EXHIBIT 10.1
SUBSIDIARY GUARANTY
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(Second Amended and Restated Loan Agreement)
This SUBSIDIARY GUARANTY ("Subsidiary Guaranty"), dated as of May 31,
2000, is made by MGM Grand, Inc. and each of the undersigned Subsidiaries of MGM
Grand, Inc. (each a "Guarantor" and collectively, jointly and severally, as
"Guarantors") in favor of Bank of America, N. A., as Administrative Agent for
the benefit of the Banks that are party to the Loan Agreement referred to below
(collectively with the Banks, "Lender"), with reference to the following facts:
RECITALS
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A. MGM Grand, Inc., a Delaware corporation ("Borrower") has entered into
a Second Amended and Restated Loan Agreement dated as of April lo, 2000 (as
amended, the "Loan Agreement") among Borrower, MGM Grand Atlantic City, Inc., a
New Jersey corporation, as a Co-Borrower, MGM Grand Detroit, LLC, a Delaware
limited liability company ("Detroit"), as a Co-Borrower, the Banks which are
party thereto, and Bank of America, N. A., as Administrative Agent.
B. Certain of the Guarantors have previously guaranteed the obligations of
the Borrowers under the Old Loan Agreement referred to in the Loan Agreement,
and it is a condition to the amended and restated credit facilities under the
Loan Agreement that each of the Guarantors enter into this Subsidiary Guaranty.
C. Each Guarantor expects to realize direct and indirect benefits as the
result of the availability of the aforementioned credit facilities to Borrower
and Co-Borrowers, as the result of financial and business support which will be
provided to the Guarantors by Borrower or Co-Borrowers.
AGREEMENT
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NOW, THEREFORE, in order to induce Lender to extend the aforementioned
credit facilities, and for other good and valuable consideration, the receipt
and adequacy of which hereby are acknowledged, each Guarantor hereby jointly and
severally represents, warrants, covenants, agrees and guaranties as follows:
1. Definitions. This Subsidiary Guaranty is one of the Guaranties
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referred to in the Loan Agreement and is one of the Loan Documents. Terms
defined in the Loan Agreement and not otherwise defined in this Subsidiary
Guaranty shall have the meanings given those terms in the Loan Agreement when
used herein and such definitions are incorporated herein as though set forth in
full. In addition, as used herein, the following terms shall have the meanings
respectively set forth after each:
"Guarantied Obligations" means all Obligations of Borrower, each Co-
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Borrower and each other Party at any time and from time to time owed to
Lender under one or more of the Loan Documents (but not including
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Obligations owed to Lender under this Subsidiary Guaranty), whether due or
to become due, matured or unmatured, liquidated or unliquidated, or
contingent or noncontingent, including obligations of performance as well
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as obligations of payment, and including interest that accrues after the
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commencement of any bankruptcy or insolvency proceeding by or against
Borrower, any Co-Borrower, any Guarantor or any other Person, provided that
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the liability of Detroit is limited to that portion of the Obligations
which are used, directly or indirectly, to finance the design, development,
construction or operation of the Detroit Project or which are actually
borrowed or received by Detroit.
"Guarantor" means, collectively, jointly and severally, each of the
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undersigned and each other Person which hereafter becomes a party hereto by
executing a Joinder hereto in the form of Exhibit A.
"Subsidiary Guaranty" means this Subsidiary Guaranty, and any extensions,
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modifications, renewals, restatements, reaffirmations, supplements or
amendments hereof.
"Lender" means the Administrative Agent (acting as the Administrative Agent
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and/or on behalf of the Banks), and the Banks, and each of them, and any
one or more of them. Subject to the terms of the Loan Agreement, any right,
remedy, privilege or power of Lender may be exercised by the Administrative
Agent, or by the Requisite Banks, or by any Bank acting with the consent of
the Requisite Banks.
2. Guaranty of Guarantied Obligations. Each Guarantor hereby jointly and
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severally irrevocably, unconditionally guaranties and promises to pay and
perform on demand the Guarantied Obligations and each and every one of them,
including all amendments, modifications, supplements, renewals or extensions of
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any of them, whether such amendments, modifications, supplements, renewals or
extensions are evidenced by new or additional instruments, documents or
agreements or change the rate of interest on any Guarantied Obligation or the
security therefor, or otherwise.
3. Nature of Guaranty. This Subsidiary Guaranty is irrevocable and
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continuing in nature and relates to any Guarantied Obligations now existing or
hereafter arising. This Subsidiary Guaranty is a guaranty of prompt and punctual
payment and performance and is not merely a guaranty of collection.
