EXHIBIT 99.11
LEASE
THIS LEASE (as amended, restated, modified, and supplemented and in
effect from time to time, this "Lease") is made as of the 3rd day of December,
1997, by and between ALADDIN GAMING, LLC, a Nevada limited-liability company
("Landlord"), and NORTHWIND ALADDIN, LLC, a Nevada limited-liability company
("Tenant").
RECITALS:
A. Landlord is constructing a casino, hotel, theater, shopping and
parking complex in Las Vegas, Nevada (the "Aladdin Complex"), and has selected
Tenant to develop, construct, own and operate an energy production facility to
supply hot water, chilled water and electricity to said complex.
B. The site on which the aforementioned energy facility shall be
constructed shall be leased by Landlord to Tenant pursuant to the terms and
conditions of this Lease. Additionally, Landlord and Tenant are executing
concurrently herewith a certain Development Agreement of even date herewith (as
amended, restated, modified, or supplemented and in effect from time to time,
the "Development Agreement") regarding the construction of such facility and
have agreed in substance to the form of an Energy Service Agreement (which form
is attached to the Development Agreement, such Energy Service Agreement, in the
form in which it shall finally be executed and delivered, and as it may
thereafter be amended, restated, modified, or supplemented and in effect from
time to time, being herein referred to as the "ESA") regarding the terms and
conditions of the sale by Tenant to Landlord of hot water, chilled water and
electricity.
NOW, THEREFORE, in consideration of the mutual covenants and agreements
hereinafter set forth, it is hereby agreed between Tenant and Landlord as
follows:
Article 1. Representations and Warranties.
1.1 Landlord hereby represents and warrants to Tenant as
follows:
1.1.1 Landlord is a limited-liability company duly
organized and existing in good standing under the laws of the
State of Nevada;
1.1.2 Landlord possesses all requisite limited
liability company power and authority to enter into and
perform this Lease and to carry out the transaction
contemplated herein;
1.1.3 Landlord's execution, delivery and performance
of this Lease have been duly authorized by, or are in
accordance with, its organic instruments; this Lease has been
duly executed and delivered for it by the signatories so
authorized; this Lease constitutes Landlord's legal, valid and
binding obligation; Landlord's execution, delivery and
performance of this Lease will not result in a breach or
violation of, or constitute a default under, any agreement,
lease, or instrument to which it is a parry or by which it or
its properties may be bound or affected; and
1.1.4 No suit, action or arbitration, or legal,
administrative or other proceedings is pending or has been
threatened against Landlord that would affect the validity or
enforceability of this Lease or the ability of Landlord to
fulfill its commitments hereunder, or that could result in any
material adverse change in the business or financial condition
of Landlord.
1.2 Tenant hereby represents and warrants to Landlord as
follows:
1.2.1 Tenant is a limited liability company duly
organized and existing in good standing under the laws of the
State of Nevada;
1.2.2 Tenant possesses all requisite limited
liability company power and authority to enter into and
perform this Lease and to carry out the transaction
contemplated herein;
1.2.3 Tenant's execution, delivery and performance of
this Lease have been duly authorized by, or are in accordance
with, its organic instruments; this Lease has been duly
executed and delivered for it by the signatories so
authorized; this Lease constitutes Tenant's legal, valid and
binding obligation; Tenant's execution, delivery and
performance of this Lease will not result in a breach or
violation of, or constitute a default under, any agreement,
lease, or instrument to which it is a party or by which it or
its properties may be bound or affected;
1.2.4 No suit, action or arbitration, or legal,
administrative or other proceedings is pending or has been
threatened against Tenant that would affect the validity or
enforceability of this Lease or the ability of Tenant to
fulfill its commitments hereunder, or that could result in any
material adverse change in the business or financial condition
of Tenant; and
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1.2.5 Tenant agrees not to permit any transfer of any
membership interest in Tenant by the sole member of Tenant as
of the date of this Lease, and not to issue any new membership
interest in Tenant, without the prior written consent of
Landlord, such consent not to be unreasonably withheld;
provided, however, that upon prior notice to Landlord and
without Landlord's prior consent, Tenant shall be permitted to
allow Nevada Power Company, or a wholly-owned subsidiary
thereof, or to Boston Edison, Ontario Hydro or Houston
Industries to own a membership interest in Tenant, such
interest to be less than or equal to the interest retained by
UTT Las Vegas Inc., a Nevada corporation and a wholly-owned,
indirect subsidiary of Unicom Corporation, that, as of the
date of execution of this Lease, owns a 100% interest in
Tenant.
