming Holdings are subject to significant business, economic, regulatory and competitive uncertainties and contingencies, many of which are beyond Gaming Holdings' control. While Gaming Holdings believes that the Aladdin will be able to attract a sufficient number of patrons and achieve the level of activity necessary to permit Gaming Holdings to meet its debt payment obligations, including the Notes and other indebtedness, and its other obligations, there can be no assurance with respect thereto. Because Enterprises' only material asset is its 25% interest in Gaming Holdings, Enterprises records 25% of Gaming Holdings' losses and preferred dividends in arrears as equity in loss of unconsolidated affiliate. Enterprises recorded a net loss of approximately $3.7 million and $6.1 million for the three and six months ended June 30, 2000, respectively, as compared to approximately $1.9 million and $3.8 million for the three and six months ended June 30, 1999, respectively. Enterprises' cumulative loss for the period of inception (December 3, 1997) to June 30, 2000 was approximately $25.2 million. Gaming Holdings' losses were due to the pre-opening costs, interest expense, amortization costs and expenses related to the Notes. MATERIAL CHANGES IN FINANCIAL CONDITION Through June 30, 2000, approximately $604.1 million had been expended primarily on the development of the Aladdin, of which approximately $74.5 million had been expended on repayment of debt associated with the land contribution to Gaming Holdings, approximately $474.3 million in construction, furniture, fixtures and equipment, and capitalized interest, approximately $39.5 million in debt issuance and member equity costs, and approximately $15.8 million in pre-opening costs, net interest expense, and other current assets. 8 LIQUIDITY AND CAPITAL RESOURCES On February 26, 1998, Gaming Holdings and Capital issued $221.5 million aggregate principal amount of their 13 1/2% Senior Discount Notes due 2010 ("Notes"). The proceeds to Gaming Holdings from the Notes were approximately $115.0 million and all the proceeds have been utilized by Gaming Holdings for the development and construction of the Aladdin. For further details on the Notes, including the covenants, restrictions and limitations on Enterprises pursuant to the Notes Indenture, see Exhibit 10.1 to Enterprises' Form 10-K for the year ended December 31, 1999. Gaming has a credit facility ("Bank Credit Facility" or "Credit Agreement") with various financial institutions and The Bank of Nova Scotia as the administrative agent for the lenders (collectively, "Lenders"). The Credit Agreement consists of four separate term loans. The Term A Loan comprises a term loan of $129.7 million and matures five and one-half years after the initial borrowing date. The Term B Loan comprises a term loan of $114 million and matures eight and one-half years after the initial borrowing date. The Term C Loan comprises a term loan of $160 million and matures ten years after the initial borrowing date. The Term D Loan is comprised of a term loan of $50 million which matures six months after the Term C Loan matures. As of June 30, 2000, approximately $100.3 million of the Term A Loan proceeds is available. As of June 30, 2000, Gaming had fully utilized the Term B and Term C Loan proceeds. As of June 30, 2000, the Term D Loan was not in place. For further details on the establishment of the Term D Loan, please see the discussion below. On June 1, 2000, the Credit Agreement was amended ("Third Amendment to Credit Agreement") to provide for: (a) the creation of wholly-owned subsidiaries of Gaming; (b) the creation of certain operating bank accounts prior to the opening of the Aladdin; (c) the increase of the annual amount of permitted operating leases prior to opening of the Aladdin and to change the date by which such amount of permitted operating leases can be increased after the opening of the Aladdin; (d) the increase of Gaming's cash management account to $10 million; and (e) the transfer, for value received, of certain collateral under the Bank Credit Facility to the FF&E Financing. For further details on the Third Amendment to Credit Agreement, see Exhibit 10.1 to Enterprises' Form 10-Q for the period ended June 30, 2000. On July 27, 2000, the Credit Agreement was amended ("Fourth Amendment to Credit Agreement") to provide for: (a) a new Term D Loan in the amount of $50 million, subject to reduction in certain events, with an interest rate of approximately 11%; (b) extending the commencement of measurement date for certain financial covenants; and (c) other technical amendments to the Credit Agreement. As of August 7, 2000, none of the Term D Loan had been utilized. For further details on the Fourth Amendment to Credit Agreement, see Exhibit 10.2 to Enterprises' Form 10-Q for the period ended June 30, 2000. For further details on the Bank Credit Facility, including the covenants, restrictions and limitations on Gaming pursuant to the Bank Credit Facility, see Exhibit 10.12 to Enterprises' Form 10-K for the year ended December 31, 1999. Gaming has operating lease financing of up to $60 million and a term loan facility of $20 million to obtain gaming equipment and other specified equipment (collectively, "FF&E Financing"). For further details on the operating lease financing and term loan facility, including the covenants, restrictions and limitations on Gaming pursuant to the FF&E Financing, see Exhibit 10.40 to Enterprises' Form 10-K for the year ended December 31, 1999. As a result of Gaming Holdings' on-going review of the anticipated construction and pre-opening costs for the Aladdin, in July, 2000, Gaming Holdings increased its main project budget by approximately $50 million, from approximately $973 million to approximately $1.023 billion. Gaming Holdings will utilize the Term D Loan proceeds to fund this budgetary increase. During June and July 2000, The Bank of Nova Scotia, as Administrative Agent under Gaming's Bank Credit Facility, drew down all of the approximately $47.3 million letter of credit previously issued for the account of London Clubs, which London Clubs posted pursuant to the Completion Guaranty. The 9 proceeds of the drawing under the letter of credit were used to fund various construction and pre-opening costs. Upon the later of (a) the transfer of the real property under the Mall Project by Gaming to Aladdin Bazaar, LLC ("Aladdin Bazaar") or (b) the commencement of Aladdin's operations, Aladdin Bazaar will execute a promissory note of approximately $16.7 million to Gaming. Principal and interest on the note is payable by Aladdin Bazaar to Gaming in the amount of $2 million per year. The required payments are subordinated to various restrictions under the Aladdin Bazaar operating agreement. Due to the restrictions upon the payments, there can be no assurances that Gaming will receive any payments under this note. London Clubs, the Sommer Trust, and Aladdin Bazaar Holdings, LLC ("Bazaar Holdings"), which is owned 99% by the Sommer Trust, have entered into a completion guaranty ("Bank Completion Guaranty") for the benefit of the Lenders under the Bank Credit Facility, under which they have agreed to guarantee, among other things, the completion of the Aladdin. The Bank Completion Guaranty is not subject to any maximum dollar limitations. From January 1, 2000 to June 30, 2000, there has been a total of approximately $79.4 million in payments pursuant to the Bank Completion Guaranty, which has been funded by London Clubs. Gaming Holdings issued for these Bank Completion Guaranty payments (i) Series A Preferred Shares in exchange for the contribution of such payments and (ii) Series D Preferred Shares representing a profits only interest in Gaming Holdings. The holders of the Notes are not a party to the Bank Completion Guaranty, however, London Clubs, the Sommer Trust and Bazaar Holdings have entered into a limited completion guaranty for the benefit of the Noteholders ("Noteholder Completion Guaranty") under which they guarantee completion of the Aladdin, subject to certain important exceptions, limitations and qualifications. The Noteholder Completion Guaranty contains certain intercreditor provisions which significantly limit the rights of the Trustee under the Noteholder Completion Guaranty. AHL, Bazaar Holdings and London Clubs have entered into the Keep-Well Agreement in favor of the lenders under the Bank Credit Facility. In connection with the Fourth Amendment to Credit Agreement, the Sommer Trust became a party to the Keep-Well Agreement. The Keep-Well Agreement is the joint and several agreement of the parties to make certain quarterly cash equity contributions to the Gaming Holdings if Gaming Holdings fails to comply with the Minimum Fixed Charges Coverage Ratio set forth in the Bank Credit Facility, but in no event shall the aggregate cash equity contribution required to be made in any fiscal year of Gaming Holdings exceed $30.0 million. In exchange for such cash equity contributions, Gaming Holdings will issue Series A or B Preferred Membership Interests. In connection with the development of the Mall Project, Aladdin Bazaar agreed to reimburse Gaming approximately $14.2 million for the construction of certain areas shared by the Aladdin and the Mall Project and the facade to the Aladdin and, as of June 30, 2000, Aladdin Bazaar has paid Gaming approximately $13.0 million of this amount. Additionally, Aladdin Bazaar is obligated to spend no more than $36 million for the Carpark. Therefore, any cost overruns associated with these items will be borne by Gaming. In addition, Gaming is obligated to pay to Aladdin Bazaar: (i) a $3.2 million fee per year for a term of 99 years, which is adjusted every fifth year pursuant to a consumer price index-based formula, for usage of the Carpark; and (ii) Gaming's proportionate share of the operating costs associated with the Carpark and other common areas. Gaming Holdings believes that the funds provided by the Notes, Bank Credit Facility, FF&E Financing, London Clubs' equity contribution and contributions pursuant to the Bank Completion Guaranty (collectively, "Funding Transactions") will be sufficient to develop, complete and commence operation of 10 the Aladdin. However, there can be no assurance that the Funding Transactions will be sufficient for the development, construction and commencement of the Aladdin. Upon the commencement of operations of the Aladdin, Gaming Holdings will have approximately $17.0 million of working capital to fund its operations, debt service and capital needs as currently anticipated. Based on Gaming Holdings' projection of operating revenues and expenses, required capital expenditures and other expected expenditures, Gaming Holdings believes that such working capital is sufficient to address Gaming Holdings' liquidity needs. Although no additional financing is contemplated, Gaming Holdings will seek, if necessary and to the extent permitted under the Notes Indenture and the terms of the Bank Credit Facility and the FF&E Financing, additional financing through additional bank borrowings or debt or equity financings. There can be no assurance that additional financing, if needed, will be available to Gaming Holdings, or that, if available, the financing will be on terms favorable to Gaming Holdings. There can also be no assurance that estimates by Gaming Holdings of its reasonably anticipated liquidity needs are accurate or that new business developments or other unforeseen events will not occur, resulting in the need to raise additional funds. CERTAIN FORWARD LOOKING STATEMENTS Certain information included in this Form 10-Q and other materials filed or to be filed by Enterprises with the United States Securities and Exchange Commission (as well as information included in oral statements or other written statements made, or to be made, by Enterprises) contain statements that are forward-looking within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. Such statements include, without limitation, those relating to plans for future operations, current construction and development activities (including completion dates, budgets and cost estimates), other business development activities, capital spending, financing sources, the effect of regulation (including gaming and tax regulations) and competition. Such forward-looking information involves important risks and uncertainties that could significantly affect anticipated results in the future and, accordingly, such results may differ from those expressed in any forward-looking statements made by, or on behalf of, Enterprises. These risks and uncertainties include, but are not limited to, those relating to the current development and construction activities and costs and timing thereof, the sources and extent of financing for the project, dependence on existing management, leverage and debt service (including sensitivity to fluctuations in interest rates), domestic or international economic conditions (including sensitivity to fluctuations in foreign currencies), changes in federal or state tax laws or the administration of such laws, changes in gaming laws or regulations (including the legalization of gaming in certain jurisdictions) and application for licenses and approvals under applicable jurisdictional laws and regulations (including gaming laws and regulations). ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK Effective June 30, 1999, Gaming restructured its interest rate swap arrangements in an effort to reduce future expenditures for interest. Gaming has entered into these agreements to manage interest expense, which is subject to fluctuations due to the variable nature of the London Interbank Offered Rate ("LIBOR"). In exchange for entering into the transaction, Gaming received $500,000 from the counterparty in July, 1999. Beginning June 30, 1999, Gaming has the following interest rate swaps, interest rate ceilings and floor caps, and related notional amounts in effect: (i) an interest rate swap with an original notional amount of $114 million increasing to a maximum of $222.5 million whereby interest is fixed at 5.50% 11 through March 31, 2000; (ii) after March 31, 2000, an interest rate collar with a notional amount of $250 million, a maximum and minimum interest rate of 7.5% and 5.15%, respectively, will go into effect and mature on September 30, 2006; and (iii) an interest rate collar with a notional amount of $160 million, a maximum rate of 8.00%, a minimum rate of 5.15% and a maturity date of March 31, 2003. All rates noted above are LIBOR equivalents only and do not include the impact of the basis point additions to LIBOR that are used in calculating interest expense on Gaming's term loans. The LIBOR applicable to these agreements is adjusted every three months and on June 30, 2000 was set at 6.28%. The fair market value of the Gaming's interest rate swaps, interest rate ceilings and floor caps as provided by the counterparty, is a net receivable of approximately $2.9 million at June 30, 2000. The notional amounts do not represent amounts exchanged by the parties, and thus are not a measure of exposure of Gaming. The amounts exchanged are normally based on the notional amounts and other terms of the swaps. The variable rates are subject to change over time as LIBOR fluctuates. Neither Gaming nor the counterparty, which is a prominent financial institution, is required to collateralize their respective obligations under these swaps. Gaming is exposed to loss if the counterparty defaults. However, Enterprises considers the risk of non-performance to be minimal as the counterparty is a member of the Bank Credit Facility. Effective July 20, 2000, Gaming restructured its interest rate collar arrangements in an effort to reduce future expenditures for interest. Gaming has entered into these agreements to manage interest expense, which is subject to fluctuations due to the variable nature of the London Interbank Offered Rate ("LIBOR"). In exchange for entering into the transaction, Gaming received $1,000,000 from the counterparty in July, 2000. Beginning July 20, 2000, Gaming has the following interest rate ceilings and floor caps, and related notional amounts in effect: (i) an interest rate collar with a notional amount of $245.7 million, a maximum and minimum interest rate of 8.00% and 6.25%, respectively, and a maturity date of June 30, 2005, (ii) an interest rate collar with a notional amount of $159.2 million, a maximum rate of 8.00%, a minimum rate of 6.25% and a maturity date of June 30, 2005; (iii) an interest rate collar with a notional amount of $50 million, a maximum rate of 8.00%, a minimum rate of 6.25%, and a maturity of June 30, 2005 All rates noted above are LIBOR equivalents only and do not include the impact of the basis point additions to LIBOR that are used in calculating interest expense on Gaming's term loans. The notional amounts do not represent amounts exchanged by the parties, and thus are not a measure of exposure of Gaming. The amounts exchanged are normally based on the notional amounts and other terms of the swaps. The variable rates are subject to change over time as LIBOR fluctuates. Neither Gaming nor the counterparty, which is a prominent financial institution, is required to collateralize their respective obligations under these swaps. Gaming is exposed to loss if the counterparty defaults. However, Gaming Enterprises considers the risk of non-performance to be minimal as the counterparty is a member of the Bank Credit Facility. 12 PART II OTHER INFORMATION ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K (a) Exhibits 10.01 Third Amendment to Credit Agreement, dated as of June 1, 2000, among Aladdin Gaming, LLC, Various Financial Institutions, The Bank of Nova Scotia, Merrill Lynch Capital Corporation and CIBC Oppenheimer Corp. 10.02 Fourth Amendment to Credit Agreement, dated as of July 27, 2000, among Aladdin Gaming, LLC, Various Financial Institutions, The Bank of Nova Scotia, Merrill Lynch Capital Corporation and CIBC Oppenheimer Corp. 10.03 Agreement of Amendment, dated as of June 2, 2000, among General Electric Capital Corporation, GMAC Commercial Mortgage Corporation and Aladdin Gaming, LLC. 10.04 Agreement of Amendment No. 3, dated as of July 27, 2000, among General Electric Capital Corporation, GMAC Commercial Mortgage Corporation and Aladdin Gaming, LLC. 10.05 First Amendment to Deed of Trust, Assignment of Rents and Leases, Fixture Filing and Security Agreement, dated as of July 27, 2000, made by and between Aladdin Gaming, LLC, as Trustee, and Stewart Title of Nevada, as Trustee, for the benefit of The Bank of Nova Scotia. 10.06 Amendment of Agreements, effective as of July 27, 2000, by and among Aladdin Gaming, LLC, the various financial institutions and The Bank of Nova Scotia. 10.07 Amendment No. 1 to the Employment Agreement of William Timmins, dated as of May 26, 2000, between Aladdin Gaming, LLC, Aladdin Gaming Holdings, LLC and William Timmins. 10.08 Employment Agreement of Patricia Becker, dated as of July 27, 2000, between Aladdin Gaming, LLC, Aladdin Gaming Holdings, LLC and Patricia Becker. 27.01 Financial Data Schedule. (b) Reports on Form 8-K None. 13 SIGNATURES Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized. ALADDIN GAMING ENTERPRISES, INC. August 14, 2000 By: /s/ Thomas A. Lettero --------------------------------- Thomas A. Lettero, Treasurer 14 EXHIBIT INDEX
EXHIBIT PAGE NO. DESCRIPTION NO. - ------- ----------- ---- 10.01 Third Amendment to Credit Agreement, dated as of June 1, 2000, among Aladdin Gaming, LLC, Various Financial Institutions, The Bank of Nova Scotia, Merrill Lynch Capital Corporation and CIBC Oppenheimer Corp. 10.02 Fourth Amendment to Credit Agreement, dated as of July 27, 2000, among Aladdin Gaming, LLC, Various Financial Institutions, The Bank of Nova Scotia, Merrill Lynch Capital Corporation and CIBC Oppenheimer Corp. 10.03 Agreement of Amendment, dated as of June 2, 2000, among General Electric Capital Corporation, GMAC Commercial Mortgage Corporation and Aladdin Gaming, LLC. 10.04 Agreement of Amendment No. 3, dated as of July 27, 2000, among General Electric Capital Corporation, GMAC Commercial Mortgage Corporation and Aladdin Gaming, LLC. 10.05 First Amendment to Deed of Trust, Assignment of Rents and Leases, Fixture Filing and Security Agreement, dated as of July 27, 2000, made by and between Aladdin Gaming, LLC, as Trustee, and Stewart Title of Nevada, as Trustee, for the benefit of The Bank of Nova Scotia. 10.06 Amendment of Agreements, effective as of July 27, 2000, by and among Aladdin Gaming, LLC, the various financial institutions and The Bank of Nova Scotia. 10.07 Amendment No. 1 to the Employment Agreement of William Timmins, dated as of May 26, 2000, between Aladdin Gaming, LLC, Aladdin Gaming Holdings, LLC and William Timmins. 10.08 Employment Agreement of Patricia Becker, dated as of July 27, 2000, between Aladdin Gaming, LLC, Aladdin Gaming Holdings, LLC and Patricia Becker. 27.01 Financial Data Schedule.
