$221,500,000
PRINCIPAL AMOUNT AT MATURITY
ALADDIN GAMING HOLDINGS, LLC
ALADDIN CAPITAL CORP.
ALADDIN GAMING ENTERPRISES, INC.
ALADDIN HOLDINGS, LLC
THE TRUST UNDER ARTICLE SIXTH U/W/O XXXXXXX XXXXXX
LONDON CLUBS INTERNATIONAL, PLC
PURCHASE AGREEMENT
February 18, 1998
XXXXXXX XXXXX & CO.
Xxxxxxx Xxxxx, Xxxxxx, Xxxxxx & Xxxxx
Incorporated
Credit Suisse First Boston Corporation
as Representatives of the several Initial Purchasers
c/x Xxxxxxx Xxxxx & Co.
Xxxxxxx Lynch, Pierce, Xxxxxx & Xxxxx
Incorporated
North Tower
World Financial Center
New York, New York 10281-1209
Ladies and Gentlemen:
Aladdin Gaming Holdings, LLC, a Nevada limited-liability company
("Holdings"), Aladdin Capital Corp., a Nevada corporation and a wholly owned
subsidiary of Holdings ("Capital" and, together with Holdings, the "Issuers"),
Aladdin Gaming Enterprises, Inc., a Nevada corporation ("Enterprises" and,
together with the Issuers, the "Aladdin Parties"), Aladdin Holdings, LLC, a
Delaware limited liability company ("AHL"), the Trust under Article Sixth u/w/o
Xxxxxxx Xxxxxx (the "Trust"), and London Clubs International, plc, a public
limited company under the laws of England and Wales ("London Clubs" and,
together with the Aladdin Parties, AHL and the Trust, collectively referred to
herein as the "Venture Parties") confirm their agreement with Xxxxxxx Xxxxx &
Co., Xxxxxxx Lynch, Xxxxxx, Xxxxxx & Xxxxx Incorporated ("Xxxxxxx Xxxxx") and
each of the other Initial Purchasers named in Schedule A hereto (collectively,
the "Initial Purchasers", which term shall also include any initial purchaser
substituted as hereinafter provided in Section 13 hereof), for whom Xxxxxxx
Xxxxx and Credit Suisse First Boston Corporation are acting as representatives
(in such capacity, the "Representatives"), with respect to the issue and sale by
the Aladdin Parties and the purchase by the Initial Purchasers, acting severally
and not jointly, of the respective number of units (the "Units") set forth in
said Schedule A, consisting in the aggregate of $221,500,000 principal amount at
maturity of the Issuers' Senior Discount Notes due 2010 (the "Series A Notes")
and 2,215,000 Warrants (the "Warrants") to purchase 2,215,000 shares (the
"Warrant Shares") of Enterprises' Class B non-voting common stock, no par value
(the "Common Stock"). The Series A Notes are to be issued pursuant to an
indenture dated as of February 26, 1998 (the "Indenture"), among the Issuers and
State Street Bank and Trust Company, as trustee (the "Trustee"). The Series A
Notes and the Series B Notes (as defined below) issuable in exchange therefor
are collectively referred to herein as the "Notes." The Warrants are to be
issued pursuant to a warrant agreement dated as of February 26, 1998 (the
"Warrant Agreement"), between Enterprises, Holdings and State Street Bank and
Trust Company, as warrant agent (the "Warrant Agent"). The Notes and the
Warrants will not be separately transferable until the earliest of: (i)
September 1, 1998; (ii) the date on which a registration statement with respect
to the Series A Notes or a registration statement with respect to the Warrants
and the Warrant Shares is filed with the Securities and Exchange Commission (the
"Commission") under the Securities Act of 1933, as amended (the "1933 Act");
(iii) the occurrence of a Change of Control (as defined in the Indenture) or a
sale or recapitalization of Enterprises, Holdings or Aladdin Gaming, LLC, a
Nevada limited-liability company (the "Company") occurs; (iv) 30 days after a
Qualified Public Offering (as defined in the Indenture); (v) the occurrence of
an Event of Default (as defined in the Indenture); or (vi) such earlier date as
determined by Xxxxxxx Xxxxx in its sole discretion. The Units, the Notes, the
Warrants and the Warrant Shares are collectively referred to herein as the
"Securities." Securities issued in book-entry form will be issued to Cede & Co.
as nominee of The Depository Trust Company ("DTC") pursuant to a letter
agreement, to be dated as of the Closing Time (as defined in Section 4(b)) (the
"DTC Agreement"), among the Aladdin Parties, the Trustee, the Warrant Agent and
DTC.
The Venture Parties understand that the Initial Purchasers propose to
make an offering of the Units on the terms and in the manner set forth herein
and agree that the Initial Purchasers may resell, subject to the conditions set
forth herein, all or a portion of the Units to purchasers ("Subsequent
Purchasers") at any time after the date of this Agreement. The Units are to be
offered and sold through the Initial Purchasers without being registered under
the 1933 Act, in reliance upon exemptions therefrom. Pursuant to the terms of
the Securities, the Indenture and the Warrant Agreement, investors that acquire
any of the Securities may only resell or otherwise transfer such Securities if
such Securities are hereafter registered under the 1933 Act or if an exemption
from the registration requirements of the 1933 Act is available (including the
exemption afforded by Rule 144A ("Rule 144A") of the rules and regulations
promulgated under the 1933 Act by the Commission).
Holders (including subsequent transferees) of the Series A Notes will
have the registration rights set forth in the Note Registration Rights Agreement
(the "Note Registration Rights Agreement") to be dated as of the Closing Time
among the Issuers and the Initial Purchasers and holders (including subsequent
transferees) of the Warrants will have registration
2
rights set forth in the Warrant Registration Rights Agreement (the "Warrant
Registration Rights Agreement") to be dated as of the Closing Time among
Enterprises and the Initial Purchasers, for so long as such Notes, Warrants or
any Warrant Shares constitute "Transfer Restricted Securities" (as defined in
each such agreement, respectively). Pursuant to the Note Registration Rights
Agreement, the Issuers will agree to file with Commission, under the
circumstances set forth therein, (i) a registration statement under the 1933 Act
(the "Exchange Offer Registration Statement") relating to the Issuers' Series B
Senior Discount Notes due 2010 (the "Series B Notes"), to be offered in exchange
for the Series A Notes (such offer to exchange being referred to as the
"Exchange Offer") and (ii) a shelf registration statement pursuant to Rule 415
under the 1933 Act (the "Shelf Registration Statement" and, together with the
Exchange Offer Registration Statement, the "Notes Registration Statements")
relating to the resale by certain holders of the Series A Notes and to use their
reasonable best efforts to cause such Notes Registration Statements to be
declared and remain effective for the periods specified in the Note Registration
Rights Agreement and to consummate the Exchange Offer. Pursuant to the Warrant
Registration Rights Agreement, Enterprises will agree to use its reasonable best
efforts to file with the Commission, under the circumstances set forth therein,
a shelf registration statement pursuant to Rule 415 under the 1933 Act (the
"Warrant Shelf Registration Statement") relating to the offer and sale of the
Warrants and the Warrant Shares and the issuance of Warrant Shares upon the
exercise of Warrants that were sold pursuant to the Warrant Shelf Registration
Statement, and to use its reasonable best efforts to cause such Warrant Shelf
Registration Statement to be declared effective.
The following documents are hereinafter collectively referred to as
"Operative Documents": (i) this Agreement, (ii) the Indenture, (iii) the Warrant
Agreement, (iv) the Units, (v) the Notes, (vi) the Warrants, (vii) the Warrant
Shares, (viii) the Note Registration Rights Agreement and (ix) the Warrant
Registration Rights Agreement.
The following documents are hereinafter collectively referred to as
"Executed Transaction Documents": (i) the Company Operating Agreement (the
"Company Operating Agreement") as amended as of the Closing Time, (ii) the
London Clubs Purchase Agreement (the "London Clubs Purchase Agreement") dated
September 24, 1997 (subsequently amended on October 16, 1997, November 18, 1997
and December 1, 1997 and as otherwise amended as of the Closing Time) among
London Clubs, London Clubs Nevada, Inc. a Nevada corporation ("LCNI"), AHL,
Sommer Enterprises, LLC, a Nevada limited-liability company ("Xxxxxx
Enterprises"), the Trust and the Company, (iii) the Development Agreement (the
"Development Agreement") dated as of December 3, 1997 between the Company and
Northwind Aladdin, LLC, a Nevada limited-liability company (the "Energy
Provider") and (iv) the Design Build Contract (the "Design Build Contract")
dated as of December 4, 1997 (as subsequently amended), between the Company and
Fluor Xxxxxx, Inc., a California corporation (the "Design/Builder").
The following documents are hereinafter collectively referred to as
"Executory Transaction Documents":
3
(i) the Holdings Operating Agreement (the "Holdings Operating
Agreement") to be executed as of the Closing Time among the Xxxxxx Enterprises,
Enterprises, GAI, LLC, a Nevada limited-liability company, and LCNI,
(ii) the Equity Participation Agreement to be executed as of the
Closing Time among the Trust, London Clubs, Holdings and the Warrant Agent,
(iii) the Bank Credit Facility (the "Bank Credit Facility") to be
executed as of the Closing Time among the Company, as borrower, various
financial institutions, as lenders (the "Bank Lenders"), The Bank of Nova
Scotia, as Administrative Agent (the "Administrative Agent"), Xxxxxxx Xxxxx
Capital Corporation, as Syndication Agent, and Canadian Imperial Bank of
Commerce, as Documentation Agent,
(iv) the Noteholder Completion Guaranty (the "Noteholder Completion
Guaranty") to be executed as of the Closing Time between London Clubs, the Trust
and Aladdin Bazaar Holdings, LLC, a Nevada limited-liability company ("Bazaar
Holdings") in favor of the Trustee,
(v) the Completion Guaranty to be executed as of the Closing Time
between London Clubs, the Trust and Bazaar Holdings in favor of the
Administrative Agent and the Bank Lenders,
(vi) the Disbursement Agreement (the "Disbursement Agreement") to be
executed as of the Closing Time between Holdings, the Company, the Trustee, The
Bank of Nova Scotia as Administrative Agent under the Bank Credit Facility, The
Bank of Nova Scotia as Disbursement Agent on behalf of the Bank Lenders and the
Trustee (the "Disbursement Agent") and an investment intermediary,
(vii) the Keep-Well Agreement (the "Keep-Well Agreement") to be
executed as of the Closing Time among AHL, Bazaar Holdings and London Clubs in
favor of the Administrative Agent under the Bank Credit Facility,
(viii) the Pledge Agreement to be executed as of the Closing Time,
between Holdings and the Trustee relating to the Series A Preferred Membership
Interests of the Company (the "Preferred Membership Interests Pledge
Agreement"),
(ix) the Note Construction Pledge Agreement to be executed as of the
Closing Time, between the Company and the Trustee relating to the funds
deposited in the Note Construction Disbursement Account (as defined in the
Disbursement Agreement) pursuant to the Disbursement Agreement,
(x) the Salle Privee Management Agreement to be executed as of the
Closing Time, among the Company, London Clubs and LCNI,
4
(xi) the Construction, Operation and Reciprocal Easement Agreement to
be executed as of the Closing Time between the Company, Bazaar, and Aladdin
Music, LLC, a Nevada limited-liability company ("Aladdin Music"),
(xii) the Site Work Development and Construction Agreement (the "Site
Work Agreement") to be executed as of the Closing Time between the Company and
Aladdin Bazaar, LLC, a Delaware limited-liability company ("Bazaar"),
(xiii) the Fluor Guaranty (the "Fluor Guaranty") to be executed as of
the Closing Time between the Company and the Fluor Corporation, a California
corporation ("Fluor"),
(xiv) the Lease to be executed as of the Closing Time, between the
Company and the Energy Provider, and
(xv) the Unicom Guaranty (the "Unicom Guaranty") executed as of the
Closing Time between the Company and Unicom Corporation, an Illinois corporation
("Unicom").
The Aladdin Parties have prepared and delivered to each Initial
Purchaser copies of a preliminary offering memorandum dated January 30, 1998
(the "Preliminary Offering Memorandum") and have prepared and will deliver to
each Initial Purchaser, on the date hereof or the next succeeding day, copies of
a final offering memorandum dated February 19, 1998 (the "Final Offering
Memorandum"), each for use by such Initial Purchaser in connection with its
solicitation of purchases of, or offering of, the Units. "Offering Memorandum"
means, with respect to any date or time referred to in this Agreement, the most
recent offering memorandum (whether the Preliminary Offering Memorandum or the
Final Offering Memorandum, or any amendment or supplement to either such
document), which has been prepared and delivered by the Aladdin Parties to the
Initial Purchasers in connection with their solicitation of purchases of, or
offering of, the Units.
SECTION 1. Representations and Warranties of the Aladdin Parties.
(a) Representations and Warranties by the Aladdin Parties.
Each of the Aladdin Parties represents and warrants to each Initial Purchaser as
of the date hereof and as of the Closing Time, and agrees with each Initial
Purchaser as follows:
(i) Similar Offerings. None of the Aladdin Parties
has, directly or indirectly, solicited any offer to buy or
offered to sell, and will not, directly or indirectly, solicit
any offer to buy or offer to sell, any security which is or
would be integrated with the sale of the Units, Notes or
Warrants in a manner that would require the Units, Notes or
Warrants to be registered under the 1933 Act.
(ii) Offering Memorandum. The Offering Memorandum
does not, and at the Closing Time will not, include an untrue
statement of a material fact or omit to state a material fact
necessary in order to make the statements therein, in the
light of the circumstances under which they were made, not
misleading; provided that this representation, warranty and
agreement shall not apply to
5
statements in or omissions from the Offering Memorandum made
in reliance upon and in conformity with information furnished
to the Aladdin Parties in writing by any Initial Purchaser
through the Representatives expressly for use in the Offering
Memorandum.
(iii) Independent Accountants. The accountants who
certified the financial statements of the Aladdin Parties and
the Company included in the Offering Memorandum are
independent certified public accountants with respect to each
of the Aladdin Parties and their subsidiaries and the Company
within the meaning of Regulation S-X under the 1933 Act.
(iv) Financial Statements. The financial statements
of Holdings and its consolidated subsidiaries, Enterprises,
Capital and the Company, together with the related schedules
and notes included in the Offering Memorandum present fairly
the financial position, results of operation and changes in
financial position of each such entity at the dates indicated
and for the respective periods specified; said financial
statements have been prepared in conformity with generally
accepted accounting principles ("GAAP") applied on a
consistent basis throughout the periods involved. The
forward-looking statements contained in the Offering
Memorandum are based upon good faith estimates and assumptions
believed by the Aladdin Parties to have been reasonable when
made.