4. Relationship to Other Agreements. Nothing herein shall in any way
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modify or limit the effect of terms or conditions set forth in any other
document, instrument or agreement executed by any Guarantor or in connection
with the Guarantied Obligations, but each and every term and condition hereof
shall be in addition thereto. All provisions contained in the Loan Agreement or
any other Loan Document that apply to Loan Documents generally are fully
applicable to this Subsidiary Guaranty and are incorporated herein by this
reference.
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5. Subordination of Indebtedness of Borrower or Any Co-Borrower to
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Guarantors to the Guarantied Obligations. Each Guarantor agrees that:
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(a) Any indebtedness of Borrower or any Co-Borrower now or hereafter
owed to that Guarantor hereby is subordinated to the Guarantied Obligations.
(b) If Lender so requests, upon the occurrence and during the
continuance of any Event of Default, any such indebtedness of Borrower or any
Co-Borrower now or hereafter owed to that Guarantor shall be collected,
enforced and received by that Guarantor as trustee for Lender and shall be
paid over to Lender in kind on account of the Guarantied Obligations, but
without reducing or affecting in any manner the obligations of that Guarantor
under the other provisions of this Subsidiary Guaranty.
(c) Should that Guarantor fail to collect or enforce any such
indebtedness of Borrower or any Co-Borrower now or hereafter owed to that
Guarantor and pay the proceeds thereof to Lender in accordance with Section
5(b) hereof, Lender as that Guarantor's attorney-in-fact may do such acts and
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sign such documents in that Guarantor's name as Lender considers necessary or
desirable to effect such collection, enforcement and/or payment.
6. Statutes of Limitations and Other Laws. Until the Guarantied
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Obligations shall have been paid and performed in full, all the rights,
privileges, powers and remedies granted to Lender hereunder shall continue to
exist and may be exercised by Lender at any time and from time to time
irrespective of the fact that any of the Guarantied Obligations may have become
barred by any statute of limitations. Each Guarantor expressly waives the
benefit of any and all statutes of limitation, and any and all Laws providing
for exemption of property from execution or for evaluation and appraisal upon
foreclosure, to the maximum extent permitted by applicable Laws.
7. Waivers and Consents. Each Guarantor acknowledges that the obligations
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undertaken herein involve the guaranty of obligations of Persons other than that
Guarantor and, in full recognition of that fact, consents and agrees that Lender
may, at any time and from time to time, without notice or demand, and without
affecting the enforceability or continuing effectiveness hereof: (a) supplement,
modify, amend, extend, renew, accelerate or otherwise change the time for
payment or the terms of the Guarantied Obligations or any part thereof,
including any increase or decrease of the rate(s) of interest thereon;
(b) supplement, modify, amend or waive, or enter into or give any agreement,
approval or consent with respect to, the Guarantied Obligations or any part
thereof, or any of the Loan Documents to which that Guarantor is not a party or
any additional security or guaranties, or any condition, covenant, default,
remedy, right, representation or term thereof or thereunder; (c) accept new or
additional instruments, documents or agreements in exchange for or relative to
any of the Loan Documents or the Guarantied Obligations or any part thereof;
(d) accept partial payments on the Guarantied Obligations; (e) receive and hold
additional security or guaranties for the Guarantied Obligations or any part
thereof; (f) release, reconvey, terminate, waive, abandon, fail to perfect,
subordinate, exchange, substitute, transfer and/or enforce any security or
guaranties, and apply any security and direct the order or manner of sale
thereof as Lender in its sole and absolute discretion may determine; (g) release
any Person from any personal liability with respect to the Guarantied
Obligations or any part thereof; (h) settle, release on terms satisfactory to
Lender or by
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operation of applicable Laws or otherwise liquidate or enforce any Guarantied
Obligations and any security or guaranty therefor in any manner, consent to the
transfer of any security and bid and purchase at any sale; and/or (i) consent to
the merger, change or any other restructuring or termination of the corporate or
other existence of Borrower, any Co-Borrower, any Guarantor or any other Person,
and correspondingly restructure the Guarantied Obligations, and any such merger,
change, restructuring or termination shall not affect the liability of
Guarantors or the continuing effectiveness hereof, or the enforceability hereof
with respect to all or any part of the Guarantied Obligations.