15 EX-10.01 2 ex-10_01.txt EXHIBIT 10.01 EXHIBIT 10.01 THIRD AMENDMENT TO CREDIT AGREEMENT Dated as of June 1, 2000 (amending the Credit Agreement, dated as of February 26, 1998) among ALADDIN GAMING, LLC, as the Borrower, VARIOUS FINANCIAL INSTITUTIONS, as the Lenders, THE BANK OF NOVA SCOTIA, as the Administrative Agent for the Lenders, MERRILL LYNCH CAPITAL CORPORATION, as the Syndication Agent for the Lenders, and CIBC OPPENHEIMER CORP., as the Documentation Agent for the Lenders THIRD AMENDMENT TO CREDIT AGREEMENT THIS THIRD AMENDMENT TO CREDIT AGREEMENT (this "THIRD AMENDMENT TO CREDIT AGREEMENT") dated as of June 1, 2000, by and among ALADDIN GAMING, LLC, a Nevada limited-liability company (the "BORROWER"), the various financial institutions as are or may become parties hereto (collectively, the "LENDERS"), THE BANK OF NOVA SCOTIA, as administrative agent (together with any successor thereto in such capacity, the "ADMINISTRATIVE AGENT") for the Lenders, MERRILL LYNCH CAPITAL CORPORATION, as syndication agent (together with any successor thereto in such capacity, the "SYNDICATION AGENT") for the Lenders, and CIBC OPPENHEIMER CORP., as documentation agent (together with any successor thereto in such capacity, the "DOCUMENTATION AGENT") for the Lenders. In consideration of the mutual agreements herein contained and other good and valuable consideration, receipt of which is hereby acknowledged, the parties hereto, intending to be legally bound, agree as follows: W I T N E S S E T H: WHEREAS, the Borrower, the Lenders, the Administrative Agent, the Syndication Agent and the Documentation Agent have heretofore entered into (x) that certain Credit Agreement (the "CA"), dated as of February 26, 1998, (y) that certain First Amendment to Credit Agreement (the "FIRST AMENDMENT TO CREDIT AGREEMENT") dated as of January 29, 1999 and (z) that certain Second Amendment to Credit Agreement (the "SECOND AMENDMENT TO CREDIT AGREEMENT") dated as of April 5, 1999, effective as of March 10, 1999 (the CA, as amended by the First Amendment to Credit Agreement and the Second Amendment to Credit Agreement, shall be referred to herein as the "CREDIT AGREEMENT"); and WHEREAS, the Borrower has requested the Lenders to enter into certain amendments of the Credit Agreement and the Disbursement Agreement; and WHEREAS, each of the parties hereto is willing, on the terms and subject to the conditions hereinafter set forth, to so amend the Credit Agreement and the Disbursement Agreement, but only upon the terms and conditions set forth below. NOW, THEREFORE, in consideration of the agreements contained herein, the parties hereto agree as follows: 1 ARTICLE I DEFINITIONS SECTION I.1. CERTAIN DEFINED TERMS. The following terms (whether or not italicized) when used in this Third Amendment to Credit Agreement, including its preamble and recitals, shall, except where the context otherwise requires, have the following meanings: "FIRST AMENDMENT TO CREDIT AGREEMENT" is defined in the FIRST RECITAL. "GECC FACILITIES AGREEMENT" shall mean that certain Facilities Agreement between General Electric Capital Corporation ("GECC"), for itself and as agent for certain participants, and the Borrower dated as of June 26, 1998, as amended by that certain First Amendment to Facilities Agreement between GECC, for itself and as agent for certain participants, and the Borrower dated as of September 2, 1998, as the same may from time to time be further amended, supplemented, amended and restated or otherwise modified in accordance with the terms of the Credit Agreement, as amended by the Third Amendment to Credit Agreement, and the GECC Intercreditor Agreement. "GECC INTERCREDITOR AGREEMENT" shall mean that certain Intercreditor Agreement by and among the Administrative Agent, GECC and the Borrower dated as of June 30, 1998 and as thereafter from time to time amended, supplemented, amended and restated or otherwise modified in accordance with the terms thereof. "SECOND AMENDMENT TO CREDIT AGREEMENT" is defined in the FIRST RECITAL. "THIRD AMENDMENT TO CREDIT AGREEMENT" is defined in the PREAMBLE. SECTION I.2. OTHER DEFINED TERMS; CONSTRUCTION. For purposes of this Third Amendment to Credit Agreement, capitalized terms used but not defined herein shall have the meanings assigned to them in the Credit Agreement, as amended by this Third Amendment to Credit Agreement, and the rules of construction set forth in ARTICLE I of the Credit Agreement shall apply to this Third Amendment to Credit Agreement. ARTICLE II AMENDMENTS SECTION II.1. AMENDMENTS. The parties hereto hereby agree as follows: (a) Provided that the Borrower has delivered an opinion of counsel which conforms to the requirements of CLAUSE (H) OF SECTION 3.1 (the "COUNSEL OPINION") which expressly provides, in relevant part, that no approval is required under the GECC Facilities Agreement or the GECC Intercreditor Agreement for the amendment set forth below (or alternatively, the Borrower delivers a consent by GECC under the GECC Facilities Agreement to the amendment of the Credit 2 Agreement as set forth herein), the last sentence of SECTION 7.19 of the Credit Agreement shall be amended in its entirety to read as set forth below: "The Borrower shall not, at any time prior to the Completion Date, open or establish any bank, deposit or any other accounts at any financial institution other than the Accounts provided for herein without the prior consent of the Administrative Agent which consent shall not be unreasonably withheld if (x) such bank, deposit or other account is required by the Borrower in the ordinary course of its business after the Opening Date, (y) the Borrower has agreed to such other conditions required by the Administrative Agent (which may include the granting of a security interest to the Administrative Agent on behalf of the Lenders) and (z) with respect to deposits in any such account (1) prior to the Opening Date, the amount of such deposits does not exceed $1,000,000 at any time, (2) after the Opening Date, the amount of such deposits does not exceed $5,000,000 at any time (or such greater amount approved by the Administrative Agent in its sole discretion) and (3) in each case, the amount of such deposits shall be reduced to a level which reasonably meets the requirements of the Borrower's business as determined by the Administrative Agent." The Lenders hereby agree that the Administrative Agent shall have the right to approve such bank, deposit or other accounts on behalf of the Lenders after the Administrative Agent has determined that the condition set forth in clause (x) above has been satisfied in all material respects. (b) Provided that the Borrower has delivered a Counsel Opinion which expressly provides, in relevant part, that no approval is required under the GECC Facilities Agreement or the GECC Intercreditor Agreement for the amendment set forth below (or alternatively, the Borrower delivers an amendment to the GECC Facilities Agreement or the GECC Intercreditor Agreement which includes a consent to the amendment of the Credit Agreement as set forth herein and which is substantially similar to the amendment set forth below), the following sentence shall be added to the end of SECTION 7.2.5 of the Credit Agreement: "Notwithstanding the foregoing, the Borrower may make an Investment in any wholly-owned Subsidiary which is created by the Borrower for the purpose of owning and controlling bank, deposit or any other accounts at any financial institution permitted under this Agreement or which otherwise are created for purposes of the Borrower's operation of the Casino so long as the Administrative Agent has consented thereto which consent shall not be unreasonably withheld if (x) such Subsidiary is required by the Borrower in the ordinary course of its business after the Opening Date, (y) the Borrower has agreed to such other reasonable conditions required by the Administrative Agent based upon the nature of the business of such Subsidiary (which may require that such Subsidiary be a bankruptcy remote single purpose entity and provide a guaranty of the Obligations under the Loan Documents) and (z) with respect to any such Investment (1) prior to the Opening Date, the amount of such Investment does not exceed $1,000,000, (2) after the Opening Date, the amount of such Investment does not exceed $5,000,000 PER 3 ANNUM (or such greater amount approved by the Administrative Agent in its sole discretion) and (3) in each case, the amount thereof shall be reduced to a level which reasonably meets the requirements of the Borrower's business as determined by the Administrative Agent." The Lenders hereby agree that the Administrative Agent shall have the right to approve each such Investment after the Administrative Agent has determined that the condition set forth in clause (x) above has been satisfied in all material respects. (c) Provided that the Borrower has delivered a Counsel Opinion which expressly provides, in relevant part, that no approval is required under the GECC Facilities Agreement or the GECC Intercreditor Agreement for the amendment set forth below (or alternatively, the Borrower delivers an amendment to the GECC Facilities Agreement or the GECC Intercreditor Agreement which includes a consent to the amendment of the Credit Agreement as set forth herein and which is substantially similar to the amendment set forth below), SECTION 7.2.8 of the Credit Agreement shall be amended in its entirety as set forth below: "The Borrower will not, and will not permit any Subsidiary to, enter into at any time any arrangement (other than the arrangement described in CLAUSE (C) of the FIFTH RECITAL) which involves the leasing by the Borrower from any lessor of any real or personal property (or any interest therein), which does not create a Capitalized Lease Liability and except arrangements which, together with all other such arrangements which shall then be in effect, will not require the payment of an aggregate amount in any Fiscal Year of rentals by the Borrower or any Subsidiary in excess of, in the case of any such arrangements entered into prior to the date which is 90 days after the Opening Date, $2,000,000 PER ANNUM and, in the case of any such arrangement entered into on or subsequent to the date which is 90 days after the Opening Date, $5,000,000 PER ANNUM." (d) Provided that the Borrower has delivered the Counsel Opinion which expressly provides, in relevant part, that no approval is required under the GECC Facilities Agreement or the GECC Intercreditor Agreement for the waiver set forth herein (or alternatively, the Borrower delivers a consent from GECC under the GECC Facilities Agreement to the waiver set forth herein), the Administrative Agent shall waive the limitation in the amount of $5,000,000 in SECTION 2.3.4 of the Disbursement Agreement and agree to direct the Disbursement Agent to increase such limitation to $10,000,000. (e) Provided that the Borrower has delivered a Counsel Opinion which expressly provides, in relevant part, that no approval is required under the GECC Facilities Agreement or the GECC Intercreditor Agreement for the waiver set forth herein (or alternatively, the Borrower delivers a consent from GECC under the GECC Facilities Agreement to the waiver set forth herein), the Administrative Agent shall waive with respect to payroll payments only the requirement in SECTION 2.2.5 of the Disbursement Agreement that the Disbursement Agent receive satisfactory evidence that Indirect Costs are then due and payable so that the Administrative Agent can provide 4 funds for payroll payments to be made within 30 days after the Advance Date PROVIDED THAT (x) all such amounts are funded from Line Items and Line Item Categories approved by the Administrative Agent and from no other Line Items or Line Item Categories, as the case may be, (y) all such amounts are deposited and held in the Servicing Agent's Payroll Account and (z) all such amounts are paid to the Person entitled thereto in accordance with the Servicing and Collateral Account Agreement. The Advance Request required by SECTION 3.2.6 of the Disbursement Agreement shall conform to the waiver set forth herein. (f) Provided that the Borrower has delivered the Counsel Opinion which expressly provides, in relevant part, that no approval is required under the GECC Facilities Agreement or the GECC Intercreditor Agreement for the waiver set forth herein (or alternatively, the Borrower delivers a consent by GECC under the GECC Facilities Agreement to the waiver set forth herein), the Administrative Agent will waive the prohibitions set forth in the Disbursement Agreement which prohibit any Advance which is funded from the Bank Proceeds Account or from a Term A Loan from being used as a down payment for the Gaming Equipment or the Specified Equipment which is to be leased under an FF&E Lease or financed by the credit facilities contemplated by the Approved Equipment Funding Commitments so long as the following conditions have been met: To the extent that any Advance Request shall include any amount in respect of a deposit or progress payment for Gaming Equipment or Specified Equipment, the Disbursement Agent will, upon satisfaction of the applicable conditions set forth in the Disbursement Agreement and the Credit Agreement, include such amount in an Advance only if (i) the aggregate amount advanced for deposits or progress payments for Gaming Equipment and Specified Equipment from and after the date of this Third Amendment to Credit Agreement is not greater than $12,000,000, (ii) any amount being Advanced for the Gaming Equipment and the Specified Equipment, as applicable, shall be from the Line Items and Line Item Categories approved by the Administrative Agent and from no other Line Items or Line Item Categories, as the case may be, (iii) the Borrower shall have provided the Administrative Agent with a copy of the Contract covering the Gaming Equipment or Specified Equipment (and all amendments thereto or modifications thereof), (iv) as collateral security, the Borrower shall have assigned each such Contract to the Lenders, (v) the Borrower shall have provided evidence satisfactory to the Administrative Agent that such Gaming Equipment or Specified Equipment is adequately insured for the benefit of the Lenders, (vi) if permitted by applicable Law, the Borrower shall have granted the Lenders a perfected and continuing first security interest in such Gaming Equipment or Specified Equipment prior to or simultaneously with the making of any such Advance, (vii) GECC shall have confirmed in writing that upon delivery of such Gaming Equipment or Specified Equipment to the Project and satisfaction of the requirements of the GECC Facilities Agreement, all amounts advanced to the Borrower from the Loans to fund a deposit or make a progress payment shall be advanced on behalf of the Borrower to the Guaranty Deposit Account and the balance due with respect to such Gaming Equipment or Specified Equipment shall be funded 5 in full under the GECC Facility Agreement, and (viii) GECC shall covenant and agree to advance all reimbursements for deposits and progress payments on behalf of the Borrower to the Guaranty Deposit Account (upon such fundings by GECC, the Administrative Agent shall release the Lenders' Liens and security interests from such Gaming Equipment and Specified Equipment as contemplated by CLAUSE (G) of this Third Amendment to Credit Agreement). After delivery to the Main Project (i) such Gaming Equipment and Specified Equipment shall be installed in the Main Project for its intended use or otherwise stored in a secure area, in each case protected from theft, vandalism and weather conditions to the reasonable satisfaction of the Administrative Agent, (ii) the Administrative Agent shall have received satisfactory evidence that such Gaming Equipment and Specified Equipment are adequately insured for the benefit of the Lenders, (iii) the Borrower shall have provided the Administrative Agent with a detailed inventory of such stored Gaming Equipment and the Specified Equipment and verified that such Gaming Equipment and Specified Equipment are stored as herein required and (iv) the Borrower shall have granted the Lenders a perfected and continuing first security interest in such Gaming Equipment and Specified Equipment. (g) The Lenders hereby authorize and direct the Agent from time to time to release from the Lien of the Mortgage and security interests granted by the Loan Documents items for which GECC has agreed are to be funded from the GECC Facility in exchange for payment from the GECC Facility of an amount equal to that which was funded for such items from the Loans. All amounts funded by GECC shall be deposited into the Guaranty Deposit Account. (h) The Lenders hereby agree that (x) the requirement in SECTION 2.3.4 of the Credit Agreement that an additional borrowing of a Term B Loan and/or Term C Loan from a Lender described in clause (i) and (ii) of said section must be made prior to the date that all of the Term B Loans and Term C Loans have been advanced from the Bank Proceeds Account is hereby waived and (y) such additional borrowing may be a Term A Loan, Term B Loan and/or Term C Loan. (i) The Lenders hereby agree that notwithstanding anything to the contrary in the Credit Agreement, any transaction (x) which is consummated in accordance with the provisions of CLAUSE (F) and CLAUSE (G) of this Third Amendment to Credit Agreement or (y) by which (1) the Borrower transfers to GECC an Ownership interest in Gaming Equipment or Specified Equipment which was financed with proceeds from the Loans, (2) GECC funds the purchase price thereof from an advance under the GECC Facilities Agreement (which purchase price shall be no less than the purchase price thereof funded from the Loans) and (3) simultaneously therewith GECC and the Borrower enter into a lease agreement for such Gaming Equipment or Specified Equipment in accordance with the Facilities Agreement shall not constitute a breach under the Credit Agreement including, without limitation, the restriction on sales and leasebacks under SECTION 7.2.15 of the Credit Agreement. 6 ARTICLE III CONDITIONS PRECEDENT AND COVENANT SECTION III.1. CONDITIONS TO EFFECTIVENESS. This Third Amendment to Credit Agreement shall be and become effective on the date (the "THIRD AMENDMENT DATE") on which each of the following conditions precedent shall have been satisfied. (a) EXECUTION OF DOCUMENTS. The Administrative Agent shall have received counterparts of (i) the Ratification of the Completion Guaranty executed by Authorized Representatives of the parties thereto, (ii) this Third Amendment to Credit Agreement executed by Authorized Representatives of the Borrower, the Administrative Agent, the Syndication Agent, the Documentation Agent and the Required Lenders and (iii) the First Amendment to Disbursement Agreement executed by Authorized Representatives of the Parties thereto. (b) INCUMBENCY, ETC. The Administrative Agent shall have received (with copies for each Lender) a certificate, dated the Third Amendment Date, of an Authorized Representative of the Borrower certifying: (i) as to the incumbency and signatures of the Person or Persons authorized to execute and deliver this Third Amendment to Credit Agreement and any instruments or agreements required hereunder, (ii) as to an attached copy of one or more resolutions or other authorizations of the manager of the Borrower certified by the Authorized Representative of such manager as being in full force and effect on the date hereof, authorizing the execution, delivery and performance of this Third Amendment to Credit Agreement and any instruments or agreements required hereunder, and (iii) that the Organizational Documents of the Borrower have not been modified other than by the letter agreement dated December 10, 1999, a true, correct and complete copy of which has been delivered to the Administrative Agent, upon which certificate the Administrative Agent, the Syndication Agent, the Documentation Agent and each Consenting Lender (collectively, the "FINANCING PARTIES") may conclusively rely until it shall have received a further certificate of an Authorized Representative of the Borrower canceling or amending such prior certificate. (c) FEES. All reasonable fees and costs and expenses of Mayer, Brown & Platt and other professionals employed by the Administrative Agent and all other reasonable expenses of the Administrative Agent in connection with the negotiation, execution and delivery of this Third Amendment to Credit Agreement and the transactions contemplated herein shall have been paid in full. 7 (d) SATISFACTORY LEGAL FORM. Each Financing Party and its counsel shall have received all information, approvals, opinions, documents or instruments as each Financing Party or its counsel may have reasonably requested, and all documents executed or submitted pursuant hereto by or on behalf of the Borrower shall be satisfactory in form and substance to each Financing Party and its counsel. (e) DEFAULT. After giving effect to this Third Amendment to Credit Agreement the following statements shall be true and correct: (i) to the best knowledge of the Borrower, no act or condition exists which, with the giving of notice or passage of time would constitute a "DEFAULT" or "EVENT OF DEFAULT" (as defined in the Credit Agreement and the GECC Facilities Agreement) has occurred and is continuing as of the date hereof, and (ii) no material adverse change in (A) the financial condition, business, property, prospects or ability of the Borrower to perform in all material respects its obligations under any Operative Document or any of the documents evidencing and securing the FF&E Financing to which it is a party or (B) the financial condition, business, property, prospects and ability of any other Aladdin Party or, to the best knowledge of the Borrower, LCNI, the Design/Builder or Fluor to perform in all material respects its obligations under any Operative Document to which it is a party has occurred since the Closing Date. (f) CONSENTS AND APPROVALS. All approvals and consents required to be taken, given or obtained, as the case may be, by or from any Governmental Instrumentality or another Person, or by or from any trustee (including, without limitation, GECC and the Discount Note Indenture Trustee) or holder of any indebtedness or obligation of the Borrower, that are necessary or, in the reasonable opinion of the Administrative Agent, advisable in connection with the execution, delivery and performance of this Third Amendment to Credit Agreement by all parties hereto, shall have been taken, given or obtained, as the case may be, shall be in full force and effect and the time for appeal with respect to any thereof shall have expired (or, if an appeal shall have been taken, the same shall have been dismissed) and shall not be subject to any pending proceedings or appeals (administrative, judicial or otherwise) and shall be in form and substance satisfactory to the Administrative Agent. (g) DELIVERY OF THIRD AMENDMENT TO CREDIT AGREEMENT. The Borrower shall have delivered this Third Amendment to Credit Agreement to all Persons entitled under the Operative Documents to receive delivery hereof. (h) OPINIONS. The Administrative Agent shall have received such opinions of counsel as it deems necessary, dated the Third Amendment Date and addressed to the Administrative Agent, the Lenders and, if applicable, the Disbursement Agent, which shall be in form and substance satisfactory to the Administrative Agent. 8 ARTICLE IV REPRESENTATIONS AND WARRANTIES In order to induce each Financing Party to enter into this Third Amendment to Credit Agreement, the Borrower hereby reaffirms, as of the Third Amendment Date, its representations and warranties contained in Article VI of the Credit Agreement and additionally represents and warrants unto each Financing Party as set forth in this ARTICLE V. SECTION IV.1. MATTERS PERTAINING TO THE GECC FACILITIES AGREEMENT. (a) The Borrower has not directly or indirectly amended (by Change Order or otherwise), modified (by Change Order or otherwise), allocated, reallocated or supplemented or permitted or consented to the amendment (by Change Order or otherwise), modification (by Change Order or otherwise) allocation, reallocation or supplementation of the Construction Benchmark Schedule in any manner which would extend the Completion Date. (b) Prior to and after giving effect to this Third Amendment, no "DEFAULT" or "EVENT OF DEFAULT" exists under the GECC Facilities Agreement (without giving effect to the GECC Intercreditor Agreement). SECTION IV.2. DUE AUTHORIZATION, NON-CONTRAVENTION, ETC. The execution, delivery and performance by the Borrower of this Third Amendment to Credit Agreement and each other document executed or to be executed by it in connection with this Third Amendment to Credit Agreement are within the Borrower's powers, have been duly authorized by all necessary action, and do not: (a) contravene the Borrower's Organizational Documents; (b) contravene any contractual restriction binding on or affecting the Borrower; (c) contravene any court decree or order or Legal Requirement binding on or affecting the Borrower; or (d) result in, or require the creation or imposition of, any Lien on any of the Borrower's properties except as expressly contemplated by the Operative Documents, and the Financing Parties may conclusively rely on such representation and warranty. SECTION IV.3. GOVERNMENT APPROVAL, REGULATION, ETC. No authorization or approval or other action by, and no notice to or filing with, any governmental authority or regulatory body or other Person is required for the due execution, delivery or performance by the Borrower of this Third Amendment to Credit Agreement or any other document to be executed by it in connection with this Third Amendment to Credit Agreement. 