(v) No Material Adverse Change in Business. Since the
respective dates as of which information is given in the
Offering Memorandum, except as otherwise stated therein, (A)
with respect to the Issuers, there has been no material
adverse change in the condition, financial or otherwise, or in
the earnings, business affairs or business prospects of the
Issuers and their subsidiaries considered as one enterprise
and, with respect to Enterprises, there has been no material
adverse change in the condition, financial or otherwise, or in
the earnings, business affairs or business prospects of
Enterprises (with respect to either, a "Material Adverse
Effect"), whether or not arising in the ordinary course of
business and (B) there have been no transactions entered into
by any of the Aladdin Parties or any of their subsidiaries,
other than those in the ordinary course of business, which are
material with respect to the Issuers and their subsidiaries
considered as one enterprise or Enterprises.
(vi) Good Standing of the Aladdin Parties. Each of
the Aladdin Parties has been duly organized or incorporated,
as applicable, and is validly existing as a limited-liability
company or corporation, as applicable, in good standing under
the laws of the State of Nevada and has all necessary power
and authority to own, lease and operate its properties and to
conduct its business as described in the Offering Memorandum
and to enter into and perform its obligations under this
Agreement; and each of the Aladdin Parties is duly qualified
as a foreign limited-liability company or corporation, as
applicable, to transact business and is in good standing in
each other jurisdiction in which such
6
qualification is required, whether by reason of the ownership
or leasing of property or the conduct of business.
(vii) Good Standing of Designated Subsidiaries. Each
"significant subsidiary" of any of the Aladdin Parties (as
such term is defined in Rule 1-02 of Regulation S-X) (each a
"Designated Subsidiary" and, collectively, the "Designated
Subsidiaries") has been duly organized or incorporated, as
applicable, and is validly existing as a limited-liability
company or corporation, as applicable, in good standing under
the laws of the jurisdiction of its organization or
incorporation, as applicable, has all necessary power and
authority to own, lease and operate its properties and to
conduct its business as described in the Offering Memorandum
and is duly qualified as a foreign limited-liability company
or corporation, as applicable, to transact business and is in
good standing in each jurisdiction in which such qualification
is required, whether by reason of the ownership or leasing of
property or the conduct of business; except as otherwise
disclosed in the Offering Memorandum, all of the issued and
outstanding membership interests or shares of capital stock,
as applicable, of each Designated Subsidiary have been duly
authorized and validly issued and are owned by the applicable
Aladdin Party, directly or through subsidiaries, free and
clear of any security interest, mortgage, pledge, lien,
encumbrance, claim or equity, except for any security
interest, mortgage, pledge, lien, encumbrance, claim or equity
granted or agreed to be granted pursuant to an Executed
Transaction Document or Executory Transaction Document; none
of the outstanding membership interests or shares of capital
stock, as applicable, of the Designated Subsidiaries was
issued in violation of any preemptive or similar rights
arising by operation of law, or under the charter, by-laws or
any other organizational document of such Designated
Subsidiary or under any agreement to which any of the Aladdin
Parties or any Designated Subsidiary is a party.
(viii) Capitalization of Holdings. All outstanding
membership interests of Holdings have been duly authorized and
validly issued and are not subject to any preemptive and
similar rights and are free and clear of any security
interest, mortgage, pledge, lien, encumbrance, claim or
equity, except for any security interest, mortgage, pledge,
lien, encumbrance, claim or equity granted or agreed to be
granted pursuant to an Executed Transaction Document or
Executory Transaction Document. The table relating to the
capitalization of Holdings under the caption "Capitalization"
in the Offering Memorandum, including the footnotes thereto,
presents fairly, as of its date (i) the capitalization of
Holdings, (ii) the expected capitalization of Holdings after
giving effect to the consummation of the offering of the Units
and the application by Holdings of the net proceeds received
by it therefrom and (iii) the expected capitalization of
Holdings on a consolidated basis after giving effect to the
consummation of the Funding Transactions (as defined in the
Offering Memorandum), the organization of Capital, the
issuance of the Units and the application by Holdings of the
net proceeds received by it therefrom. Capital, the Company
and Aladdin Music Holdings, LLC, a Nevada
7
limited-liability company ("Aladdin Music Holdings") are the
only subsidiaries of Holdings.
(ix) Capitalization of Capital. All outstanding
shares of capital stock of Capital have been duly authorized
and validly issued and are fully paid, non-assessable and not
subject to any preemptive or similar rights and are directly
owned by Holdings free and clear of any security interest,
mortgage, pledge, lien, encumbrance, claim or equity. Capital
has no subsidiaries.
(x) Capitalization of Enterprises. All outstanding
shares of capital stock of Enterprises have been duly
authorized and validly issued and are fully paid,
non-assessable and not subject to any preemptive or similar
rights and are free and clear of any security interest,
mortgage, pledge, lien, encumbrance, claim or equity, except
for any security interest, mortgage, pledge, lien,
encumbrance, claim or equity granted or agreed to be granted
pursuant to an Executed Transaction Document or Executory
Transaction Document. The Warrants will entitle the holders
thereof to acquire an aggregate of 2,215,000 shares of Common
Stock. As of the Closing Time, there will be 8,000,000 shares
of Common Stock authorized, of which 2,215,000 will be issued
and outstanding. Enterprises has no subsidiaries.
(xi) Subscription Rights. Except as described in the
Offering Memorandum, none of the Aladdin Parties nor any of
their subsidiaries has any outstanding options to purchase, or
any preemptive rights or other rights to subscribe for or
purchase, any securities or obligations convertible into, or
any contracts or commitments to issue or sell, any of its
equity interests or any such options, rights, convertible
securities or obligations.
(xii) Ranking. When issued, the Notes will rank pari
passu in right of payment with all senior Indebtedness (as
defined in the Indenture) of the Issuers and will rank senior
in right of payment to all subordinated Indebtedness of the
Issuers. As of the Closing Time, and after giving effect to
the Funding Transactions, the Notes will be the only
outstanding Indebtedness of the Issuers.
(xiii) Authorization of Agreement. This Agreement has
been duly authorized, executed and delivered by each of the
Aladdin Parties.
(xiv) Authorization of the Units. The Units have been
duly authorized by each of the Aladdin Parties. At the Closing
Time, the Units will conform in all material respects to the
description thereof contained in the Offering Memorandum.
(xv) Authorization of the Series A Notes. The Series
A Notes have been duly authorized and, at the Closing Time,
will have been duly executed by each of the Issuers and, when
authenticated in the manner provided for in the Indenture and
delivered against payment of the purchase price therefor, will
8
constitute valid and binding obligations of each of the
Issuers, enforceable against each of the Issuers in accordance
with their terms, except as the enforcement thereof may be
limited by bankruptcy, insolvency (including, without
limitation, all laws relating to fraudulent transfers),
reorganization, moratorium or other similar laws relating to
or affecting enforcement of creditors' rights generally, or by
general principles of equity (regardless of whether
enforcement is considered in a proceeding in equity or at
law), and will be in the form contemplated by, and entitled to
the benefits of, the Indenture. At the Closing Time, the
Series A Notes will conform in all material respects to the
description thereof contained in the Offering Memorandum.
(xvi) Authorization of the Series B Notes. The Series
B Notes have been duly authorized by each of the Issuers. When
the Series B Notes are issued, executed and authenticated in
the manner provided for by the terms of the Exchange Offer and
the Indenture, the Series B Notes will constitute valid and
binding obligations of each of the Issuers, enforceable
against each of the Issuers in accordance with their terms,
except as the enforcement thereof may be limited by
bankruptcy, insolvency (including, without limitation, all
laws relating to fraudulent transfers), reorganization,
moratorium or other similar laws relating to or affecting
enforcement of creditors' rights generally, or by general
principles of equity (regardless of whether enforcement is
considered in a proceeding in equity or at law), and will be
in the form contemplated by, and entitled to the benefits of,
the Indenture.
(xvii) Authorization of the Series A Preferred
Membership Interests. The Company's Series A Preferred
Membership Interests (the "Preferred Membership Interests")
have been duly authorized by the Company and, when issued and
delivered to Holdings in the manner set forth under the
caption "Use of Proceeds" in the Offering Memorandum, will be
validly issued and not subject to any preemptive or similar
rights and, other than in connection with and subject to the
Preferred Membership Interests Pledge Agreement, will be
directly owned by Holdings free and clear of any security
interest, mortgage, pledge, lien, encumbrance, claim or
equity. At the Closing Time, the Preferred Membership
Interests will conform in all material respects to the
description thereof contained in the Offering Memorandum.
(xviii) Authorization of the Indenture. The Indenture
has been duly authorized by each of the Issuers and, at the
Closing Time, will have been duly executed and delivered by
each of the Issuers and will constitute a valid and binding
agreement of each of the Issuers, enforceable against each of
the Issuers in accordance with its terms, except as the
enforcement thereof may be limited by bankruptcy, insolvency
(including, without limitation, all laws relating to
fraudulent transfers), reorganization, moratorium or other
similar laws relating to or affecting enforcement of
creditors' rights generally, or by general principles of
equity (regardless of whether enforcement is considered in a
proceeding in equity
9
or at law). At the Closing Time, the Indenture will conform
in all material respects to the requirements of the Trust
Indenture Act of 1939, as amended (the "1939 Act"), and
the rules and regulations of the Commission applicable to
an indenture which qualified thereunder.
(xix) Authorization of the Note Registration Rights
Agreement. The Note Registration Rights Agreement has been
duly authorized by each of the Issuers and, at the Closing
Time, will have been duly executed and delivered by each of
the Issuers and will constitute a valid and binding agreement
of each of the Issuers, enforceable against each of the
Issuers in accordance with its terms except (i) as the
enforcement thereof may be limited by bankruptcy, insolvency
(including, without limitation, all laws relating to
fraudulent transfers), reorganization, moratorium or other
similar laws relating to or affecting enforcement of
creditors' rights generally, or by general principles of
equity (regardless of whether enforcement is considered in a
proceeding in equity or at law) and (ii) as limited by
state or federal securities laws prohibiting or limiting
the availability of, and public policy against,
indemnification or contribution. At the Closing Time,
the Note Registration Rights Agreement will conform in
all material respects to the description thereof contained
in the Offering Memorandum.
(xx) Authorization of the Warrants. The Warrants have
been duly authorized and at the Closing Time, will have been
duly executed by Enterprises, and when issued in the manner
provided for in the Warrant Agreement and delivered against
payment of the purchase price therefor will constitute valid
and binding obligations of Enterprises, enforceable against
Enterprises in accordance with their terms, except as the
enforcement thereof may be limited by bankruptcy, insolvency
(including, without limitation, all laws relating to
fraudulent transfers), reorganization, moratorium or other
similar laws relating to or affecting enforcement of
creditors' rights generally, or by general principles of
equity (regardless of whether enforcement is considered in a
proceeding in equity or at law), and will be in the form
contemplated by, and entitled to the benefits, of the Warrant
Agreement. At the Closing Time, the Warrants will conform in
all material respects to the description thereof contained in
the Offering Memorandum.
(xxi) Authorization of the Warrant Shares. The
Warrants are exercisable into Warrant Shares in accordance
with the terms of the Warrant Agreement. Enterprises has duly
authorized and reserved for issuance the Warrant Shares and,
when issued and paid for upon exercise of the Warrants in
accordance with the terms thereof, the Warrant Shares will be
validly issued, fully paid and nonassessable, free of any
preemptive or similar rights. At the Closing Time, the Warrant
Shares will conform in all material respects to the
description thereof contained in the Offering Memorandum.
10
(xxii) Authorization of the Warrant Agreement. The
Warrant Agreement has been duly authorized by Enterprises and,
at the Closing Time, will have been duly executed and
delivered by Enterprises and will constitute a valid and
binding agreement of Enterprises, enforceable against
Enterprises in accordance with its terms except as the
enforcement thereof may be limited by bankruptcy, insolvency
(including, without limitation, all laws relating to
fraudulent transfers), reorganization, moratorium or other
similar laws relating to or affecting enforcement of
creditors' rights generally, or by general principles of
equity (regardless of whether enforcement is considered in a
proceeding in equity or at law).
(xxiii) Authorization of the Warrant Registration
Rights Agreement. The Warrant Registration Rights Agreement
has been duly authorized by Enterprises and, at the Closing
Time, will have been duly executed and delivered by
Enterprises and will constitute a valid and binding agreement
of Enterprises, enforceable against Enterprises in accordance
with its terms except (i) as the enforcement thereof may be
limited by bankruptcy, insolvency (including, without
limitation, all laws relating to fraudulent transfers),
reorganization, moratorium or other similar laws relating to
or affecting enforcement of creditors' rights generally, or by
general principles of equity (regardless of whether
enforcement is considered in a proceeding in equity or at law)
and (ii) as limited by state or federal securities laws
prohibiting or limiting the availability of, and public policy
against, indemnification or contribution. At the Closing Time,
the Warrant Registration Rights Agreement will conform in all
material respects to the description thereof contained in the
Offering Memorandum.
(xxiv) Authorization of the Executed Transaction
Documents. Each of the Executed Transaction Documents to which
an Aladdin Party is a party has been duly authorized, executed
and delivered by each such Aladdin Party that is a party
thereto and constitutes a valid and binding agreement of each
such party, enforceable against each such party in accordance
with its terms except as the enforcement thereof may be
limited by bankruptcy, insolvency (including, without
limitation, all laws relating to fraudulent transfers),
reorganization, moratorium or other similar laws relating to
or affecting enforcement of creditors' rights generally, or by
general principles of equity (regardless of whether
enforcement is considered in a proceeding in equity or at
law). At the Closing Time, each of the Executed Transaction
Documents that is described in the Offering Memorandum will
conform in all material respects to the description thereof
contained in the Offering Memorandum.
(xxv) Authorization of the Executory Transaction
Documents. Each of the Executory Transaction Documents to
which an Aladdin Party is a party has been duly authorized by
each such Aladdin Party that is a party thereto and, at the
Closing Time, will have been duly executed and delivered by
each such party and will constitute a valid and binding
agreement of each such party, enforceable
11
against each such party in accordance with its terms except as
the enforcement thereof may be limited by bankruptcy,
insolvency (including, without limitation, all laws relating
to fraudulent transfers), reorganization, moratorium or other
similar laws relating to or affecting enforcement of
creditors' rights generally, or by general principles of
equity (regardless of whether enforcement is considered in a
proceeding in equity or at law). At the Closing Time, each of
the Executory Transaction Documents will conform in all
material respects to the description thereof contained in the
Offering Memorandum.