Article 2. Grant and Term.
2.1 Grant. For and in consideration of the rents herein
reserved and of the covenants and agreements herein contained on the part of
Tenant to be performed:
2.1.1 Landlord hereby leases to Tenant, and Tenant
hereby leases from Landlord, the real property located in
Xxxxx County, Nevada that is legally described on Exhibit A
(the "Project Site"), which exhibit shall be attached hereto
by Landlord no later than thirty (30) days after Notice to
Proceed is received by Northwind pursuant to the Development
Agreement.
2.1.2 Landlord hereby grants to Tenant and its
successors and assigns a non-exclusive easement in the real
property described on Exhibit B (the "Landlord's Property"),
which exhibit shall be attached hereto by Landlord no later
than thirty (30) days after Notice to Proceed is received by
Northwind pursuant to the Development Agreement (i) for the
purpose of providing access to the Project Site, and the other
property of Tenant located on, in or under the Landlord's
Property, and (ii) to permit access for, such access not to be
unreasonably denied, and the installation, maintenance,
repair, security and replacement of, pipes, ducts, cables,
conduit and other equipment and apparatus (including the
energy transfer stations) used or to be used by Tenant in the
operation of the Project (as defined in Article 4 below) and
the provision of Services (as defined in Article 4 below) to
users, distributors and/or vendors.
Any such use by Tenant of the Landlord's Property shall be in
accordance with all safety and security rules, regulations and policies then in
effect on Landlord's Property or such other reasonable rules or requirements
which Landlord imposes, and provided further that such use by Tenant shall in no
way have an adverse effect on
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Landlord's other activities. Landlord agrees that Landlord's activities shall
not have an adverse effect on Tenant's activities. For the purposes of this
paragraph, "adverse effect" means a materially detrimental effect on the
ownership, construction, maintenance, repair, or operation of the Project, in
the case of Tenant, or the Aladdin Complex, in the case of Landlord. The
easements granted in this Section shall continue so long as this Lease remains
in effect and shall expire and be of no further force or effect upon the earlier
of the execution of the Reciprocal Easement Agreement (as defined in the
Development Agreement) or the expiration or termination of this Lease. Each
easement granted under this Lease shall exist by virtue of this Lease, without
the necessity of or confirmation by any other document, and shall run with the
Landlord's Property. Upon the expiration, termination (in whole or in part) or
the release of any such easement in accordance with the provisions of this
Lease, the same shall be deemed to have expired, or have been terminated or
released without the necessity of confirmation by any other document.
2.2 Term. The terms and conditions of this Lease shall be
effective as of the date of this Lease. The initial term of this Lease (the
"Initial Term") shall commence on the date upon which the Aladdin Complex is
first opened for business to the public (the "Commencement Date"). Except as
otherwise provided in this Lease to the contrary, the Initial Term of this Lease
shall end on the day immediately preceding the twentieth anniversary of the
Commencement Date and the Initial Term shall be subject to extension and renewal
as provided for in Section 2.3 below. The term of this Lease, as the same may be
extended or renewed is referred to herein as the "Term".
2.3 Renewal Terms.
2.3.1 The Initial Term of this Lease shall be
automatically extended for a period of five years commencing
on the twentieth anniversary of the Commencement Date and
expiring on the day immediately preceding the twenty-fifth
anniversary of the Commencement Date unless either party gives
the other party written notice not later than twelve (12)
months before the twentieth anniversary of the Commencement
Date that such party is terminating the Lease as of the
twentieth anniversary of the Commencement Date. The five year
renewal period provided for in this Section 2.3.1 and each
subsequent five year renewal period provided for in Section
2.3.2 below are hereinafter referred to as "Renewal Terms".