Upon the occurrence and during the continuance of any Event of Default,
Lender may enforce this Subsidiary Guaranty independently as to that Guarantor
and independently of any other remedy or security Lender at any time may have or
hold in connection with the Guarantied Obligations. Each Guarantor expressly
waives any right to require Lender to marshal assets in favor of Borrower, any
Co-Borrower or any other Person, and agrees that Lender may proceed against
Borrower, any Co-Borrower or any other Person, or upon or against any security
or remedy, before proceeding to enforce this Subsidiary Guaranty, in such order
as it shall determine in its sole and absolute discretion. Lender may file a
separate action or actions against Borrower, any Co-Borrower and/or any one or
more Guarantors without respect to whether action is brought or prosecuted with
respect to any security or against any other Person, or whether any other Person
is joined in any such action or actions. Each Guarantor agrees that Lender and
Borrower, any Co-Borrower and any Affiliates of Borrower or any Co-Borrower may
deal with each other in connection with the Guarantied Obligations or otherwise,
or alter any contracts or agreements now or hereafter existing between any of
them, in any manner whatsoever, all without in any way altering or affecting the
security of this Subsidiary Guaranty. Lender's rights hereunder shall be
reinstated and revived, and the enforceability of this Subsidiary Guaranty shall
continue, with respect to any amount at any time paid on account of the
Guarantied Obligations which thereafter shall be required to be restored or
returned by Lender upon the bankruptcy, insolvency or reorganization of
Borrower, any Co-Borrower or any other Person, or otherwise, all as though such
amount had not been paid. The rights of Lender created or granted herein and the
enforceability of this Subsidiary Guaranty with respect to Guarantors at all
times shall remain effective to guaranty the full amount of all the Guarantied
Obligations even though the Guarantied Obligations, or any part thereof, or any
security or guaranty therefor, may be or hereafter may become invalid or
otherwise unenforceable as against Borrower, any Co-Borrower, any other Party or
any other guarantor or surety and whether or not Borrower, any Co-Borrower or
any other Party shall have any personal liability with respect thereto. Each
Guarantor expressly waives any and all defenses now or hereafter arising or
asserted by reason of (a) any disability or other defense of Borrower, any Co-
Borrower or any other Party with respect to the Guarantied Obligations, (b) the
unenforceability or invalidity of any security or guaranty for the Guarantied
Obligations or the lack of perfection or continuing perfection or failure of
priority of any security for the Guarantied Obligations, (c) the cessation for
any cause whatsoever of the liability of Borrower, any Co-Borrower or any other
Party (other than by reason of the full payment and performance of all
Guarantied Obligations), (d) any failure of Lender to marshal assets in favor of
Borrower, any Co-Borrower or any other Person, (e) except as otherwise provided
in this Subsidiary Guaranty, any failure of Lender to give notice of sale or
other disposition of any collateral securing any Guarantied Obligation to that
Guarantor or any other Person or any defect in any notice that may be given in
connection with any sale or disposition of any collateral securing any
Guarantied Obligation, (f) any failure of Lender to comply with applicable Laws
in connection with the sale or other disposition of any collateral securing any
Guarantied Obligation or other security for any
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Guarantied Obligation, including without limitation, any failure of Lender to
conduct a commercially reasonable sale or other disposition of any collateral
securing any Guarantied Obligation or other security for any Guarantied
Obligation, (g) any act or omission of Lender or others that directly or
indirectly results in or aids the discharge or release of Borrower, any Co-
Borrower, any other Party or the Guarantied Obligations or any security or
guaranty therefor by operation of law or otherwise, (h) any Law which provides
that the obligation of a surety or guarantor must neither be larger in amount
nor in other respects more burdensome than that of the principal or which
reduces a surety's or guarantor's obligation in proportion to the principal
obligation, (i) any failure of Lender to file or enforce a claim in any
bankruptcy or other proceeding with respect to any Person, (j) the election by
Lender, in any bankruptcy proceeding of any Person, of the application or non-
application of Section 1111(b)(2)of the United States Bankruptcy Code, (k) any
extension of credit or the grant of any Lien under Xxxxxxx 000 xx xxx Xxxxxx
Xxxxxx Bankruptcy Code, (1) any use of cash collateral under Section 363 of the
United States Bankruptcy Code, (m) any agreement or stipulation with respect to
the provision of adequate protection in any bankruptcy proceeding of any Person,
(n) the avoidance of any Lien in favor of Lender for any reason, (0) any
bankruptcy, insolvency, reorganization, arrangement, readjustment of debt,
liquidation or dissolution proceeding commenced by or against any Person,
including any discharge of, or bar or stay against collecting, all or any of the
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Guarantied Obligations (or any interest thereon) in or as a result of any such
proceeding, (p) to the extent permitted in paragraph 40.495(4) of the Nevada
Revised Statutes ("NRS"), the benefits of the one-action rule under NRS Section
40.430, or (q) any action taken by Lender that is authorized by this Section or
any other provision of any Loan Document. Each Guarantor expressly waives all
setoffs and counterclaims and all presentments, demands for payment or
performance, notices of nonpayment or nonperformance, protests, notices of
protest, notices of dishonor and all other notices or demands of any kind or
nature whatsoever with respect to the Guarantied Obligations, and all notices of
acceptance of this Subsidiary Guaranty or of the existence, creation or
incurrence of new or additional Guarantied Obligations.