(xxvi) Absence of Defaults and Conflicts. None of the
Aladdin Parties or any of their subsidiaries is in violation
of its charter, by-laws or any other organizational document
or in default in the performance or observance of any
obligation, agreement, covenant or condition contained in any
contract, indenture, mortgage, deed of trust, loan or credit
agreement, note, lease or other agreement or instrument to
which it is a party or by which it may be bound, or to which
any of its property or assets is subject (collectively,
"Agreements and Instruments") except for such defaults that
would not result in a Material Adverse Effect; and the
execution, delivery and performance of this Agreement, the
Units, the Series A Notes, the Series B Notes, the Indenture,
the Note Registration Rights Agreements, the Warrant
Agreement, the Warrants, the Warrant Registration Rights
Agreements, the Executed Transaction Documents to the extent
that any of the Aladdin Parties is a party, the Executory
Transaction Documents to the extent that any of the Aladdin
Parties will be a party and any other agreement or instrument
entered into or issued or to be entered into or issued by any
of the Aladdin Parties or any of their subsidiaries in
connection with the transactions contemplated hereby or
thereby or in the Offering Memorandum and the consummation of
the transactions contemplated herein and in the Offering
Memorandum (including the issuance and sale of the Units and
the use of the proceeds from the sale of the Units as
described in the Offering Memorandum under the caption "Use of
Proceeds") and compliance by any of the Aladdin Parties with
their obligations hereunder have been duly authorized by all
necessary action and do not and will not, whether with or
without the giving of notice or passage of time or both,
conflict with or constitute a breach of, or default or a
Repayment Event (as defined below) under, or, except with
respect to the transactions contemplated by the Offering
Memorandum, result in the creation or imposition of any lien,
charge or encumbrance upon any property or assets of any of
the Aladdin Parties or any of their subsidiaries pursuant to,
the Agreements and Instruments except for such conflicts,
breaches or defaults or liens, charges or encumbrances that,
singly or in the aggregate, would not result in a Material
Adverse Effect, nor will such execution, delivery, performance
or compliance result in any violation of the provisions of the
charter, by-laws or any other organizational document of such
Aladdin Party or any such subsidiary or, except as would not
have a Material Adverse Effect, any applicable law, statute,
rule, regulation, judgment, order, writ or decree of any
government, government instrumentality or court, domestic or
foreign, having jurisdiction over it or any of
12
its assets or properties. As used herein, a "Repayment Event"
means any event or condition which gives the holder of any
note, debenture or other evidence of indebtedness (or any
person acting on such holder's behalf) the right to require
the repurchase, redemption or repayment of all or a portion of
such indebtedness by any of the Aladdin Parties or any of
their subsidiaries.
(xxvii) Absence of Labor Dispute. No labor dispute
with the employees of any of the Aladdin Parties or any of
their subsidiaries exists or, to the knowledge of any of the
Aladdin Parties, is imminent, and none of the Aladdin Parties
is aware of any existing or imminent material labor
disturbance by the employees of any of their or any of the
Company's principal suppliers or contractors, which, in either
case, may reasonably be expected to result in a Material
Adverse Effect.
(xxviii) Absence of Proceedings. There is no action,
suit, proceeding, inquiry or investigation before or by any
court or governmental agency or body, domestic or foreign, now
pending, or, to the knowledge of any of the Aladdin Parties,
threatened, against or affecting any of the Aladdin Parties or
any subsidiary thereof which might reasonably be expected to
result in a Material Adverse Effect, or which might reasonably
be expected to materially and adversely affect the properties
or assets of any of the Aladdin Parties or any of their
subsidiaries or the consummation of this Agreement or the
performance by any of the Aladdin Parties of their obligations
hereunder or under any of the other Operative Documents, the
Executed Transaction Documents or the Executory Transaction
Documents, except as disclosed in the Offering Memorandum.
Except as disclosed in the Offering Memorandum, the aggregate
of all pending legal or governmental proceedings to which any
of the Aladdin Parties or any subsidiary thereof is a party or
of which any of their respective property or assets is the
subject, including ordinary routine litigation incidental to
the business, could not reasonably be expected to result in a
Material Adverse Effect.
(xxix) Possession of Intellectual Property. The
Company will at the Closing Time own or have contractual
rights to acquire or be able to acquire on reasonable terms,
adequate licenses, copyrights, know-how (including trade
secrets and other unpatented and/or unpatentable proprietary
or confidential information, systems or procedures),
trademarks, service marks, trade names or other intellectual
property (collectively, "Intellectual Property") which will be
employed by it in connection with the operation of its
business in the manner described in the Offering Memorandum,
and none of the Aladdin Parties or any of their subsidiaries
has received any notice or is otherwise aware of any
infringement of or conflict with asserted rights of others
with respect to any Intellectual Property or of any facts or
circumstances which would render any Intellectual Property
invalid or inadequate to protect the interest of the Company,
and which infringement or conflict (if the subject of any
unfavorable decision,
13
ruling or finding) or invalidity or inadequacy, singly or in
the aggregate, would result in a Material Adverse Effect.
(xxx) Absence of Further Requirements. No filing
with, or authorization, approval, consent, license, order,
registration, qualification or decree of, any court or
governmental authority or agency is necessary or required for
the performance by any of the Aladdin Parties of their
obligations hereunder or in connection with issuance and sale
of the Units hereunder or, except as contemplated by the
Offering Memorandum, for the consummation of the transactions
contemplated by this Agreement.
(xxxi) Possession of Licenses and Permits. Each of
the Aladdin Parties and their subsidiaries possesses such
permits, licenses, franchises, certificates, approvals,
consents and other authorizations (collectively, "Governmental
Licenses") issued by, and has made all declarations and
filings with the appropriate federal, state, local or foreign
regulatory agencies or bodies necessary to own, lease and
operate its respective properties and to conduct the
businesses now operated by them, except (i) where the failure
thereof would not, singly or in the aggregate, have a Material
Adverse Effect, (ii) for Governmental Licenses which the
Aladdin Parties and their subsidiaries would not customarily
possess at the date hereof but which customarily would be
obtained in the ordinary course of development of the Aladdin
(as defined in the Indenture) and (iii) for any Governmental
Licenses to be issued by any Gaming Authority (as defined in
the Indenture) which are necessary for any of the Aladdin
Parties or any of their subsidiaries to own and operate the
Aladdin, and no such Government License contains, or is
expected by the Aladdin Parties to contain, a materially
burdensome restriction; each of the Aladdin Parties and their
subsidiaries is in compliance with the terms and conditions of
all such Governmental Licenses, except where the failure so to
comply would not, singly or in the aggregate, have a Material
Adverse Effect; all of the Governmental Licenses are valid and
in full force and effect, except when the invalidity of such
Governmental Licenses or the failure of such Governmental
Licenses to be in full force and effect would not have a
Material Adverse Effect; and none of the Aladdin Parties or
any of their subsidiaries has received any notice of
proceedings relating to the revocation or modification of any
such Governmental Licenses which, singly or in the aggregate,
if the subject of an unfavorable decision, ruling or finding,
would result in a Material Adverse Effect. None of the Aladdin
Parties nor any of their subsidiaries believes that any such
Governmental Authorization necessary in the future to own or
operate the Aladdin in the manner described in the Offering
Memorandum will not be granted in due course following
application or that any governmental agency is investigating
any of the Aladdin Parties or any of their subsidiaries, other
than ordinary course administrative reviews or any ordinary
course review of the transactions contemplated hereby or by
any such application.
14
(xxxii) Title to Property. Each of the Aladdin
Parties and their subsidiaries have good and marketable title
to all real and personal property and other assets reflected
in the financial statements in the Offering Memorandum as
owned by them, free and clear of all security interests,
mortgages, pledges, liens, encumbrances, claims or equities of
any kind except such as (a) are described in the Offering
Memorandum or (b) do not, singly or in the aggregate,
materially affect the value of such property and do not
interfere with the use made and proposed to be made of such
property by any of the Aladdin Parties or any of their
subsidiaries; and, except as would not, singly or in the
aggregate, have a Material Adverse Effect, all of the leases
and subleases material to the businesses of any of the Issuers
and their subsidiaries considered as one enterprise, or
Enterprises and their subsidiaries considered as one
enterprise, and under which any of the Aladdin Parties or any
of their subsidiaries holds properties described in the
Offering Memorandum, are valid and binding and in full force
and effect; and, except as would not, singly or in the
aggregate, have a Material Adverse Effect, none of the Aladdin
Parties or any of their subsidiaries has any notice of any
default or material claim of any sort that has been asserted
by anyone adverse to the rights of any of the Aladdin Parties
or any of their subsidiaries under any of the leases or
subleases mentioned above, or affecting or questioning the
rights of any of the Aladdin Parties or any of their
subsidiaries to the continued possession of the leased or
subleased premises under any such lease or sublease.
(xxxiii) Personal and Real Property of the Company.
At the Closing Time, the Company will have good and marketable
title in fee simple to the Project Site (as defined in the
Indenture) and good and marketable title to all personal
property owned by the Company which is material to the
business of the Company, free and clear of any security
interest, mortgage, pledge, lien, encumbrance, claim or equity
and defects, except (i) as contemplated by the Executed
Transaction Documents or the Executory Transaction Documents
and (ii) such as do not materially affect the value of such
property and do not interfere with the use made and proposed
to be made of such property by the Company in connection with
its business as described in the Offering Memorandum; and
there are no leases under which the Company holds real
property.
(xxxiv) Tax Returns. Each of the Aladdin Parties and
their subsidiaries have filed all federal, state, local and
foreign tax returns that are required to be filed or have duly
requested extensions thereof and have paid all taxes required
to be paid by any of them and any related assessments, fines
or penalties, except for any such tax, assessment, fine or
penalty that is being contested in good faith and by
appropriate proceedings; and adequate charges, accruals and
reserves have been provided for in the financial statements
referred to in Section 1(a)(iv) above in respect of all
federal, state, local and foreign taxes for all periods to
which such financial statements relate as to which the tax
liability of any of the Aladdin
15
Parties or any of their subsidiaries has not been finally
determined or remains open to examination by applicable taxing
authorities.
(xxxv) Environmental Laws. Except as described in the
Offering Memorandum and except such matters as would not,
singly or in the aggregate, result in a Material Adverse
Effect, (A) none of the Aladdin Parties or any of their
subsidiaries is in violation of any federal, state or local
statute, law, rule, regulation, ordinance, code, policy or
rule of common law or any judicial or administrative
interpretation thereof, including any judicial or
administrative order, consent, decree or judgment, relating to
pollution or protection of human health, the environment
(including, without limitation, ambient air, surface water,
groundwater, land surface or subsurface strata) or wildlife,
including, without limitation, laws and regulations relating
to the release or threatened release of chemicals, pollutants,
contaminants, wastes, toxic substances, hazardous substances,
petroleum or petroleum products (collectively, "Hazardous
Materials") or to the manufacture, processing, distribution,
use, treatment, storage, disposal, transport or handling of
Hazardous Materials (collectively, "Environmental Laws"), (B)
each of the Aladdin Parties and their subsidiaries have all
permits, authorizations and approvals required under any
applicable Environmental Laws and are each in compliance with
their requirements, (C) there are no pending or, to the
knowledge of the Aladdin Parties, threatened administrative,
regulatory or judicial actions, suits, demands, demand
letters, claims, liens, notices of noncompliance or violation,
investigation or proceedings relating to any Environmental Law
against any of the Aladdin Parties or any of their
subsidiaries and (D) there are no events or circumstances that
might reasonably be expected to form the basis of an order for
clean-up or remediation, or an action, suit or proceeding by
any private party or governmental body or agency, against or
affecting any of the Aladdin Parties or any of their
subsidiaries relating to Hazardous Materials or Environmental
Laws.
(xxxvi) Investment Company Act. None of the Aladdin
Parties are, and upon the issuance and sale of the Units as
herein contemplated and the application of the net proceeds
therefrom as described in the Offering Memorandum, will not
be, an "investment company" or an entity "controlled" by an
"investment company" as such terms are defined in the
Investment Company Act of 1940, as amended (the "1940 Act"),
required to register under the 1940 Act.
(xxxvii) Rule 144A Eligibility. The Securities are
eligible for resale pursuant to Rule 144A and will not be, at
the Closing Time, of the same class as securities listed on a
national securities exchange registered under Section 6 of the
Securities Exchange Act of 1934, as amended (the "1934 Act"),
or quoted in a U.S. automated interdealer quotation system.
(xxxviii) No General Solicitation. None of the
Aladdin Parties or their subsidiaries or any person acting on
their respective behalf (other than the Initial
16
Purchasers, their officers, employees and agents, as to whom
the Aladdin Parties make no representation) has engaged or
will engage, in connection with the offering of the Units, in
any form of general solicitation or general advertising within
the meaning of Rule 502(c) under the 1933 Act.
(xxxix) No Registration Required. Subject to
compliance by the Initial Purchasers with the representations
and warranties set forth in Section 4 and the procedures set
forth in Section 8 hereof, it is not necessary in connection
with the offer, sale and delivery of the Units to the Initial
Purchasers and to each Subsequent Purchaser in the manner
contemplated by this Agreement and the Offering Memorandum to
register the Securities under the 1933 Act or to qualify the
Indenture under the 1939 Act.
(xl) Accounting System. Each of the Aladdin Parties
and their subsidiaries maintains a system of internal
accounting controls sufficient to provide reasonable
assurances that (A) transactions are executed in accordance
with management's general or specific authorization, (B)
transactions are recorded as necessary to permit preparation
of financial statements in conformity with generally accepted
accounting principles and to maintain accountability for
assets, (C) access to assets is permitted only in accordance
with management's general or specific authorization and (D)
the recorded accountability for assets is compared with the
existing assets at reasonable intervals and appropriate action
is taken with respect to any differences.
(xli) Insurance. As of the Closing Time, the Aladdin
Parties and their subsidiaries are insured by and maintain
insurance covering, or are the named beneficiaries of
insurance maintained by third parties covering, their
respective properties, with insurers of recognized financial
responsibility against such losses and risks and in such
amounts as are prudent and customary in the businesses in
which they are engaged; and none of the Aladdin Parties nor
their subsidiaries has any reason to believe that such
insurance coverage can not be renewed as and when such
coverage expires or that similar coverage could not be
obtained from similar insurers at a cost that would not have a
Material Adverse Effect.
(xlii) No Agreement for Filing a Registration
Statement. There are no persons with registration rights or
other similar rights to have any securities registered
pursuant to any registration statement or otherwise registered
by any of the Aladdin Parties under the 1933 Act, except
persons having such rights pursuant to the Notes Registration
Statements, the Warrant Shelf Registration Statement and the
Consulting Agreement dated as of July 1, 1997, between GAI,
LLC and the Company.
(xliii) Distribution of the Offering Memorandum. None of
the Aladdin Parties or any of their subsidiaries has
distributed and, prior to the later to occur of
17
(i) the Closing Time and (ii) completion of the distribution
of the Units, will distribute any offering materials in
connection with the offering and sale of the Units other than
the Preliminary Offering Memorandum, the Final Offering
Memorandum and any amendment and supplements thereto, if any,
unless permitted by the 1933 Act and approved by the
Representatives (which approval shall not be unreasonably
withheld or delayed).
(xliv) Tax Treatment. Holdings qualifies as a
partnership and not an association or publicly traded
partnership taxable as a corporation and the Company qualifies
as a division of Holdings for federal income tax purposes.
(xlv) Compliance with Federal Reserve System
Regulations. None of the Aladdin Parties, any of their
subsidiaries or any agent thereof acting on the behalf of any
of them has taken, and none of them will take, any action that
might cause this Agreement or the issuance or sale of the
Units to violate Regulation G (12 C.F.R. Part 207), Regulation
T (12 C.F.R. Part 220), Regulation U (12 C.F.R. Part 221) or
Regulation X (12 C.F.R. Part 224) of the Board of Governors of
the Federal Reserve System.