2.3.2 The first Renewal Term shall be automatically
extended and renewed for a five year period commencing upon
the expiration of the first Renewal Term, and each subsequent
Renewal Term shall be automatically extended for an additional
five year renewal period commencing upon the
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expiration of the then existing Renewal Term and expiring on
the day preceding the fifth anniversary thereof, unless either
party gives the other party written notice not later than
twelve (12) months prior to the scheduled expiration of the
then existing Renewal Term that such parry is terminating this
Lease as of the scheduled expiration of such then existing
Renewal Term.
2.3.3 Notwithstanding anything herein to the
contrary, the Term shall automatically continue or be extended
for so long as the ESA (as defined in Section 2.4 hereof)
shall continue in effect.
2.4 Early Termination Rights. Subject to the terms of Article
18.2 below, if either the ESA or the Development Agreement is terminated in
accordance with the terms thereof, then each party hereto shall have the right
to terminate this Lease on the effective date of the termination of the ESA or
the Development Agreement, as applicable, by notifying the other party hereto in
writing of such termination, provided, however, that Landlord may not terminate
this Lease by reason of termination of the ESA or the Development Agreement if
such termination of the ESA or the Development Agreement was by the Tenant
pursuant to the Landlord's default thereunder and the Landlord did not acquire
the Project pursuant to such termination.
2.5 Acceptance of Project Site. Tenant hereby acknowledges (a)
that it has been advised to satisfy itself with respect to the condition of the
Project Site (including but not limited to the environmental aspects, compliance
with Applicable Law, (as defined in Section 4.2), and the level of utilities and
services available to the Project Site), (b) that Tenant will make such
investigation as it deems necessary with reference to such matters and, subject
to the provisions of the Development Agreement and the Energy Service Agreement
governing the cost of the Project and the charges payable in respect of
Services, assumes all responsibility therefor as the same relate to Tenant's
occupancy of the Project Site and/or the Term of this Lease, except with respect
to any Hazardous Material located on the Project Site as of the date hereof or
any other conditions of the Project Site existing as of the date hereof which
violate any Environmental Requirements, as to which Landlord shall have
responsibility and from and against which Landlord agrees to indemnify, defend
and hold Tenant harmless, and (c) that neither Landlord, nor any of Landlord's
agents, has made any oral or written representations or warranties with respect
to said matters, other than as set forth in this Lease, and Landlord has no
obligation and has made no promises to alter, remodel, improve, repair or
renovate the Project Site or any part thereof, other than as expressly set forth
in this Lease, the ESA or the Development Agreement.
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Article 3. Rent.
3.1 Base Rent. Tenant shall pay to Landlord a fixed monthly
base rent equal to $1.00 (the "Base Rent") per month throughout the Term.
Landlord hereby acknowledges receipt of $240 as prepayment of the Base Rent for
the entire Initial Term.
3.2 Net Lease. Except as provided below, this Lease shall be
deemed to be a "net" lease, and Tenant shall pay, as provided herein, all
Impositions (as hereinafter defined). Tenant shall pay to Landlord, absolutely
net throughout the Term, the Base Rent and other payments hereunder, free of any
charges, assessments, impositions or deductions of any kind, and, except as
contemplated by the Development Agreement and the ESA with respect to the cost
of construction, maintenance, service, repair, ownership, and operation of the
energy production facility, under no circumstances or conditions, whether now
existing or hereafter arising, or whether beyond the present contemplation of
the parties, shall Landlord be expected or required to make any payment of any
kind whatsoever relating to the Project Site. As used herein, "Impositions"
shall mean all operating, maintenance, repair and improvement costs and
insurance premiums owing with respect to the improvements being constructed by
Tenant, in accordance with the terms of the Development Agreement and the ESA,
on the Project Site (collectively, the "Improvements") and the property being
installed by Tenant, in accordance with the terms of the Development Agreement
and the ESA, on, in or under the Landlord's Property (collectively, the
"Additional Property") and all taxes, levies and assessments; use and occupancy
taxes; water and water assessments, fees and use charges; charges for public
utilities; excises; levies; license and permit fees; transit taxes; real estate
taxes; taxes on rentals; intangible and other personal property taxes; business
and occupation taxes; gross sales taxes; occupational license taxes; and all
other governmental impositions and charges of every kind and nature whatsoever,
whether the same are extraordinary or ordinary, general or special, or
unforeseen or foreseen, which at any time from and after the date hereof shall
be or become due and payable, but shall not include any general income taxes or
franchise fees assessed against Landlord; provided, however, that .