8. Condition of Borrower, Co-Borrowers and their Subsidiaries. Each
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Guarantor represents and warrants to Lender that such Guarantor has established
adequate means of obtaining from Borrower, the Co-Borrowers, and their
Subsidiaries, on a continuing basis, financial and other information pertaining
to the businesses, operations and condition (financial and otherwise) of
Borrower, the Co-Borrowers and their Subsidiaries and their properties, and such
Guarantor now is and hereafter will be completely familiar with the businesses,
operations and condition (financial and otherwise) of Borrower, the Co-Borrowers
and their Subsidiaries and their properties. Each Guarantor hereby expressly
waives and relinquishes any duty on the part of Lender (should any such duty
exist) to disclose to that Guarantor any matter, fact or thing related to the
businesses, operations or condition (financial or otherwise) of Borrower, the
Co-Borrowers or their Subsidiaries or their properties, whether now known or
hereafter known by Lender during the life of this Subsidiary Guaranty. With
respect to any of the Guarantied Obligations, Lender need not inquire into the
powers of Borrower, the Co-Borrowers or any Subsidiaries thereof or the officers
or employees acting or purporting to act on their behalf, and all Guarantied
Obligations made or created in good faith reliance upon the professed exercise
of such powers shall be secured hereby.
9. Liens on Real Property. In the event that all or any part of the
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Guarantied Obligations at any time are secured by any one or more deeds of trust
or mortgages or other instruments creating or granting Liens on any interests in
real Property, each Guarantor authorizes
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Lender, upon the occurrence of and during the continuance of any Event of
Default, at its sole option, without notice or demand and without affecting any
obligations of that Guarantor hereunder, the enforceability of this Subsidiary
Guaranty, or the validity or enforceability of any Liens of Lender on any
collateral securing any Guarantied Obligation, to foreclose any or all of such
deeds of trust or mortgages or other instruments by judicial or nonjudicial
sale. Each Guarantor expressly waives any defenses to the enforcement of this
Subsidiary Guaranty or any rights of Lender created or granted hereby or to the
recovery by Lender against Borrower, any Co-Borrower, that Guarantor or any
other Person liable therefor of any deficiency after a judicial or nonjudicial
foreclosure or sale because all or any part of the Guarantied Obligations is
secured by real Property. This means, among other things: (1) Lender may collect
from any Guarantor without first foreclosing on any real or personal Property
collateral pledged by the Borrower, any Co-Borrower or any other Party. (2) If
Lender forecloses on any real Property collateral pledged by the Borrower, any
Co-Borrower or any other Party: (A) The amount of the Guarantied Obligations may
be reduced only by the price for which that collateral is sold at the
foreclosure sale, even if the collateral is worth more than the sale price. (B)
The Lender may collect from any Guarantor even if the Lender, by foreclosing on
the real Property collateral, has destroyed any right any Guarantor may have to
collect from the Borrower, any Co-Borrower or any other Party. This is an
unconditional and irrevocable waiver of any rights and defenses any Guarantor
may have because all or any part of the Guarantied Obligations is secured by
real Property. Each Guarantor expressly waives any defenses or benefits that may
be derived from California Code of Civil Procedure SS 580a, 580b, 580d or 726,
or comparable provisions of the Laws of any other jurisdiction, including,
without limitation, NRS Section 40.430 and judicial decisions relating thereto,
and NRS Sections 40.451,40.455,40.457 and 40.459, and all other suretyship
defenses it otherwise might or would have under Nevada Law or other applicable
Law. Each Guarantor expressly waives any right to receive notice of any judicial
or nonjudicial foreclosure or sale of any real Property or interest therein
subject to any such deeds of trust or mortgages or other instruments and any
Guarantor's or any other Person's failure to deceive any such notice shall not
impair or affect any Guarantor's Obligations or the enforceability of this
Subsidiary Guaranty or any rights of Lender created or granted herein.