(xlvi) Compliance with Rule 144A. Each of the
Preliminary Offering Memorandum and the Offering Memorandum,
as of its date, contains all the information specified in, and
meeting the requirements of, Rule 144A(d)(4) under the 1933
Act.
(xlvii) No Change in Rating. No "nationally recognized
statistical rating organization" as such term is defined for
purposes of Rule 436(g)(2) under the 1933 Act (i) has imposed
(or has informed any of the Aladdin Parties that it is
considering imposing) any condition (financial or otherwise)
on any of the Aladdin Parties retaining any rating assigned to
any of the Aladdin Parties or any securities of any of the
Aladdin Parties or (ii) has indicated to any of the Aladdin
Parties that it is considering (a) the downgrading,
suspension, or withdrawal of, or any review for a possible
change that does not indicate the direction of the possible
change in, any rating so assigned or (b) any change in the
outlook for any rating of any of the Aladdin Parties or any
securities of any of the Aladdin Parties.
(xlviii) ERISA. None of the Aladdin Parties or any of
their subsidiaries has violated any provisions of the Employee
Retirement Income Security Act of 1974, as amended ("ERISA"),
or the rules and regulations promulgated thereunder, except
for such violations which, singly or in the aggregate, would
not have a Material Adverse Effect. If any such plan is
adopted, the execution and delivery of this Agreement and the
sale of the Units will not involve any non-exempt prohibited
transaction within the meaning of Section 406 of ERISA or
Section 4975 of the Internal Revenue Code of 1986, as amended.
The representations made in the preceding sentence are made in
reliance upon and subject to the accuracy of, and compliance
with, the representations and covenants
18
made or deemed made by the Initial Purchasers as set forth in
the Offering Memorandum under "Notice to Investors."
(xlix) Operation of the Aladdin. The contemplated
operation and use of the Aladdin, including the construction
of the Aladdin, will be (giving effect to any waivers or
variances which may be obtained) in compliance with all
applicable municipal, county, state and federal laws,
regulations, ordinances, standards, orders, and other
regulations, except as would not, singly or in the aggregate,
have a Material Adverse Effect. Under applicable zoning and
use laws, ordinances, rules and regulations, the Aladdin may
be used for the purposes contemplated in the Offering
Memorandum.
(l) Plans and Specifications. The Initial Purchasers
have been furnished with a copy of the plans and
specifications for the construction of the improvements of the
Aladdin and other necessary expenditures. Such plans and
specifications are satisfactory to the Aladdin Parties. The
anticipated cost by the Aladdin Parties as of the Closing Time
of such improvements (including interest, legal,
architectural, engineering, planning, zoning and other similar
costs) does not exceed the amounts for such costs set forth
under the caption "Use of Proceeds" in the Offering
Memorandum. In addition, each of the other amounts set forth
in the section entitled "Sources and Uses of Funds" under the
caption "Use of Proceeds" in the Offering Memorandum are based
upon reasonable assumptions as to all matters material to the
estimates set forth therein and are not expected by the
Aladdin Parties to exceed the amounts set forth for such
items.
(li) Disbursement Budget and Construction Schedule.
The Disbursement Budget (as defined in the Disbursement
Agreement) and the Construction Schedule (as defined in the
Disbursement Agreement), as of the Closing Time, (i) are, in
the opinion of the Aladdin Parties after due investigation,
based on reasonable assumptions as to all legal and factual
matters material to the estimates set forth therein and
relying to a large extent on professional advisors and (ii)
call for the construction of the Minimum Aladdin Facilities
(as defined in the Indenture) on or prior to the Operating
Deadline (as defined in the Indenture).
(b) Officer's Certificates. Any certificate signed by any
officer of any of the Aladdin Parties or any of their subsidiaries delivered to
the Representatives or to counsel for the Initial Purchasers shall be deemed a
representation and warranty by such Aladdin Party to each Initial Purchaser as
to the matters covered thereby.
SECTION 2. Representations and Warranties of London Clubs.
(a) Representations and Warranties by London Clubs. London
Clubs represents and warrants to each Initial Purchaser as of the date hereof
and as of the Closing Time, and agrees with each Initial Purchaser as follows:
19
(i) Good Standing of London Clubs and LCNI. Each of
London Clubs and LCNI has been duly incorporated, is validly
existing and is a corporation in good standing under the laws
of its jurisdiction of incorporation and has all necessary
corporate power and authority to carry on its business and to
own, lease and operate its properties, and is duly qualified
and is in good standing as a foreign corporation authorized to
do business in each jurisdiction in which the nature of its
business or its ownership or leasing of property requires such
qualification, except, with respect to London Clubs, where the
failure to be so qualified would not have a material adverse
effect on its business, prospects, financial condition or
results of operations. London Clubs owns all of the
outstanding shares of capital stock of LCNI.
(ii) Authorization of this Agreement. This Agreement
has been duly authorized, executed and delivered by London
Clubs.
(iii) Absence of Defaults and Conflicts. Neither of
London Clubs or LCNI is in violation of its charter, by-laws
or any other organizational document or in default in the
performance or observance of any obligation, agreement,
covenant or condition contained in any contract, indenture,
mortgage, deed of trust, loan or credit agreement, note, lease
or other agreement or instrument to which either of them is a
party or by which or either of them may be bound, or to which
any of the property or assets of either of them is subject
(collectively, "LCI Agreements and Instruments") except for
such defaults that would not result in a material adverse
change in the condition, financial or otherwise, or in the
earnings, business affairs or business prospects of either of
London Clubs or LCNI; and the execution, delivery and
performance of this Agreement and compliance by either of
London Clubs or LCNI with their obligations hereunder have
been duly authorized by all necessary action, other than in
connection with the U.S. Facilities Agreement banks with
National Westminster PLC as arranger and U.S. 1997 Noteholders
which shall be obtained prior to the Closing Time, and do not
and will not, whether with or without the giving of notice or
passage of time or both, conflict with or constitute a breach
of, or default or any event or condition which gives the
holder of any note, debenture or other evidence of
indebtedness (or any person acting on such holder's behalf)
the right to require the repurchase, redemption or repayment
of all or a portion of such indebtedness by London Clubs or
LCNI under, or result in the creation or imposition of any
lien, charge or encumbrance upon any property or assets of
either of them pursuant to, the LCI Agreements and Instruments
except for such conflicts, breaches or defaults or liens,
charges or encumbrances that, singly or in the aggregate,
would not result in a material adverse change in the
condition, financial or otherwise, or in the earnings,
business affairs or business prospects of either of London
Clubs or LCNI, nor will such action result in any violation of
the provisions of the charter, by-laws or any other
organizational document of any of either London Clubs or LCNI
or any applicable law, statute, rule, regulation, judgment,
order, writ or
20
decree of any government, government instrumentality or court,
domestic or foreign, having jurisdiction over either or them
or any of their assets or properties.
(iv) Absence of Further Requirements. Other than the
approval of the shareholders of London Clubs and approvals
necessary in connection with the U.S. Facilities Agreement
banks with National Westminster PLC as arranger and U.S. 1997
Noteholders, each of which shall be obtained prior to the
Closing Time, no filing with, or authorization, approval,
consent, license, order, registration, qualification or decree
of, any court or governmental authority or agency or any other
party is necessary or required for the performance by either
of London Clubs or LCNI of their obligations hereunder.
(v) Independent Accountants. The accountants who
audited the financial statements of London Clubs included in
the Offering Memorandum are independent certified public
accountants with respect to London Clubs and their
subsidiaries within the meaning of Regulation S-X under the
1933 Act.
(b) Officer's Certificates. Any certificate signed by any
officer of London Clubs or LCNI delivered to the Representatives or to counsel
for the Initial Purchasers shall be deemed a representation and warranty by
London Clubs or LCNI, as applicable, to each Initial Purchaser as to the matters
covered thereby.
SECTION 3.Representations and Warranties of the Trust and AHL.
(a) Representations and Warranties by the Trust and AHL. Each
of the Trust and AHL represents and warrants to each Initial Purchaser as of the
date hereof and as of the Closing Time, and agrees with each Initial Purchaser
as follows:
(i) Good Standing of the Trust and AHL. Each of the
Trust and AHL has been duly organized or incorporated, as
applicable, is validly existing and is a trust or
limited-liability company, as applicable, in good standing
under the laws of its jurisdiction of organization or
incorporation, as applicable, and has all necessary power and
authority to carry on its business and to own, lease and
operate its properties, and is duly qualified and is in good
standing as a foreign trust or limited-liability company, as
applicable, authorized to do business in each jurisdiction in
which the nature of its business or its ownership or leasing
of property requires such qualification, except, with respect
to the Trust, where the failure to be so qualified would not
have a material adverse effect on its business, prospects,
financial condition or results of operations. The Trust owns
95% of the outstanding membership interests of AHL.
(ii) Authorization of this Agreement. This Agreement
has been duly authorized, executed and delivered by each of
the Trust and AHL.
(iii) Absence of Defaults and Conflicts. Neither of
the Trust or AHL is in violation of its charter, by-laws or
any other organizational document or in
21
default in the performance or observance of any obligation,
agreement, covenant or condition contained in any contract,
indenture, mortgage, deed of trust, loan or credit agreement,
note, lease or other agreement or instrument to which either
of them is a party or by which or either of them may be bound,
or to which any of the property or assets of either of them is
subject (collectively, "Xxxxxx Agreements and Instruments")
except for such defaults that would not result in a material
adverse change in the condition, financial or otherwise, or in
the earnings, business affairs or business prospects of either
of the Trust or AHL; and the execution, delivery and
performance of this Agreement and compliance by either of the
Trust or AHL with their obligations hereunder have been duly
authorized by all necessary action and do not and will not,
whether with or without the giving of notice or passage of
time or both, conflict with or constitute a breach of, or
default or any event or condition which gives the holder of
any note, debenture or other evidence of indebtedness (or any
person acting on such holder's behalf) the right to require
the repurchase, redemption or repayment of all or a portion of
such indebtedness by the Trust or AHL under, or result in the
creation or imposition of any lien, charge or encumbrance upon
any property or assets of either of them pursuant to, the
Xxxxxx Agreements and Instruments except for such conflicts,
breaches or defaults or liens, charges or encumbrances that,
singly or in the aggregate, would not result in a material
adverse change in the condition, financial or otherwise, or in
the earnings, business affairs or business prospects of either
of the Trust or AHL, nor will such action result in any
violation of the provisions of the charter, by-laws or any
other organizational document of any of either the Trust or
AHL or , except to the extent that such action would not
result in a material adverse change in the condition,
financial or otherwise, or in the earnings, business affairs
or business prospects of either of the Trust or AHL, any
applicable law, statute, rule, regulation, judgment, order,
writ or decree of any government, government instrumentality
or court, domestic or foreign, having jurisdiction over either
or them or any of their assets or properties.
(iv) Absence of Further Requirements. No filing with,
or authorization, approval, consent, license, order,
registration, qualification or decree of, any court or
governmental authority or agency is necessary or required for
the performance by either the Trust or AHL of their
obligations hereunder.
(b) Officer's Certificates. Any certificate signed by any
officer of the Trust or AHL delivered to the Representatives or to counsel for
the Initial Purchasers shall be deemed a representation and warranty by the
Trust or AHL, as applicable, to each Initial Purchaser as to the matters covered
thereby.
SECTION 4. Sale and Delivery to Initial Purchasers; Closing.
(a) Units. On the basis of the representations and warranties
herein contained and subject to the terms and conditions herein set forth, the
Aladdin Parties agree to sell to each Initial Purchaser, severally and not
jointly, and each Initial Purchaser, severally and not jointly,
22
agrees to purchase from the Aladdin Parties, at the price set forth in Schedule
B, the number of Units set forth in Schedule A opposite the name of such Initial
Purchaser, plus any additional Units which such Initial Purchaser may become
obligated to purchase pursuant to the provisions of Section 13 hereof.
(b) Payment. Payment of the purchase price for, and delivery
of certificates for, the Units shall be made at the office of Xxxxx Xxxxx &
Xxxxx, 0000 Xxxxxxxx, Xxx Xxxx, Xxx Xxxx, or at such other place as shall be
agreed upon by the Representatives and the Aladdin Parties, at 9:00 A.M. (New
York City time), on the fifth business day after the date hereof (unless
postponed in accordance with the provisions of Section 13), or such other time
not later than ten business days after such date as shall be agreed upon by the
Representatives and the Aladdin Parties (such time and date of payment and
delivery being herein called the "Closing Time").
Payment shall be made to the Aladdin Parties by wire transfer of
immediately available funds to bank accounts designated by the Aladdin Parties,
against delivery to the Representatives for the respective accounts of the
Initial Purchasers of certificates for the Units to be purchased by them. It is
understood that each Initial Purchaser has authorized the Representatives, for
its account, to accept delivery of, receipt for, and make payment of the
purchase price for, the Units which it has agreed to purchase. Xxxxxxx Xxxxx,
individually and not as representative of the Initial Purchasers, may (but shall
not be obligated to) make payment of the purchase price for the Units to be
purchased by any Initial Purchaser whose funds have not been received by the
Closing Time, but such payment shall not relieve such Initial Purchaser from its
obligations hereunder. The certificates representing the Units shall be
registered in the name of Cede & Co. pursuant to the DTC Agreement and shall be
made available for examination and packaging by the Initial Purchasers in the
City of New York not later than 3:00 p.m. (New York City time) on the last
business day prior to the Closing Time.
(c) Qualified Institutional Buyer. Each Initial Purchaser
severally and not jointly represents and warrants to, and agrees with, the
Aladdin Parties that it is a "qualified institutional buyer" within the meaning
of Rule 144A under the 1933 Act (a "Qualified Institutional Buyer") and an
"accredited investor" within the meaning of Rule 501(a) under the 1933 Act (an
"Accredited Investor").
(d) Registration; Denominations. One or more Units in
definitive global form, registered in the name of Cede & Co., as nominee of the
Depository Trust Company ("DTC"), having an aggregate amount corresponding to
the aggregate amount of the Units sold to Subsequent Purchasers (collectively,
the "Global Unit"), shall be delivered by the Aladdin Parties to the
Representatives (or as the Representatives direct) in each case with any
transfer taxes thereon duly paid by the Aladdin Parties, against payment by the
Representatives of the purchase price therefor in accordance with this Section
4. The Global Unit shall be made available to the Representatives for inspection
not later than 3:00 p.m. (New York City time) on the business day immediately
preceding the Closing Time.
23
SECTION 5. Covenants of Each of the Aladdin Parties. Each of the
Aladdin Parties covenants with each Initial Purchaser as follows:
(a) Suspension of Qualification. The Aladdin Parties will, as
promptly as possible after receipt of notice thereof, advise each Initial
Purchaser of the issuance by any state securities commission of any stop order
suspending the qualification or exemption from qualification of any Units for
offering or sale in any jurisdiction, or the initiation of any proceeding by any
state securities commission or other federal or state regulatory agency for such
purpose. The Aladdin Parties shall use their best efforts to prevent the
issuance of any stop order or order suspending the qualification or exemption of
any of the Units under any state securities or Blue Sky laws, and if at any time
any state securities commission or other federal or state regulatory authority
shall issue an order suspending the qualification or exemption of any Units
under any state securities or Blue Sky laws, the Aladdin Parties shall use their
best efforts to obtain the withdrawal or lifting of such order at the earliest
possible time.