notwithstanding the foregoing, nothing herein is intended to require Tenant to
pay any charges, fees, costs or expenses that Landlord is required to pay under
the ESA or the Development Agreement, and the term "Impositions" shall not be
deemed to include any of such charges, fees, costs or expenses.
3.3 Rent. As used herein the term "Rent" shall mean the sum of
the Base Rent and any and all other amounts which are due from Tenant pursuant
to the provisions of this Lease. Rent which has not been prepaid as of the date
hereof shall be due and payable to Landlord on the last day of each month and
shall be paid to Landlord at Las Vegas, Nevada or at such other place as
Landlord may designate from time to time. All payments of Rent shall be made in
lawful money of the United States.
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3.4 No Presumption. Wherever in this Lease it is provided that
an activity or obligation is at Tenant's cost cr expense, such provision shall
not imply or be construed to imply or mean any limitation on any right which
Tenant may have under the ESA and/or the o Development Agreement to include such
cost or expense (or some portion thereof) in charges payable to Tenant
thereunder.
Article 4. Use and Possession.
4.1 Use and Possession. In accordance with the terms of the
Development Agreement and the ESA, Tenant shall construct on, in and/or under
the Project Site, and shall operate and maintain thereon, an energy facility
(such facility, including the Improvements and the Additional Property, is
referred to herein as the "Project") that will provide hot water, cold water and
electricity (collectively, the "Services") for the Landlord's Property, as
described more fully in the ESA. The Project shall include fiber optic cable and
conduit and related equipment installed by Tenant for use in connection with
providing and monitoring the Services. In accordance with the terms of the
Development Agreement and the ESA, equipment and other improvements necessary to
control and monitor the Project may also be located at the Project Site and on,
in or under the Landlord's Property. Title to the Improvements and to all of the
personal property owned by Tenant and used in connection with the construction,
operation and maintenance of the Project is now and shall be and remain in
Tenant during the from and after the date hereof, subject to Landlord's
potential future interest in the Improvements, which shall become a possessory
interest upon the expiration or earlier termination of the Term and subject to
the other terms and conditions contained in this Lease.
4.2 Limitations on Use. Tenant shall not use or occupy the
Project Site, or permit the use or occupancy of the Project Site, in any manner
or for any purpose which: (a) would violate any law, statute, ordinance or other
federal, state or local governmental rule, regulation or requirement
("Applicable Law") including, without limitation, those with respect to
hazardous or toxic materials, or the provisions of any applicable governmental
permit or document related to the Project Site; (b) would violate any safety,
security or other rule, regulation or policy of Landlord; (c) would in any way
cause an adverse effect on any of Landlord's activities or Landlord's use of
Landlord's property (provided that the handling of interruptions of Services is
exclusively addressed in the ESA); or (d) would cause the cancellation or
ineffectiveness of any fire or other insurance maintained or required hereunder
to be maintained by Tenant. Tenant shall not use the Project Site for any
purpose other than those intended by the Development Agreement and the ESA or as
otherwise permitted by this Lease.
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4.3 Applicable Law. Tenant shall not do anything or suffer
anything to be done in or about the Project Site which conflicts with or
violates any Applicable Law then in effect. At its sole cost and expense, Tenant
shall promptly comply with ail requirements of Applicable Law relating to or
arising out of the use, occupancy, repair or alteration of the Project Site and
the improvements located thereon (provided that Tenant's compliance obligations
in respect of matters addressed by Section 5.7 of the ESA shall be governed
thereby and not hereby).