1O. Waiver of Rights of Subrogation. Notwithstanding anything to the
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contrary elsewhere contained herein or in any other Loan Document to which any
Guarantor is a Party, each Guarantor hereby expressly waives with respect to
Borrower, any Co-Borrower, any other Party and their successors and assigns
(including any surety) and any other Person which is directly or indirectly a
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creditor of Borrower, any Co-Borrower, any other Party or any surety for
Borrower, any Co-Borrower or any other Party, any and all rights at Law or in
equity to subrogation, to reimbursement, to exoneration, to contribution, to
setoff or to any other rights that could accrue to a surety against a principal,
to a guarantor against a maker or obligor, to an accommodation party against the
party accommodated, or to a holder or transferee against a maker, and which that
Guarantor may have or hereafter acquire against Borrower, any Co-Borrower or any
other such Person in connection with or as a result of that Guarantor's
execution, delivery and/or performance of this Subsidiary Guaranty or any other
Loan Document to which that Guarantor is a Party. Each Guarantor agrees that it
shall not have or assert any such rights against Borrower, any Co-Borrower or
any other Party or their successors and assigns or any other Person (including
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any surety) which is directly or indirectly a creditor of Borrower, any Co-
Borrower or any other Party or any surety for Borrower, any Co-Borrower, or any
other Party either directly or as an attempted setoff to any action commenced
against that Guarantor by Borrower, any Co-Borrower or any other Party (as
borrower,
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co-borrower or in any other capacity), Lender or any other such Person. Each
Guarantor hereby acknowledges and agrees that this waiver is intended to benefit
Borrower, the Co-Borrowers, the other Parties and Lender and shall not limit or
otherwise affect that Guarantor's liability hereunder, under any other Loan
Document to which that Guarantor is a Party, or the enforceability hereof or
thereof.
11. Understandings With Respect to Waivers and Consents. Each Guarantor
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warrants and agrees that each of the waivers and consents set forth herein are
made with full knowledge of their significance and consequences, with the
understanding that events giving rise to any defense or right waived may
diminish, destroy or otherwise adversely affect rights which that Guarantor
otherwise may have against Borrower, any Co-Borrower, any other Party, Lender or
others, or against any collateral securing any Guarantied Obligation, and that,
under the circumstances, the waivers and consents herein given are reasonable
and not contrary to public policy or Law. Each Guarantor acknowledges that it
has either consulted with legal counsel regarding the effect of this Subsidiary
Guaranty and the waivers and consents set forth herein, or has made an informed
decision not to do so. If this Subsidiary Guaranty or any of the waivers or
consents herein are determined to be unenforceable under or in violation of
applicable Law, this Subsidiary Guaranty and such waivers and consents shall be
effective to the maximum extent permitted by Law.
12. Representations and Warranties. Each Guarantor hereby makes each and
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every representation and warranty applicable to the Guarantors set forth in
Article 4 of the Loan Agreement as if set forth in full herein.
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13. Costs and Expenses. Each Guarantor jointly and severally agrees to pay
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to Lender all costs and expenses (including, without limitation, reasonable
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attorneys' fees and disbursements) incurred by Lender in the enforcement or
attempted enforcement of this Subsidiary Guaranty, whether or not an action is
filed in connection therewith, and in connection with any waiver or amendment of
any term or provision hereof. All advances, charges, costs and expenses,
including reasonable attorneys' fees and disbursements (including the reasonably
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allocated cost of legal counsel employed by Lender), incurred or paid by Lender
in exercising any right, privilege, power or remedy conferred by this Subsidiary
Guaranty, or in the enforcement or attempted enforcement thereof, shall be
subject hereto and shall become a part of the Guarantied Obligations and shall
be paid to Lender by each Guarantor, immediately upon demand, together with
interest thereon at the rate(s) provided for under the Loan Agreement.
14. Construction of this Subsidiary Guaranty. This Subsidiary Guaranty is
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intended to give rise to absolute and unconditional obligations on the part of
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each Guarantor; hence, in any construction hereof, notwithstanding any provision
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of any Loan Document to the contrary, this Subsidiary Guaranty shall be
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construed strictly in favor of Lender in order to accomplish its stated purpose.
15. Liability. Each Guarantor and by its acceptance hereof Lender hereby
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confirms that it is the intention of all such parties that the guarantee by such
Guarantor pursuant to this Subsidiary Guaranty not constitute a fraudulent
transfer or conveyance for purposes of any federal or state Law. To effectuate
the foregoing intention, the obligations of each such Guarantor under this
Subsidiary Guaranty shall be limited to the maximum amount as will, after giving
effect to
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all other contingent and fixed liabilities of such Guarantor and after giving
effect to any collections from or payments made by or on behalf of any other
Guarantor in respect of the obligations of such other Guarantor under this
Subsidiary Guaranty or pursuant to Section 16 of this Subsidiary Guaranty,
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result in the obligations of such Guarantor under this Subsidiary Guaranty not
constituting a fraudulent conveyance or fraudulent transfer under federal or
state Law. This Section 15 is for the benefit of the creditors of each
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Guarantor. The liability of each Guarantor hereunder is independent of any other
guaranties at any time in effect with respect to all or any part of the
Guarantied Obligations, and each Guarantor's liability hereunder may be enforced
regardless of the existence of any such guaranties. Any termination by or
release of any Guarantor in whole or in part shall not affect the continuing
liability of any other Guarantor hereunder, and no notice of any such
termination or release shall be required. The execution hereof by each Guarantor
is not founded upon an expectation or understanding that there will be any other
guarantor of the Guarantied Obligations.