(b) Offering Memorandum. The Aladdin Parties, as promptly as
possible, will furnish to each Initial Purchaser, without charge, such number of
copies of the Preliminary Offering Memorandum, the Final Offering Memorandum and
any amendments and supplements thereto and documents incorporated by reference
therein as such Initial Purchaser may reasonably request.
(c) Notice and Effect of Material Events. The Aladdin Parties
will as promptly as reasonably practicable notify each Initial Purchaser, and
confirm such notice in writing, of (x) any filing made by any of the Aladdin
Parties of information relating to the offering of the Units with any securities
exchange or any other regulatory body in the United States or any other
jurisdiction, and (y) prior to the completion of the placement of the Units by
the Initial Purchasers as evidenced by a notice in writing from the Initial
Purchasers to the Aladdin Parties, any material changes in or affecting the
earnings, business affairs or business prospects of any of the Aladdin Parties
and their subsidiaries, the Trust, AHL, London Clubs or LCNI which (i) make any
statement of fact in the Offering Memorandum untrue or (ii) constitute an
omission of material fact from the Offering Memorandum necessary so that the
Offering Memorandum will omit to state a material fact necessary in order to
make the statements therein, in light of the circumstances in which they were
made, not misleading. In such event or if during such time any event shall occur
as a result of which it is necessary, in the reasonable opinion of any of the
Aladdin Parties, their counsel, the Initial Purchasers or counsel for the
Initial Purchasers, to amend or supplement the Final Offering Memorandum in
order that the Final Offering Memorandum not include any untrue statement of a
material fact or omit to state a material fact necessary in order to make the
statements therein not misleading in the light of the circumstances then
existing, the Aladdin Parties will forthwith amend or supplement the Final
Offering Memorandum by preparing and furnishing to each Initial Purchaser an
amendment or amendments of, or a supplement or supplements to, the Final
Offering Memorandum (in form and substance satisfactory in the reasonable
opinion of counsel for the Initial Purchasers) so that, as so amended or
supplemented, the Final Offering Memorandum will not include an untrue statement
of a material fact or omit to state a material fact necessary in order to make
the
24
statements therein, in the light of the circumstances existing at the time
it is delivered to a Subsequent Purchaser, not misleading.
(d) Amendment to Offering Memorandum and Supplements. The
Aladdin Parties will advise each Initial Purchaser promptly of any proposal to
amend or supplement the Offering Memorandum and will not effect such amendment
or supplement without the consent of the Initial Purchasers (which consent will
not be unreasonably withheld or delayed). Neither the consent of the Initial
Purchasers, nor the Initial Purchasers' delivery of any such amendment or
supplement, shall constitute a waiver of any of the conditions set forth in
Section 7 hereof.
(e) Qualification of Units for Offer and Sale. The Aladdin
Parties will use their best efforts, in cooperation with the Initial Purchasers,
to qualify the Units for offering and sale under the applicable securities laws
of such jurisdictions within the United States as the Representatives may
reasonably designate and will maintain such qualifications in effect as long as
required for the sale of the Units; provided, however, that the Aladdin Parties
shall not be obligated to file any general consent to service of process or to
qualify as a foreign corporation or as a dealer in securities in any
jurisdiction in which it is not so qualified or to subject itself to taxation in
respect of doing business in any jurisdiction in which it is not otherwise so
subject.
(f) DTC. The Aladdin Parties will cooperate with the
Representatives and use their best efforts to permit the Securities to be
eligible for clearance and settlement through the facilities of DTC.
(g) Use of Proceeds. Each of the Aladdin Parties will use the
net proceeds received by it from the sale of the Units, and Holdings will cause
the Company to use the net proceeds from the sale of the Units contributed to it
by Holdings, substantially in the manner specified in the Offering Memorandum
under "Use of Proceeds" and to comply with the provisions of the Disbursement
Agreement.
(h) Restriction on Sale of Securities. During a period of 120
days from the date of the Offering Memorandum, the Aladdin Parties will not,
without the prior written consent of Xxxxxxx Xxxxx, directly or indirectly,
offer, pledge, sell, contract to sell, sell any option or contract to purchase
any option or contract to sell, grant any option, right or warrant for the sale
of or otherwise dispose of or transfer any debt securities of the Issuers, other
than pursuant to this Agreement, or file a registration statement under the 1933
Act with respect to the foregoing, other than pursuant to the Note Registration
Rights Agreement.
(i) Comply with Agreements. To comply with all of their
respective agreements set forth in each of the Note Registration Rights
Agreement and the Warrant Registration Rights Agreement.
(j) Furnish Reports. So long as any Securities are
outstanding, to furnish to the Initial Purchasers as promptly as practicable
after they are available copies of all reports or other communications furnished
to or filed with the Commission or any national securities exchange on which any
class of securities of the Aladdin Parties are listed and such other
25
publicly available information concerning the Aladdin Parties and/or its
subsidiaries as the Initial Purchaser may reasonably request.
(k) Portal Registration. To use its best efforts to effect the
inclusion of the Securities in PORTAL and to maintain the listing of each of the
Securities on PORTAL for so long as any of such Securities are outstanding.
(l) Exercise of Warrants. Enterprises will reserve and
continue to reserve, so long as any Warrants are outstanding, a sufficient
number of shares of Common Stock for issuance upon exercise of the Warrants.
(m) Performance of Duties. To use its best efforts (i) to do
and perform all things required or necessary to be done and performed under this
Agreement by it prior to the Closing Time and (ii) to satisfy all conditions
precedent to the delivery of the Units.
SECTION 6. Payment of Expenses.
(a) Expenses. The Aladdin Parties will pay, whether or not the
transactions contemplated in this Agreement are consummated or this Agreement is
terminated, all expenses incident to the performance of their obligations under
this Agreement, including, without limitation, (i) the preparation, printing and
any filing of the Offering Memorandum (including financial statements and any
exhibits and any document incorporated therein by reference) and of each
amendment or supplement thereto, (ii) the preparation, printing and delivery to
the Initial Purchasers of this Agreement, the Indenture, the Warrant Agreement,
the Note Registration Rights Agreement, the Warrant Registration Rights
Agreement, the Executed Transaction Documents, the Executory Transaction
Documents and such other documents as may be required in connection with the
offering, purchase, sale and delivery of the Units, except for fees and expenses
of the Initial Purchasers (including the fees and expenses of counsel to the
Initial Purchasers) other than as set forth in clause (xii) below, (iii) the
preparation, issuance and delivery of the certificates for the Units to the
Initial Purchasers, including any charges of DTC in connection therewith; (iv)
the fees and disbursements of any of the Venture Parties' counsel, accountants
and other advisors, (v) the qualification of the Units under securities laws in
accordance with the provisions of Section 5(d) hereof, including filing fees and
the reasonable fees and disbursements of counsel for the Initial Purchasers in
connection therewith and in connection with the preparation of the Blue Sky
Memoranda and any supplement thereto, (vi) the fees and expenses of the Trustee,
including the fees and disbursements of counsel for the Trustee in connection
with the Indenture and the Notes, (vii) the fees and expenses of the Warrant
Agent, including the fees and disbursements of counsel for the Warrant Agent in
connection with the Warrant Agreement, the Warrants and the Warrant Shares,
(viii) any fees payable to the review by the National Association of Securities
Dealers, Inc. (the "NASD") in connection with the initial and continued
designation of the Securities as PORTAL securities under the PORTAL Market Rules
pursuant to NASD Rule 5322, (ix) all costs and expenses of the Exchange Offer
and any Registration Statement, as set forth in and subject to the Note
Registration Rights Agreement, (x) all cost and expenses of any Warrant
Registration Statements as set forth in and subject to the Warrant Registration
Rights Agreement, (xi) the fees and expenses of the
26
Disbursement Agent pursuant to the Disbursement Agreement and (xii) the expenses
and disbursements of the Initial Purchasers (including reasonable fees, expenses
and disbursements of counsel for the Initial Purchasers) up to a maximum of
$500,000.
(b) Termination of Agreement. If this Agreement is terminated
by the Representatives in accordance with the provisions of Section 7 or Section
12(a)(i) hereof, the Aladdin Parties and the Trust, jointly and severally, shall
reimburse the Initial Purchasers for all of their reasonable out-of-pocket
expenses, including the reasonable fees and disbursements of counsel for the
Initial Purchasers.
SECTION 7. Conditions of Initial Purchasers' Obligations.The
obligations of the several Initial Purchasers hereunder are subject to the
accuracy of the representations and warranties of the Aladdin Parties contained
in Section 1 hereof, the representations and warranties of London Clubs
contained in Section 2 hereof and the representations and warranties of the
Trust and AHL contained in Section 3 hereof or in certificates of any officer of
any of the Venture Parties or any of their subsidiaries delivered pursuant to
the provisions hereof, to the performance by each of the Venture Parties of
their respective covenants and other obligations hereunder, and to the following
further conditions:
(a) Opinion of Counsel for the Venture Parties.
(i) At the Closing Time, the Representatives shall
have received the favorable opinion, dated as of the Closing
Time, of Skadden, Arps, Slate, Xxxxxxx & Xxxx LLP &
Affiliates, counsel for the Aladdin Parties, the Trust and AHL
in form and substance satisfactory to counsel for the Initial
Purchasers, together with signed or reproduced copies of such
letter for each of the other Initial Purchasers substantially
to the effect set forth in Exhibit A hereto and to such
further effect as counsel to the Initial Purchasers may
reasonably request.
(ii) At the Closing Time, the Representatives shall
have received the favorable opinion, dated as of the Closing
Time, of Xxxxxxx Xxxxxx, counsel for the Aladdin Parties in
form and substance satisfactory to counsel for the Initial
Purchasers, together with signed or reproduced copies of such
letter for each of the other Initial Purchasers substantially
to the effect set forth in Exhibit B hereto and to such
further effect as counsel to the Initial Purchasers may
reasonably request.
(iii) At the Closing Time, the Representatives shall
have received the favorable opinion, dated as of the Closing
Time, of Xxxxxxxxxx & Brown, counsel for London Clubs in form
and substance satisfactory to counsel for the Initial
Purchasers, together with signed or reproduced copies of such
letter for each of the other Initial Purchasers substantially
to the effect set forth in Exhibit C hereto and to such
further effect as counsel to the Initial Purchasers may
reasonably request.
27
(b) Opinion of Counsel for Initial Purchasers. At the Closing
Time, the Representatives shall have received the favorable opinion, dated as of
the Closing Time, of Xxxxxx & Xxxxxxx, counsel for the Initial Purchasers,
together with signed or reproduced copies of such letter for each of the other
Initial Purchasers with respect to the matters set forth in (i), (ii), (vi)
through (x), inclusive, (xii) (solely as to the information in the Offering
Memorandum under "Description of the Units", "Description of the Notes" and
"Description of the Warrants") and the penultimate paragraph of Exhibit A
hereto. In giving such opinion such counsel may rely, as to all matters governed
by the laws of jurisdictions other than the law of the State of New York and the
federal law of the United States and the General Corporation Law of the State of
Delaware, upon the opinions of counsel satisfactory to the Representatives. Such
counsel may also state that, insofar as such opinion involves factual matters,
they have relied, to the extent they deem proper, upon certificates of officers
of the Venture Parties and their subsidiaries and certificates of public
officials.
(c) Officers' Certificates.
(i) (A) At the Closing Time, there shall not have
been, since the date hereof or since the respective dates as
of which information is given in the Offering Memorandum, any
material adverse change in the condition, financial or
otherwise, or in the earnings, business affairs or business
prospects of either of the Issuers and their subsidiaries
considered as one enterprise or Enterprises, whether or not
arising in the ordinary course of business, (B) the
Representatives shall have received a certificate of the
President or a Vice President of each of the Aladdin Parties
and of the chief financial or chief accounting officer of each
of the Aladdin Parties, dated as of the Closing Time, to the
effect that there has been no such material adverse change and
(C) the Representatives shall have received a certificate of
the President or a Vice President of each of the Venture
Parties and of the chief financial or chief accounting officer
of each of the Venture Parties, dated as of the Closing Time,
that (1) to the extent applicable to such Venture Party, the
representations and warranties in Section 1 hereof with
respect to the Aladdin Parties, the representations and
warranties in Section 2 hereof with respect to London Clubs
and LCNI and the representations and warranties in Section 3
hereof with respect to the Trust and AHL are true and correct
with the same force and effect as though expressly made at and
as of the Closing Time and (2) the applicable Venture Party
has complied with all agreements and satisfied all conditions
on its part to be performed or satisfied at or prior to the
Closing Time.
(ii) The Representatives shall have received a
certificate of the President or a Vice President of London
Clubs and of the chief financial or chief accounting officer
of London Clubs, dated as of the Closing Time, to the effect
that London Clubs has obtained all consents from creditors of
London Clubs, necessary or required for the performance by
London Clubs or any of its subsidiaries of their obligations
hereunder, in connection with the offering, issuance or sale
of the Units hereunder or the consummation of the transactions
28
contemplated by this Agreement or otherwise described in the
Offering Memorandum.
(iii) The Representatives shall have received a
certificate of the chief financial or chief accounting officer
of AHL, dated as of the Closing Time, setting forth (i) the
nature of and the amount of pre-development costs which have
been incurred prior to the Closing Time by AHL and which are
to be reimbursed at the Closing Time as described in the
Offering Memorandum and (ii) the nature of and the estimated
amount of pre-development costs which AHL expects to incur on
behalf of the Company after the Closing Time.
(d) Accountants' Comfort Letters.
(i) At the time of the execution of this Agreement,
the Representatives shall have received from Xxxxxx Xxxxxxxx
LLP with respect to the Aladdin Parties, a letter dated such
date, in form and substance satisfactory to the
Representatives, together with signed or reproduced copies of
such letter for each of the other Initial Purchasers
containing statements and information of the type ordinarily
included in accountants' "comfort letters" to Initial
Purchasers with respect to the financial statements and
certain financial information of the Aladdin Parties contained
in the Offering Memorandum and substantially the form of
Example A of SAS 72.
(ii) At the time of the execution of this Agreement,
the Representatives shall have received from Price Waterhouse
with respect to London Clubs, a letter dated such date, in
form and substance satisfactory to the Representatives,
together with signed or reproduced copies of such letter for
each of the other Initial Purchasers containing statements and
information of the type ordinarily included in accountants'
"comfort letters" to Initial Purchasers with respect to the
financial statements of London Clubs contained in the Offering
Memorandum and substantially the form of Example A of SAS 72.
(e) Bring-down Comfort Letters.