4.4 Other Uses.
4.4.1 Tenant may not use the Project Site to provide
services other than the Services without obtaining the prior
written consent of Landlord, and provided that such consent,
if granted, will result in an equitable adjustment to the Base
Rent and/or consumption and capacity charges under the ESA and
other reasonable modifications to this Lease and/or the ESA.
When Tenant presents Landlord with a proposal pursuant to
which Tenant would provide services other than the Services,
Landlord shall consider such proposal promptly (and with
respect to a proposal by Tenant to provide services to
Bally's, Paris, and/or Flamingo within seven (7) days of
receipt of such proposal) and in good faith.
4.4.2 Notwithstanding the foregoing, Landlord agrees
that Tenant may network the Project with another energy
production facility (or facilities) provided that: (i)
Landlord determines, in its sole discretion, that such
networking will not adversely affect the ability of the
Project to provide the Services for the Landlord's Property
and (ii) the customer(s) of the energy production facility or
facilities to which the Project is networked are not charged
rates for hot water, cold water and/or electricity services
provided by the Project which are less than those charged for
the Services pursuant to the terms of the ESA; provided, that
if Tenant disagrees with Landlord as to whether the charges to
third parties for services are less than those payable by
Landlord for Services under the ESA, then the matter shall be
referred to the "Independent Engineer" (as defined in the
Development Agreement) or another mutually acceptable
arbitrator, whose decision shall be final and binding on the
parties, and provided further that Tenant shall have the right
to remedy any discrepancy in such charges by decreasing the
charges payable under the ESA and/or by agreeing to increase
the charges for services paid by third parties.
4.4.3 Notwithstanding the foregoing, in the event
Tenant terminates the ESA in accordance with the terms thereof
because of a Landlord default under the ESA or the Development
Agreement, and Landlord does not acquire the energy production
facility at Tenant's request pursuant to such termination,
then without Landlord's
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consent, Tenant may provide and sell to third parties
services, provided, however, that Tenant's provision of such
services other than the Services will result in an equitable
adjustment to the Base Rent and/or consumption and capacity
charges under the ESA and other reasonable modifications to
this Lease and/or the ESA.
Article 5. Possession and Construction of Improvements.
5.1 Possession; Access. In addition to the interests and
rights granted by Landlord to Tenant in Section 2.1 above, Landlord shall
deliver to Tenant, within five (5) days of Landlord's issuance of a Notice to
Proceed pursuant to the Development Agreement, possession of the Project Site
and reasonable and necessary access to the Landlord's Property as is necessary
to enable Tenant to construct the Project and install and secure Tenant's
equipment and fixtures and otherwise to make the Project Site ready for Tenant
use and occupancy in the manner described herein and in the ESA and the
Development Agreement. In addition, Landlord shall permit Tenant access to the
Project Site at all reasonable times after execution of this Lease for the
purposes of investigating surface and subsurface conditions on and around the
Project Site, including taking soil samples and borings. Such entry to the
Landlord's Property shall be subject to all the terms and conditions of this
Lease, excluding payment of Base Rent, during the period commencing on the date
of Tenant's entry and ending on the earlier of (i) the Commencement Date or (ii)
the commencement of operation of Tenant's business from the Project Site or any
part thereof.
5.2 Tenant's Work. For purposes of this Article 5, the term
"Tenant's Work" shall mean and refer to the construction and installation of all
aspects of the Project as set forth in detail in the Development Agreement,
including the Improvements, and all other equipment, fixtures, pipes, wiring,
mechanical systems and other property and systems necessary to the operation of
the Project. All of Tenant's work shall be done in the manner required by the
Development Agreement and shall be completely lien-free (except as provided in
Sections 11.1 and 11.2 hereof, and except as otherwise permitted by the
Development Agreement and the ESA). Tenant shall use commercially reasonable
efforts to obtain warranties for Tenant's Work from its contractors and to
enforce such warranties so that defects in Tenant's Work are corrected. If any
warranties are not assignable to Landlord, Tenant shall nevertheless use
reasonable diligence to keep such warranties in effect and to enforce the same.