9 SECTION IV.4. VALIDITY, ETC. This Third Amendment to Credit Agreement constitutes, and each other document executed by the Borrower in connection with this Third Amendment to Credit Agreement, on the due execution and delivery thereof, will constitute, the legal, valid and binding obligations of the Borrower enforceable in accordance with their respective terms, except as such enforceability may be limited by applicable bankruptcy, insolvency or similar laws affecting the enforcement of creditors rights generally and by general principles of equity. SECTION IV.5. LIMITATION. Except as expressly provided hereby, all of the representations, warranties, terms, covenants and conditions of the Credit Agreement and each other Operative Document shall remain unamended and unwaived and shall continue to be, and shall remain, in full force and effect in accordance with their respective terms. The amendments, modifications and consents set forth herein shall be limited precisely as provided for herein, and shall not be deemed to be a waiver of, amendment of, consent to or modification of any other term or provision of the Credit Agreement, the GECC Facilities Agreement, any Operative Document, or other Instrument referred to therein or herein, or of any transaction or further or future action on the part of the Borrower or any other Person which would require the consent of the Agents, the Lenders, GECC or the Discount Note Indenture Trustee. SECTION IV.6. OFFSETS AND DEFENSES. The Borrower has no offsets or defenses to its obligations under the Loan Documents or the documents evidencing and securing the FF&E Financing and no claims or counterclaims against any of the Agents, the Lenders or the Construction Consultant. ARTICLE V MISCELLANEOUS PROVISIONS SECTION V.1. RATIFICATION OF AND REFERENCES TO THE CREDIT AGREEMENT. This Third Amendment to Credit Agreement shall be deemed to be an amendment to the Credit Agreement, and the Credit Agreement, as amended by this Third Amendment to Credit Agreement, shall continue in full force and effect and is hereby ratified, approved and confirmed in each and every respect. All references to the Credit Agreement in any other document, instrument, agreement or writing shall hereafter be deemed to refer to the Credit Agreement, as amended by this Third Amendment to Credit Agreement. SECTION V.2. HEADINGS. The various headings of this Third Amendment to Credit Agreement are inserted for convenience only and shall not affect the meaning or interpretation of this Third Amendment to Credit Agreement or any provisions hereof. SECTION V.3. APPLICABLE LAW. THIS THIRD AMENDMENT TO CREDIT AGREEMENT AND THE RIGHTS AND OBLIGATIONS OF THE PARTIES UNDER THIS THIRD AMENDMENT TO CREDIT AGREEMENT SHALL BE GOVERNED BY, AND CONSTRUED AND INTERPRETED IN ACCORDANCE WITH, THE LAWS OF THE 10 STATE OF NEW YORK, INCLUDING SECTION 5-1401 OF THE NEW YORK GENERAL OBLIGATIONS LAW, BUT EXCLUDING ALL OTHER CHOICE OF LAW AND CONFLICTS OF LAW RULES OF SUCH STATE. SECTION V.4. CROSS-REFERENCES. References in this Third Amendment to Credit Agreement to any Article or Section are, unless otherwise specified, to such Article or Section of this Third Amendment to Credit Agreement. SECTION V.5. OPERATIVE DOCUMENT. This Third Amendment to Credit Agreement is a Loan Document executed pursuant to the Credit Agreement and shall (unless otherwise expressly indicated therein) be construed, administered and applied in accordance with the terms and provisions of the Credit Agreement. SECTION V.6. SUCCESSORS AND ASSIGNS. This Third Amendment to Credit Agreement shall be binding upon and inure to the benefit of the parties hereto and their respective successors and assigns. SECTION V.7. COUNTERPARTS. This Third Amendment to Credit Agreement may be executed by the parties hereto in any number of counterparts and on separate counterparts, each of which shall be an original but all of which together shall constitute one and the same instrument. SECTION V.8. RESERVATION OF RIGHTS. The Borrower agrees that neither this Third Amendment to Credit Agreement nor the making of any Advance by the Disbursement Agent and the Administrative Agent's consent thereto shall constitute (w) an approval of all or any portion of any Advance Request, (x) a waiver or forbearance by the Disbursement Agent or the Administrative Agent under any of the Loan Documents, (y) the acceptance by the Disbursement Agent or the Administrative Agent of any course of conduct by the Borrower, the Completion Guarantors or any of the Aladdin Parties or the London Clubs Parties (including, without limitation, matters relating to transfers of direct and indirect interests in Holdings between the members thereof) or (z) an agreement by the Administrative Agent to amend any of the Loan Documents or waive any of the provisions thereof without the approval from the Required Lenders and a corresponding amendment of the GECC Facilities Agreement or waiver from GECC, as the case may be. The Borrower further agrees that the Administrative Agent and the Disbursement Agent reserve all rights, remedies and options under the Loan Documents to require the Borrower to satisfy in all respects the conditions relating to each Advance and perform all of its obligations under the Loan Documents which are then due and owing or are susceptible of performance, as the case may be. 11 IN WITNESS WHEREOF, the parties hereto have executed this Third Amendment to Credit Agreement as of the day and year first above written. ALADDIN GAMING, LLC By: /s/ RICHARD J. GOEGLEIN -------------------------------------- Name: Richard J. Goeglein Title: President & Chief Executive Officer THE BANK OF NOVA SCOTIA, as the Administrative Agent By: ---------------------------------- Name: Title: MERRILL LYNCH CAPITAL CORPORATION, as the Syndication Agent By: ---------------------------------- Name: Title: CIBC OPPENHEIMER CORP., as the Documentation Agent By: ---------------------------------- Name: Title: 12 By signing below, the Guarantors confirm their agreement to the terms of this Third Amendment to Credit Agreement. ALADDIN BAZAAR HOLDINGS, LLC By: /s/ RONALD DICTROW ---------------------------- Name: Ronald Dictrow Title: Secretary/Treasurer THE TRUST UNDER ARTICLE SIXTH UNDER THE WILL OF SIGMUND SOMMER By: /s/VIOLA SOMMER ----------------------------- Name: Viola Sommer Title: Trustee By: /s/ JACK SOMMER ----------------------------- Name: Jack Sommer Title: Trustee LONDON CLUBS INTERNATIONAL PLC By: /s/ WILLIAM TIMMINS ----------------------------- Name: William Timmins Title: Executive Director By signing below, the Disbursement Agent confirms receipt of this Third Amendment to Credit Agreement. THE BANK OF NOVA SCOTIA, as the Disbursement Agent By: ------------------------------ Name: Title: 13 EX-10.02 3 ex-10_02.txt EXHIBIT 10.02 EXHIBIT 10.02 ====================================================================== FOURTH AMENDMENT TO CREDIT AGREEMENT Dated as of July _, 2000 (amending the Credit Agreement, dated as of February 26, 1998) among ALADDIN GAMING, LLC, as the Borrower, VARIOUS FINANCIAL INSTITUTIONS, as the Lenders, THE BANK OF NOVA SCOTIA, as the Administrative Agent for the Lenders, and MERRILL LYNCH CAPITAL CORPORATION, as the Syndication Agent for the Lenders. ====================================================================== 1 FOURTH AMENDMENT TO CREDIT AGREEMENT THIS FOURTH AMENDMENT TO CREDIT AGREEMENT (this "Fourth Amendment to Credit Agreement") is dated as of July _, 2000, by and among ALADDIN GAMING, LLC, a Nevada limited-liability company (the "Borrower") the various financial institutions as are or may become parties hereto (collectively, "Lenders") THE BANK OF NOVA SCOTIA, as administrative agent (together with any successor thereto in such capacity, the "Administrative Agent") the Lenders, and MERRILL LYNCH CAPITAL CORPORATION, as syndication agent (together with any successor thereto in such capacity, the "Syndication Agent") for the Lenders. In consideration of the mutual agreements herein contained and other good and valuable consideration, receipt of which is hereby acknowledged, the parties hereto, intending to be legally bound, agree as follows: W I T N E S S E T H: WHEREAS, the Borrower, the Lenders, the Administrative Agent, the Syndication Agent and the Documentation Agent have heretofore entered into (w) that certain Credit Agreement (the "CA") dated as of February 26, 1998, (x) that certain First Amendment to Credit Agreement (the "First Amendment to Credit Agreement") dated as of January 29, 1999, (y) that certain Second Amendment to Credit Agreement (the "Second Amendment to Credit Agreement") dated as of April 5, 1999, effective as of March 10, 1999 and (z) that certain Third Amendment to Credit Agreement (the "Third Amendment to Credit Agreement") dated as of June 2, 2000 (the CA, as amended by the First Amendment to Credit Agreement, the Second Amendment to Credit Agreement and the Third Amendment to Credit Agreement shall be referred to herein as the ("Credit Agreement") and WHEREAS, the Borrower has requested the Lenders to enter into certain amendments of the Credit Agreement; and WHEREAS, each of the parties hereto is willing, on the terms and subject to the conditions hereinafter set forth, to so amend the Credit Agreement. NOW, THEREFORE, in consideration of the agreements contained herein, the parties hereto agree as follows: 2 ARTICLE I DEFINITIONS SECTION I.1. Certain Defined Terms. The following terms (whether or not italicized) when used in this Fourth Amendment to Credit Agreement, including its preamble and recitals, shall, except where the context otherwise requires, have the following meanings: "Effective Date" is defined in SECTION 4.1. "First Amendment to Credit Agreement" is defined in the FIRST RECITAL. "Fourth Amendment to Credit Agreement" is defined in the PREAMBLE. "GECC Facilities Agreement" shall mean that certain Facilities Agreement between General Electric Capital Corporation ("GECC") itself and as agent for certain participants, and the Borrower dated as of June 26, 1998, as amended by that certain First Amendment to Facilities Agreement between GECC, for itself and as agent for certain participants, GMAC Commercial Mortgage Corporation ("GMAC CMC") and the Borrower dated as of September 2, 1998, that certain Agreement of Amendment among GECC, for itself and as agent for certain participants, and the Borrower dated as of June 2, 2000, that certain Agreement of Amendment No. 3 between GECC, for itself and as agent for certain participants, GMAC CMC and the Borrower dated as of July __, 2000 ("Amendment No. 3") as the same may from time to time be further amended, supplemented, amended and restated or otherwise modified in accordance with the terms of the Credit Agreement, as amended by the Fourth Amendment to Credit Agreement, and the GECC Intercreditor Agreement. "GECC Intercreditor Agreement" shall mean that certain Intercreditor Agreement by and among the Administrative Agent, GECC and the Borrower dated as of June 30, 1998 and as thereafter from time to time amended, supplemented, amended and restated or otherwise modified in accordance with the terms thereof. "Second Amendment to Credit Agreement" is defined in the FIRST RECITAL. "Third Amendment to Credit Agreement" is defined in the FIRST RECITAL. SECTION I.2. OTHER DEFINED TERMS; CONSTRUCTION. For purposes of this Fourth Amendment to Credit Agreement, capitalized terms used but not defined herein shall have the meanings assigned to them in the Credit Agreement, as amended by this Fourth Amendment to Credit Agreement, and the rules of construction set forth in ARTICLE I of the CA shall apply to this Fourth Amendment to Credit Agreement. 3 ARTICLE II ACKNOWLEDGMENTS BY THE BORROWER SECTION II.1. BALANCING THE MAIN PROJECT BUDGET. The Borrower acknowledges that as of the date of this Fourth Amendment to Credit Agreement, the amount required in order for the Main Project Budget to be In Balance is $50,000,000 (collectively, the "IN BALANCE AMOUNT"). SECTION II.2. LETTER OF CREDIT. On or about April 3, 2000, London Clubs, one of the Completion Guarantors, delivered a letter of credit to the Administrative Agent in the amount of $47,261,830 in order to bring the Main Project Budget In Balance. On or about June 30, 2000, the Borrower and London Clubs requested the Administrative Agent to waive the requirement that the Main Project Budget be In Balance and make an Advance of $45,698,305.94 by drawing such amount under such letter of credit and depositing the proceeds thereof into the Guaranty Deposit Account for disbursement by the Disbursement Agent. Such requirement was waived by the Administrative Agent pursuant to CLAUSE (a) of SECTION 5.2.1 of the CA and such Advance was approved by the Administrative Agent as set forth in the Advance Request and Certificate dated as of June 30, 2000 and advanced on or about June 30, 2000 by the Disbursement Agent pursuant thereto. SECTION II.3. RESERVATION OF RIGHTS. The Borrower agrees that neither this Fourth Amendment to Credit Agreement nor the making of any Advance by the Disbursement Agent and the Administrative Agents consent thereto either before or after the date hereof shall constitute (w) an approval of all or any portion of any Advance Request, (x) a waiver or forbearance by the Disbursement Agent or the Administrative Agent under any of the Loan Documents, (y) the acceptance by the Disbursement Agent or the Administrative Agent of any course of conduct by the Borrower, the Completion Guarantors or any other Person or (z) an agreement by the Administrative Agent to amend any of the Loan Documents without the approval from the Required Lenders and a corresponding amendment of the GECC Facilities Agreement. The Borrower further agrees that the Administrative Agent and the Disbursement Agent reserve all rights, remedies and options under the Loan Documents to require the Borrower to satisfy in all respects the conditions relating to each Advance and perform all of its obligations under the Loan Documents which are then due and owing or are susceptible of performance, as the case may be. ARTICLE III AMENDMENTS SECTION III.1. AMENDMENTS. The parties hereto hereby agree as follows: (a) The FIFTH RECITAL in the CA shall be deemed to be deleted in its entirety and the following recital shall be substituted in its place: 4 WHEREAS, the Borrower expects to fund the costs to construct the Hotel/Casino Component and pay for the Equipment Component and the Borrower's expenses, if any, with respect to the Energy Project Component, which are expected pursuant to the Main Project Budget to cost $916,469,139 in the aggregate, by (a) obtaining from Holdings in consideration for common membership interests of the Borrower (x) the Site which has a net equity value (the "Land Equity") of $67,000,000, based on an appraised value of $135,000,000 (after giving effect to the release of the portion of the Site required for the Mall Project and the Music Project) and the discharge of all Indebtedness secured thereby of $68,000,000, (y) the benefit of pre-development Main Project Costs of at least $7,000,000 and (z) a portion of the London Clubs Contribution in the amount of $42,000,000; (b) obtaining from Holdings in consideration for Series A Preferred Membership Interests of the Borrower, the amount of $115,047,100, representing the proceeds received by Holdings, Capital and Enterprises from the issuance of the Discount Notes and Warrants in an aggregate amount of $107,047,100 pursuant to the Discount Note Purchase Agreement and a portion of the London Clubs Contribution in the amount of $8,000,000; (c) obtaining from the Sponsors additional contributions pursuant to the Completion Guaranty in the aggregate amount of $145,459,968; (d) obtaining from GECC pursuant to the Approved Equipment Funding Commitment a $60,000,000 capitalized lease and $20,000,000 in purchase money loans covering the Gaming Equipment and the Specified Equipment; (e) obtaining Commitments from the Lenders in an aggregate amount of $453,750,000, all as further described in the following recital; (f) obtaining from The Pepsi-Cola Company or an Affiliate thereof ("Pepsi") an agreement (the "Pepsi Agreement") pursuant to which Pepsi will provide beverages exclusively at the Main Project during the term of the Pepsi Agreement in exchange for payments in an aggregate amount of $2,754,643; (g) obtaining $1,500,000 from the counterparty to the initial Rate Protection Agreement which was delivered by the Borrower on the Closing Date in accordance with SECTION 5.1.9 of the CA with respect to a restructuring of such initial Rate Protection Agreement; (h) obtaining from Global Cash Access, Inc. or an Affiliate thereof ("Global Cash") an agreement (the "Global Agreement") pursuant to which Global Cash will 5 provide credit card services during the term of the Global Agreement in exchange for payments in an aggregate amount of $1,000,000; and (i) obtaining $957,428 from advance deposits and rental income. (b) The SIXTH RECITAL in the CA shall be deemed to be deleted in its entirety and the following recital shall be substituted in its place: WHEREAS, the Borrower desires to obtain (a) Term A Loan Commitments from the Term A Lenders pursuant to which the Borrower may, from time to time on and after the Effective Date and prior to the Term A Loan Commitment Termination Date, obtain (i) from the Issuer, Letters of Credit in a maximum aggregate Stated Amount at any time outstanding not to exceed $20,000,000, and (ii) from the Term A Lenders, Borrowings of the Term A Loans, all SUBJECT, HOWEVER, to the limitation that the sum at any time of (x) the aggregate original principal amount of all Term A Loans PLUS (y) the aggregate Stated Amount of outstanding Letters of Credit shall not exceed $129,750,000; (b) Term B Loan Commitments from the Term B Lenders pursuant to which a single Borrowing of Term B Loans in a maximum original principal amount of $114,000,000 shall be made by the Borrower on the Closing Date; and (c) Term C Loan Commitments from the Term C Lenders pursuant to a single Borrowing of Term C Loans in a maximum original principal amount of $160,000,000 shall be made by the Borrower on the Closing Date; and (d) Term D Loan Commitments from the Term D Lenders pursuant to which the Borrower may, from time to time on and after July __, 2000 and prior to the Term D Loan Commitment Termination Date, obtain from the Term D Lenders, Borrowings of the Term D Loans in a maximum principal amount of $50,000,000 which amount shall be reduced by the aggregate amount of Main Project Costs which the Design/Builder, Fluor, any other Contractor and/or the Completion Guarantor have agreed or confirmed in writing, to the satisfaction of the Administrative Agent in its sole discretion, that they are responsible for paying from their own funds (including, without limitation, the Dollar value of Change Orders which have been or will be performed by the Design/Builder or any other Contractor at no cost to the Borrower but which will be paid by one or more of the Completion Guarantors pursuant to an agreement which has been approved by the Administrative Agent in its sole discretion); and 6 (c) The following definition shall be added to the CA after the definition of AMH Pledge Agreement: "Amendment to Agreements" means on any date, the Amendment to Agreements, as originally in effect on the Effective Date of Fourth Amendment to Credit Agreement, between the Borrower and the Administrative Agent, for the benefit of the Lenders, as thereafter from time to time amended, supplemented, amended and restated or otherwise modified in accordance with the terms of the Credit Agreement. (d) The definition of APPLICABLE BASE RATE MARGIN as set forth in the CA shall be deemed to be deleted in tis entirety and the following definition shall be substituted in its place: "Applicable Base Rate Margin" means, (v) relative to any Term B Loan, Term C Loan or Term D Loan, the proceeds of which on any date are being held in the Bank Proceeds Account, 1.00% PER ANNUM, (w) relative to any Term B Loan, the proceeds of which on any date have been advanced to the Borrower from the Bank Proceeds Account, 2.50% PER ANNUM, (x) relative to any Term C Loan, the proceeds of which on any date have been advanced to the Borrower from the Bank Proceeds Account, 3.00% PER ANNUM; (y) relative to any Term D Loan, the proceeds of which on any date have been advanced from the Bank Proceeds Account, 3.50% PER ANNUM; and (z) relative to any Term A Loan, (1) on any date prior to the date which is six months after the Conversion Date, 2.00% PER ANNUM and (2) on any date from and after the date which is six months after the Conversion Date, the PER ANNUM percentage set forth below opposite the Total Debt to EBITDA Ratio set forth in the Current Compliance Certificate:
Total Debt to EBITDA Ratio Applicable Base Rate Margin - -------------------------------------------------- --------------------------------- (Greater or equal to) 4.0:1 1.75% (Greater or equal to) 3.5:1 and (Less than) 4.0:1 1.50% (Greater or equal to) 3.0:1 and (Less than) 3.5:1 1.00% (Greater or equal to) 2.5:1 and (Less than) 3.0:1 0.75% (Greater or equal to) 2.5:1 0.50%
(e) The definition of APPLICABLE LIBO RATE MARGIN as set forth in the CA shall be deemed to be deleted in its entirety and the following definition shall be substituted in its place: 7 "Applicable LIBO Rate Margin" means, (v) relative to any Term B Loan, Term C Loan or Term D Loan, the proceeds of which on any date are being held in the Bank Proceeds Account, 2.00% PER ANNUM, (w) relative to any Term B Loan, the proceeds of which on any date have been advanced to the Borrower from the Bank Proceeds Account, 3.50% PER ANNUM, (x) relative to any Term C Loan, the proceeds of which on any date have been advanced to the Borrower from the Bank Proceeds Account, 4.00% PER ANNUM; (y) relative to any Term D Loan, the proceeds of which on any date have been advanced from the Bank Proceeds Account, 4.50% PER ANNUM; and (z) relative to any Term A Loan, (1) on any date prior to the date which is six months after the Conversion Date, 3.00% PER ANNUM and (2) on any date from and after the date which is six months after the Conversion Date, the PER ANNUM percentage set forth below opposite the Total Debt to EBITDA Ratio set forth in the Current Compliance Certificate:
Total Debt to EBITDA Ratio Applicable LIBO Rate Margin - --------------------------------------------------- ------------------------------ (Greater or equal to) 4.0:1 2.75% (Greater or equal to) 3.5:1 and (Less than) 4.0:1 2.50% (Greater or equal to) 3.0:1 and (Less than) 3.5:1 2.00% (Greater or equal to) 2.5:1 and (Less than) 3.0:1 1.75% (Greater or equal to) 2.5:1 1.50%
(f) The definition of BANK CREDIT FACILITY as set forth in the CA shall be deemed to be deleted in its entirety and the following definition shall be substituted in its place: "Bank Credit Facility" means the Term A Loan Commitment, the Term B Loan Commitment, the Term C Loan Commitment and the Term D Loan Commitment. (g) The definition of CHANGE ORDER as set forth in the CA shall be deemed to be deleted in its entirety and the following definition shall be substituted in its place: "Change Order" means, at any time, (i) with respect to the Design/Build Contract, an adjustment made to the Guaranteed Maximum Price or the Design/Build Contract Time with respect to changes in the Work which increase or decrease the time of performance or the actual cost to the Design/Builder of the Work to be performed by the Design/Builder under the Design/Build Contract and (ii) with respect to the other Contracts, an adjustment made to the cost or time to complete the Work which increase or decrease the time of performance or the actual cost of the Work to be performed by the Contractors under the Contract. 8 (h) The definition of COMMITMENT as set forth in the CA shall be deemed to be deleted in its entirety and the following definition shall be substituted in its place: "Commitment" means, as the context may require, a Term A Loan Commitment, a Term B Loan Commitment, a Term C Loan Commitment, a Term D Loan Commitment or a Letter of Credit Commitment made by a Lender hereunder. (i) The definition of COMMITMENT AMOUNT as set forth in the CA shall be deemed to be deleted in its entirety and the following definition shall be substituted in its place: "Commitment Amount" means, as the context may require, the Term A Loan Commitment Amount, the Term B Loan Commitment Amount, the Term C Loan Commitment Amount, the Term D Loan Commitment Amount or the Letter of Credit Commitment Amount. (j) The definition of COMMITMENT TERMINATION DATE as set forth in the CA shall be deemed to be deleted in its entirety and the following definition shall be substituted in its place: "Commitment Termination Date" means, as the context may require, the Term A Loan Commitment Termination Date, the Term B Loan and Term C Loan Commitment Termination Date or the Term D Loan Commitment Termination Date. (k) The following definition shall be added to the CA after the definition of Completion Guaranty: "Completion Guaranty Joinder" means the Joinder Agreement dated as of July __, 2000 between Jack Sommer and Laura Sommer, his wife, and the Administrative Agent, for the benefit of the Lenders as thereafter from time to time amended, supplemented, amended and restated or otherwise modified in accordance with the terms of the Credit Agreement. (l) ITEM (x) in CLAUSE (a) of the definition of FORCE MAJEURE as set forth in the CA shall be deleted in its entirety and the following ITEM (x) shall be substituted in its place: (x) late performance by the Design Builder, the Architect of Record or any other Contractor, (m) The definition of INDIRECT COST as set forth in the CA shall be deemed to be deleted in its entirety and the following definition shall be substituted in its place: "Indirect Cost" means any Main Project Cost which is not a Direct Cost, including appraisal fees, the Term A Loan Commitment Fee, the Term B and Term C Loan Commitment Fee, the Term D Loan Commitment Fee, the fees set forth in the Fee Letters, interest on the 9 Loans prior to the Conversion Date, brokers' commissions, fees of the Independent Consultants, insurance during construction, surety bond premiums, cost of surveys, Impositions during construction, title examination and title insurance premiums, recording expenses in connection with the Deed of Trust and other Security Documents (and any amendments or modifications thereof or supplements thereto) and fees and disbursements of the attorneys for the Administrative Agent. (n) The following ITEM (iv) shall be added to CLAUSE (a) of the definition of INTEREST PERIOD as set forth in the CA: (iv) in the case of Term D Loans made or maintained as LIBO Rate Loans, occurring on more than four different dates;" (o) The following definition shall be added to the CA after the definition of Keep-Well Agreement: "Keep-Well Joinder" means the Joinder Agreement dated as of July __, 2000 between the Trust and the Administrative Agent, for the benefit of the Lenders, as thereafter from time to time amended, supplemented, amended and restated or otherwise modified in accordance with the terms of the Credit Agreement. (p) The definition of LOAN as set forth in the CA shall be deemed to be deleted in its entirety and the following definition shall be substituted in its place: "Loan" means a Term A Loan, a Term B Loan, a Term C Loan or a Term D Loan of any type. (q) The Ratification and Reaffirmation, the Term D Loan Fee Letter, the Term D Note, the Keep Well Joinder, the Completion Guaranty Joinder and the Amendment to Agreement shall be added to the definitions of Loan Documents in the CA. (r) The definition of MAIN PROJECT BUDGET as set forth in the CA shall be deemed to be deleted in its entirety and the following definition shall be substituted in its place: "Main Project Budget" means a budget in substantially the form of EXHIBIT X-2 (as amended from time to time in accordance with SECTION 7.2.18) annexed to the Fourth Amendment to Credit Agreement. (s) The definition of NOTE as set forth in the CA shall be deemed to be deleted in its entirety and the following definition shall be substituted in its place: "Note" means a Term A Note, a Term B Note, a Term C Note, a Term D Note or a Registered Note. 10 (t) The references to ("Owner