(i) At the Closing Time, the Representatives shall
have received from Xxxxxx Xxxxxxxx LLP with respect to the
Aladdin Parties, a letter, dated as of the Closing Time, to
the effect that they reaffirm the statements made in the
letter furnished pursuant to subsection (d)(i) of this
Section, except that the specified date referred to shall
be a date not more than three business days prior to the
Closing Time.
(ii) At the Closing Time, the Representatives shall
have received from Price Waterhouse with respect to London
Clubs, a letter, dated as of the Closing Time, to the effect
that they reaffirm the statements made in the letter furnished
pursuant to subsection (d)(ii) of this Section, except that
the specified
29
date referred to shall be a date not more than three business
days prior to the Closing Time.
(f) Maintenance of Rating. Since the date of this Agreement,
there shall not have occurred a downgrading in the rating assigned any of the
Aladdin Parties' securities by any nationally recognized securities rating
agency, and no such securities rating agency shall have publicly announced that
it has under surveillance or review, with possible negative implications, its
rating of such securities.
(g) PORTAL. At the Closing Time, the Units, the Notes, the
Warrants and the Warrant Shares shall have been designated for trading on
PORTAL.
(h) Transaction Documents.
(i) All the representations and warranties contained
in each of the Executed Transaction Documents and Executory
Transaction Documents shall be true and correct in all
material respects at the Closing Time with the same force and
effect as if made on and as of the Closing Time.
(ii) All of the Executed Transaction Documents and
Executory Transaction Documents shall have been executed and
shall be in full force and effect and the Initial Purchasers
shall have received fully executed copies thereof. The Venture
Parties shall have received the requisite governmental and
regulatory approval in connection with each of the Executed
Transaction Documents and Executory Transaction Documents and
transactions contemplated by the Offering Memorandum to be
completed on or before the Closing Time.
(iii) No party shall have failed materially at or
prior to the Closing Time to perform or comply with any of the
agreements contained in any of the Executed Transaction
Documents or Executory Transaction Documents and required to
be performed or complied with by such party at or prior to the
Closing Time.
(iv) All documents and agreement shall have been
filed, and other actions shall have been taken, as may be
required to perfect the security interests of the Trustee in
the Series A Notes and the Note Construction Disbursement
Account, and to accord the Trustee the priorities over other
creditors of the Issuers as contemplated by the Offering
Memorandum, the Pledge Agreement and the Note Construction
Pledge Agreement.
(v) No injunction, restraining order or order of any
nature by a court, government body or agency shall have been
issued as of the Closing Time that would prevent or interfere
with the issuance and sale of the Units; and no stop order
suspending the qualification or exemption from qualification
of any of the Units in any jurisdiction shall have been issued
and no action, claim, suit or proceeding (including without
limitation an investigation or partial proceeding
30
such as a deposition) for that purpose shall have been
commenced or be pending or contemplated as of the Closing
Time.
(i) Bank Credit Facility. At the Closing Time, (i) the Bank
Credit Facility will conform in all material respects to the description thereof
contained in the Offering Memorandum and (ii) the Term B Loan (as defined in the
Offering Memorandum) and the Term C Loan (as defined in the Offering Memorandum)
shall have been advanced to the Company.
(j) Title Commitments. The Trustee shall have received
irrevocable commitments for title insurance for the Project Site from Xxxxxxx
Title Guaranty Company and Lawyers Title Insurance Company, in a form and
substance reasonably satisfactory to the Representatives, subject only to
Permitted Liens under the Indenture.
(k) Additional Documents.
(i) At the Closing Time, counsel for the Initial
Purchasers shall have been furnished with such documents and
opinions as they may require for the purpose of enabling them
to pass upon the issuance and sale of the Units as herein
contemplated, or in order to evidence the accuracy of any of
the representations or warranties, or the fulfillment of any
of the conditions, herein contained; and all proceedings taken
by the Aladdin Parties in connection with the issuance and
sale of the Units as herein contemplated shall be reasonably
satisfactory in form and substance to the Representatives and
counsel for the Initial Purchasers.
(ii) At the Closing Time, the Initial Purchasers
shall have received copies of all certificates, documents and
opinions reasonably requested by the Initial Purchasers or
counsel to the Initial Purchasers delivered by any of the
Venture Parties or any of their counsels and such other
certificates, documents and opinions reasonably obtainable by
any of the Venture Parties in connection with any of the
Funding Transactions or any other transactions contemplated in
the Offering Memorandum, together with letters addressed to
the Initial Purchasers stating that the Initial Purchasers may
rely on such certificates as if they had been address to the
Initial Purchasers.
(l) Termination of Agreement. If any condition specified in
this Section shall not have been fulfilled when and as required to be fulfilled,
this Agreement may be terminated by the Representatives by notice to the Aladdin
Parties at any time at or prior to the Closing Time, and such termination shall
be without liability of any party to any other party except as provided in
Section 6 and except that Sections 1, 2, 3, 9, 10 and 13 shall survive any such
termination and remain in full force and effect.
31
SECTION 8. Subsequent Offers and Resales of the Units.
(a) Offer and Sale Procedures. Each of the Initial Purchasers
and each of the Aladdin Parties hereby establish and agree to observe the
following procedures in connection with the offer and sale of the Units:
(i) Offers and Sales Only to Qualified Institutional
Buyers. Offers and sales of the Units will be made only by the
Initial Purchasers or Affiliates (as such term is defined in
Rule 501(b) under the 1933 Act) thereof qualified to do so in
the jurisdictions in which such offers or sales are made. Each
such offer or sale shall only be made to persons whom the
offeror or seller reasonably believes to be qualified
institutional buyers (as defined in Rule 144A under the 1933
Act).
(ii) No General Solicitation. The Units will be
offered by approaching prospective Subsequent Purchasers on an
individual basis. No general solicitation or general
advertising (within the meaning of Rule 502(c) under the 1933
Act) will be used in the United States in connection with the
offering of the Units.
(iii) Purchases by Non-Bank Fiduciaries. In the case
of a non-bank Subsequent Purchaser of a Unit acting as a
fiduciary for one or more third parties, in connection with an
offer and sale to such purchaser pursuant to this clause (a),
each third party shall, in the reasonable judgment of the
applicable Initial Purchaser, be a Qualified Institutional
Buyer.
(iv) Subsequent Purchaser Notification. Each Initial
Purchaser will take reasonable steps to inform, and cause each
of its U.S. Affiliates to take reasonable steps to inform,
persons acquiring Units from such Initial Purchaser or
affiliate, as the case may be, in the United States that the
Units (A) have not been and will not be registered under the
1933 Act, (B) are being sold to them without registration
under the 1933 Act in reliance on Rule 144A and (C) may not be
offered, sold or otherwise transferred except (1) to the
Aladdin Parties, (2) outside the United States in accordance
with Rule 904 of Regulation S or (3) inside the United States
in accordance with (x) Rule 144A to a person whom the seller
reasonably believes is a Qualified Institutional Buyer that is
purchasing such Units for its own account or for the account
of a Qualified Institutional Buyer to whom notice is given
that the offer, sale or transfer is being made in reliance on
Rule 144A or (y) the exemption from registration under the
1933 Act provided by Rule 144, if available.
(v) Minimum Principal Amount. No sale of the Units to
any one Subsequent Purchaser will be for consideration of less
than U.S. $150,000. If the Subsequent Purchaser is a non-bank
fiduciary acting on behalf of others, each
32
person for whom it is acting must purchase Units for
consideration of at least U.S. $150,000.
(vi) Restrictions on Transfer. The transfer
restrictions and the other provisions set forth in Article 2
of the Indenture and Sections 2, 3, 4 and 5 of the Warrant
Agreement, including any legends required thereby, shall apply
to the Securities except as otherwise agreed by the Aladdin
Parties and the Initial Purchasers. Following the sale and
transfer of the Units by the Initial Purchasers to Subsequent
Purchasers pursuant to the terms hereof, the Initial
Purchasers shall not be liable or responsible to the Aladdin
Parties for any losses, damages or liabilities suffered or
incurred by the Aladdin Parties, including any losses, damages
or liabilities under the 1933 Act, arising from or relating to
any resale or transfer of any Security.
(vii) Delivery of Offering Memorandum. Each Initial
Purchaser will deliver to each purchaser of the Units from
such Initial Purchaser, in connection with its original
distribution of the Units, a copy of the Offering Memorandum,
as amended and supplemented at the date of such delivery.
(b) Covenants of the Aladdin Parties. Each of the Aladdin
Parties covenants with each Initial Purchaser as follows:
(i) Due Diligence. In connection with the original
distribution of the Units, each of the Aladdin Parties agrees
that, prior to any offer or resale of the Units by the Initial
Purchasers, the Initial Purchasers and counsel for the Initial
Purchasers shall have the right to make reasonable inquiries
into the business of each of the Aladdin Parties and their
subsidiaries. Each of the Aladdin Parties also agrees to
provide answers to each prospective Subsequent Purchaser of
Units who so reasonably requests concerning the Aladdin
Parties and their subsidiaries (to the extent that such
information is available or can be acquired and made available
to prospective Subsequent Purchasers without unreasonable
effort or expense and to the extent the provision thereof is
not prohibited by applicable law and to the extent such
disclosure, in the reasonable opinion of the Aladdin Parties,
could not adversely effect the business, earnings, business
prospects or condition (financial or otherwise) of the Aladdin
Parties or their subsidiaries) and the terms and conditions of
the offering of the Units, as provided in the Offering
Memorandum.
(ii) Integration. (a) The Aladdin Parties agree that
they will not and will cause their Affiliates not to make any
offer or sale of securities of the Aladdin Parties of any
class if, as a result of the doctrine of "integration"
referred to in Rule 502 under the 1933 Act, such offer or sale
would render invalid (for the purpose of (i) the sale of the
Units by the Aladdin Parties to the Initial Purchasers, (ii)
the resale of the Units by the Initial Purchasers to
Subsequent Purchasers or (iii) the resale of the Units by such
Subsequent Purchasers to others) the
33
exemption from the registration requirements of the 1933 Act
provided by Section 4(2) thereof or by Rule 144A or otherwise.
(iii) Rule 144A Information. The Aladdin Parties
agree that, in order to render the Securities eligible for
resale pursuant to Rule 144A under the 1933 Act, while any of
the Securities remain outstanding, it will make available,
upon request, to any holder of any of the Securities or
prospective purchasers of any of the information specified in
Rule 144A(d)(4), unless the Aladdin Parties furnish
information to the Commission pursuant to Section 13 or 15(d)
of the 1934 Act (such information, whether made available to
holders or prospective purchasers or furnished to the
Commission, is herein referred to as "Additional
Information").
(iv) Restriction on Repurchases. Until the expiration
of two years after the original issuance of the Units, the
Aladdin Parties will not, and will cause their Affiliates not
to, purchase or agree to purchase or otherwise acquire any of
the Securities which are "restricted securities" (as such term
is defined under Rule 144(a)(3) under the 1933 Act), whether
as beneficial owner or otherwise (except as agent acting as a
securities broker on behalf of and for the account of
customers in the ordinary course of business in unsolicited
broker's transactions) unless, immediately upon any such
purchase, the Aladdin Parties or any Affiliate shall submit
such Securities to the Trustee or the Warrant Agent, as
applicable, for cancellation.
SECTION 9. Indemnification.
(a) Indemnification of Initial Purchasers. The Aladdin Parties
and the Trust agree, jointly and severally, to indemnify and hold harmless each
Initial Purchaser and each person, if any, who controls any Initial Purchaser
within the meaning of Section 15 of the 1933 Act or Section 20 of the 1934 Act
as follows:
(i) against any and all loss, liability, claim,
damage and expense whatsoever, as incurred, arising out of any
untrue statement or alleged untrue statement of a material
fact contained in any Preliminary Offering Memorandum or the
Final Offering Memorandum (or any amendment or supplement
thereto), or the omission or alleged omission therefrom of a
material fact necessary in order to make the statements
therein, in the light of the circumstances under which they
were made, not misleading;
(ii) against any and all loss, liability, claim,
damage and expense whatsoever, as incurred, to the extent of
the aggregate amount paid in settlement of any litigation, or
any investigation or proceeding by any governmental agency or
body, commenced or threatened, or of any claim whatsoever
based upon any such untrue statement or omission, or any such
alleged untrue statement or omission; provided that (subject
to Section 9(d) below) any such settlement is effected with
the written consent of the Aladdin Parties and the Trust; and
34
(iii) against any and all expense whatsoever, as
incurred (including the fees and disbursements of counsel
chosen by Xxxxxxx Xxxxx), reasonably incurred in
investigating, preparing or defending against any litigation,
or any investigation or proceeding by any governmental agency
or body, commenced or threatened, or any claim whatsoever
based upon any such untrue statement or omission, or any such
alleged untrue statement or omission, to the extent that any
such expense is not paid under (i) or (ii) above;
provided, however, that this indemnity agreement shall not apply to any loss,
liability, claim, damage or expense to the extent arising out of any untrue
statement or omission or alleged untrue statement or omission made in reliance
upon and in conformity with written information furnished to the Aladdin Parties
by any Initial Purchaser through the Representatives expressly for use in the
Offering Memorandum (or any amendment thereto). The foregoing indemnity with
respect to any untrue statement contained in or any omission from the
Preliminary Offering Memorandum shall not inure to the benefit of any Initial
Purchaser (or any person controlling such Initial Purchaser) from whom the
person asserting such loss, liability, claim, damage or expense purchased any of
the Units that are the subject thereof if (i) the untrue statement or omission
contained in the Preliminary Offering Memorandum (excluding documents
incorporated by reference) was corrected; (ii) such person was not sent or given
a copy of the Final Offering Memorandum (excluding documents incorporated by
reference) which corrected the untrue statement or omission at or prior to the
written confirmation of the sale of such Units to such person; and (iii) the
Aladdin Parties and the Trust satisfied their obligation pursuant to Section
5(b) of this Agreement to provide a sufficient number of copies of the Final
Offering Memorandum to the Initial Purchasers.
(b) Indemnification of Aladdin Parties, Managers, Directors
and Officers and the Trust. Each Initial Purchaser severally agrees to indemnify
and hold harmless any of the Aladdin Parties and the Trust, their managers,
directors, and officers and each person, if any, who controls the Aladdin
Parties and the Trust within the meaning of Section 15 of the 1933 Act or
Section 20 of the 1934 Act against any and all loss, liability, claim, damage
and expense described in the indemnity contained in subsection (a) of this
Section, as incurred, but only with respect to untrue statements or omissions,
or alleged untrue statements or omissions, made in the Offering Memorandum in
reliance upon and in conformity with written information furnished to the
Aladdin Parties by such Initial Purchaser through the Representatives expressly
for use in the Offering Memorandum.