Tenant further agrees that if it determines that any portion of the Tenant's
Work contains a material defect, it shall promptly notify Landlord of such
defect and of the action which Tenant proposes to take or requires its
contractors to take to remedy the same, provided that Tenant shall not take any
action that may prejudice Landlord's ability to assert its warranty rights (if
any) without Landlord's prior written consent. Without limiting the foregoing,
Tenant reserves the right to install its own security system on the
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Project Site and Landlord, notwithstanding any other provision of this Lease to
the contrary, understands and agrees that Tenant shall have the right to limit
or restrict Landlord's access to the Project Site for reasonable safety and
security purposes, but subject to Landlord's rights under Section 14.1 below and
as provided for in the ESA and the Development Agreement. Subject to the rights
of Tenant under Sections 11.1 and 11.2 hereof, and except as permitted by the
Development Agreement and the ESA, all of Tenant's Work shall be completed
lien-free and in accordance with all Applicable Law. At Landlord's election, all
Tenant's Work shall be coordinated with Landlord's construction manager (who
shall not unreasonably interfere with the rendition of Tenant's Work).
5.3 Landlord's Work. The work to be performed by Landlord in
connection with the construction and development of the Project is described in
detail in the Develop ment Agreement (such work being referred to herein as the
"Landlord's Work"). The Landlord's Work shall be performed in accordance with
all Applicable Law and in accordance with the Development Agreement. Landlord
shall use commercially reasonable efforts to obtain warranties for Landlord's
Work from its contractors and to enforce such warranties so that defects in
Landlord's Work are corrected.
5.4 Laydown and Staging Areas. Landlord shall give Tenant the
right to use, at no cost to Tenant and at such times as reasonably required by
Tenant before or after the Commencement Date, such portion of the property of
Landlord reasonably needed by Tenant for staging of construction of the Project,
storing materials and parking for Tenant's contractors and subcontractors and
their respective employees, such portion of the property to be designated by the
Landlord.
5.5 Mutual Cooperation. Landlord and Tenant, both acting
reasonably, agree to cooperate with each other so that the Landlord's Work and
Tenant's Work can be completed in a timely manner.
Article 6. Insurance and Waiver of Subrogation.
6.1 Insurance.
(a) At all times from and after the date hereof, Tenant shall,
at its sole expense, purchase and maintain in full force and effect,
the following insurance coverages:
(i) Workers' compensation insurance, with limits of
liability at least equal to the statutory
requirements therefor;
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(ii) Employer's liability insurance of not less than
$1,000,000;
(iii) Comprehensive general liability insurance against
liability for injury to or death of any person or
damage to property in connection with the use,
operation or condition of the Project of not less
that $2,000,000 combined single limit per occurrence
and annual aggregate;
(iv) "All-risk" property insurance covering the Project to
the extent of the full replacement cost thereof and,
during construction of the Project, "all-risk
builder's risk" insurance covering the Project to the
extent of the full replacement thereof;
(v) During any and all periods of construction of the
Project, Tenant shall cause its general contractors
(including all contractors who contract directly with
Tenant) to obtain (i) commercial general liability
insurance with a minimum limit of liability of
$5,000,000 combined single limit for bodily injury,
personal injury and property damage and include
Landlord and Landlord's lenders as additional
insured's and (ii) workers' compensation insurance,
with limits of liability at least equal to the
statutory requirements therefor and employer's
liability insurance of not less than $1,000,000; and
(vi) Excess liability umbrella coverage of at least
$50,000,000.