Representatives") in the definitions of "Available Funds", "Construction Benchmark Schedule", "Opening Condition" and "Realized Savings" and in SECTION 6.26.2, SECTION 7.1.16, SECTION 7.1.17 and SECTION 7.2.18 shall be deleted in their entirety and any requirements in the Loan Documents regarding deliveries, certifications, opinions, determinations, inspections, analyses to be made by the Owner Representative or other duties to be performed by it under the Loan Documents may be (i) made or performed by any other Person approved by the Administrative Agent or (ii) waived by the Administrative Agent, in each case in its sole discretion. (u) The definition of PERCENTAGE as set forth in the CA shall be deemed to be deleted in its entirety and the following definition shall be substituted in its place: "Percentage" means, relative to any Lender, the applicable percentage relating to Term A Loans, Term B Loans, Term C Loans, as the case may be, as set forth opposite its signature to the CA under the applicable column heading or as set forth in a Lender Assignment Agreement under the applicable column heading and relating to Term D Loans as set forth on ANNEX I to the Fourth Amendment to Credit Agreement or as set forth in a Lender Assignment Agreement, in each case as such percentage may be adjusted from time to time pursuant to Lender Assignment Agreement(s) executed by such Lender and its Assignee Lender(s) and delivered pursuant to SECTION 10.11.1. A Lender shall not have any Commitment to make Term A Loans, Term B Loans, Term C Loans or Term D Loans, as the case may be, if its percentage under the applicable column heading is zero percent (0%). (v) The definition of PROJECT PARTY as set forth in the CA shall be deemed to be deleted in its entirety and the following definition shall be substituted in its place: "Project Party" means the Borrower, AHL, Sommer Enterprises, Capital, Holdings, London Clubs, LCNI, the Design/Builder, Fluor or any other Person which is a party to a Material Main Project Document. (w) The following definition shall be added to the CA after the definition of RATE PROTECTION AGREEMENT: "Ratification and Reaffirmation" means that certain Ratification and Reaffirmation dated as of July __, 2000, by each of the parties signatory thereto, as the same may from time to time be further amended, supplemented, amended and restated or otherwise modified in accordance with the terms of this Agreement." (x) ITEM (x) in the PROVISO in the definition of REQUIRED LENDERS as set forth in the CA shall be deleted in its entirety and the following ITEM (x) shall be substituted in its place: 11 (x) amendments affecting only one class of Lenders (with a class for each of the Term A Lenders, the Term B Lenders, the Term C Lenders and the Term D Lenders) will require the approval of the Non-Defaulting Lenders holding 66 2/3% or more of the principal amount of the Loans, Letters of Credit or, if applicable, Commitments for such class: (y) The following definition shall be added to the CA after the definition of SCOTIABANK: "Scotiabank Collateral Account Agreement" means, on any date, the Scotiabank Collateral Account Agreement, as originally in effect on the Closing Date, among the Borrower, the Disbursement Agent and the Depositary and as thereafter from time to time amended, supplemented, amended and restated or otherwise modified in accordance with the terms hereof. (z) The definition of SCOTIABANK FEE LETTER as set forth in the CA shall be deemed to be deleted in its entirety and the following definition shall be substituted in its place: "Scotiabank Fee Letter" means the confidential letter agreement, dated December 4, 1997, among the Borrower, the Sponsors and Scotiabank and the confidential letter agreement, dated July __, 2000 (the "Term D Loan Fee Letter") among the Borrower, the Sponsors and Scotiabank. (aa) The definition of STATED MATURITY DATE as set forth in the CA shall be deemed to be deleted in its entirety and the following definition shall be substituted in its place: "Stated Maturity Date" means (a) with respect to all Term A Loans, the date which is the seventh anniversary of the Closing Date; (b) with respect to all Term B Loans, the date which is eight and one-half years after the Closing Date; (c) with respect to all Term C Loans, the tenth anniversary of the Closing Date; and (d) with respect to all Term D Loans, the date which is ten and one-half years after the Closing Date. (bb) The following definitions shall be added to the CA after the definition of TERM C NOTE: "Term D Lender" means any Lender which has made a Term D Loan Commitment or holds a Term D Loan. 12 "Term D Loan" is defined in SECTION 2.1.6. "Term D Loan Commitment" means the aggregate principal amount of Term D Loans which the Term D Lenders are obligated to make pursuant to SECTION 2.1.6. The Term D Loan Commitment shall not exceed $50,000,000 which amount shall be reduced by the aggregate amount of Main Project Costs which the Design/Builder, Fluor, any other Contractor and/or the Completion Guarantor have agreed or confirmed in writing, to the satisfaction of the Administrative Agent in its sole discretion, that they are responsible for paying from their own funds (including, without limitation, the Dollar value of Change Orders which have been or will be performed by the Design/Builder or any other Contractor at no cost to the Borrower but which will be paid by one or more of the Completion Guarantors pursuant to an agreement which has been approved by the Administrative Agent in its sole discretion). "Term D Loan Commitment Amount" means, on any date, relative to any Term D Lender, the portion of the Term D Loan Commitment of such Term D Lender reduced by the principal amount of any Term D Loans made by such Term D Lender as of such date. The portion of the Term D Loan Commitment of each Term D Lender is set forth on ANNEX I to the Fourth Amendment to Credit Agreement or as set forth in a Lender Assignment Agreement. "Term D Loan Commitment Fee" is defined in SECTION 3.3.1. "Term D Loan Commitment Termination Date" means the earlier of (a) the Term A Loan Commitment Termination Date (if the Term A Loans have not been made on or prior to such date); (b) the date which is six months after the Conversion Date; and (c) the date on which any Event of Default occurs. Upon the occurrence of any event described in CLAUSE (a), (b) or (c), the Term D Loan Commitments shall terminate automatically and without any further action. "Term D Note" means, on any date, a promissory note of the Borrower payable to any Term D Lender, in the form of EXHIBIT A-5 annexed to the Fourth Amendment of Credit Agreement (as such promissory note may thereafter from time to time be amended, supplemented, amended and restated, endorsed or otherwise modified), evidencing the aggregate Indebtedness of the Borrower to such Term D Lender resulting from outstanding Term D Loans, and also means all other promissory notes accepted from time to time in substitution or replacement therefor or renewal thereof. 13 (cc) The definition of WORK as set forth in the CA shall be deemed to be deleted in its entirety and the following definition shall be substituted in its place: "Work" shall include the "Work" as defined in SECTION 1.7 of the Design/Build Contract and the obligations to be performed by the Contractors under the Contracts. (dd) SECTION 2.1.4 as set forth in the CA shall be deemed to be deleted in its entirety and the following Section shall be substituted in its place: SECTION 2.1.4 LENDERS NOT PERMITTED OR REQUIRED TO MAKE LOANS. No Lender shall be permitted or required to make any Loan if, after giving effect thereto, the aggregate outstanding principal amount of (a) all Term A Loans (i) of all Lenders with a Term A Loan Commitment, together with the aggregate amount of all Letter of Credit Outstandings, would exceed the then existing aggregate amount of the Term A Loan Commitment Amounts, or (ii) of such Lender with a Term A Loan Commitment, together with such Lender's Percentage of the aggregate amount of all Letter of Credit Outstandings, would exceed such Lender's then existing Term A Loan Commitment Amount of such Lender; or (b) all Term B Loans or all Term C Loans (as the case may be) (i) of all Lenders made on the Closing Date would exceed the aggregate amount of the Term B Loan Commitment Amounts (in the case of Term B Loans) or the aggregate amount of the Term C Loan Commitment Amounts (in the case of Term C Loans), or (ii) of such Lender with a Term B Loan Commitment or with a Term C Loan Commitment, as applicable, made on the Closing Date would exceed such Lender's then existing Term B Loan Commitment Amount (in the case of Term B Loans) or then existing Term C Loan Commitment Amount (in the case of Term C Loans); or (c) all Term D Loans of all Lenders with a portion of the Term D Loan Commitment would exceed the then existing aggregate amount of the Term D Loan Commitment. (ee) The following Section shall be added to the Credit Agreement as SECTION 2.1.6: 14 SECTION 2.1.6 TERM D LOAN COMMITMENT. From time to time on any Business Day occurring from and after the date on which the proceeds of all Term B Loans, Term C Loans and the Term A Loans have been disbursed from the Bank Proceeds Account but prior to the Term D Loan Commitment Termination Date, each Lender that has a portion of the Term D Loan Commitment will make a loan (relative to such Lender, its "Term D Loan") to the Borrower equal to such Lender's Percentage of the aggregate amount of each Borrowing of the Term D Loans requested by the Borrower to be made on such day. The Commitment of each such Lender described in this SECTION 2.1.6 is herein referred to as its "Term D Loan Commitment." On the terms and subject to the conditions hereof, the Borrower may from time to time borrow and prepay the Term D Loans but no amount paid or prepaid with respect to the Term D Loans may be reborrowed. (ff) The following Section shall be added to the Credit Agreement as SECTION 2.3.5: SECTION 2.3.5 TERM D LOANS. On the terms and subject to the conditions of this Agreement and the Disbursement Agreement prior to the Term D Loan Commitment Termination Date, the Borrower may from time to time irrevocably request that Term D Loans be made by the Lenders. Term D Loans may be part of an Advance from time to time to Fund Project Costs in accordance with the Loan Documents or, at the option of a Term D Lender, may be made in a single Borrowing directly into the Bank Proceeds Account (for purposes of the Disbursement Agreement, any Term D Loan advanced to the Bank Proceeds Account shall be deposited into the Term B Sub-Account and disbursed therefrom as a Term B Loan in accordance with the Disbursement Agreement and the Fourth Amendment to Credit Agreement). Any such request for Term D Loans shall be made in accordance with SECTION 2.3.1 and Section 2.4 of the Disbursement Agreement. Notwithstanding the date on which the Term D Loans are made by the Lenders or any provisions of the UCC, any applicable law or decision, each Lender agrees that all Liens and security interests created under any Loan Document in favor of the Lenders shall inure to the benefit of such Lender as if such Lender had made such loan on the Closing Date and such Liens and security interests shall be treated by such Lenders, on the one hand, and such Lenders making the Term D Loans, on the other hand, as having equal priority. (gg) CLAUSE (a), CLAUSE (b) and CLAUSE (c) of SECTION 3.1.1 as set forth in the CA shall be deemed to be deleted in its entirety and the following clauses shall be substituted in their place: (a)(i) From time to time on any Business Day, the Borrower may make a voluntary prepayment, in whole, of the outstanding principal amount of any Term A Loan, PROVIDED, HOWEVER, that 15 (A) All such voluntary prepayments shall require at least one but no more than five Business Days' prior written notice to the Administrative Agent; and (B) All such voluntary partial prepayments shall be, in the case of LIBO Rate Loans, in an aggregate minimum amount of $4,000,000 and an integral multiple of $1,000,000 and, in the case of Base Rate Loans, in an aggregate minimum amount of $4,000,000 and an integral multiple of $1,000,000. (ii) From time to time on any Business Day after the second anniversary of the Effective Date, the Borrower may make a voluntary prepayment, in whole or in part, of the outstanding principal amount of any Term B Loan, Term C Loan or Term D Loan; PROVIDED, HOWEVER, that (A) any such prepayment of such Loans shall be made PRO RATA among such Loans of the same type and, if applicable, having the same Interest Period of all Lenders that have made such Loans (with the amounts so allocated being applied to the remaining amortization payments for such Loans in such amounts as the Borrower shall determine); (B) all such voluntary prepayments shall require at least one but no more than five Business Days' prior written notice to the Administrative Agent; (C) all such voluntary partial prepayments shall be, in the case of LIBO Rate Loans, in an aggregate minimum amount of $4,000,000 and an integral multiple of $1,000,000 and, in the case of Base Rate Loans, in an aggregate minimum amount of $4,000,000 and an integral multiple of $1,000,000; and (D) shall be accompanied by a premium equal to the product of (1) the percentage set forth opposite the 12-month period ending on the anniversary of the Effective Date in which such prepayment is made MULTIPLIED BY (2) the amount then prepaid:
Third Anniversary: 3.00% Fourth Anniversary: 2.00% Fifth Anniversary: 1.00% Each Anniversary Thereafter: 0.0%
16 (b) From and after the Conversion Date, the principal amount of the Term A Loans, the Term B Loans, the Term C Loans and the Term D Loans shall be amortized (the "Scheduled Amortization") on the dates and in the amounts set forth on SCHEDULE II annexed to the Fourth Amendment to Credit Agreement. (c) From and after the Conversion Date, the Borrower shall make mandatory prepayments of principal (the "Mandatory Prepayments") of all Loans in addition to the Scheduled Amortization on the dates and in the amounts set forth in SCHEDULE III annexed to the Fourth Amendment to Credit Agreement; PROVIDED, HOWEVER, on any date on which a Mandatory Prepayment is to be made, any Term B Lender, any Term C Lender or any Term D Lender may elect not to receive its portion of such Mandatory Prepayment in which case 50% of the portion of the Mandatory Prepayment which was to have been made to such Lender shall be paid PRO RATA to (x) the Term B Lenders, the Term C Lenders and the Term D Lenders which have elected to receive their portions of such Mandatory Prepayment and (y) the Term A Lenders which have made a Term A Loan (up to the outstanding amount of the Term A Loans), and upon the payment of such 50% portion of such Mandatory Prepayment, the Borrower shall be deemed to have satisfied its obligations to make such Mandatory Prepayment. Except as set forth in the proviso of the immediately preceding sentence, Mandatory Prepayments will be applied ratably among the Term A Loan, the Term B Loan, the Term C Loan and the Term D Loan." (hh) ITEM SIXTH as set forth in CLAUSE (b) of SECTION 3.1.2 of the CA and the balance of the sentence appearing after ITEM SIXTH shall be deemed to be deleted in its entirety and the following shall be substituted in its place: SIXTH, ratably among the aggregate outstanding principal balance of the Loans and, after all amounts evidenced and secured by the Loan Documents have been indefeasibly paid in full and the Borrowers have performed their obligations under the Loan Documents, the balance, if any, shall be delivered to the Borrower." (ii) The following sentence shall be added at the end of SECTION 3.3.1: From and after July __, 2000 and until the Conversion Date, a non-refundable fee (the "Term D Loan Commitment Fee") in the amount of one-half percent PER ANNUM of the aggregate amount of the then existing Term D Loan Commitment Amounts shall accrue on the daily average of the aggregate amount of the then existing Term D Loan Commitment Amount. The Term D Loan Commitment Fee shall be payable in arrears to the Term D Lenders on each Quarterly Payment Date in proportion to such Term D 17 Lenders' respective then existing Term D Loan Commitment Amount. (jj) The first sentence of SECTION 5.2.4 as set forth in the CA shall be deemed to be deleted in its entirety and the following sentence shall be substituted in its place: Subject to SECTION 2.3.2 with respect to Term A Loans, SECTION 2.3.3 with respect to Term B Loans and Term C Loans and SECTION 2.3.5 with respect to Term D Loans, the Administrative Agent shall have received a Borrowing Request for the Loan being requested or a Letter of Credit Issuance Request if a Letter of Credit is being requested or extended. (kk) The following Section shall be added to the Credit Agreement as SECTION 5.2.7: SECTION 5.2.7 CONDITIONS FOR ADVANCES OF TERM D LOANS UNDER THE DISBURSEMENT AGREEMENT AND THE MAKING OF TERM D Loans. Not in limitation but in furtherance of the other conditions in this ARTICLE V, the following conditions shall be satisfied prior to the making of any Advance of a Term D Loan under the Disbursement Agreement or any Term D Loan, as the case may be, (a) all conditions to the making of any Advance as set forth in the Disbursement Agreement shall be satisfied by the Borrower or otherwise waived in writing by the Administrative Agent in its sole discretion; (b) except as set forth in the proviso to this CLAUSE (b), the proceeds of the Term B Loan and Term C Loan shall be fully disbursed from the Term B Sub-Account and the Term C Sub-Account, respectively, and the Term A Loans shall be fully advanced prior to the making of the Term D Loan; PROVIDED, HOWEVER, all fees payable under the Term D Loan Fee Letter on or before the Effective Date (as defined in the Fourth Amendment to Credit Agreement) shall be paid from the Term D Loan; (c) if such Lender was not already a Lender prior to the making of such Loan, the Administrative Agent shall have received from such Lender a joinder to this Agreement, which joinder shall be in form and substance reasonably satisfactory to the Administrative Agent. (ll) CLAUSE (c) of SECTION 7.1.19 of the CA shall be deleted in its entirety and the following clause (c) shall be substituted in its place: (c) Take all actions and do all things as may be reasonably necessary under NRS Chapter 278 and the applicable provisions of the Clark County Code, to cause the Music Project Parcel to become a separate legal parcel as promptly as practicable. The 18 Borrower shall, upon creation of the Music Project Parcel as a separate legal parcel, deliver a notice to such effect to the Administrative Agent. Promptly thereafter, at the Borrower's sole cost and expense, in substantially concurrent transactions: (i) the Borrower and Aladdin Music shall terminate the Music Project Ground Lease; and (ii) substantially concurrently with the foregoing, and as a condition precedent thereto, the Borrower shall deliver to the Administrative Agent: (A) a legal opinion from counsel reasonably acceptable to the Administrative Agent to the effect that (1) the Music Project Parcel and the Main Project Parcel have been legally created as separate legal parcels under NRS Chapter 278 and the applicable provisions of the Clark County Code and (2) the Deed of Trust remains enforceable in accordance with its terms and continues to be effective with respect to the Music Project Parcel and the Main Project Parcel to create the security interests described therein against the Music Project Parcel and the Main Project Parcel, together with such other legal opinions as the Administrative Agent may reasonably request, each in form and substance reasonably satisfactory to the Administrative Agent, (B) endorsements, or commitments by the Title Insurer to issue endorsements, to the Title Policies, in each case, in form and substance satisfactory to the Administrative Agent, insuring the continuing perfection and priority of the respective Liens on the Main Project Security and (C) any amendments to the Reciprocal Easement Agreement, the Site Work Agreement and the Common Parking Area Use Agreement necessary to allow continued performance by the parties thereto of their obligations thereunder. Notwithstanding anything to the contrary set forth herein, in exchange for the "Release Price" (defined below) and satisfaction of the conditions listed below, the Administrative Agent shall deliver on behalf of the Lenders a release of the Music Project Parcel from the Deed of Trust and the Music Parcel Project shall be reconveyed on behalf of the Lenders by the Administrative Agent to the Borrower or its designee. The obligation of the Lenders to deliver the release and reconveyance shall be subject to the delivery by the Borrower of (A) a legal opinion from counsel reasonably acceptable to the Administrative Agent to the effect that the Deed of Trust remains enforceable in accordance with its terms and continues to be effective with respect to the Main Project Parcel to create the security interests described therein against the Main Project Parcel, together with such other legal opinions as the Administrative Agent may reasonably request, each in form and substance satisfactory to the Administrative Agent, (B) endorsements, or commitments by the Title Insurer to issue endorsements, to the Title Policies, in each case, in form and substance satisfactory to the Administrative Agent, insuring the continuing perfection and priority of the respective Liens on the Main Project Security and (C) any amendments which have been approved by the Administrative Agent to the Reciprocal Easement Agreement, the Site Work Agreement and the Common Parking Area Use Agreement necessary to allow continued performance by the parties thereto of their obligations thereunder. 19 The "Release Price" shall be a cash payment equal to 100% of the contract sales price (which shall be no less than the fair market value of the Music Parcel Project at the time the Borrower enters into the contract of sale therefor) paid by a BONA FIDE third party purchaser of the Music Project Parcel which is not an Affiliate any of any of the Aladdin Parties or the London Clubs Parties REDUCED BY BONA FIDE closing costs which have been approved by the Administrative Agent in its sole discretion. The Release Price received by the Lenders shall be applied in accordance with SECTION 3.1.2. (mm) Notwithstanding anything to the contrary set forth in the introductory language of SECTION 7.2.4 of the CA, for purposes of CLAUSE (a), CLAUSE (b), CLAUSE (d) and CLAUSE (e) of said Section, FQ1 shall commence with the close of the Fiscal Quarter in which December 31, 2000 occurs and the references in each of said clauses to the Conversion Date shall be deleted and deemed to be December 31, 2000. The introductory language in SECTION 7.2.4 of the CA shall continue to apply to CLAUSE (C) of said Section. (nn) The words "or under any other Contract" shall be added to the end of ITEM (III) of CLAUSE (a) of SECTION 7.2.17 of the CA before the semi-colon. ARTICLE IV CONDITIONS PRECEDENT AND COVENANT SECTION IV.1. CONDITIONS TO EFFECTIVENESS. This Fourth Amendment to Credit Agreement shall be and become effective on the date (the "Effective Date") on which each of the following conditions precedent shall have been satisfied. (a) DELIVERIES. The Administrative Agent shall have received counterparts of (i) the Ratification and Reaffirmation executed by Authorized Representatives of each of the parties thereto; (ii) this Fourth Amendment to Credit Agreement executed by Authorized Representatives of the Borrower, the Administrative Agent and the Syndication Agent; (iii) all documentation required by the Lenders to evidence and secure the Term D Loans; (iv) written verification that a portion of the payments to be made by Pepsi to the Borrower under the Pepsi Contract in an amount of no less than $1,200,000 has been received by the Borrower and deposited into the Guaranty Deposit Account together with a written commitment from Pepsi to make the balance of such payments under the Pepsi Contract on or before July 28, 2000 such that an aggregate amount of no less than $2,754,643 shall have been funded under the Pepsi Contract on or before July 28, 2000; (v) a certificate from the Architect that the design of the Main Project and the Parking Garage is complete (subject to such variations approved by the Administrative Agent in its sole discretion) such design has been approved by all Governmental Authorities having jurisdiction over the Main Project and that all temporary certificates of occupancy for zones listed on SCHEDULE IV hereto have been 20 issued by the due date for such temporary certificate of occupancy listed on said schedule; (vi) a certified copy of each of the Contracts listed on SCHEDULE V hereto together with a continuation agreement from the Contractor thereunder in form and content satisfactory to the Administrative Agent in its sole discretion; (vii) written confirmation that (x) the GECC Facility has been funded in an aggregate amount of at least $42,257,379.96 covering the Specified Property and the Gaming Equipment listed on SCHEDULE VI annexed hereto, (y) that the proceeds thereof have been received by the proper Person and (z) to the extent that the Borrower has received any proceeds, the Borrower has deposited such proceeds into the Guaranty Deposit Account; (viii) written confirmation from GECC that it will fund $37,742,620.04 from the GECC Facility on or before September 30, 2000 for the Specified Property and Gaming Equipment listed on SCHEDULE VII annexed hereto, subject to and in accordance with the terms of the GECC Facility Agreement (of which no less than $30,000,000 shall be funded on or before August 30, 2000 with the balance being funded on or before September 30, 2000) such that the aggregate amount funded from the GECC Facility on or before September 30, 2000 shall be no less than the aggregate amount of $80,000,000; (ix) an effective amendment to the GECC Facilities Agreement which conforms the GECC Facilities Agreement to the Credit Agreement, as amended by the Fourth Amendment to Credit Agreement, and includes the consent of GECC to the execution and delivery hereof; (x) a general release substantially in the form of the release set forth in SECTION 5.7 of this Fourth Amendment to Credit Agreement in favor of the Lenders and the Agents from each of the Aladdin Parties, the London Clubs Parties and all other Persons as required by the Administrative Agent through the Effective Date of this Fourth Amendment of Credit Agreement; and (xi) delivery of such other items required by the Administrative Agent or any of the Lenders. (b) INCUMBENCY, ETC. The Administrative Agent shall have received (with copies for each Lender) a certificate, dated as of the date of the Fourth Amendment to Credit Agreement, of an Authorized Representative of (i) the Borrower certifying (x) as to the incumbency and signatures of the Person or Persons authorized to execute