16. Contribution. In order to provide for just and equitable contribution
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among the Guarantors, the Guarantors agree, inter se, that in the event any
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payment or distribution is made by any Guarantor (a "Funding Guarantor") under
this Subsidiary Guaranty, such Funding Guarantor shall be entitled to a
contribution from each other Guarantor in a pro rata amount based on the net
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worth of each Guarantor (including the Funding Guarantor) for all payments,
damages and expenses incurred by that Funding Guarantor in discharging any
Guarantied Obligation or any other Guarantor's obligations with respect to this
Subsidiary Guaranty.
17. WAIVER OF JURY TRIAL. EACH GUARANTOR AND LENDER EXPRESSLY WAIVE THEIR
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RESPECTIVE RIGHTS TO A TRIAL BY JURY OF ANY CLAIM, DEMAND, ACTION OR CAUSE OF
ACTION BASED UPON OR ARISING OUT OF OR RELATED TO THIS SUBSIDIARY GUARANTY, THE
LOAN AGREEMENT, THE OTHER LOAN DOCUMENTS OR THE TRANSACTIONS CONTEMPLATED HEREBY
OR THEREBY IN ANY ACTION, PROCEEDING OR OTHER LITIGATION OF ANY TYPE BROUGHT
BY ANY OF THE PARTIES AGAINST ANY OTHER PARTY OR PARTIES, WHETHER NOW EXISTING
OR HEREAFTER ARISING AND WHETHER WITH RESPECT TO CONTRACT CLAIMS, TORT CLAIMS,
OR OTHERWISE. EACH GUARANTOR AND LENDER AGREE THAT ANY SUCH CLAIM, DEMAND,
ACTION OR CAUSE OF ACTION SHALL BE TRIED BY A COURT TRIAL WITHOUT A JURY.
WITHOUT LIMITING THE FOREGOING, THE PARTIES FURTHER AGREE THAT THEIR RESPECTIVE
RIGHT TO A TRIAL BY JURY IS WAIVED BY OPERATION OF THIS SECTION AS TO ANY
ACTION, COUNTERCLAIM OR OTHER PROCEEDING WHICH SEEKS, IN WHOLE OR IN PART, TO
CHALLENGE THE VALIDITY OR ENFORCEABILITY OF THIS SUBSIDIARY GUARANTY, THE LOAN
AGREEMENT OR THE OTHER LOAN DOCUMENTS OR ANY PROVISION HEREOF OR THEREOF. THIS
WAIVER SHALL APPLY TO ANY SUBSEQUENT AMENDMENTS, RENEWALS, SUPPLEMENTS OR
MODIFICATIONS TO THIS SUBSIDIARY GUARANTY, THE LOAN AGREEMENT AND THE OTHER LOAN
DOCUMENTS. ANY PARTY HERETO MAY FILE AN ORIGINAL COUNTERPART OR A COPY OF THIS
SECTION WITH ANY COURT AS WRITTEN EVIDENCE OF THE CONSENT OF THE SIGNATORIES
HERETO TO THE WAIVER OF THEIR RIGHT TO TRIAL BY JURY.
18. THIS SUBSIDIARY GUARANTY SHALL BE GOVERNED BY, AND SHALL BE CONSTRUED
AND ENFORCED IN ACCORDANCE WITH, THE LOCAL
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LAWS OF THE STATE OF NEVADA WITHOUT REFERENCE TO THE CONFLICT OF LAWS OR
CHOICE OF LAW PRINCIPLES THEREOF.
19. Non-Involvement of Tracinda. The parties hereto acknowledge that
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neither Xxxx Xxxxxxxxx nor Tracinda Corporation, individually or collectively,
is a party to this Subsidiary Guaranty or any of the other Loan Documents
executed on the Closing Date. Accordingly, the parties hereto hereby agree that
in the event (i) there is any alleged breach or default by any Party under this
Subsidiary Guaranty or any such Loan Document, or (ii) any party hereto has any
claim arising from or relating to any such Loan Document, no party hereto, nor
any party claiming through it (to the extent permitted by applicable Law), shall
commence any proceedings or otherwise seek to impose any liability whatsoever
against Xx. Xxxxxxxxx or Tracinda Corporation by reason of such alleged breach,
default or claim.