(b) At all times from and after the date hereof, Landlord
shall, at its sole expense, purchase and maintain in full force and
effect, the following insurance coverages:
(i) Comprehensive general liability (including public
liability and property damage) insurance coverage
covering occurrences, accidents and incidents on the
Landlord's Property that (1) occur from and after the
date hereof (regardless of when the claim is filed)
and (2) result in bodily injury, personal injury or
death to any person or entity and/or damage or
destruction of property. Said insurance shall have a
combined single limit of liability per occurrence of
not less than $1,000,000 on a primary basis and not
less than $50,000,000 on an excess/umbrella basis, or
such greater amounts as are typical for similar
casino-hotel projects in Las Vegas; and
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(ii) "All-risk" property insurance covering the Landlord's
Property and improvements thereon to the extent of
the full replacement cost thereof.
(c) Each party hereto agrees that the insurance described
above to be provided by the other party may be provided by and through
blanket coverages which may be provided in whole or in part through a
policy or policies covering other liabilities and locations of the
party obligated to provide such insurance and its affiliates.
Except as otherwise set forth in Articles 13 and 15 hereof, Tenant shall be
liable for any deductible amount in the event of any loss under the policies
required by Section 6.1.
6.2 Additional Requirements. All insurance required to be
purchased by Tenant pursuant to this Article 6 shall be placed with reputable
companies licensed to do business in the State of Nevada and shall provide for
deductibles reasonably acceptable to Landlord. Prior to the Commencement Date,
Tenant shall deliver to Landlord certificates of insurance evidencing the
insurance required hereby. All such insurance will require not less than thirty
(30) days prior written notice to both parties in the event of modification or
cancellation of coverage.
6.3 Waiver of Subrogation Rights; Default. Each party hereby
releases and waives for itself, and to the extent legally possible for it to do
so, on behalf of its insurer, the other party hereto and its respective
officers, directors, agents, members, partners, servants, and employees from
liability for any loss or damage to any or all property located on the Aladdin
Lands (as defined in the Development Agreement) which loss or damage is of the
type and within the limits covered by the "all-risk" property damage insurance
and other insurance which the parties have agreed to obtain and maintain in
effect pursuant to clauses (a) and (b) of Section 6.1, irrespective of any
negligence on the part of the released party and its respective officers,
directors, agents, partners, members, servants, or employees, which may have
contributed to or cause such loss or damage. Each party covenants that it will,
if available, obtain for the benefit of the other party and its officers,
directors, agents, members, partners, servants, and employees, a waiver of any
right of subrogation which the insurer of such party may acquire against such
party by virtue of the payment of any such loss covered by insurance. In the
event a party is by law, statute or governmental regulation unable to obtain a
waiver of the right of subrogation for the benefit of the other party (and its
respective, officers, directors, agents, members, partners, servants, and
employees) or its insurance carriers will not give such a waiver, then, during
any period of time when such waiver is unobtainable, said party shall not have
been deemed to have released any subrogated claim of its insurance carrier
against such other party (or its respective officers, directors, agents,
members, partners, servants, or employees), and during the same period of time,
such other party shall not have been deemed to have released the party which has
been
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unable to obtain such waiver (or such party's respective officers, directors,
agents, members, partners, servants, or employees) from any claims it or its
insurance carrier may assert which otherwise would have been released pursuant
to this Section 6.3.
If Tenant at any time fails to provide the insurance coverage
required by this Article 6, Landlord will be entitled to purchase such coverage,
after written notice of Landlord's intent, and to collect the cost of such
coverage from Tenant. Notwithstanding anything to the contrary in this Lease, in
no event shall Landlord or Tenant be liable to the other for any lost business,
loss of profits or other special and/or consequential damages, whether direct or
indirect, in respect of which each hereby excuses the other and waives any and
all such claims against the other, provided that the foregoing is not intended
to be a waiver of any rights or obligations of Tenant or Landlord under the ESA
or the Development Agreement.
Article 7. Damage or Destruction. In the event the Project or any part
thereof is damaged or destroyed by fire, explosion or other casualty, except as
otherwise provided below in this Article 7, Tenant shall repair, restore or
rebuild with due diligence the damaged portion of the Project. Said damage and
destruction shall not affect in any way the obligation of Tenant to pay Rent or
release Tenant of or from any obligation imposed on Tenant under this Lease.