and deliver this Fourth Amendment to Credit Agreement and any instruments or agreements required hereunder, (y) as to an attached copy of one or more resolutions or other authorizations of the manager of the Borrower certified by the Authorized Representative of such manager as being in full force and effect on the date hereof, authorizing the execution, delivery and performance of this Fourth Amendment to Credit Agreement, the Term D Notes and any instruments or agreements required hereunder, and 21 (z) that the Organizational Documents of the Borrower have not been modified since the date on which they were last delivered to the Administrative Agent, (i) of each signatory to the Ratification and Reaffirmation certifying (x) as to the incumbency and signatures of the Person or Persons authorized to execute and deliver the Ratification and Reaffirmation on behalf of such signatory; (y) as to an attached copy of one or more resolutions or other authorizations of (A) the Board of Directors certified by the Authorized Representative of such signatory, or (B) the manager of such signatory certified by the Authorized Representative of such manager, as applicable, each as being in full force and effect on the date hereof, authorizing the execution, delivery and performance of the Ratification and Reaffirmation, and (z) that the Organizational Documents of such signatory have not been modified since the date on which they were last delivered to the Administrative Agent, upon which certificate the Administrative Agent, the Syndication Agent, the Documentation Agent and each Consenting Lender (collectively, the "Financing Parties" may conclusively rely until it shall have received a further certificate of an Authorized Representative of the Borrower canceling or amending such prior certificate. (c) FEES. All reasonable fees and costs and expenses of Mayer, Brown & Platt and other professionals employed by the Administrative Agent and all other reasonable expenses of the Administrative Agent in connection with the negotiation, execution and delivery of this Fourth Amendment to Credit Agreement and the transactions contemplated herein shall have been paid in full. (d) SATISFACTORY LEGAL FORM. Each Financing Party and its counsel shall have received all information, approvals, opinions, documents or instruments as each Financing Party or its counsel may have reasonably requested, and all documents executed or submitted pursuant hereto by or on behalf of the Borrower shall be satisfactory in form and substance to each Financing Party and its counsel. (e) DEFAULT. After giving effect to this Fourth Amendment to Credit Agreement the following statements shall be true and correct: (i) to the best knowledge of the Borrower, no act or condition exists which, with the giving of notice or passage of 22 time would constitute a "Default" or "Event of Default" (as defined in the Credit Agreement, the GECC Facilities Agreement and the Discount Note Indenture) has occurred and is continuing as of the date hereof and (ii) no material adverse change in (A) the financial condition, business, property, prospects or ability of the Borrower to perform in all material respects its obligations under any Operative Document or any of the documents evidencing and securing the FF&E Financing to which it is a party or (B) the financial condition, business, property, prospects and ability of the Design/Builder, Fluor or the Contractors to perform in all material respects their respective obligations under any Operative Document to which it is a party has occurred since the Closing Date. (f) CONSENTS AND APPROVALS. All approvals and consents required to be taken, given or obtained, as the case may be, by or from any Governmental Instrumentality or another Person, or by or from any trustee (including, without limitation, GECC and the Discount Note Indenture Trustee) or holder of any indebtedness or obligation of the Borrower, that are necessary or, in the reasonable opinion of the Administrative Agent, advisable in connection with the execution, delivery and performance of this Fourth Amendment to Credit Agreement by all parties hereto, shall have been taken, given or obtained, as the case may be, shall be in full force and effect and the time for appeal with respect to any thereof shall have expired (or, if an appeal shall have been taken, the same shall have been dismissed) and shall not be subject to any pending proceedings or appeals (administrative, judicial or otherwise) and shall be in form and substance satisfactory to the Administrative Agent. (g) DELIVERY OF FOURTH AMENDMENT TO CREDIT AGREEMENT, ETC. The Borrower shall have delivered this Fourth Amendment to Credit Agreement, the Term D Notes, and all documents required by Amendment No. 3 and the Discount Note Indenture to all Persons entitled under the Operative Documents to receive delivery hereof and thereof, as the case may be, and arranged for or caused the recording and/or filing thereof, as required. (h) OPINIONS. The Administrative Agent shall have received such opinions of counsel as it deems necessary, dated as of the date of the Fourth Amendment to Credit Agreement and addressed to the Administrative Agent, the Lenders and, if applicable, the Disbursement Agent, which shall be in form and substance satisfactory to the Administrative Agent. ARTICLE V REPRESENTATIONS AND WARRANTIES In order to induce each Financing Party to enter into this Fourth Amendment to Credit Agreement, the Borrower hereby reaffirms, as of the date of this Fourth Amendment to Credit 23 Agreement, its representations and warranties contained in Article VI of the Credit Agreement and the Disbursement Agreement and additionally represents and warrants unto each Financing Party as set forth in this ARTICLE V. SECTION V.1. MATTERS PERTAINING TO THE GECC FACILITIES AGREEMENT AND THE DISCOUNT NOTE INDENTURE. (a) The Borrower has performed all of its obligations under the GECC Facilities Agreement and the Discount Note Indenture. (b) After giving effect to this Fourth Amendment to Credit Agreement and the performance by the Borrower of its obligation to keep the Main Project Budget In Balance, no "Default" or "Event of Default" exists under the GECC Facilities Agreement (without giving effect to the GECC Intercreditor Agreement) or the Discount Note Indenture. SECTION V.2. DUE AUTHORIZATION, NON-CONTRAVENTION, ETC. The execution, delivery and performance by the Borrower of this Fourth Amendment to Credit Agreement, the Term D Notes, the amendments to the other Loan Documents and each other document executed or to be executed by it in connection with this Fourth Amendment to Credit Agreement are within the Borrower's powers, have been duly authorized by all necessary action, and do not (a contravene the Borrower's Organizational Documents; (b contravene any contractual restriction binding on or affecting any of the Aladdin Parties and/or the London Clubs Parties; (c contravene any court decree or order or Legal Requirement binding on or affecting any of the Aladdin Parties and/or the London Clubs Parties; or (d result in, or require the creation or imposition of, any Lien on any property of the Borrower, any of the other Aladdin Parties, any other Person which executes and delivers documents with respect to the Fourth Amendment to Credit Agreement in favor of the Lenders except as expressly permitted by the Operative Documents, the GECC Facilities Agreement, the Discount Note Indenture and other Instruments binding on such Persons, as the case may be, and the Financing Parties may conclusively rely on such representation and warranty. SECTION V.3. GOVERNMENT APPROVAL, REGULATION, ETC. No authorization or approval or other action by, and no notice to or filing with, any governmental authority or regulatory body or other Person is required for the due execution, delivery or performance by the Borrower or any other Person of this Fourth Amendment to Credit Agreement or any other document to be 24 executed by it or any other Person in connection with this Fourth Amendment to Credit Agreement. SECTION V.4. VALIDITY, ETC. This Fourth Amendment to Credit Agreement constitutes, and each other document executed by the Borrower in connection with this Fourth Amendment to Credit Agreement, on the due execution and delivery thereof, will constitute, the legal, valid and binding obligations of the Borrower enforceable in accordance with their respective terms, except as such enforceability may be limited by applicable bankruptcy, insolvency or similar laws affecting the enforcement of creditors rights generally and by general principles of equity. SECTION V.5. LIMITATION. Except as expressly provided hereby, all of the representations, warranties, terms, covenants and conditions of the Credit Agreement and each other Operative Document shall remain unamended and unwaived and shall continue to be, and shall remain, in full force and effect in accordance with their respective terms. The amendments and modifications set forth herein shall be limited precisely as provided for herein, and shall not be deemed to be a waiver of, amendment of, consent to or modification of any other term or provision of the Credit Agreement, the GECC Facilities Agreement, any Operative Document, the Discount Note Indenture or other Instrument referred to therein or herein, or of any transaction or further or future action on the part of the Borrower or any other Person which would require the consent of the Agents, the Lenders, GECC or the Discount Note Indenture Trustee or any other Person. SECTION V.6. OFFSETS AND DEFENSES. The Borrower has no offsets or defenses to its obligations under the Loan Documents, the Term D Notes or the documents evidencing and securing the FF&E Financing and no claims or counterclaims against any of the Agents, the Lenders or the Construction Consultant. SECTION V.7. RELEASE BY THE BORROWER. (a) As an inducement to the Lenders, the Administrative Agent and the Syndication Agents to enter into this Fourth Amendment to Credit Agreement, the Borrower hereby releases and discharges the Lenders and the Agents, and their respective successors and assigns, and all officers, directors, employees, agents, representatives, insurers and attorneys of each of them from all actions, counterclaims, causes of action, suits, debts, dues, sums of money, accounts, reckonings, bonds, bills, specialties, covenants, contracts, controversies, agreements, promises, variances, trespasses, damages, judgments, executions, claims, and demands whatsoever, in law, admiralty or equity, against the Lenders, the Agents and/or their successors and assigns which the Borrower ever had, now has or hereafter can, shall or may, have for, upon, or by reason of any matter, cause or thing whatsoever from the beginning of the world to the day of the date of this Fourth Amendment to Credit Agreement (the "Released Claims"). (b) In order to induce the Lenders, the Administrative Agent and the Syndication Agent to accept the release set forth herein, the Borrower represents that: 25 (i) such release constitutes a legal, valid and binding obligation of the Borrower, enforceable against it in accordance with its terms. The execution and delivery of, and the performance and compliance by the Borrower with such release will not conflict with, or constitute on the part of the Borrower a violation or breach of, or a default under, and will not require any authorization, consent, approval or other action by, or any notice to, or filing with any court or administrative body or any other Person pursuant to, any mortgage, deed of trust, loan agreement, trust agreement or other agreement or instrument to which the Borrower or any of its property is subject or any laws and other governmental requirements; and (ii) the Borrower (A) has not sold, transferred, conveyed, abandoned or otherwise disposed of any of the Released Claims, whether or not known, suspected or claimed that the Borrower has, had or may have, against the Lenders, any Agent and/or any of their successors, predecessors (including, without limitation, all predecessors by virtue of merger) and assigns, as the case may be and (B) has sought the advice of counsel with respect to the execution and delivery of this Fourth Amendment to Credit Agreement and the Borrower understands the legal implications with respect to the release set forth herein and the other documents executed by the Borrower in connection herewith. (c) The Borrower hereby acknowledges that it may hereafter discover facts in addition to or different from those which it now knows or believes to be true with respect to the subject matter of the release set forth herein, but that it is the Borrower's intention to, and it does, hereby fully, finally and forever settle the Released Claims; in furtherance of such intention, the Borrower acknowledges that the release set forth herein shall be and remain in effect as a full and complete release, notwithstanding the subsequent discovery or existence of any such additional or different facts. SECTION V.8. ATTACHMENTS TO CERTAIN PLEDGE AGREEMENTS. Attachment 1 to each of the following Pledge Agreements shall be replaced by the corresponding Attachment 1 attached hereto after approval by the Nevada Gaming Commission: the Holdings Pledge Agreement, the LCNI Pledge Agreement, the Sommer Enterprises Pledge Agreement, the AHL Pledge Agreement, the Enterprises Pledge Agreement and the AMH Pledge Agreement. The shares of Capital Stock or Membership Interests listed on Item A of any Attachment 1 constitute all the shares of Capital Stock or Membership Interests which have been issued by the Pledged Share Issuer (as defined in the applicable Pledge Agreement) to such Pledgor (as defined in such Pledge Agreement). The Borrower covenants and agrees to request immediately after the execution and delivery of this Fourth Amendment to Credit Agreement that the Nevada Gaming Commission approve the amendment of each of the aforementioned Attachments to Pledge Agreements and to diligently and continuously prosecute to completion such approval process. ARTICLE VI 26 MISCELLANEOUS PROVISIONS SECTION VI.1. RATIFICATION OF AND REFERENCES TO THE CREDIT AGREEMENT. This Fourth Amendment to Credit Agreement shall be deemed to be an amendment to the Credit Agreement, and the Credit Agreement, as amended by this Fourth Amendment to Credit Agreement, shall continue in full force and effect and is hereby ratified, approved and confirmed in each and every respect. All references to the Credit Agreement in any other document, instrument, agreement or writing shall hereafter be deemed to refer to the Credit Agreement, as amended by this Fourth Amendment to Credit Agreement. SECTION VI.2. HEADINGS. The various headings of this Fourth Amendment to Credit Agreement are inserted for convenience only and shall not affect the meaning or interpretation of this Fourth Amendment to Credit Agreement or any provisions hereof. SECTION VI.3. APPLICABLE LAW. THIS FOURTH AMENDMENT TO CREDIT AGREEMENT AND THE RIGHTS AND OBLIGATIONS OF THE PARTIES UNDER THIS FOURTH AMENDMENT TO CREDIT AGREEMENT SHALL BE GOVERNED BY, AND CONSTRUED AND INTERPRETED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK, INCLUDING SECTION 5-1401 OF THE NEW YORK GENERAL OBLIGATIONS LAW, BUT EXCLUDING ALL OTHER CHOICE OF LAW AND CONFLICTS OF LAW RULES OF SUCH STATE. SECTION VI.4. CROSS-REFERENCES. References in this Fourth Amendment to Credit Agreement to any Article or Section are, unless otherwise specified, to such Article or Section of this Fourth Amendment to Credit Agreement. SECTION VI.5. LOAN DOCUMENT. This Fourth Amendment to Credit Agreement is a Loan Document executed pursuant to the Credit Agreement and shall (unless otherwise expressly indicated therein) be construed, administered and applied in accordance with the terms and provisions of the Credit Agreement. SECTION VI.6. SUCCESSORS AND ASSIGNS. This Fourth Amendment to Credit Agreement shall be binding upon and inure to the benefit of the parties hereto and their respective successors and assigns. SECTION VI.7. COUNTERPARTS. This Fourth Amendment to Credit Agreement may be executed by the parties hereto in any number of counterparts and on separate counterparts, each of which shall be an original but all of which together shall constitute one and the same instrument. SECTION VI.8. ANNEX; SCHEDULES; EXHIBITS. Annexed to this Fourth Amendment to Credit Agreement are the following: 27
ANNEX I Term D Lenders SCHEDULE II Amortization (Replaces Schedule II to the CA) SCHEDULE III Mandatory Payments (Replaces Schedule III to the CA) SCHEDULE IV Certificates of Occupancy for Zones SCHEDULE V Schedule of Contracts and Continuation Agreements SCHEDULE VI Specified Property and the Gaming Equipment Funded by GECC SCHEDULE VII Specified Property and the Gaming Equipment to be Funded by GECC EXHIBIT A-5 Form of Term D Note EXHIBIT X-2 Main Project Budget [ATTACHMENT 1 to the Holdings Pledge Agreement ATTACHMENT 1 to the LCNI Pledge Agreement ATTACHMENT 1 to the Sommer Enterprises Pledge Agreement ATTACHMENT 1 to the AHL Pledge Agreement ATTACHMENT 1 to the Enterprises Pledge Agreement ATTACHMENT 1 to the Borrower Pledge Agreement ATTACHMENT 1 to the AMH Pledge Agreement]
IN WITNESS WHEREOF, the parties hereto have executed this Fourth Amendment to Credit Agreement as of the day and year first above written. ALADDIN GAMING, LLC By: ------------------------------------ Name: ---------------------------------- Title: --------------------------------- THE BANK OF NOVA SCOTIA, as the Administrative Agent By: ------------------------------------ Name: ---------------------------------- Title: --------------------------------- MERRILL LYNCH CAPITAL 28 CORPORATION, as the Syndication Agent By: ------------------------------------ Name: ---------------------------------- Title: --------------------------------- 29 Schedule V Schedule of Contracts and Continuation Agreements (a "Contract for Construction for a Guaranteed Maximum Price," dated February 18, 2000, between Aladdin Gaming, LLC and George M. Raymond Co.; (b "Contract for Construction for a Guaranteed Maximum Price," dated February 7, 2000, between Aladdin Gaming, LLC and Valley Crest Landscaping, Inc.; (c "Contract for Construction for a Guaranteed Maximum Price," dated January 24, 2000, between Aladdin Gaming, LLC and Korte-Bellew & Associates Construction Co.; (d "Contract Agreement," dated January 26, 2000 between Aladdin Gaming, LLC and Dynalectric Company of Nevada; (e "Contract for Construction for a Guaranteed Maximum Price," dated February 7, 2000, between Aladdin Gaming, LLC and Taylor International Corp. 30 EX-10.03 4 ex-10_03.txt EXHIBIT 10.03 EXHIBIT 10.03 AGREEMENT OF AMENDMENT THIS AGREEMENT OF AMENDMENT (this "Amendment") is made as of the 2nd day of June, 2000, among GENERAL ELECTRIC CAPITAL CORPORATION, FOR ITSELF AND AS AGENT FOR CERTAIN PARTICIPANTS ("GE Capital"), GMAC COMMERCIAL MORTGAGE CORPORATION ("GMAC CMC"), and ALADDIN GAMING, LLC ("Aladdin Gaming"). GE Capital and Aladdin Gaming have heretofore executed that certain Facilities Agreement dated as of June 26, 1998, as amended (the "Facilities Agreement"), and pursuant thereto that certain Master Lease Agreement dated as of June 26, 1998 (the "Lease Agreement"; and together with the Facilities Agreement being sometimes hereinafter collectively referred to as the "Agreements"). Capitalized terms used herein without definition shall have the meaning given them in the Agreements. GE Capital has heretofore assigned to GMAC CMC certain of its right, title, interest and obligations pursuant to the Agreements. The parties desire to amend the Lease Agreement and to further amend the Facilities Agreement as hereinafter set forth. NOW, THEREFORE, in consideration of the premises and mutual covenants hereinafter contained, the parties agree as follows: SECTION 1. AMENDMENTS TO FACILITIES AGREEMENT. The Facilities Agreement is amended as follows: Section 1.1. Exhibit No. 2 attached to the Facilities Agreement is deleted and Exhibit No. 2 to Facilities Agreement attached hereto is substituted in lieu thereof and incorporated therein as fully as if originally set forth therein. Section 1.2. The following sentence shall be added to the end of Section 11(e) of the Facilities Agreement: "Notwithstanding the foregoing, Aladdin Gaming may make an Investment in any wholly-owned Subsidiary which is created by Aladdin Gaming for the purpose of owning and controlling bank, deposit or any other accounts at any financial institution permitted under the Senior Credit Agreement or which otherwise are created for purposes of Aladdin Gaming's operation of the Casino so long as the Administrative Agent has consented thereto." Section 1.3. Section 11(h) of the Facilities Agreement is deleted and the following substituted in lieu thereof: "Aladdin Gaming will not, and will not permit any Subsidiary to, enter into at any time any arrangement (other than the financing pursuant hereto) which involves the leasing by Aladdin Gaming from any lessor of any real or personal property (or any interest therein), which does not create a Capitalized Lease Liability and except arrangements which, together with all other such arrangements which shall then be in effect, will not require the 1 payment of an aggregate amount in any Fiscal Year of rentals by Aladdin Gaming or any Subsidiary in excess of, in the case of any such arrangements entered into prior to the date which is ninety (90) days after the Opening Date, $2,000,000 per annum and, in the case of any such arrangement entered into on or subsequent to the date which is ninety (90) days after the Opening Date, $5,000,000 per annum." SECTION 2. AMENDMENTS TO LEASE AGREEMENT. The Lease Agreement is hereby amended as follows: Section 2.1. The following is added to the end of Section 1(b) of the Lease: "The obligation of Lessor to purchase any Unit of Equipment from Lessee and to lease the same to Lessee under any Schedule shall be subject to satisfaction of the conditions specified above in this Section 1(b) and to receipt by Lessor, prior to the Lease Commencement Date (with respect to such Unit of Equipment), of each of the following documents in form and substance satisfactory to Lessor: (v) a Bill of Sale, in substantially the form attached hereto as Exhibit No. 3, with respect to such Unit of Equipment, duly executed by Lessee, (vi) a certified true copy of the invoice from the Supplier with respect to such Unit of Equipment, and (vii) such documents and instruments as reasonably may be required by Lessor evidencing the termination of any security interest in such Unit of Equipment then held by any third party." Section 2.2. Exhibit No. 3 to Master Lease Agreement attached hereto is incorporated in the Lease as fully as if originally set forth therein and made a part thereof. SECTION 3. CONSENT TO AMENDMENTS AND CONFIRMATION. Section 3.1. GE Capital and GMAC CMC hereby consent to the amendments of the Senior Credit Agreement and the Disbursement Agreement specified in Section 2.1 of that certain Third Amendment to Senior Credit Agreement dated as of May ___, 2000 (the "Third Amendment"), by and among Aladdin Gaming, the various financial institutions as are or may become parties thereto, The Bank of Nova Scotia, as Administrative Agent for the Lenders (the "Administrative Agent"), Merrill Lynch Capital Corporation, as Syndication Agent for the Lenders, and CIBC Oppenheimer Corp., as Documentation Agent for the Lenders. Section 3.2. GE Capital and GMAC CMC hereby confirm and agree that, upon delivery to the Project of Gaming Equipment or Specified Equipment as to which Advances to fund deposits or progress payments have been made pursuant to the Senior Credit Agreement, all amounts advanced to Aladdin Gaming from the Loans to fund such deposits or to make such progress payments shall be advanced on behalf of Aladdin Gaming to the Guaranty Deposit Account and the balance due with respect to such Gaming Equipment or Specified Equipment shall be funded in full under the Agreements, subject to and in accordance with the terms of the Agreements. 