IN WITNESS WHEREOF, each Guarantor has executed this Subsidiary Guaranty by
its duly authorized officer as of the date first written above.
MGM GRAND, INC.,
a Delaware corporation
MGM GRAND HOTEL, INC.,
a Nevada corporation
MGM GRAND MOVIEWORLD, INC.,
a Nevada corporation
GRAND LAUNDRY, INC.,
a Nevada corporation
MGM GRAND ADVERTISING, INC.,
a Nevada corporation
MGM GRAND ENTERTAINMENT, INC.,
a Nevada corporation
MGM GRAND MONORAIL, INC.,
a Nevada corporation
MGM DIST., INC.,
a Nevada corporation
DESTRON, INC.,
a Nevada corporation
DESTRON MARKETING, INC.,
a Nevada corporation
MGM GRAND MERCHANDISING, INC.,
a Nevada corporation
MGM GRAND ATLANTIC CITY, INC.,
a New Jersey corporation
By: /s/ Xxxxx Xxxxxxxx
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Xxxxx Xxxxxxxx,
Secretary to each of the foregoing
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MGM GRAND DETROIT, INC.,
a Delaware corporation
MGM GRAND DETROIT, LLC,
a Delaware limited liability company
1533 XXXXXXXX, INC.,
a Michigan corporation
BUSINESS DEVELOPMENT FUND, LLC,
a Delaware limited liability company
NEW PRMA LAS VEGAS, INC.,
a Nevada corporation
NEW YORK-NEW YORK HOTEL & CASINO, LLC, a
Nevada limited liability company
METROPOLITAN MARKETING, LLC,
a Nevada limited liability company
THE PRIMADONNA COMPANY, LLC,
a Nevada limited liability company
PRMA, LLC,
a Nevada limited liability company
PRMA LAND DEVELOPMENT COMPANY,
a Nevada corporation
PRMA-MS, INC.,
a Mississippi corporation
MGMGMR ACQUISITION, INC.,
a Nevada corporation
MGM ACQUISITION CO. #1,
a Nevada corporation
By: /s/ Xxxxx Xxxxxxxx
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Xxxxx Xxxxxxxx,
Secretary to each of the foregoing
-10-
MGM ACQUISITION CO. #2,
a Nevada corporation
MGM ACQUISITION CO. #3,
a Nevada corporation
MGM ACQUISITION CO. #4,
a Nevada corporation
MGM ACQUISITION CO. #5,
a Nevada corporation
MGM ACQUISITION CO. #6,
a Nevada corporation
MGM ACQUISITION CO. #7,
a Nevada corporation
MGM ACQUISITION CO. #8,
a Nevada corporation
MGM ACQUISITION CO. #9,
a Nevada corporation
MGM ACQUISITION CO. #10,
a Nevada corporation
MGM ACQUISITION CO. #11,
a Nevada corporation
MGM ACQUISITION CO. #12,
a Nevada corporation
MGM ACQUISITION CO. #13,
a Nevada corporation
MGM ACQUISITION CO. #14,
a Nevada corporation
MGM ACQUISITION CO. #15,
a Nevada corporation
By: /s/ Xxxxx Xxxxxxxx
-----------------------------------
Xxxxx Xxxxxxxx,
Secretary to each of the foregoing
-11-
MGM ACQUISITION CO. #16,
a Nevada corporation
MGM ACQUISITION CO. #17,
a Nevada corporation
MGM ACQUISITION CO. #18,
a Nevada corporation
MGM ACQUISITION CO. #19,
a Nevada corporation
MGM ACQUISITION CO. #20,
a Nevada corporation
MGM ACQUISITION CO. #21,
a Nevada corporation
MGM ACQUISITION CO. #22,
a Nevada corporation
MGM ACQUISITION CO. #23,
a Nevada corporation
MGM ACQUISITION CO. #24,
a Nevada corporation
MGM ACQUISITION CO. #25,
a Nevada corporation
MGM ACQUISITION CO. #26,
a Nevada corporation
MGM ACQUISITION CO. #27,
a Nevada corporation
MGM ACQUISITION CO. #28,
a Nevada corporation
MGM ACQUISITION CO. #29,
a Nevada corporation
By: /s/ Xxxxx Xxxxxxxx
-----------------------------------
Xxxxx Xxxxxxxx,
Secretary to each of the foregoing
-12-
MGM ACQUISITION CO. #30,
a Nevada corporation
MGM ACQUISITION CO. #31,
a Nevada corporation
MGM ACQUISITION CO. #32,
a Nevada corporation
MGM ACQUISITION CO. #33,
a Nevada corporation
MGM ACQUISITION CO. #34,
a Nevada corporation
MGM ACQUISITION CO. #35,
a Nevada corporation
MGM ACQUISITION CO. #36,
a Nevada corporation
MGM ACQUISITION CO. #37,
a Nevada corporation
MGM ACQUISITION CO. #38,
a Nevada corporation
MGM ACQUISITION CO. #39,
a Nevada corporation
MGM ACQUISITION CO. #40,
a Nevada corporation
MGM ACQUISITION CO. #41,
a Nevada corporation
MGM ACQUISITION CO. #42,