(c) Actions against Parties; Notification. Each indemnified
party shall give notice as promptly as reasonably practicable to each
indemnifying party of any action commenced against it in respect of which
indemnity may be sought hereunder, but failure to so notify an indemnifying
party shall not relieve such indemnifying party from any liability hereunder to
the extent it is not materially prejudiced as a result thereof and in any event
shall not relieve it from any liability which it may have otherwise than on
account of this indemnity agreement. In the case of parties indemnified pursuant
to Section 9(a) above, counsel to the indemnified parties shall be selected by
Xxxxxxx Xxxxx, and, in the case of parties indemnified pursuant to Section 9(b)
above, counsel to the indemnified parties shall be selected by the
35
Aladdin Parties and the Trust. An indemnifying party may participate at its own
expense in the defense of any such action; provided, however, that counsel to
the indemnifying party shall not (except with the consent of the indemnified
party) also be counsel to the indemnified party. In no event shall the
indemnifying parties be liable for fees and expenses of more than one counsel
(in addition to any local counsel) separate from their own counsel for all
indemnified parties in connection with any one action or separate but similar or
related actions in the same jurisdiction arising out of the same general
allegations or circumstances. No indemnifying party shall, without the prior
written consent of the indemnified parties, settle or compromise or consent to
the entry of any judgment with respect to any litigation, or any investigation
or proceeding by any governmental agency or body, commenced or threatened, or
any claim whatsoever in respect of which indemnification or contribution could
be sought under this Section 9 or Section 10 hereof (whether or not the
indemnified parties are actual or potential parties thereto), unless such
settlement, compromise or consent (i) includes an unconditional release of each
indemnified party from all liability arising out of such litigation,
investigation, proceeding or claim and (ii) does not include a statement as to
or an admission of fault, culpability or a failure to act by or on behalf of any
indemnified party.
(d) Settlement without Consent if Failure to Reimburse. If at
any time an indemnified party shall have requested an indemnifying party to
reimburse the indemnified party for fees and expenses of counsel, such
indemnifying party agrees that it shall be liable for any settlement of the
nature contemplated by Section 9(a)(ii) effected without its written consent if
(i) such settlement is entered into more than 45 days after receipt by such
indemnifying party of the aforesaid request, (ii) such indemnifying party shall
have received notice of the terms of such settlement at least 30 days prior to
such settlement being entered into and (iii) such indemnifying party shall not
have reimbursed such indemnified party in accordance with such request prior to
the date of such settlement. Notwithstanding the immediately preceding sentence,
if at any time an indemnified party shall have requested an indemnifying party
to reimburse the indemnified party for fees and expenses of counsel, an
indemnifying party shall not be liable for any settlement of the nature
contemplated by Section 9(a)(ii) effected without its consent if such
indemnifying party (i) reimburses such indemnified party in accordance with such
request to the extent that it considers such request to be reasonable and (ii)
provides written notice to the indemnified party substantiating the unpaid
balance as unreasonable, in each case prior to the date of such settlement.
SECTION 10. Contribution. If the indemnification provided for
in Section 9 hereof is for any reason unavailable to or insufficient to hold
harmless an indemnified party in respect of any losses, liabilities, claims,
damages or expenses referred to therein, then each indemnifying party shall
contribute to the aggregate amount of such losses, liabilities, claims, damages
and expenses incurred by such indemnified party, as incurred, (i) in such
proportion as is appropriate to reflect the relative benefits received by the
Aladdin Parties on the one hand and the Initial Purchasers on the other hand
from the offering of the Units pursuant to this Agreement or (ii) if the
allocation provided by clause (i) is not permitted by applicable law, in such
proportion as is appropriate to reflect not only the relative benefits referred
to in clause (i) above but also the relative fault of the Aladdin Parties and
the Trust on the one hand and of the Initial Purchasers on the other hand in
connection with the statements or omissions which resulted in
36
such losses, liabilities, claims, damages or expenses, as well as any other
relevant equitable considerations.
The relative benefits received by the Aladdin Parties on the one hand
and the Initial Purchasers on the other hand in connection with the offering of
the Units pursuant to this Agreement shall be deemed to be in the same
respective proportions as the total net proceeds from the offering of the Units
pursuant to this Agreement (before deducting expenses) received by the Aladdin
Parties and the total underwriting discount received by the Initial Purchasers,
bear to the aggregate initial offering price of the Units.
The relative fault of the Aladdin Parties and the Trust on the one hand
and the Initial Purchasers on the other hand shall be determined by reference
to, among other things, whether any such untrue or alleged untrue statement of a
material fact or omission or alleged omission to state a material fact relates
to information supplied by the Aladdin Parties or the Trust or by the Initial
Purchasers and the parties' relative intent, knowledge, access to information
and opportunity to correct or prevent such statement or omission.
The Aladdin Parties and the Trust and the Initial Purchasers agree that
it would not be just and equitable if contribution pursuant to this Section 10
were determined by pro rata allocation (even if the Initial Purchasers were
treated as one entity for such purpose) or by any other method of allocation
which does not take account of the equitable considerations referred to above in
this Section 10. The aggregate amount of losses, liabilities, claims, damages
and expenses incurred by an indemnified party and referred to above in this
Section 10 shall be deemed to include any legal or other expenses reasonably
incurred by such indemnified party in investigating, preparing or defending
against any litigation, or any investigation or proceeding by any governmental
agency or body, commenced or threatened, or any claim whatsoever based upon any
such untrue or alleged untrue statement or omission or alleged omission.
Notwithstanding the provisions of this Section 10, no Initial Purchaser
shall be required to contribute any amount in excess of the amount by which the
total price at which the Units underwritten by it and distributed to the public
were offered to the public exceeds the amount of any damages which such Initial
Purchaser has otherwise been required to pay by reason of such untrue or alleged
untrue statement or omission or alleged omission.
No person guilty of fraudulent misrepresentation (within the meaning of
Section 11(f) of the 1933 Act) shall be entitled to contribution from any person
who was not guilty of such fraudulent misrepresentation.
For purposes of this Section 10, each person, if any, who controls an
Initial Purchaser within the meaning of Section 15 of the 1933 Act or Section 20
of the 1934 Act shall have the same rights to contribution as such Initial
Purchaser, and each director, trustee or manager of the Aladdin Parties, each
officer of the Aladdin Parties, and each person, if any, who controls the
Aladdin Parties or the Trust within the meaning of Section 15 of the 1933 Act or
Section 20 of the 1934 Act shall have the same rights to contribution as the
Aladdin Parties and the Trust, as applicable. The Initial Purchasers' respective
obligations to contribute pursuant to this Section
37
10 are several in proportion to the principal amount of Units set forth opposite
their respective names in Schedule A hereto and not joint.
SECTION 11. Representations, Warranties and Agreements to
Survive Delivery. All representations, warranties and agreements contained in
this Agreement or certificates of officers of any of the Venture Parties and the
Initial Purchasers submitted pursuant hereto, shall remain operative and in full
force and effect, regardless of any investigation made by or on behalf of any
Initial Purchaser, Venture Party or controlling person, or by or on behalf of
the Venture Parties or the Initial Purchasers, and shall survive delivery of the
Units to the Initial Purchasers.
SECTION 12. Termination of Agreement.
(a) Termination; General. The Representatives may terminate
this Agreement, by notice to the Venture Parties, at any time at or prior to the
Closing Time (i) if there has been, since the time of execution of this
Agreement or since the respective dates as of which information is given in the
Offering Memorandum, any material adverse change in the condition, financial or
otherwise, or in the earnings, business affairs or business prospects of any of
Holdings and its subsidiaries considered as one enterprise or Enterprises,
whether or not arising in the ordinary course of business, or (ii) if there has
occurred any material adverse change in the financial markets in the United
States or the international financial markets, any outbreak of hostilities or
escalation thereof or other calamity or crisis or any change or development
involving a prospective change in national or international political, financial
or economic conditions, in each case the effect of which is such as to make it,
in the judgment of the Representatives, impracticable to market the Units or to
enforce contracts for the sale of the Units, or (iii) if trading in any
securities of any of the Venture Parties has been suspended or limited by the
Commission or any stock exchange, or if trading generally on the American Stock
Exchange or the New York Stock Exchange or in the NASDAQ National Market System
has been suspended or limited, or minimum or maximum prices for trading have
been fixed, or maximum ranges for prices have been required, by any of said
exchanges or by such system or by order of the Commission, the NASD or any other
governmental authority, or (iv) if a banking moratorium has been declared by
either Federal or New York authorities.
(b) Liabilities. If this Agreement is terminated pursuant to
this Section, such termination shall be without liability of any party to any
other party except as provided in Section 6 hereof, and provided further that
Sections 1, 2, 3, 9 and 10 shall survive such termination and remain in full
force and effect.
SECTION 13. Default by One or More of the Initial Purchasers.
If one or more of the Initial Purchasers shall fail at the Closing Time to
purchase the Units which it or they are obligated to purchase under this
Agreement (the "Defaulted Units"), the Representatives shall have the right,
within 24 hours thereafter, to make arrangements for one or more of the
non-defaulting Initial Purchasers, or any other Initial Purchasers, to purchase
all, but not less than all, of the Defaulted Units in such amounts as may be
agreed upon and upon the terms herein set
38
forth; if, however, the Representatives shall not have completed such
arrangements within such 24-hour period, then:
(a) if the number of Defaulted Units does not exceed 10% of
the number of Units to be purchased hereunder, each of the
non-defaulting Initial Purchasers shall be obligated, severally and not
jointly, to purchase the full amount thereof in the proportions that
their respective obligations hereunder bear to the obligations of all
non-defaulting Initial Purchasers, or
(b) if the number of Defaulted Units exceeds 10% of the number
of Units to be purchased hereunder, this Agreement shall terminate
without liability on the part of any non-defaulting Initial Purchaser.
No action taken pursuant to this Section shall relieve any defaulting
Initial Purchaser from liability in respect of its default.
In the event of any such default which does not result in a termination
of this Agreement, either the Representatives or the Aladdin Parties shall have
the right to postpone the Closing Time for a period not exceeding seven days in
order to effect any required changes in the Offering Memorandum or in any other
documents or arrangements. As used herein, the term "Initial Purchaser" includes
any person substituted for an Initial Purchaser under this Section 13.
SECTION 14. Notices. All notices and other communications
hereunder shall be in writing and shall be deemed to have been duly given if
mailed or transmitted by any standard form of telecommunication. Notices to the
Initial Purchasers shall be directed to the Representatives c/x Xxxxxxx Lynch,
Xxxxxx, Xxxxxx & Xxxxx Incorporated at North Tower, World Financial Center, New
York, New York 10281-1201, attention of Xxxxxx Xxxxxxxx; notices to the Issuers
shall be directed to such party at P.O. Box 94827, Las Vegas, Nevada 89193,
attention of Xxxxxxx X. Xxxxxxxx; notices to Enterprises shall be directed to it
at P.O. Box 94827, Las Vegas, Nevada 89193, attention of Xxxxxxx X. Xxxxxxxx;
notices to London Clubs shall be directed to it at 00 Xxx Xxxxxxxxxx Xxxxxx,
Xxxxxx, XXX, 0XX Xxxxxxx, attention of Xxxxx Xxxxx; notices to LCNI shall be
directed to it c/o Xxxxxx, Xxxxxx & Xxxxxxx, 000 Xxxxx Xxxxxx Xxxxxx, Xxxxx
0000, Xxx Xxxxx, Xxxxxx 00000, attention of Xxxx Xxxxxxxx; notices to the Trust
shall be directed to it at 000 Xxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000, attention
of Xxxxxx Xxxxxxx; and notices to AHL shall be directed to it at 000 Xxxx
Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000, attention of Xxxxxx Xxxxxxx.
SECTION 15. Parties. This Agreement shall each inure to the
benefit of and be binding upon the Initial Purchasers and the Venture Parties
and their respective successors. Nothing expressed or mentioned in this
Agreement is intended or shall be construed to give any person, firm or
corporation, other than the Initial Purchasers and the Venture Parties and their
respective successors and the controlling persons and officers, trustees,
managers and directors referred to in Section 9 and 10 and their heirs and legal
representatives, any legal or equitable right, remedy or claim under or in
respect of this Agreement or any provision herein contained. This Agreement and
all conditions and provisions hereof are intended to be for the sole and
39
exclusive benefit of the Initial Purchasers and the Venture Parties and their
respective successors, and said controlling persons and officers, trustees,
managers and directors and their heirs and legal representatives, and for the
benefit of no other person, firm or corporation. No purchaser of Units from any
Initial Purchaser shall be deemed to be a successor by reason merely of such
purchase.
SECTION 16. GOVERNING LAW AND TIME. THIS AGREEMENT SHALL BE GOVERNED BY
AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK. SPECIFIED
TIMES OF DAY REFER TO NEW YORK CITY TIME.
SECTION 17. Consent to Jurisdiction. Each of the Venture Parties and,
with respect to clause (i) below, each of the Initial Purchasers hereby
irrevocably and unconditionally:
(a) submits itself and its property to any legal action or
proceeding relating to this Agreement, or for recognition and enforcement of any
judgment in respect of this Agreement, to the non-exclusive general jurisdiction
of the courts of the State of New York, the courts of the United States of
America for the Southern District of New York and appellate courts for such
state and federal courts;
(b) consents that any such action or proceeding may be brought
in such courts and waives any objection that it may now or hereafter have to the
venue of any such action or proceeding in any such court or that such action or
proceeding was brought in an inconvenient court and agrees not to plead or claim
the same;
(c) agrees that service of process in any such action or
proceeding may be effected by registered or certified mail (or any substantially
similar form of mail), postage prepaid, to LCNI at its address set forth in
Section 14 above; and
(d) agrees that nothing in this Agreement shall affect the
right to effect service of process in any other manner permitted by law or shall
limit the right to sue in any other jurisdiction.
SECTION 18. Effect of Headings. The Article and Section headings herein
and the Table of Contents are for convenience only and shall not affect the
construction hereof.
40
If the foregoing is in accordance with your understanding of our
agreement, please sign and return to the Venture Parties a counterpart hereof,
whereupon this instrument, along with all counterparts, will become a binding
agreement between the Initial Purchasers and the Venture Parties in accordance
with its terms.
ALADDIN GAMING HOLDINGS, LLC
By /s/ Xxxxxx Xxxxxxx
--------------------------------------
Name: Xxxxxx Xxxxxxx
Title: Executive Vice President/Secretary
ALADDIN CAPITAL CORP.
By /s/ Xxxxxx Xxxxxxx
--------------------------------------
Name: Xxxxxx Xxxxxxx
Title: Executive Vice President/Secretary
ALADDIN GAMING ENTERPRISES, INC.
By /s/ Xxxxxx Xxxxxxx
--------------------------------------
Name: Xxxxxx Xxxxxxx
Title: Secretary
ALADDIN HOLDINGS, LLC
By /s/ Xxxxxx Xxxxxxx
--------------------------------------
Name: Xxxxxx Xxxxxxx
Title: Vice President
41
THE TRUST UNDER ARTICLE SIXTH U/W/O XXXXXXX XXXXXX
By /s/ Xxxxx Xxxxxx
----------------------------------------------
Name: Xxxxx Xxxxxx
Title: Trustee
LONDON CLUBS INTERNATIONAL, PLC
By /s/ Xxxxx Xxxxx
----------------------------------------------
Name: Xxxxx Xxxxx
Title: Financial Director
CONFIRMED AND ACCEPTED, as of the date first above written:
XXXXXXX LYNCH, XXXXXX, XXXXXX & XXXXX
INCORPORATED
CREDIT SUISSE FIRST BOSTON CORPORATION
By: XXXXXXX XXXXX, XXXXXX, XXXXXX & XXXXX
INCORPORATED
By /s/ Xxxxxxx Xxxxxxxxx
----------------------------------------------
Authorized Signatory
For themselves and as Representatives of the other Initial Purchasers named in
Schedule A hereto.