2 SECTION 4. CONDITIONS TO EFFECTIVENESS. This Amendment shall be and become effective on the date (the "Amendment Date") on which each of the following conditions precedent shall have been satisfied. (a) EXECUTION OF DOCUMENTS. GE Capital and GMAC CMC shall have received counterparts of (i) this Amendment executed by Authorized Representatives of Aladdin Gaming, the Administrative Agent, GE Capital and GMAC CMC, (ii) the Third Amendment executed by Authorized Representatives of the parties thereto, (iii) the Ratification of the Completion Guaranty executed by Authorized Representatives of the parties thereto, and (iv) the First Amendment to Disbursement Agreement executed by Authorized Representatives of the Parties thereto. (b) INCUMBENCY, ETC. GE Capital and GMAC CMC shall have received a certificate, dated the Amendment Date, of an Authorized Representative of Aladdin Gaming certifying: (i) as to the incumbency and signatures of the Person or Persons authorized to execute and deliver this Amendment and any instruments or agreements required hereunder, (ii) as to an attached copy of one or more resolutions or other authorizations of the manager of Aladdin Gaming certified by the Authorized Representative of such manager as being in full force and effect on the date hereof, authorizing the execution, delivery and performance of this Amendment and any instruments or agreements required hereunder, and (iii) that the Organizational Documents of Aladdin Gaming have not been modified other than by the letter agreement dated December 10, 1999, a true, correct and complete copy of which shall have been delivered to GE Capital and GMAC CMC, upon which certificate GE Capital and GMAC CMC and Credit Suisse First Boston Mortgage Capital, LLC (collectively, the "FINANCING PARTIES") may conclusively rely until it shall have received a further certificate of an Authorized Representative of Aladdin Gaming cancelling or amending such prior certificate. (c) FEES. All reasonable fees and costs and expenses of Ober, Kaler, Grimes & Shriver and other professionals employed by the Financing Parties and all other reasonable expenses of the Financing Parties in connection with the negotiation, execution and delivery of this Amendment and the transactions contemplated herein shall have been paid in full. (d) SATISFACTORY LEGAL FORM. Each Financing Party and its counsel shall have received all information, approvals, opinions, documents or instruments as each Financing Party or its counsel may have reasonably requested, and all documents executed or submitted pursuant hereto by or on behalf of Aladdin Gaming shall be satisfactory in form and substance to each Financing Party and its counsel. (e) DEFAULT. After giving effect to this Amendment the following statements shall be true and correct: (i) to the best knowledge of Aladdin Gaming, no act or condition exists which, with the giving of notice or passage of time would constitute a "DEFAULT" or "EVENT OF 3 DEFAULT" (as defined in the Senior Credit Agreement or in the Agreements has occurred and is continuing as of the date hereof, and (ii) no material adverse change in (A) the financial condition, business, property, prospects or ability of Aladdin Gaming to perform in all material respects its obligations under any Operative Document, or (B) the financial condition, business, property, prospects and ability of any other Aladdin Party or, to the best knowledge of Aladdin Gaming, LCNI, the Design/Builder or Fluor to perform in all material respects its obligations under any Operative Document to which it is a party has occurred since the Closing Date. (f) CONSENTS AND APPROVALS. All approvals and consents required to be taken, given or obtained, as the case may be, by or from any Governmental Instrumentality or another Person, or by or from any trustee (including, without limitation, the Financing Parties and the Administrative Agent for itself and on behalf of the Lenders and the Discount Note Indenture Trustee) or holder of any indebtedness or obligation of Aladdin Gaming, that are necessary or, in the reasonable opinion of GE Capital and GMAC CMC, advisable in connection with the execution, delivery and performance of this Amendment by all parties hereto, shall have been taken, given or obtained, as the case may be, shall be in full force and effect and the time for appeal with respect to any thereof shall have expired (or, if an appeal shall have been taken, the same shall have been dismissed) and shall not be subject to any pending proceedings or appeals (administrative, judicial or otherwise) and shall be in form and substance satisfactory to GE Capital and GMAC CMC. (g) DELIVERY OF AMENDMENT. Aladdin Gaming shall have delivered this Amendment to all Persons entitled under the Operative Documents to receive delivery hereof. (h) OPINIONS. GE Capital and GMAC CMC shall have received such opinions of counsel as it deems necessary, dated the Amendment Date and addressed to the Financing Parties, which shall be in form and substance satisfactory to the financing parties. SECTION 5. REPRESENTATIONS AND WARRANTIES. In order to induce each Financing Party to enter into this Amendment, Aladdin Gaming hereby reaffirms, as of the Amendment Date, its representations and warranties contained in Section 8 of the Facilities Agreement and additionally represents and warrants unto each Financing Party as set forth in this Section 5. Section 5.1. MATTERS PERTAINING TO THE FACILITIES AGREEMENT. (a) Aladdin Gaming has not directly or indirectly amended (by Change Order or otherwise), modified (by Change Order or otherwise), allocated, reallocated or supplemented or permitted or consented to the amendment (by Change Order or otherwise), modification (by Change Order or otherwise) allocation, reallocation or supplementation of the Construction Benchmark Schedule in any manner which would extend the Completion Date. (b) Prior to and after giving effect to this Amendment, no "DEFAULT" or "EVENT OF DEFAULT" exists under the Senior Credit Agreement or the Agreements (without giving effect to the Intercreditor Agreement). Section 5.2. DUE AUTHORIZATION, NON-CONTRAVENTION, ETC. The execution, delivery and performance by Aladdin Gaming of this Amendment and each other document executed or to be executed by it in connection with this Amendment are within Aladdin Gaming's powers, have been duly authorized by all necessary action, and do not: 4 (a) contravene Aladdin Gaming's Organizational Documents; (b) contravene any contractual restriction binding on or affecting Aladdin Gaming; (c) contravene any court decree or order or Legal Requirement binding on or affecting Aladdin Gaming; or (d) result in, or require the creation or imposition of, any Lien on any of Aladdin Gaming's properties except as expressly contemplated by the Operative Documents, and the Financing Parties may conclusively rely on such representations and warranties. Section 5.3. GOVERNMENT APPROVAL, REGULATION, ETC. No authorization or approval or other action by, and no notice to or filing with, any governmental authority or regulatory body or other Person is required for the due execution, delivery or performance by Aladdin Gaming of this Amendment or any other document to be executed by it in connection with this Amendment. Section 5.4. VALIDITY, ETC. This Amendment constitutes, and each other document executed by Aladdin Gaming in connection with this Amendment, on the due execution and delivery thereof, will constitute, the legal, valid and binding obligations of Aladdin Gaming enforceable in accordance with their respective terms, except as such enforceability may be limited by applicable bankruptcy, insolvency or similar laws affecting the enforcement of creditors rights generally and by general principles of equity. Section 5.5. LIMITATION. Except as expressly provided hereby, all of the representations, warranties, terms, covenants and conditions of the Agreement and each other Operative Document shall remain unamended and unwaived and shall continue to be, and shall remain, in full force and effect in accordance with their respective terms. The amendments, modifications and consents set forth herein shall be limited precisely as provided for herein, and shall not be deemed to be a waiver of, amendment of, consent to or modification of any other term or provision of the Agreement, the Agreement, any Operative Document, or other Instrument referred to therein or herein, or of any transaction or further or future action on the part of Aladdin Gaming or any other Person which would require the consent of the Financing Parties, the Administrative Agent, the Lenders, GECC or the Discount Note Indenture Trustee. Section 5.6. OFFSETS AND DEFENSES. Aladdin Gaming has no offsets or defenses to its obligations under the Operative Documents or the documents evidencing and securing the FF&E Financing and no claims or counterclaims against any of the Financing Parties, the Administrative Agent, the Lenders or the Construction Consultant. Section 6.1. RATIFICATION OF AND REFERENCES TO THE AGREEMENT. This Amendment shall be deemed to be an amendment to the Agreements, and the Agreements, as amended by this Amendment, shall continue in full force and effect and are hereby ratified, approved and confirmed in each and every respect. All references to the Agreements in any other document, instrument, agreement or writing shall hereafter be deemed to refer to the Agreements, as amended by this Amendment. 5 Section 6.2. HEADINGS. The various headings of this Amendment are inserted for convenience only and shall not affect the meaning or interpretation of this Amendment or any provisions hereof. Section 6.3. APPLICABLE LAW. THIS AMENDMENT AND THE RIGHTS AND OBLIGATIONS OF THE PARTIES HEREUNDER SHALL BE GOVERNED BY, AND CONSTRUED AND ENFORCED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK, APPLICABLE TO CONTRACTS MADE AND PERFORMED IN SUCH STATE. Section 6.4. CROSS-REFERENCES. References in this Amendment to any Section are, unless otherwise specified, to such Section of this Amendment. Section 6.5. OPERATIVE DOCUMENT. This Amendment is an Operative Document executed pursuant to the Facilities Agreement and shall (unless otherwise expressly indicated therein) be construed, administered and applied in accordance with the terms and provisions of the Facilities Agreement. Section 6.6. SUCCESSORS AND ASSIGNS. This Amendment shall be binding upon and inure to the benefit of the parties hereto and their respective successors and assigns. Section 6.7. COUNTERPARTS. This Amendment may be executed by the parties hereto in any number of counterparts and on separate counterparts, each of which shall be an original but all of which together shall constitute one and the same instrument. Section 6.8. RESERVATION OF RIGHTS. Aladdin Gaming agrees that neither this Amendment nor the making of any Funding and GE Capital and GMAC CMC's consent thereto shall constitute (w) an approval of all or any portion of any request for Funding, (x) a waiver or forbearance by GE Capital and GMAC CMC under any of the Operative Documents, (y) the acceptance by GE Capital and GMAC CMC of any course of conduct by Aladdin Gaming, the Completion Guarantors or any of the Aladdin Parties or the London Clubs Parties (including, without limitation, matters relating to transfers of direct and indirect interests in Holdings between the members thereof), or (z) an agreement by GE Capital and GMAC CMC to amend any of the Operative Documents or waive any of the provisions thereof without a corresponding amendment of the Senior Credit Agreement or waiver from the Administrative Agent on behalf of the Lenders, as the case may be. Aladdin Gaming further agrees that GE Capital and GMAC CMC reserve all rights, remedies and options under the Operative Documents to require Aladdin Gaming to satisfy in all respects the conditions relating to each Funding and perform all of its obligations under the Operative Documents which are then due and owing or are susceptible of performance, as the case may be. 6 IN WITNESS WHEREOF, this Agreement of Amendment has been duly executed as of the date first above written. ALADDIN GAMING, LLC GENERAL ELECTRIC CAPITAL CORPORATION, FOR ITSELF AND AS AGENT FOR CERTAIN PARTICIPANTS By: /s/ RICHARD J. GOEGLEIN By: /s/ TIMOTHY S. SHANAHAN ------------------------ ------------------------------ Name: Richard J. Goeglein Name: Timothy S. Shanahan Title: President & Chief Executive Officer Title: Vice President GMAC COMMERCIAL MORTGAGE CORPORATION By: /s/ JON S. WRIGHT --------------------------- Name: John S. Wright Title: Senior Vice President PURSUANT TO SECTION 5.1(c) OF THAT CERTAIN INTERCREDITOR AGREEMENT DATED AS OF JUNE 30, 1998, BY AND AMONG THE BANK OF NOVA SCOTIA, AS ADMINISTRATIVE AGENT, GENERAL ELECTRIC CAPITAL CORPORATION, FOR ITSELF AND AS AGENT FOR CERTAIN PARTICIPANTS, AND ALADDIN GAMING, LLC, THE UNDERSIGNED CONSENTS TO THE EXECUTION OF THE FOREGOING AMENDMENT BY ALADDIN GAMING, LLC. THE BANK OF NOVA SCOTIA, as Administrative Agent By: ------------------------- Name: ------------------------- Title: ------------------------- 7 EX-10.04 5 ex-10_04.txt EXHIBIT 10.04 EXHIBIT 10.04 AGREEMENT OF AMENDMENT NO. 3 THIS AGREEMENT OF AMENDMENT NO. 3 (this "Amendment") is made as of the ______ day of July, 2000, among GENERAL ELECTRIC CAPITAL CORPORATION, FOR ITSELF AND AS AGENT FOR CERTAIN PARTICIPANTS ("GE Capital"), GMAC COMMERCIAL MORTGAGE CORPORATION ("GMAC CMC"), and ALADDIN GAMING, LLC ("Aladdin Gaming"). GE Capital and Aladdin Gaming have heretofore executed that certain Facilities Agreement dated as of June 26, 1998, as amended (the "Facilities Agreement"), and pursuant thereto that certain Master Lease Agreement dated as of June 26, 1998, as amended (the "Lease Agreement"; and together with the Facilities Agreement being sometimes hereinafter collectively referred to as the "Agreements"). Capitalized terms used herein without definition shall have the meaning given them in the Agreements. GE Capital has heretofore assigned to GMAC CMC certain of its right, title, interest and obligations pursuant to the Agreements. The parties desire to further amend the Facilities Agreement as hereinafter set forth. NOW, THEREFORE, in consideration of the premises and mutual covenants hereinafter contained, the parties agree as follows: SECTION 1. AMENDMENTS TO FACILITIES AGREEMENT. The Facilities Agreement is amended as follows: Section 1.1. Notwithstanding anything to the contrary set forth in the introductory language of Section 11(d), for purposes of clause (1), clause (2), clause (4), and clause (5) of said Section, FQ1 shall commence with the close of the Fiscal Quarter in which December 31, 2000 occurs and the references in each of said clauses to the Conversion Date shall be deleted and deemed to be December 31, 2000. The introductory language in Section 11(d) shall continue to apply to clause (3) of said Section. SECTION 2. CONSENT TO AMENDMENTS AND CONFIRMATION. Section 2.1. GE Capital and GMAC CMC hereby consent to the amendments of the Senior Credit Agreement specified in Article III of that certain Fourth Amendment to Senior Credit Agreement dated as of the date hereof (the "Fourth Amendment"), by and among Aladdin Gaming, the various financial institutions as are or may become parties thereto, The Bank of Nova Scotia, as Administrative Agent for the Lenders (the "Administrative Agent"), Merrill Lynch Capital Corporation, as Syndication Agent for the Lenders, and CIBC Oppenheimer Corp., as Documentation Agent for the Lenders. Section 2.2. GE Capital and GMAC CMC hereby confirm and agree that, upon delivery to the Project of the Gaming Equipment and the Specified Equipment listed on Schedule A attached hereto, the Capitalized Lessor's Cost of such Specified Equipment and the aggregate acquisition cost of such Gaming Equipment (which, in the aggregate, shall be no less than $37,742,620.04) shall be funded in full under the Agreements on or before September 30, 2000 (of which no less than $30,000,000.00 shall be funded on or before August 30, 2000, with the balance being funded on or before September 30, 2000), subject to and in accordance with the terms of the Agreements. SECTION 3. CONDITIONS TO EFFECTIVENESS. This Amendment shall be and become effective on the date (the "Effective Date") on which each of the following conditions precedent shall have been satisfied. Section 3.1. EXECUTION OF DOCUMENTS. GE Capital and GMAC CMC shall have received counterparts of (i) this Amendment executed by Authorized Representatives of Aladdin Gaming, the Administrative Agent, GE Capital and GMAC CMC; (ii) the Fourth Amendment executed by Authorized Representatives of the parties thereto; (iii) the Ratification and Reaffirmation (as defined in the Senior Credit Agreement) of each of the parties thereto; (iv) a certificate from the Architect that the design of the Main Project and the Parking Garage is complete (subject to such variations approved by GE Capital and GMAC CAC in their sole discretion), such design 1 has been approved by all Governmental Authorities having jurisdiction over the Main Project and that all temporary certificates of occupancy for zones listed on Schedule B hereto have been issued by the date for such temporary certificate of occupancy listed on said schedule; (v) a certified copy of each of the Contracts listed on Schedule C hereto together with a continuation agreement from the Contractor thereunder in form and content satisfactory to GE Capital and GMAC CMC in their sole discretion; (vi) a general release substantially in the form of the release set forth in Section 4.7 of this Amendment in favor of GE Capital, GMAC CAC and Credit Suisse First Boston Mortgage Capital, LLC (collectively, the "Financing Parties") from each of the Aladdin Parties, the London Clubs Parties and all other Persons as required by GE Capital and GMAC CAC through the Effective Date of this Amendment; and (vii) delivery of such other items required by GE Capital and GMAC CMC. Section 3.2. INCUMBENCY, ETC. GE Capital and GMAC CMC shall have received a certificate, dated as of the date of this Amendment, of an Authorized Representative of (i) Aladdin Gaming certifying: (x) as to the incumbency and signatures of the Person or Persons authorized to execute and deliver this Amendment and any instruments or agreements required hereunder, (y) as to an attached copy of one or more resolutions or other authorizations of the manager of Aladdin Gaming certified by the Authorized Representative of such manager as being in full force and effect on the date hereof, authorizing the execution, delivery and performance of this Amendment and any instruments or agreements required hereunder, and (z) that the Organizational Documents of Aladdin Gaming have not been modified other than by the letter agreement dated December 10, 1999, a true, correct and complete copy of which shall have been delivered to GE Capital and GMAC CMC, (ii) each signatory to the Ratification and Reaffirmation certifying: (x) as to the incumbency and signatures of the Person or Persons authorized to execute and deliver the Ratification and Reaffirmation on behalf of such signatory, (y) as to an attached copy of one or more resolutions or other authorizations of (A) the Board of Directors certified by the Authorized Representative of such signatory, or (B) the manager of each signatory certified by the Authorized Representative of such manager, as applicable, each as being in full force and effect on the date hereof, authoring the execution, delivery and performance of the Ratification and Reaffirmation, and (z) that the Organizational Documents of such signatory have not been modified since the date on which they were last delivered to GE Capital and GMAC CMC, upon which certificates the Financing Parties may conclusively rely until they shall have received a further certificate of an Authorized Representative of Aladdin Gaming canceling or amending such prior certificate. Section 3.3. FEES. All reasonable fees and costs and expenses of Ober, Kaler, Grimes & Shriver and other professionals employed by the Financing Parties and all other reasonable expenses of the Financing Parties in connection with the negotiation, execution and delivery of this Amendment and the transactions contemplated herein shall have been paid in full. Section 3.4. SATISFACTORY LEGAL FORM. Each Financing Party and its counsel shall have received all information, approvals, opinions, documents or instruments as each Financing Party or its counsel may have reasonably requested, and all documents executed or submitted pursuant hereto by or on behalf of Aladdin Gaming shall be satisfactory in form and substance to each Financing Party and its counsel. Section 3.5. DEFAULT. After giving effect to this Amendment and the Fourth Amendment the following statements shall be true and correct: (i) to the best knowledge of Aladdin Gaming, no act or condition exists which, with the giving of notice or passage of time would constitute a "DEFAULT" or "EVENT OF DEFAULT" (as 2 defined in the Senior Credit Agreement, the Discount Note Indenture, or in the Agreements) has occurred and is continuing as of the date hereof, and (ii) no material adverse change in (A) the financial condition, business, property, prospects or ability of Aladdin Gaming to perform in all material respects its obligations under any Operative Document, or (B) the financial condition, business, property, prospects and ability of the Design/Builder, Fluor or the Contractors to perform in all material respects their respective obligations under any Operative Document to which it is a party has occurred since the Closing Date. Section 3.6. CONSENTS AND APPROVALS. All approvals and consents required to be taken, given or obtained, as the case may be, by or from any Governmental Instrumentality or another Person, or by or from any trustee (including, without limitation, the Financing Parties and the Administrative Agent for itself and on behalf of the Lenders and the Discount Note Indenture Trustee) or holder of any indebtedness or obligation of Aladdin Gaming, that are necessary or, in the reasonable opinion of GE Capital and GMAC CMC, advisable in connection with the execution, delivery and performance of this Amendment by all parties hereto, shall have been taken, given or obtained, as the case may be, shall be in full force and effect and the time for appeal with respect to any thereof shall have expired (or, if an appeal shall have been taken, the same shall have been dismissed) and shall not be subject to any pending proceedings or appeals (administrative, judicial or otherwise) and shall be in form and substance satisfactory to GE Capital and GMAC CMC. Section 3.7. DELIVERY OF AMENDMENT. Aladdin Gaming shall have delivered this Amendment to all Persons entitled under the Operative Documents to receive delivery hereof. Section 3.8. OPINIONS. GE Capital and GMAC CMC shall have received such opinions of counsel as it deems necessary, dated as of the date of this Amendment and addressed to the Financing Parties, which shall be in form and substance satisfactory to the Financing Parties. SECTION 4. REPRESENTATIONS AND WARRANTIES. In order to induce each Financing Party to enter into this Amendment, Aladdin Gaming hereby reaffirms, as of the Effective Date, its representations and warranties contained in Section 8 of the Facilities Agreement and additionally represents and warrants unto each Financing Party as set forth in this Section 4. Section 4.1. MATTERS PERTAINING TO THE FACILITIES AGREEMENT AND THE DISCOUNT NOTE INDENTURE. (a) Aladdin Gaming has performed all of its obligations under the Senior Credit Agreement and the Discount Note Indenture. (b) After giving effect to this Amendment and the Fourth Amendment and the performance by Aladdin Gaming of its obligation to keep the Main Project Budget In Balance, no "DEFAULT" or "EVENT OF DEFAULT" exists under the Senior Credit Agreement or the Agreements (without giving effect to the Intercreditor Agreement) or the Discount Note Indenture. Section 4.2. DUE AUTHORIZATION, NON-CONTRAVENTION, ETC. The execution, delivery and performance by Aladdin Gaming of this Amendment and each other document executed or to be executed by it in connection with this Amendment are within Aladdin Gaming's powers, have been duly authorized by all necessary action, and do not: (a) contravene Aladdin Gaming's Organizational Documents; (b) contravene any contractual restriction binding on or affecting any of the Aladdin Parties and/or the London Clubs Parties; (c) contravene any court decree or order or Legal Requirement binding on or affecting any of the Aladdin Parties and/or the London Clubs Parties; or (d) result in, or require the creation or imposition of, any Lien on any property of Aladdin Gaming, any of the other Aladdin Parties, any other Person which executes and delivers documents with respect to this Amendment in favor of the Financing Parties except as expressly permitted by the Operative Documents, the Senior Credit Agreement, the Discount Note Indenture and other Instruments binding on 3 such Persons, as the case may be, and the Financing Parties may conclusively rely on such representations and warranties. Section 4.3. GOVERNMENT APPROVAL, REGULATION, ETC. No authorization or approval or other action by, and no notice to or filing with, any governmental authority or regulatory body or other Person is required for the due execution, delivery or performance by Aladdin Gaming or any other Person of this Amendment or any other document to be executed by it in connection with this Amendment. Section 4.4. VALIDITY, ETC. This Amendment constitutes, and each other document executed by Aladdin Gaming in connection with this Amendment, on the due execution and delivery thereof, will constitute, the legal, valid and binding obligations of Aladdin Gaming enforceable in accordance with their respective terms, except as such enforceability may be limited by applicable bankruptcy, insolvency or similar laws affecting the enforcement of creditors rights generally and by general principles of equity. Section 4.5. LIMITATION. Except as expressly provided hereby, all of the representations, warranties, terms, covenants and conditions of the Agreement and each other Operative Document shall remain unamended and unwaived and shall continue to be, and shall remain, in full force and effect in accordance with their respective terms. The amendments, modifications and consents set forth herein shall be limited precisely as provided for herein, and shall not be deemed to be a waiver of, amendment of, consent to or modification of any other term or provision of the Agreements, any Operative Document, or other Instrument referred to therein or herein, or of any transaction or further or future action on the part of Aladdin Gaming or any other Person which would require the consent of the Financing Parties, the Administrative Agent, the Lenders, GECC or the Discount Note Indenture Trustee. Section 4.6. OFFSETS AND DEFENSES. Aladdin Gaming has no offsets or defenses to its obligations under the Operative Documents or the documents evidencing and securing the FF&E Financing and no claims or counterclaims against any of the Financing Parties, the Administrative Agent, the Lenders or the Construction Consultant. Section 4.7. RELEASE BY ALADDIN GAMING. (a) As an inducement to GE Capital and GMAC CMC to enter into this Agreement, Aladdin Gaming hereby releases and discharges the Financing Parties and their respective successors and assigns, and all officers, directors, employees, agents, representatives, insurers and attorneys of each of them from all actions, counterclaims, causes of action, suits, debts, dues, sums of money, accounts, reckonings, bonds, bills, specialties, covenants, contracts, controversies, agreements, promises, variances, trespasses, damages, judgments, executions, claims and demands whatsoever, in law, admiralty or equity, which against the Financing Parties and/or their successors and assigns Aladdin Gaming ever had, now has or hereafter can, shall or may have, for, upon, or by reason of any matter, cause or thing whatsoever from the beginning of the world to the day of the date of this Release (the "Released Claims"). (b) In order to induce the Financing Parties to accept the release set forth herein, Aladdin Gaming represents that: (i) such release constitutes a legal, valid and binding obligation of Aladdin Gaming, enforceable against it in accordance with its terms. The execution and delivery of, and the performance and compliance by Aladdin Gaming with such release will not conflict with, or constitute on the part of Aladdin Gaming a violation or breach of, or a default under, and will not require any authorization, consent, approval or other action by, or any notice to, or filing with any court or administrative body or any Person pursuant to, any mortgage, deed of trust, loan agreement, trust agreement or other agreement or instrument to which Aladdin Gaming or any of its property is subject or any laws and other governmental requirements; and (ii) Aladdin Gaming (A) has not sold, transferred, conveyed, abandoned or otherwise disposed of any of the Released Claims, whether or not known, suspected or claimed that Aladdin Gaming has, had or may have, against the Financing Parties and/or any their successors, predecessors (including, without limitation, all predecessors by virtue of merger) and assigns, as the case may be, and (B) has sought the advice of counsel with respect to the execution and 4 delivery of this Amendment and Aladdin Gaming understands the legal implications with respect to the release set forth herein and the other documents executed by Aladdin Gaming in connection herewith. (c) Aladdin Gaming hereby acknowledges that it may hereafter discover facts in addition to or different from those which it now knows or believes to be true with respect to the subject matter of the release set forth herein, but that it is Aladdin Gaming's intention to, and it does, hereby fully, finally and forever settle the Released Claims; in furtherance of such intention, Aladdin