a Nevada corporation
MGM ACQUISITION CO. #43,
a Nevada corporation
By: /s/ Xxxxx Xxxxxxxx
-----------------------------------
Xxxxx Xxxxxxxx,
Secretary to each of the foregoing
-13-
MGM ACQUISITION CO. #44,
a Nevada corporation
MGM ACQUISITION CO. #45,
a Nevada corporation
MGM ACQUISITION CO. #46,
a Nevada corporation
MGM ACQUISITION CO. #47,
a Nevada corporation
MGM ACQUISITION CO. #48,
a Nevada corporation
MGM ACQUISITION CO. #49,
a Nevada corporation
MGM ACQUISITION CO. #50,
a Nevada corporation
MGM ACQUISITION CO. #51,
a Nevada corporation
MGM ACQUISITION CO. #52,
a Nevada corporation
MGM ACQUISITION CO. #53,
a Nevada corporation
MGM ACQUISITION CO. #54,
a Nevada corporation
MGM ACQUISITION CO. #55,
a Nevada corporation
MGM ACQUISITION CO. #56,
a Nevada corporation
By: /s/ Xxxxx Xxxxxxxx
-----------------------------------
Xxxxx Xxxxxxxx,
Secretary to each of the foregoing
-14-
MGM ACQUISITION CO. #60,
a Nevada corporation
By: /s/ Xxxxx Xxxxxxxx
-----------------------------------
Xxxxx Xxxxxxxx,
Secretary to each of the foregoing
Address for notices for each of the Guarantors:
c/o MGM Grand, Inc.
0000 Xxx Xxxxx Xxxxxxxxx Xxxxx
Xxx Xxxxx, Xxxxxx 00000-0000
-15-
[Exhibit A]
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INSTRUMENT OF JOINDER
---------------------
THIS INSTRUMENT OF JOINDER ("Joinder") is executed as of
______________, _________, by _____________________________, a (" Joining
Party"), and delivered to Bank of America, N. A., as Administrative Agent,
pursuant to the Subsidiary Guaranty dated as of May 3 1,2000, made by certain of
the Subsidiaries of MGM Grand, Inc. (each, a "Guarantor") in favor of the
Administrative Agent and the Banks referred to in the Loan Agreement referred to
below (the "Subsidiary Guaranty"). Terms used but not defined in this Joinder
shall have the meanings defined for those terms in the Subsidiary Guaranty.
RECITALS
--------
(A) The Subsidiary Guaranty was made by the Guarantors in favor of
the Administrative Agent for the benefit of the Banks that are parties to that
certain Second Amended and Restated Loan Agreement dated as of April 10,2000, by
and among MGM Grand, Inc., a Delaware corporation ("Borrower"), MGM Grand
Atlantic City, Inc., a New Jersey corporation, as a Co-Borrower, MGM Grand
Detroit, LLC, a Delaware limited liability company, as a Co-Borrower, the Banks
which are parties thereto and Bank of America, N. A., as the Administrative
Agent for the Banks (as amended, the "Loan Agreement").
(B) Joining Party has become a Restricted Subsidiary of Borrower,
and as such is required pursuant to Section 5.8 of the Loan Agreement to become
-----------
a party to the Subsidiary Guaranty.
(C) Joining Party expects to realize direct and indirect benefits
as a result of the availability to Borrower and the Co-Borrowers of the credit
facilities under the Loan Agreement.
NOW THEREFORE, Joining Party agrees as follows:
AGREEMENT
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(1) By this Joinder, Joining Party becomes a party to the
Subsidiary Guaranty as an additional joint and several "Guarantor." Joining
Party agrees that, upon its execution hereof, it will become a Guarantor under
the Subsidiary Guaranty with respect to all Guarantied Obligations as
Exhibit A
Page 1 of 2
further set forth therin, and will be bound by all terms, conditions, and duties
applicable to a Guarantor under the Subsidiary Guaranty.
(2) The effective date of this Joinder is ____________.
"Joining Party"
________________________________
a__________________________
By:______________________________
Title:___________________________
ACKNOWLEDGED:
BANK OF AMERICA, N.A.,
as Administrative Agent
By:_____________________________
Title:__________________________
Exhibit A
Page 2 of 2