42
SCHEDULE A
Name of Initial Purchaser Number of Units
Xxxxxxx Xxxxx, Xxxxxx, Xxxxxx & Xxxxx
Incorporated........................... 128,470
Credit Suisse First Boston Corporation................ 64,235
CIBC Xxxxxxxxxxx Corp................................. 14,398
Scotia Capital Markets (USA) Inc...................... 14,397
-------
Total..................................... 221,500
SCHEDULE B
ALADDIN GAMING HOLDINGS, LLC
ALADDIN CAPITAL CORP.
ALADDIN GAMING ENTERPRISES, INC.
221,500 Units consisting of in the aggregate of $221,500,000 principal amount at
maturity of Senior Discount Notes due 2010 of Aladdin Gaming Holdings, LLC and
Aladdin Capital Corp. (the "Notes") and Warrants (the "Warrants") to purchase an
aggregate of 2,215,000 shares of Common Stock of Aladdin Gaming Enterprises,
Inc.
1. The initial public offering price of the Units shall be $519.40 per
Unit, plus accrued interest on the Notes, if any, from the date of issuance.
2. The purchase price to be paid by the Initial Purchasers for the
Units shall be $499.92 per Unit.
Exhibit A
Exhibit B
FORM OF OPINION OF SPECIAL COUNSEL TO THE ALADDIN PARTIES
TO BE DELIVERED PURSUANT TO
SECTION 7(a)(ii)
(i) Each of the Aladdin Parties has been duly organized or
incorporated, as applicable, and is validly existing as a limited-liability
company or corporation, as applicable, in good standing under the laws of the
State of Nevada.
(ii) Each of the Aladdin Parties has all necessary power and authority
to own, lease and operate its properties and to conduct its business as
described in the Offering Memorandum and to enter into and perform its
obligations under the Purchase Agreement.
(iii) Each of the Aladdin Parties is duly qualified as a foreign
limited-liability company or corporation, as applicable, to transact business
and is in good standing in each jurisdiction in which such qualification is
required, whether by reason of the ownership or leasing of property or the
conduct of business.
(iv) Each Designated Subsidiary has been duly organized or
incorporated, as applicable, and is validly existing as a limited-liability
company or corporation, as applicable, in good standing under the laws of the
jurisdiction of its organization or incorporation, as applicable, has all
necessary power and authority to own, lease and operate its properties and to
conduct its business as described in the Offering Memorandum and is duly
qualified as a foreign limited-liability company or corporation, as applicable,
to transact business and is in good standing in each jurisdiction in which such
qualification is required, whether by reason of the ownership or leasing of
property or the conduct of business; except as otherwise disclosed in the
Offering Memorandum, all of the issued and outstanding membership interests or
shares of capital stock, as applicable, of each Designated Subsidiary has been
duly authorized and validly issued, is fully paid and non-assessable and, to the
best of our knowledge and information, is owned by the applicable Aladdin Party,
directly or through subsidiaries, free and clear of any security interest,
mortgage, pledge, lien, encumbrance, claim or equity.
(v) All outstanding membership interests of Holdings have been duly
authorized and validly issued and are fully paid, non-assessable and not subject
to any preemptive and similar rights and are free and clear of any security
interest, mortgage, pledge, lien, encumbrance, claim or equity and is as set
forth in the column entitled "At the Closing Time" under the table relating to
the capitalization of Holdings under the caption "Capitalization" in the
Offering Memorandum. Capital, the Company and Aladdin Music Holdings are the
only subsidiaries of Holdings.
(vi) All outstanding shares of capital stock of Capital have been duly
authorized and validly issued and are fully paid, non-assessable and not subject
to any preemptive or similar rights and are directly owned by Holdings free and
clear of any security interest, mortgage, pledge, lien, encumbrance, claim or
equity. Capital has no subsidiaries.
B-1
(vii) All outstanding shares of capital stock of Enterprises have been
duly authorized and validly issued and are fully paid, non-assessable and not
subject to any preemptive or similar rights and are free and clear of any
security interest, mortgage, pledge, lien, encumbrance, claim or equity and is
as set forth in the column entitled "At the Closing Time" under the table
relating to the capitalization of Enterprises under the caption "Capitalization"
in the Offering Memorandum. Enterprises has no subsidiaries.
(viii) Each of the Trust and AHL is duly qualified as a foreign trust
or limited-liability company, as applicable, to transact business and the Trust
is in good standing in each jurisdiction in which such qualification is
required, whether by reason of the ownership or leasing of property or the
conduct of business, except where the failure so to qualify or to be in good
standing would not result in a material adverse effect on its business,
prospects, financial condition or results of operations.
(ix) The Preferred Membership Interests have been duly authorized by
the Company, and are validly issued, fully-paid, non-assessable and not subject
to any preemptive or similar rights and, other than in connection with the
Preferred Membership Interests Pledge Agreement, are directly owned by Holdings
free and clear of any security interest, mortgage, pledge, lien, encumbrance,
claim or equity.
(x) Each of the Aladdin Parties and their subsidiaries possesses such
permits, licenses, approvals, consents and other authorizations (collectively,
"Governmental Licenses") issued by the appropriate federal, state, local or
foreign regulatory agencies or bodies necessary to conduct the business now
operated by them; each of the Aladdin Parties and their subsidiaries is in
compliance with the terms and conditions of all such Governmental Licenses,
except where the failure so to comply would not, singly or in the aggregate,
have a Material Adverse Effect; all of the Governmental Licenses are valid and
in full force and effect, except when the invalidity of such Governmental
Licenses or the failure of such Governmental Licenses to be in full force and
effect would not have a Material Adverse Effect; and none of the Aladdin Parties
or any of their subsidiaries has received any notice of proceedings relating to
the revocation or modification of any such Governmental Licenses which, singly
or in the aggregate, if the subject of an unfavorable decision, ruling or
finding, would result in a Material Adverse Effect.
(xi) The issuance of the Warrant Shares has been duly authorized by all
requisite corporate action of Enterprises; and upon issuance thereof and payment
therefor in accordance with the terms of the Warrant Agreement, the Warrant
Shares will be duly authorized, validly issued, fully paid and nonassessable and
free of preemptive or similar rights. Enterprises has reserved the number of
Warrant shares contemplated by the Warrant Agreement for issuance under the
Warrants.
(xii) None of the Aladdin Parties or any of their subsidiaries is in
violation of its charter, by-laws or any other organizational document and, to
the best of our knowledge, no default by any of the Aladdin Parties or any of
their subsidiaries exists in the due performance or observance of any material
obligation, agreement, covenant or condition contained in any contract,
indenture, mortgage, deed of trust, loan or credit agreement, note, lease or
other
B-2
agreement or instrument to which any of the Aladdin Parties or any of
their subsidiaries is a party that is described or referred to in the Offering
Memorandum.
(xiii) Except as set forth in Section ___ of the Holdings Operating
Agreement, none of the Aladdin Parties nor any of their subsidiaries has any
outstanding options to purchase, or any preemptive rights or other rights to
subscribe for or purchase, any securities or obligations convertible into, or
any contracts or commitments to issue or sell, equity interests or any such
options, rights, convertible securities or obligations.
(xiv) The statements under the caption "Risk Factors--Ability to
Realize on Collateral; "Risk Factors--Certain Bankruptcy Considerations," "Risk
Factors--Mechanic's Liens," "Risk Factors-Government Regulation" and "Regulation
and Licensing"" in the Offering Memorandum, insofar as such statements
constitute a summary of the legal matters, documents or proceedings referred to
therein with respect to Nevada law, fairly present in all material respects such
legal matters, documents and proceedings.
(xv) After due inquiry, such counsel does not know of any legal or
governmental proceedings pending or threatened to which any of the Aladdin
Parties is or could be a party or to which any of their respective property is
or could be subject, which might result, singly or in the aggregate, in a
Material Adverse Effect.
(xvi) None of the Aladdin Parties has violated any Environmental Laws
or any provisions of ERISA, or the rules and regulations promulgated thereunder,
except for such violations which, singly or in the aggregate, would not have a
Material Adverse Effect.
(xvii) Other than as disclosed in the Offering Memorandum, there exists
no fact or any event which has occurred or which is reasonably likely to result
in material liability (including, without limitation, alleged or potential
liability for investigatory costs, cleanup costs, governmental response costs,
natural resource damages, property damages, personal injuries or penalties)
arising out of, based on or resulting from the presence or release into the
environment of any hazardous material (including without limitation any
pollutant or contaminant or hazardous, dangerous or toxic chemical, material,
waste or substance regulated under or within the meaning of any Environmental
Law) or any violation of any Environmental Law with respect to the Contributed
Land.
(xviii) Each of the Aladdin Parties and their subsidiaries possesses
such Governmental Licenses issued by the appropriate federal, state, local or
foreign regulatory agencies or bodies necessary to conduct the business now
operated by them; each of the Aladdin Parties and their subsidiaries is in
compliance with the terms and conditions of all such Governmental Licenses,
except where the failure so to comply would not, singly or in the aggregate,
have a Material Adverse Effect; all of the Governmental Licenses are valid and
in full force and effect, except when the invalidity of such Governmental
Licenses or the failure of such Governmental Licenses to be in full force and
effect would not have a Material Adverse Effect; and none of the Aladdin Parties
or any of their subsidiaries has received any notice of proceedings relating to
the revocation or modification of any such Governmental Licenses which, singly
or in the aggregate,
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if the subject of an unfavorable decision, ruling or finding, would result in a
Material Adverse Effect.
(xix) The Company has good and marketable title in fee simple to the
Project Site and good and marketable title to all personal property owned by the
Company which is material to the business of the Company, free and clear of any
security interest, mortgage, pledge, lien, encumbrance, claim or equity and
defects, except such as do not materially affect the value of such property and
do not interfere with the use made and proposed to be made of such property by
the Company in connection with its business as described in the Offering
Memorandum; and any real property held under lease by the Company is held under
valid, subsisting and enforceable leases with such exceptions as are not
material and do not interfere with the use made and proposed to be made of such
property by the Company in connection with its business as described in the
Offering Memorandum, and the Company enjoys peaceful and undisturbed possession
under all such leases.
(xx) To the best knowledge of such counsel, there is no statute, rule,
regulation or order that has been enacted, adopted or issued by any governmental
agency which could have a Material Adverse Effect.
(xxi) The contemplated operation and use of the Aladdin, including the
construction of the Aladdin, will be (giving effect to any waivers or variances
which may be obtained) in compliance with all applicable municipal, county,
state and federal laws, regulations, ordinances, standards, orders, and other
regulations, where the failure to comply therewith could have a Material Adverse
Effect. Under applicable zoning and use laws, ordinances, rules and regulations,
the Aladdin may be used for the purposes contemplated in the Offering
Memorandum.
(xxii) It is our opinion that a federal or state court sitting in
Nevada will honor the parties' choice of the internal laws of the State of New
York as the law applicable to the Executed Transaction Documents and the
Executory Transaction Documents (to the extent set forth in such documents) and
to the determination of whether the obligations created by the Executed
Transaction Documents and Executory Transaction Documents are usurious.
(xxiii) The Pledge Agreements are in a form that substantially meets
the requirements of the Nevada Act and the Nevada Gaming Authorities.
(xxiv) The (a) deposit of the proceeds from the sale of the Units into
the Note Construction Disbursement Account, (b) execution of the Disbursement
Agreement and the Note Construction Pledge Agreement and the Escrow Agreement by
Holdings or the Company, as applicable, and (c) filing of the financing
statements in the office of the Nevada Secretary of State, shall cause the
Trustee, for the ratable benefit of the holders of the Notes, to have, as
security for the payment of obligations under the Indenture and the Notes, a
valid and perfected security interest or lien in the proceeds from the sale of
the Units deposited into the Note Construction Disbursement Account, and the
actions and filings described in clauses (a), (b) and (c) are hte only actions
and filings necessary to publish notice of the validity of such security
interests or liens and to perfect such security interest or liens as may be
perfected by filing. From
B-4
and after the date hereof (assuming the due filing of Holdings' financing
statements and continuation statements required by Nevada law, without
intervening liens or security interests), the liens or security interests
created by the Disbursement Agreement and the Note Construction Pledge
Agreement which are to be perfected by the filing of a UCC-1 financing
statement will be duly perfected.
(xxv) Assuming the Preferred Membership Interests Pledge Agreement
create a valid security interest in the Pledged Interest (as defined in the
Preferred Membership Interests Pledge Agreement) under New York law, after
giving effect to the delivery to the Trustee for the benefit of the Noteholders
in the State of Nevada of the certificates representing the Pledged Interests,
in good faith and without notice of any adverse claim and in bearer form, or in
registered form endorsed to the Trustee or in blank by an effective enforsement
or registered in the name of the Trustee upon registration of transfer by the
issuer, the Trustee for the benefit of the Noteholders will have a perfected
security interest in such Pledged Interests.
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Exhibit C
FORM OF OPINION OF COUNSEL TO LONDON CLUBS AND LCNI
TO BE DELIVERED PURSUANT TO
SECTION 7(a)(iii)
(i) Each of London Clubs and LCNI has been duly incorporated, is
validly existing and is a corporation in good standing under the laws of its
jurisdiction of incorporation.
(ii) Each of London Clubs and LCNI has all necessary corporate power
and authority to carry on its business and to own, lease and operate its
properties. London Clubs owns all of the outstanding shares of capital stock of
LCNI.
(iii) Each of London Clubs and LCNI is duly qualified and is in good
standing as a foreign corporation authorized to do business in each jurisdiction
in which the nature of its business or its ownership or leasing of property
requires such qualification, except, with respect to London Clubs, where the
failure to be so qualified would not have a material adverse effect on its
business, prospects, financial condition or results of operations.
(iv) The Purchase Agreement has been duly authorized, executed and
delivered by London Clubs.
(v) Neither London Clubs or LCNI is in violation of its charter,
by-laws or any other organizational document and, to the best of our knowledge,
no default by London Clubs or LCNI exists in the due performance or observance
of any material obligation, agreement, covenant or condition contained in any
contract, indenture, mortgage, deed of trust, loan or credit agreement, note,
lease or other agreement or instrument to which London Clubs or LCNI is a party
that is described or referred to in the Offering Memorandum.
(vi) Other than the approval of the shareholders of London Clubs and
approvals necessary in connection with the U.S. Facilities Agreement banks with
National Westminster PLC as arranger and U.S. 1997 Noteholders, each of which
shall be obtained prior to the Closing Time, no filing with, or authorization,
approval, consent, license, order, registration, qualification or decree of, any
court or governmental authority or agency or any other party is necessary or
required for the performance by either of London Clubs or LCNI of their
obligations hereunder.