Gaming acknowledges that the release set forth herein shall be and remain in effect as a full and complete release, notwithstanding the subsequent discovery or existence of any such additional or different facts. SECTION 5. MISCELLANEOUS. Section 5.1. RATIFICATION OF AND REFERENCES TO THE AGREEMENT. This Amendment shall be deemed to be an amendment to the Agreements, and the Agreements, as amended by this Amendment, shall continue in full force and effect and are hereby ratified, approved and confirmed in each and every respect. All references to the Agreements in any other document, instrument, agreement or writing shall hereafter be deemed to refer to the Agreements, as amended by this Amendment. Section 5.2. HEADINGS. The various headings of this Amendment are inserted for convenience only and shall not affect the meaning or interpretation of this Amendment or any provisions hereof. Section 5.3. APPLICABLE LAW. THIS AMENDMENT AND THE RIGHTS AND OBLIGATIONS OF THE PARTIES HEREUNDER SHALL BE GOVERNED BY, AND CONSTRUED AND ENFORCED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK, APPLICABLE TO CONTRACTS MADE AND PERFORMED IN SUCH STATE. Section 5.4. CROSS-REFERENCES. References in this Amendment to any Section are, unless otherwise specified, to such Section of this Amendment. Section 5.5. OPERATIVE DOCUMENT. This Amendment is an Operative Document executed pursuant to the Facilities Agreement and shall (unless otherwise expressly indicated therein) be construed, administered and applied in accordance with the terms and provisions of the Facilities Agreement. Section 5.6. SUCCESSORS AND ASSIGNS. This Amendment shall be binding upon and inure to the benefit of the parties hereto and their respective successors and assigns. Section 5.7. COUNTERPARTS. This Amendment may be executed by the parties hereto in any number of counterparts and on separate counterparts, each of which shall be an original but all of which together shall constitute one and the same instrument. Section 5.8. RESERVATION OF RIGHTS. Aladdin Gaming agrees that neither this Amendment nor the making of any Funding and GE Capital and GMAC CMC's consent thereto either before or after the date hereof shall constitute (w) an approval of all or any portion of any request for Funding, (x) a waiver or forbearance by GE Capital and GMAC CMC under any of the Operative Documents, (y) the acceptance by GE Capital and GMAC CMC of any course of conduct by Aladdin Gaming, the Completion Guarantors or any other Person, or (z) an agreement by GE Capital and GMAC CMC to amend any of the Operative Documents or waive any of the provisions thereof without a corresponding amendment of the Senior Credit Agreement or waiver from the Administrative Agent on behalf of the Lenders, as the case may be. Aladdin Gaming further agrees that GE Capital and GMAC CMC reserve all rights, remedies and options under the Operative Documents to require Aladdin Gaming to satisfy in all respects the conditions relating to each Funding and perform all of its obligations under the Operative Documents which are then due and owing or are susceptible of performance, as the case may be. 5 Section 5.9. SCHEDULES. Annexed to this Amendment are the following: Schedule A Specified Property and the Gaming Equipment to be Funded by the Financing Parties Schedule B Certificates of Occupancy for Zones Schedule C Schedule of Contracts and Continuation Agreements IN WITNESS WHEREOF, this Agreement of Amendment No. 3 has been duly executed as of the date first above written. ALADDIN GAMING, LLC GENERAL ELECTRIC CAPITAL CORPORATION, FOR ITSELF AND AS AGENT FOR CERTAIN PARTICIPANTS By: /s/ THOMAS A. LETTERO By: /s/ TIMOTHY S. SHANAHAN ------------------------------- ------------------------------ Name: Thomas A. Lettero Name: Timothy S. Shanahan Title: Senior Vice President Title: Vice President and Chief Financial Officer GMAC COMMERCIAL MORTGAGE CORPORATION By: /s/ JOHN S. WRIGHT ------------------------------ Name: John S. Wright Title: Senior Vice President PURSUANT TO SECTION 5.1(c) OF THAT CERTAIN INTERCREDITOR AGREEMENT DATED AS OF JUNE 30, 1998, BY AND AMONG THE BANK OF NOVA SCOTIA, AS ADMINISTRATIVE AGENT, GENERAL ELECTRIC CAPITAL CORPORATION, FOR ITSELF AND AS AGENT FOR CERTAIN PARTICIPANTS, AND ALADDIN GAMING, LLC, THE UNDERSIGNED CONSENTS TO THE EXECUTION OF THE FOREGOING AMENDMENT BY ALADDIN GAMING, LLC. THE BANK OF NOVA SCOTIA, as Administrative Agent By: /s/ ALAN PENDERGAST ------------------------------ Name: Alan Pendergast Title: Managing Director 6 SCHEDULE A Specified Property and the Gaming Equipment to be Funded by the Financing Parties i SCHEDULE B Certificates of Occupancy for Zones ii SCHEDULE C Schedule of Contracts and Continuation Agreements (a) "Contract for Construction for a Guaranteed Maximum Price," dated February 18, 2000, between Aladdin Gaming, LLC and George M. Raymond Co. (b) "Contract for Construction for a Guaranteed Maximum Price," dated February 7, 2000, between Aladdin Gaming, LLC and Valley Crest Landscaping, Inc. (c) "Contract for Construction for a Guaranteed Maximum Price," dated January 24, 2000, between Aladdin Gaming, LLC and Korte-Bellew & Associates Construction Co. (d) "Contract Agreement," dated January 26, 2000 between Aladdin Gaming, LLC and Dynalectric Company of Nevada (e) "Contract for Construction for a Guaranteed Maximum Price," dated February 7, 2000, between Aladdin Gaming, LLC and Taylor International Corp. iii EX-10.05 6 ex-10_05.txt EXHIBIT 10.05 EXHIBIT 10.05 APN NO.: 162-21-201-006 RECORDING REQUESTED BY AND RECORDED COUNTERPARTS SHOULD BE RETURNED TO: MAYER, BROWN & PLATT 1675 Broadway New York, New York 10019-5820 Attn: Douglas L. Wisner, Esq. FIRST AMENDMENT TO DEED OF TRUST, ASSIGNMENT OF RENTS AND LEASES, FIXTURE FILING AND SECURITY AGREEMENT made by and between ALADDIN GAMING, LLC, a Nevada limited-liability company, AS TRUSTOR, and STEWART TITLE OF NEVADA, a Nevada corporation, AS TRUSTEE, for the benefit of THE BANK OF NOVA SCOTIA, in its capacity as Administrative Agent, AS BENEFICIARY ****************************************************************************** THIS INSTRUMENT IS TO BE FILED AND INDEXED IN THE REAL ESTATE RECORDS AND IS ALSO TO BE INDEXED IN THE INDEX OF FINANCING STATEMENTS OF CLARK COUNTY, NEVADA UNDER THE NAME OF ALADDIN GAMING, LLC AS DEBTOR AND THE BANK OF NOVA SCOTIA, AS ADMINISTRATIVE AGENT, AS SECURED PARTY. THIS INSTRUMENT IS A CONSTRUCTION MORTGAGE AS THAT TERM IS DEFINED IN SECTION 104.9313(1)(C) OF THE NEVADA REVISED STATUTES AND SECURES AN OBLIGATION INCURRED FOR THE CONSTRUCTION OF AN IMPROVEMENT UPON LAND. 1 FIRST AMENDMENT TO DEED OF TRUST, ASSIGNMENT OF RENTS AND LEASES, FIXTURE FILING AND SECURITY AGREEMENT THIS FIRST AMENDMENT TO DEED OF TRUST, ASSIGNMENT OF RENTS AND LEASES, FIXTURE FILING AND SECURITY AGREEMENT, dated as of July ___, 2000 (this "Amendment"), is made by and between ALADDIN GAMING, LLC, a Nevada limited-liability company (Aladdin Gaming, LLC, together with all successors and assigns of the Trust Estate (as hereinafter defined), ("Trustor") whose address is 831 Pilot Road, Las Vegas, Nevada 89119, Attention: Jack Sommer, and STEWART TITLE OF NEVADA, a Nevada corporation, whose address is 3800 Howard Hughes Parkway, Suite 500, Las Vegas, Nevada 89109, Attention: Linda J. Jones, as Trustee ("Trustee"), for the benefit of THE BANK OF NOVA SCOTIA, a Canadian chartered bank ("Beneficiary"), whose address is: 580 California Street, 21st Floor, San Francisco, California 94104, Attention: Alan Pendergast, in its capacity as Administrative Agent. W I T N E S S E T H: WHEREAS, the Trustor is on the date of delivery hereof the owner of a fee simple interest in the parcel of land described in EXHIBIT A attached hereto (the "Land"); WHEREAS, the Borrower, the Lenders, the Administrative Agent, the Syndication Agent and the Documentation Agent have heretofore entered into (w) that certain Credit Agreement (the "CA") dated as of February 26, 1998, (x) that certain First Amendment to Credit Agreement (the "First Amendment to Credit Agreement") dated as of January 29, 1999, (y) that certain Second Amendment to Credit Agreement (the "Second Amendment to Credit Agreement") dated as of April 5, 1999, effective as of March 10, 1999 and (z) that certain Third Amendment to Credit Agreement (the "Third Amendment to Credit Agreement") dated as of June 2, 2000; WHEREAS, the Trustor executed and delivered to the Beneficiary a Deed of Trust, Assignment of Rents and Leases, Fixture Filing and Security Agreement dated as of February 26, 1998 (the "Original Deed of Trust;" the Original Deed of Trust as amended by this Amendment and as hereafter amended is hereinafter sometimes referred to as the "Deed of Trust"), which Original Deed of Trust was recorded with the Clark County Recorder in Book No. 98030 of official records as document number 00006; WHEREAS, the Borrower has requested, and the Lenders have approved the execution and delivery of the Fourth Amendment to Credit Agreement dated as of July __, 2000 (the "Fourth Amendment to Credit Agreement"), which Fourth Amendment to Credit Agreement, among other things, increases the maximum principal amount of the Credit Extensions from Four Hundred Ten Million Dollars ($410,000,000.00) to Four Hundred Fifty-Three Million Seven Hundred Fifty Thousand Dollars ($453,750,000.00) (the Credit Agreement, as amended by the 2 First Amendment to Credit Agreement, the Second Amendment to Credit Agreement and the Third Amendment to Credit Agreement shall be referred to herein as the "Credit Agreement"); and WHEREAS, (i) as a material inducement for the Lenders to enter into the Fourth Amendment to Credit Agreement (ii) to secure the payment and performance of the Trustor's obligations under the Credit Agreement and the other Loan Documents, and (iii) to secure the payment and performance of the Obligations, Trustor has agreed to enter into this Amendment with Trustee. NOW, THEREFORE, in consideration of good and valuable consideration given by the Trustor to the Beneficiary, the receipt and sufficiency of which are hereby acknowledged, the Trustor and the Beneficiary agree as follows: 1. Capitalized terms used herein and not otherwise defined shall have the meanings ascribed to such terms in the Original Deed of Trust. 2. Clause (1) of the Granting Clause is amended by deleting Four Hundred Ten Million Dollars ($410,000,000) and substituting in place thereof Four Hundred Fifty-Three Million Seven Hundred Fifty Thousand Dollars ($453,750,000.00) or so much thereof as may be advanced by the Lenders pursuant to the Loan Documents. 3. Granting clause (B) on page 6 of the Deed of Trust shall be amended to include the parenthetical clause (other than the Specified Equipment and the Gaming Equipment) after the word "Improvements" in the second line thereof. 4. Granting clause (D) on page 6 of the Deed of Trust shall be amended to include the parenthetical clause (other than the Specified Equipment and the Gaming Equipment) after the word "Collateral" in the second line thereof. 5. All references in the Deed of Trust and the other Loan Documents to the Credit Agreement shall mean and refer to the Credit Agreement between Trustor and Beneficiary dated as of February 26,1998, as amended by the First Amendment to Credit Agreement dated as of January 29, 1999, as further amended by the Second Amendment to Credit Agreement dated as of April 5, 1999, effective as of March 10, 1999, as further amended by the Third Amendment to Credit Agreement dated as June 2, 2000, as further amended by the Fourth Amendment to Credit Agreement dated as of July __, 2000 and as further amended, restated, supplemented, modified or amended and restated from time to time. All references in the Credit Agreement to the Deed of Trust shall mean and refer to the Original Deed of Trust as amended by this Amendment, as the same may be further amended, restated, supplemented, modified or amended and restated from time to time. 3 6. The Land described in EXHIBIT A hereto shall remain subject to the lien, charge and encumbrance of the Deed of Trust, as hereby amended and increased, and nothing herein contained or done pursuant hereto shall affect or be construed to affect the liens, charges or encumbrances of the Deed of Trust, or the priority thereof over other liens, charges or encumbrances, or to release or affect the liability of any party or parties who may now or hereafter be liable under or on account of the Note and/or the Deed of Trust. 7. This Amendment shall be binding upon and inure to the benefit of the parties hereto and their respective successors and assigns. 8. All notices and other communications provided to any of the parties hereto shall be in writing and addressed or transmitted to such party as set forth in the Credit Agreement. 9. This Amendment shall also be construed under and governed by the laws of the State of New York; provided, however, that (i) the terms and provisions of this Deed of Trust pertaining to the priority, perfection, enforcement or realization by Beneficiary of its respective rights and remedies under this Amendment with respect to the Trust Estate shall be governed and construed and enforced in accordance-with the internal laws of the State of Nevada (the "State") without giving effect to the conflicts-of-law rules and principles of the State; (ii) Trustor agrees that to the extent deficiency judgments are available under the laws of the State after a foreclosure (judicial or nonjudicial) of the Trust Estate, or any portion thereof, or any other realization thereon by Beneficiary or any Lender under the Credit Agreement, Beneficiary or such Lender, as the case may be, shall have the right to seek such a deficiency judgment against Trustor in the State; and (iii) Trustor agrees that if Beneficiary or any Lender under the Credit Agreement obtains a deficiency judgment in another state against Trustor, then Beneficiary or such Lender, as the case may be, shall have the right to enforce such judgment in the State to the extent permitted under the laws of the State, as well as in other states. Nothing contained in this Section shall be deemed to expand the limitations set forth in Section 10.9 of the Credit Agreement. 10. Any provision of this Amendment which is prohibited or unenforceable in any jurisdiction shall as to such provision and such jurisdiction, be ineffective to the extent of such prohibition or unenforceability without invalidating the remaining provisions of this First Amendment to Deed of Trust or affecting the validity or enforceability of such provision in any other jurisdiction. 11. This Amendment may be executed by the parties hereto in several counterparts, each of which when executed and delivered shall be deemed to be an original and all of which shall constitute together but one and the same agreement. 4 12. Except as amended pursuant to the terms of this Amendment, all of the terms, provisions and conditions of the Original Deed of Trust shall remain in full force and effect and are hereby ratified and confirmed. IN WITNESS WHEREOF, Trustor has executed this Deed of Trust, Assignment of Rents and Leases and Security Agreement to be effective as of the day and year first above written. TRUSTOR: ALADDIN GAMING, LLC, a Nevada limited-liability company, as Trustor By: /s/ THOMAS A. LETTERO ---------------------------------- Name: Thomas A. Lettero Title: Senior Vice President and Chief Financial Officer TRUSTEE: STEWART TITLE OF NEVADA, a Nevada corporation, as Trustee By: /s/ LINDA JONES ---------------------------------- Name: Linda Jones Title: Executive 5 TRUSTOR NOTARIZATION STATE OF NEVADA ) ) ss: COUNTY OF CLARK ) This instrument was acknowledged before me on July 27, 2000 by Thomas A. Lettero, as of Aladdin Gaming, LLC, a Nevada limited-liability company. /s/ Anne Kazar ----------------------------- NOTARY PUBLIC 6 TRUSTEE NOTARIZATION STATE OF NEVADA ) ) ss: COUNTY OF CLARK ) This instrument was acknowledged before me on July 27, 2000 by L. J. Jones, as Executive Vice President of Stewart Title of Nevada, a Nevada corporation. /s/ Sharon Haze ----------------------------- NOTARY PUBLIC 7 EXHIBIT A DESCRIPTION OF THE LAND Please see attached legal description. 8 EX-10.06 7 ex-10_06.txt EXHIBIT 10.06 EXHIBIT 10.06 AMENDMENT OF AGREEMENTS This AMENDMENT OF AGREEMENTS (this "AMENDMENT") is effective as of the 27 day of July, 2000 by and among ALADDIN GAMING, LLC, a Nevada limited-liability company (the "BORROWER"), the various financial institutions as are or may become parties hereto (collectively, the "LENDER"), THE BANK OF NOVA SCOTIA, as administrative agent (together with any successor thereto in such capacity, the ("ADMINISTRATIVE AGENT") for the Lenders. W I T N E S S E T H: WHEREAS, the Borrower, the Lenders, the Administrative Agent, the Syndication Agent and the Documentation Agent have heretofore entered into (w) that certain Credit Agreement (the "CA") dated as of February 26, 1998, (x) that certain First Amendment to Credit Agreement (the "FIRST AMENDMENT TO CREDIT AGREEMENT") dated as of January 29, 1999, (y) that certain Second Amendment to Credit Agreement (the "SECOND AMENDMENT TO CREDIT AGREEMENT") dated as of April 5, 1999, effective as of March 10, 1999 and (z) that certain Third Amendment to Credit Agreement (the "THIRD AMENDMENT TO CREDIT AGREEMENT") dated as of June 2, 2000 (the CA, as amended by the First Amendment to Credit Agreement, the Second Amendment to Credit Agreement and the Third Amendment to Credit Agreement shall be referred to herein as the "CREDIT AGREEMENT"); WHEREAS, the Borrower has requested the Lenders to enter into the Fourth Amendment to Credit Agreement, dated as of July 27, 2000 (the "FOURTH AMENDMENT TO CREDIT AGREEMENT"), by and among Aladdin Gaming, LLC, a Nevada limited-liability company (the "BORROWER"), the various financial institutions identified on the signature pages thereof as "Lenders" (collectively, the "LENDERS"), The Bank of Nova Scotia, as administrative agent (together with any successor thereto in such capacity, the "ADMINISTRATIVE AGENT") for the Lenders and Merrill Lynch Capital Corporation, as syndication agent (together with any successor thereto in such capacity, the "SYNDICATION AGENT") for the Lenders which Fourth Amendment to Credit Agreement, among other things, increases the maximum principal amount of the Credit Extensions from Four Hundred Ten Million Dollars ($410,000,000.00) to Four Hundred Fifty-Three Million Seven Hundred Fifty Thousand Dollars ($453,750,000.00). NOW, THEREFORE, in consideration of the agreements contained herein, the parties hereto agree as follows: 1. All references in any Loan Document, including without limitation, the agreements listed on SCHEDULE A hereto, to the amount $410,000,000 in respect of the aggregate principal amount of the Bank Credit Facility to the Borrower shall hereinafter be deemed to be deleted and replaced by the amount $453,750,000. 1 2. THIS AMENDMENT OF AGREEMENTS SHALL BE GOVERNED BY, AND CONSTRUED AND INTERPRETED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK, INCLUDING SECTION 5-1401 OF THE NEW YORK GENERAL OBLIGATIONS LAW, BUT EXCLUDING ALL OTHER CHOICE OF LAW AND CONFLICTS OF LAW RULES OF SUCH STATE. 3. Unless otherwise defined herein or the context otherwise requires, terms used herein have the meanings provided in the Fourth Amendment to Credit Agreement. 4. This Amendment of Agreements is a Loan Document executed pursuant to the Credit Agreement and shall (unless otherwise expressly indicated therein) be construed, administered and applied in accordance with the terms and provisions of the Credit Agreement. 5. This Amendment of Agreements shall be binding upon and inure to the benefit of the parties hereto and their respective successors and assigns. 6. This Amendment of Agreements may be executed by the parties hereto in any number of counterparts and on separate counterparts, each of which shall be an original but all of which together shall constitute one and the same instrument. IN WITNESS WHEREOF, the parties hereto have executed this Amendment of Agreements as of the day and year first above written. ALADDIN GAMING, LLC By: THOMAS A. LETTERO ----------------------------- Name: Thomas A. Lettero Title: Senior Vice President and Chief Financial Officer THE BANK OF NOVA SCOTIA, as the Administrative Agent By: ----------------------------- Name: Title: 2 SCHEDULE A
1. Assignment of Design/Build Contract 2. Assignment of Salle Privee Agreement 3. Assignment of Consulting Agreement 4. Assignment of Project Management Agreement 5. Borrower Collateral Account Agreement 6. Holdings Collateral Account Agreement 7. Servicing and Collateral Account Agreement 8. Scotiabank Collateral Account Agreement
3 EX-10.07 8 ex-10_07.txt EXHIBIT 10.07 EXHIBIT 10.07 AMENDMENT NO. 1 TO THE EMPLOYMENT AGREEMENT OF WILLIAM TIMMINS This Amendment No. 1 to the Employment Agreement, dated as of May 26, 2000, effective as of January 1, 2000, ("Amendment") is made between Aladdin Gaming, LLC ("Company"), Aladdin Gaming Holdings, LLC ("Gaming Holdings") and William Timmins ("Executive"). WHEREAS, the Company, Gaming Holdings and Executive entered into an Employment Agreement effective as of February 25, 2000 ("Employment Agreement"). WHEREAS, the Company, Gaming Holdings and Executive desire to clarify certain matters contained in the Employment Agreement. NOW, THEREFORE, in consideration of the foregoing and the following mutual covenants and agreements, the parties agree as follows: 1. AMENDMENTS. Pursuant to Section 9(c) of the Employment Agreement, the Employment Agreement is hereby amended as follows: A. Section 2(a) of the Agreement is amended as follows: The sentence which read: "The term of Executive's employment under this Agreement ("Term") shall commence on January 26, 2000 ("Commencement Date") and shall continue to and including January 25, 2003, unless earlier terminated as provided in this Agreement. (The date of any termination of this Agreement as provided herein is the "Termination Date")." is deleted in its entirety and hereby replaced with the following: "The term of Executive's employment under this Agreement ("Term") shall commence on January 1, 2000 ("Commencement Date") and shall continue to and including January 1, 2003, unless earlier terminated as provided in this Agreement. (The date of any termination of this Agreement as provided herein is the "Termination Date")." 1 B. Section 2(b) of the Agreement is amended as follows: The sentence which reads: "Notwithstanding Section 2(a), Executive shall have the right, but not the obligation, to terminate this Agreement on January 26, 2002, and thirty (30) days after such date his right to terminate the Agreement pursuant to this section shall expire." is hereby deleted in its entirety and replaced with the following: "Notwithstanding Section 2(a), Executive shall have the right, but not the obligation, to terminate this Agreement on January 1, 2002, and thirty (30) days after such date his right to terminate the Agreement pursuant to this section shall expire." C. Section 4(a) of the Agreement is amended as follows: The initial Base Salary of Two Hundred Fifty-two Thousand ($252,000) is hereby deleted in its entirety and hereby the initial Base Salary shall be Three Hundred Seventy-two Thousand Dollars ($372,000). D. Section 4(a) of the Amendment is further amended as follows: The sentence which reads: "On January 26, 2001, and each year thereafter, the Board of Directors will consider an increase in the Base Salary based upon criteria determined by the Board of Directors and applicable to other members of the executive management group" is deleted in its entirety and hereby replaced with the following sentence: "On January 1, 2001, and each year thereafter, the Board of Directors will consider an increase in the Base Salary based upon criteria determined by the Board of Directors and applicable to other members of the executive management group." Provided further, that any other dates in the Agreement which were based upon the original start date shall be hereby amended to so provide that such date shall be based upon January 1, 2000. 2. GAMING LAW. Notwithstanding anything to the contrary contained herein or in the Employment Agreement, the parties hereto agree and acknowledge that they are subject to and that they shall comply in all respects with the gaming laws of the state of Nevada, including the Nevada Gaming Control Act (or any successor statute) and the 2 rules and regulations promulgated by the Nevada Gaming Commission and the State Gaming Control Board. To the extent anything in this Amendment or the Employment Agreement is inconsistent with any gaming laws or regulations, the gaming laws and regulations shall control. 3. ASSIGNMENT. This Agreement shall be binding upon and inure to the benefit of any successor of the Company or Gaming Holdings. Any such successor of the Company or Gaming Holdings shall be deemed substituted for the Company or Gaming Holdings under the terms of this Agreement for all purposes. As used herein, "successor" shall include any person, firm, corporation or other business entity which at any time, whether by purchase, merger or otherwise, directly or indirectly acquires all or substantially all of the assets or business of the Company or Gaming Holdings and supercedes any prior understanding or agreements between the parties hereto. 4. ENTIRE AGREEMENT. This Amendment and the Employment Agreement represent the entire agreement and understanding between the Company, Gaming Holdings and Executive concerning the matters herein. 5. REMAINING AGREEMENT EFFECTIVE. Any provision of the Employment Agreement not amended by this Amendment shall remain in full force and effect. 6. NO ORAL MODIFICATION, CANCELLATION OR DISCHARGE. This Amendment may only be amended, canceled or discharged in writing signed by the Executive, Gaming Holdings and the Company. 7. GOVERNING LAW. This Amendment shall be governed by the laws of the state of Nevada. 8. CAPITALIZED TERMS. Capitalized terms not defined herein shall have the meanings as ascribed thereto in the Employment Agreement. 9. COUNTERPARTS. This Amendment may be executed in any number of counterparts, each of which shall be considered an original, but all of which shall together constitute one and the same contract. [The remainder of this page intentionally left blank.] 3 IN WITNESS WHEREOF, the undersigned have executed this Amendment as of the date first above-written. ALADDIN GAMING, LLC By: /s/ RICHARD J. GOEGLEIN ------------------------------- Richard J. Goeglein President and Chief Executive Officer ALADDIN GAMING HOLDINGS, LLC By: /s/ RICHARD J. GOEGLEIN -------------------------------- Richard J. Goeglein President and Chief Executive Officer EXECUTIVE /s/ WILLIAM TIMMINS -------------------------------- Name: William Timmins Title: Executive Vice President 4 EX-10.08 9 ex-10_08.txt EXHIBIT 10.08 EXHIBIT 10.08 EMPLOYMENT AGREEMENT This Employment Agreement ("Agreement") is made and entered into this 27th day of July 2000, by and between Aladdin Gaming, LLC ("Company"), Aladdin Gaming Holdings, LLC ("Gaming Holdings") and Patricia Becker ("Executive"). WHEREAS, the Company considers it important and in its best interest and the best interest of its owners to foster the employment of key management personnel and desires to retain the services of Executive on the terms and subject to the conditions of this Agreement; WHEREAS, the Executive desires to continue employment with the Company and to render services to the Company on the terms and subject to the conditions of this Agreement. NOW, THEREFORE, in consideration of the foregoing and the following mutual covenants and agreements, the parties agree as follows: 1. EMPLOYMENT. a. The Company hereby employs Executive as Senior Vice President, Corporate Affairs and Legal, and Secretary of Gaming Holdings and the Company. Executive shall serve as a member on the Company's Executive Committee. Executive hereby accepts such employment and positions for the compensation and subject to the terms and conditions in this Agreement. 2. TERM. The term of the Executive's employment under this Agreement ("Term") shall commence on February 1, 2000 ("Commencement Date") and shall continue for three (3) years unless earlier terminated as provided in this Agreement. (The date of any termination of this Agreement as provided herein is the "Termination Date.") 3. DUTIES AND RESPONSIBILITIES. During the Term, Executive will serve as Senior Vice President, Corporate Affairs and Legal, and Secretary of Gaming Holdings and the Company. Executive shall serve as a member on the Company's Executive Committee and report to the CEO. Executive will have such authority, responsibilities and duties as are customarily associated with this position. At all times Executive shall faithfully and to the best of her abilities perform her duties and responsibilities hereunder to the reasonable satisfaction of the Board of Directors. In addition, Executive shall devote 60% of her full time, efforts and attention to the business and affairs of the Company, use her best efforts to further the interest of the Company and at all times conduct herself in a manner which reflects credit upon the Company. 4. COMPENSATION. a. SALARY. For her services hereunder, the Company shall pay Executive a base salary of One Hundred Sixty-two Thousand Two Hundred Forty Dollars ($162,240) prior to the opening for operation of the Aladdin Resort & Casino. Upon the opening for operation 1 of the Aladdin Resort & Casino, the Company will pay the Executive a base salary equal to the 75th percentile of the industry rate, but not less than $215,000. ("Base Salary") for each consecutive 12-month period during the Term. (Each such consecutive 12-month period is an "Employment Year"). Executive's Base Salary will be prorated for any partial Employment Year. On February 1, 2001 and each year thereafter, the Board of Directors will consider an increase in the Base Salary based upon criteria determined by the Board of Directors and applicable to other members of the executive management group. Any such increases, however, shall be in the sole discretion of the Board of Directors. There shall be no reduction in Base Salary during the Term. The Base Salary shall be payable in equal periodic installments subject to customary deductions for social security, other taxes and amounts customarily withheld from salaries of employees of the Company, all in accordance with the Company's usual and customary payroll practices. b. CONSULTING FEE. (i) During the Term of this Agreement, company shall pay to Patricia Becker & Associates an annual retainer of $40,000. The first payment will be made upon execution of this Agreement and thereafter, on February 1 of each year. (ii) Upon Termination of this Agreement, except Termination by the Company for Cause, for three years, Company shall employ executive as a member or Chairman of its Compliance committee at an annual retainer of $50,000. During this period any unvested long-term compensation awards will continue to vest; and, Executive has the option to postpone exercise of the claw back provisions on any Equity Interest. c. ANNUAL BONUS. From and after the date the Company opens and begins operating the Aladdin Resort & Casino ("Operational Date"). Executive is eligible to receive from the Company an annual cash bonus. The Board of Directors will determine such criteria and standards in a bonus plan, which will be competitive with industry standards and applicable to other members of the executive management group. Executive's bonus will be prorated accordingly if the Aladdin Resort & Casino is only open and operating during a portion of the bonus year. Executive is eligible to participate in the opening bonus for the Aladdin Resort & Casino established by the Board of Directors provided Executive meets all the criteria for such bonus. d. BENEFITS. During the Term, Executive shall be entitled to receive from the Company such health, pension, retirement and other employee benefits as the Company provides to other members of the executive management group. During the Term, the Company, at its expense, will provide Executive with term life insurance in the amount of Executive's annual Base Salary. During the Term, the Company, at its expense, will provide Executive with long-term disability coverage under a group long-term disability plan the Company provides other members of the executive management group. e. VACATION. Executive shall be entitled to two (2) weeks paid vacation for each Employment Year, prorated for any partial Employment Year. The Board of Directors in 2 its discretion may increase Executive's vacation entitlement. The timing and duration of specific vacations will take into account the business needs of the Company and will be mutually agreed to by the parties. In the event any such vacation is not used by Executive in any Employment Year, the Executive has a right to accumulate and carry forward such number of unused vacation days from year to year as may be consistent with the Company's policy for other members of the executive management group. Upon termination of employment, all unused vacation time shall be paid to Executive. f. REIMBURSEMENT OF EXPENSES. The Company shall pay all reasonable expenses incurred by Executive in the performance of her duties and responsibilities for the Company. Executive shall submit to the Company statements and documentation reflecting such expenses incurred, with such detail, backup and confirmation as the Company may reasonably require. Subject to any audit Company deems necessary, the Company shall promptly reimburse Executive the full amount of any such expenses incurred by Executive. g. EQUITY INTEREST. Executive will receive a restricted membership interest of 0.45%, or the economic equivalent thereof, in Gaming Holdings which Gaming Holdings is currently evaluating which may include, but not be limited to, a "profits only interest," "option," or "phantom stock" (collectively, "Equity"). Such Equity will be fully vested no later than February 1, 2002. Such Equity arrangement shall include the right to receive 0.45% of the distributions that are made to the holders of Gaming Holdings Common Membership Interests. When Gaming Holdings finalizes the Equity arrangement, the parties will amend this Agreement so that the Executive shall participate in such program substantially in the form previously presented to the Executive. If Gaming Holdings does not create an Equity arrangement by the Operational Date, the parties will negotiate in good faith to establish a compensation arrangement in lieu of an Equity arrangement, which would have the same economic benefit to the Executive. The profits only interest shall not have a company valuation basis greater than 200 million dollars. h. AUTO ALLOWANCE. During the Term, the Company shall pay Executive an auto allowance of Five Hundred Dollars ($500) per month. 5. TERMINATION. This Agreement shall terminate in accordance with the following provisions: a. EXPIRATION OF THE TERM. Unless earlier terminated in accordance with the provisions hereof, this Agreement shall terminate on expiration of the term as provided in Section 2. b. DEATH. If the Executive dies during the Term, this Agreement shall terminate, with the Termination Date being the date of the Executive's Death. c. DISABILITY. If the Executive has been absent from service to the Company as required in this Agreement for a period of ninety (90) days or more during any one hundred eighty (180) day period during the Term as a result of any physical or mental disability, the 3 Company has the right to terminate this Agreement, the Termination Date being ten (10) days after notice thereof is given to Executive. d. TERMINATION BY COMPANY FOR CAUSE. The Company has the right to terminate this Agreement for Cause as defined herein, the Termination Date being the date upon which the Company delivers notice thereof to the Executive. For purposes of this Agreement, Cause shall mean Executive's: (1) conviction of any felony; (2) embezzlement or misappropriation of money or property of the Company; (3) denial, rejection, suspension or revocation of any gaming license or permit; (4) Executive's material breach of section 6 hereof which material breach has an adverse impact on the Company; and (5) Executive quits her employment with the Company without Good Reason. Good Reason is defined as: (i) the assignment to Executive of duties materially inconsistent with her position and title without her consent; or (ii) a material reduction in Executive's duties, authorities and responsibilities without her consent; or (iii) a reduction by the Company in Executive's Base Salary, in effect immediately prior to such reduction, without her consent, provided Executive gives the Company written notice specifying such assignment or reduction and the Company has not cured or abated such assignment or reduction within twenty (20) days thereafter; or (iv) the Operational Date has not occurred within 365 calendar days from the Effective Date; or (v) Executive quits employment after February 1, 2002. e. TERMINATION BY COMPANY WITHOUT CAUSE OR TERMINATION BY EXECUTIVE WITH GOOD REASON OR UPON A CHANGE OF CONTROL. Subject to the provisions of Section 8(e), (i) the Company has the right to terminate this Agreement without Cause, (ii) the Executive has the right to terminate this Agreement for Good Reason and (iii) the Executive has the right to terminate this Agreement upon a Change of Control by giving the other party written notice thereof. In each case above, the Termination Date being the date upon which notice of termination is delivered by the terminating party to the other party. For purposes of this Agreement, a Change of Control shall be deemed to occur only if collectively the Sommer Family Trust and London Clubs International, plc, through their affiliates, own less than fifty percent (50%) of the membership interests of either Gaming Holdings or the Company. 6. EXECUTIVE'S COVENANTS. The Executive acknowledges that the Company and Gaming Holdings have substantial, legitimate and continuing interest in the protection of their business relationships with others including, without limitation, current and prospective employees, consultants, advisors, customers, vendors, suppliers, partners or joint venturers and financing sources, and in the protection of their Confidential Information and have invested substantial sums, time and effort and will continue to invest substantial sums, time and effort to develop, maintain and protect such relationships and Confidential Information. Accordingly, Executive covenants and agrees as follows: a. CONFIDENTIALLY. During the Term and thereafter, Executive shall keep secret and retain in strictest confidence and shall not, without the prior written consent of the Company or Gaming Holdings, furnish, make available or disclose to any third party or use for the benefit of himself or any third party any Confidential Information. Confidential Information is information related to or concerning Gaming Holdings, the Company and 4 their businesses which is confidential, proprietary or not generally known to and cannot be readily ascertained through proper means by persons or entities (including Gaming Holdings' and the Company's present or future competitors), who can obtain any type of value from its disclosure or use. Confidential Information includes all secret, confidential or proprietary information, knowledge or data specifically relating to Gaming Holdings and the Company, such as, without limitation, finances and financing methods, sources, proposals or plans; operational methods; marketing or development proposals, plans or strategies; pricing strategies; business or property acquisition or development proposals or plans; new personnel acquisition proposals or plans; customer lists and any descriptions or data concerning current or prospective customers. While employed by the Company and in furtherance of the business and for the benefit of Gaming Holdings and the Company, Executive may provide Confidential Information as appropriate to attorneys, accountants, financial institutions, and other persons or entities engaged in business with the Company and to Executive's personal attorney and/or accountant to the extent necessary to advise Executive; provided, however, such individual(s) will be similarly bound to maintain the confidentiality of the information disclosed. b. NON-COMPETITION. 1) The Company acknowledges and agrees that the Executive, as a member of the State Bar of Nevada, is subject to the Nevada Supreme Court Rules ("Supreme Court Rules"). The Supreme Court Rules impose upon Executive various restrictions including, among other things, confidentiality of information and conflicts of interest arising from Executive's employment with the Company. The Company and Executive agree that the Supreme Court Rules provide adequate and sufficient protections to the Company and its interests if Executives employment ceases with the Company and Executive is employed by another company. Company acknowledges that it is aware of Executives employment with other companies in her capacity as a consultant on compliance matters and as a member of Boards. 2) Notwithstanding anything to the contrary contained herein, Executive shall not be subject to the non-competition provisions of this Agreement, if this Agreement is terminated other than pursuant to the provisions of Section 5(d). c. EMPLOYEES OF THE COMPANY. For one (1) year following the Termination Date, Executive shall not, directly or indirectly, solicit, or cause others to solicit, for employment by any person or entity other than the Company, any employee of the Company or encourage any such employee to leave the employment of the Company. d. PROPERTY OF THE COMPANY. Executive acknowledges and agrees that all memoranda, notes, lists, records and other documents or papers, including copies thereof, containing or reflecting Confidential Information (whether or not such items are kept or stored in computer memories, microfiche, hard copy or any other manner) made or compiled by Executive or made available to Executive are and remain the property of the Company ("Company Property") and shall be delivered to the Company promptly upon any termination of this Agreement. Under Section 5 hereof, Executive shall retain no copies of Company Property following the Termination Date. 6 e. REASONABLENESS AND SEVERABILITY OF COVENANTS. The Executive acknowledges and agrees that the Executive's covenants herein are necessary for the protection of the Company's legitimate interests, are reasonable and valid in duration and geographical scope, and in all other respects. If any court determines that any of the Executive covenants or any part thereof, invalid or unenforceable, the remainder of the restrictive covenants shall not thereby be affected and shall be given full effect without regard to the invalid portions. f. BLUE-PENCILLING. If any court determines that any of the Executive's covenants, or any part thereof, is unenforceable because of the duration or geographical scope of such provision, such court shall have the power to reduce the duration or scope of such provision, as the case may be, and, in its reduced form, such provision shall then be enforceable. 7. NON-DISPARAGEMENT. Each of the parties agrees that after the Termination Date, neither shall, publicly or privately, disparage or make any statements (written or oral) that could impugn the integrity, acumen (business or otherwise), ethics or business practices of the other, except in each case, to the extent (but solely to the extent) necessary: (i) in any judicial or arbitral action to enforce the provisions of this Agreement; or (ii) in connection with any judicial or administrative proceeding to the extent required by applicable law. 8. EFFECT OF TERMINATION. The following provisions shall apply in the event of the termination of this Agreement as provided in Section 5 above, and neither party shall have any further liability or obligation to the other, except as provided herein: a. EXPIRATION OF TERM. Upon expiration of the term under Section 5(a) hereof, this agreement shall terminate and be of no further force and effect, except as provided in Sections 4(b)(ii), 6(a), 6(c), 6(d), 6(e), 6(f) and 7; provided that, the Executive shall be entitled to such salary, bonus and benefits then accrued or vested to the Termination Date, and any expense reimbursement amounts accrued to the Termination Date; b. DEATH. Upon termination of this Agreement as provided in Section 5(b) hereof, this Agreement shall terminate and be of no further force and effect; provided, further, that the Company shall pay to Executive's estate any salary, bonus and benefits then accrued or vested to the Termination Date, and any expense reimbursement amounts accrued to the Termination Date; c. DISABILITY. Upon termination of this Agreement as provided in Section 5(c) hereof, this Agreement shall terminate and be of no further force and effect, except as provided in Sections 6(a), 6(c), 6(d), 6(e), 6(f) and 7; provided that Executive shall be entitled to such salary, bonus and benefits then accrued or vested to the Termination Date, and any expense reimbursement amounts accrued to the Termination Date; d. TERMINATION PURSUANT TO SECTION 5(D). Upon termination of this Agreement as provided in Section 5(d) hereof, this Agreement shall terminate and be of no further force 7 and effect, except as provided in Sections 6 and 7; provided that Executive shall be entitled to such salary, bonus and benefits then accrued or vested to the Termination Date, and any expense reimbursement amounts accrued to the Termination Date; e. TERMINATION PURSUANT TO SECTION 5(e). Upon termination of this Agreement as provided in Section 5(e) hereof, this Agreement shall terminate and be of no further force and effect, except as provided in Sections 4(b)(ii), 6(a), 6(c), 6(d), 6(e), 6(f) and 7; provided, further, that Executive shall be entitled to such salary, bonus and benefits including but not limited to health benefits and expense reimbursements to which Executive would have been entitled for the remainder of the Term or twelve (12) months, whichever is longer, as if there had been no earlier termination. 9. GENERAL PROVISIONS. a. ASSIGNMENT. Neither this Agreement nor any right or interest hereunder shall be assignable by the Executive, or the Company or Gaming Holdings without prior written consent of the other; provided, that (1) in the event of the Executive's Death during the Term, the Executive's estate and his heirs, executors, administrators, legatees and distributees shall have the rights and obligations set forth herein, as provided herein, and (2) nothing contained in this Agreement shall limit or restrict the Company's ability (A) to merge or consolidate or effect any similar transaction with any other entity, irrespective or whether the Company is the surviving entity (including a split up, spin off or similar type transaction), provided, that one or more of such surviving entities shall continue to be bound by the provisions hereof binding upon the Company, (B) to assign this Agreement in conjunction with a sale of all or substantially all of the Company's assets, or (C) an assignment of this Agreement to an affiliate controlled by or under common control with the Company. Gaming Holdings has the same rights and obligations under this Section as the Company. b. BINDING AGREEMENT. Except as otherwise provided in this Agreement, this Agreement shall be binding upon, and inure to the benefit of, the Executive, Gaming Holdings and the Company and their respective heirs, executors, administrators, legatees and distributees, successors and permitted assigns. Any such successor of the Company or Gaming Holdings shall be deemed substituted for the Company or Gaming Holdings under the terms of this Agreement for all purposes. As used herein, "successor" shall include any person, firm, corporation or other business entity which at any time, whether by purchase, merger or otherwise, directly or indirectly acquires all or substantially all or the assets or business or the Company or Gaming Holdings and supercedes any prior understandings or agreements between the parties hereto. c. AMENDMENT OF AGREEMENT. This Agreement may not be modified or amended except by an instrument in writing signed by the parties hereto. d. SEVERABILITY. If, for any reason, any provision of this Agreement is determined to be invalid or unenforceable, such invalidity or lack of enforceability shall not affect any other provision of this Agreement not so determined to be invalid or unenforceable, and 7 each such other provision shall, to the full extent consistent with applicable law, continue in full force and effect, irrespective of such invalid or unenforceable provision. Gaming Holdings has the same rights and obligations under this Section as the Company. e. ENTIRE AGREEMENT. Except for those matters detailed in Section 4(f), this Agreement represents the entire agreement and understanding between the Company, Gaming Holdings and the Executive concerning the matters herein and supercede any prior understandings or agreements between the parties. f. INDEMNIFICATION. Notwithstanding the termination of this Agreement, the Company shall indemnify and hold Executive harmless to the full extent permitted by Chapter 86 of the Nevada Revised Statutes against costs, expenses, liabilities and losses, including reasonable attorney's fees and disbursements of counsel, incurred or suffered by him in connection with his service as an employee of the company during the Term of this Agreement. g. NOTICES. For the purpose of this Agreement, notices and all other communications provided for in this Agreement shall be in writing and shall be deemed to have been duly given (1) when delivered, if sent by telecopy or by hand, (2) one business day after sending, if sent by reputable overnight courier service, such as Federal Express, or (3) three business days after being mailed, if sent by United States certified or registered mail, return receipt requested, postage prepaid. Notices shall be sent by one of the methods described above; provided, that any notice sent by telecopy shall also be sent by any other method permitted above. Notices shall be sent: If to the Executive: Patricia Becker 1800 Wincanton Drive Las Vegas, NV 89134 If to the Company Aladdin Gaming Holdings, LLC and/or Gaming Aladdin Gaming, LLC Holdings: 831 Pilot Road Las Vegas, NV 89119 Attn: Richard Goeglein With a copy to: Aladdin Gaming Holdings, LLC Aladdin Gaming, LLC 831 Pilot Road Las Vegas, Nevada 89119 Attn: General Counsel or to such other address as either party may have furnished to the other in writing in accordance herewith, except that notice of change of address shall be effective only upon receipt. h. COUNTERPARTS. This Agreement may be executed in several counterparts, each of which shall be deemed to be an original but all of which together shall constitute one and the 8 same instrument. Gaming Holdings has the same rights and obligations under this Section as the Company. i. INDULGENCES, ETC. Neither the failure nor any delay on the part of either party to exercise any right, remedy, power or privilege under this Agreement shall operate as a waiver thereof, nor shall any single or partial exercise of any right, remedy, power or privilege preclude any other or further exercise of the same or of any other right, remedy, power or privilege, nor shall any waiver of any right, remedy, power or privilege with respect to any occurrence be construed as a waiver of such right, remedy, power or privilege with respect to any other occurrence. j. BINDING ARBITRATION. Except for an action by the company for injunctive or other equitable relief, any dispute or controversy arising under or in connection to this Employment Agreement shall be resolved through binding arbitration, conducted in Las Vegas, Nevada, in accordance with the rules of the American Arbitration Association. Judgment may be entered on the arbitration award in any court of competent jurisdiction. k. HEADINGS. The headings of sections and paragraphs herein are included solely for convenience of reference and shall not control the meaning or interpretation of any of the provisions of this Agreement. Gaming Holdings has the same rights and obligations under this Section as the Company. l. NEUTRAL CONSTRUCTION. Each party to this Agreement has had the opportunity to retain counsel, and to review and participate in the drafting of this Agreement, and, accordingly, the normal rule of construction to the effect that any ambiguities are to be resolved against the drafting parties will not be employed or used in any interpretation of enforcement of this Agreement. m. GAMING LAW. Anything to the contrary herein notwithstanding, the parties hereto agree and acknowledge that they are subject to and that they shall comply in all respects with the gaming laws of the state of Nevada including the Nevada Gaming Control Act and the rules and regulations promulgated by the Nevada Gaming Commission and the Gaming Control Board. To the extent anything in this Agreement is inconsistent with any gaming laws or regulations, the gaming laws and regulations shall control. 9 n. GOVERNING LAW. This Agreement has been executed and delivered in the state of Nevada, and its validity, interpretation, performance, and enforcement shall be governed by the laws of such state, without regard to principles of conflicts of laws. ALADDIN GAMING, LLC By: /s/ RICHARD J. GOEGLEIN ------------------------------------- Richard J. Goeglein President and Chief Executive Officer ALADDIN GAMING HOLDINGS, LLC By: /s/ RICHARD J. GOEGLEIN ------------------------------------- Richard J. Goeglein President and Chief Executive Officer EXECUTIVE /s/ PATRICIA BECKER ------------------------------------- Patricia Becker 10 EX-27 10 ex-27.txt EXHIBIT 27
5 1,000 6-MOS DEC-31-2000 JAN-01-2000 JUN-30-2000 1 0 0 0 0 1 0 0 2,495 6 0 0 0 13,247 (10,758) 2,495 0 0 0 0 6,070 0 0 (6,070) 0 (6,070) 0 0 0 (6,070) (1.83) (1.83)
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