Tenant shall commence the repair, restoration or rebuilding of the Project as
soon as is reasonably practicable after such damage or destruction occurs and
shall complete such repair, restoration or rebuilding as promptly as is
reasonably possible in order to comply with its obligations under the ESA, and
shall in the course thereof comply with the terms of the Development Agreement
and with Section 5.2 hereof, provided that Tenant may make such revisions and
changes to the Tenant's Work as Tenant deems appropriate under the
circumstances, after obtaining Landlord's prior approval, which shall not be
unreasonably withheld or delayed, to such revisions and changes; provided,
however, that any such changes are made in accordance with the terms of the
Development Agreement during the term thereof.
Article 8. Condemnation.
8.1 Complete Taking. If, at any time during the Term, title to
all or substantially all of the Project Site shall be taken in condemnation
proceedings or by any right of eminent domain, this Lease shall terminate and
expire on the date of such taking and the Rent payable hereunder shall be
apportioned and paid to the date of such taking. For purposes of this Article,
substantially all of the Project Site shall be deemed to have been taken if the
untaken portion cannot be practically and economically used or converted for use
by Tenant for the Project in a manner permitting Tenant to comply with its
obligations under the ESA and the Development Agreement. Upon the occurrence of
any such taking and the
13
termination of this Lease, Landlord and Tenant shall share any award or awards
as follows: (i) if the aggregate amount of such award or awards equals or
exceeds (x) the purchase price then payable under Section 9.3 of the ESA plus
(y) the fair value of the portion of the Project Site being taken, then Landlord
shall be entitled to receive an amount equal to the fair value of the Project
Site being taken and Tenant shall be entitled to receive an amount equal to the
purchase price which would then be payable under Section 9 of the ESA if the
Project were then purchased by Landlord from Tenant pursuant to such section,
and Landlord and Tenant shall each be entitled to receive an amount equal to
fifty (50) percent of the amount (if any) by which the aggregate awards exceeds
the amount described in clauses (x) and (y) immediately preceding; and (ii) if
the aggregate awards are less than an amount equal to the aggregate amount under
clauses (i)(x) and (i)(y) preceding, then Landlord shall be entitled to receive
an amount equal to the fair value of the portion of the Project Site being taken
multiplied by a fraction, the numerator of which is the aggregate awards and the
denominator of which is the aggregate of the amounts described in clauses (i)(x)
and (i)(y) preceding, and the Tenant shall be entitled to receive the balance of
the aggregate awards. In either case, Tenant shall be entitled to collect the
entire award and withhold therefrom the portion thereof to which Tenant is
entitled pursuant to this Section 8.1 and pay to Landlord the portion thereof to
which Landlord is entitled. Tenant shall execute any and all documents that may
be required in order to facilitate the collection and distribution of the award
in accordance with the terms of this section. In the event of a dispute between
Landlord and Tenant as to whether or not the untaken portion of the Project Site
can be practically and economically used or converted by Tenant as aforesaid,
and the parties cannot agree within thirty days after such taking, such dispute
shall be resolved in the manner provided in Section 7.1(c) of the ESA.
8.2 Partial Taking. Upon any such taking of less than the
whole or substantially all of the Project Site, as promptly as possible a
determination under the ESA shall be made as to whether the ESA shall be
terminated pursuant to Section 7.1(c) thereof. (a) If the ESA is terminated as a
result of such partial taking, then this Lease shall be terminated concurrently
with the termination of the ESA and Landlord and Tenant shall any award or
awards as follows: (i) if the aggregate amount of such awards equals or exceeds,
(x) the purchase price then payable under Section 9.3 of the ESA plus (y) the
fair value of the portion of the Project Site being taken, then Landlord shall
be entitled to receive an amount equal to the fair value of the Project Site
being taken and Tenant shall be entitled to receive an amount equal to the
purchase price which would then be payable under Section 9 of the ESA if the
Project were then purchased by Landlord from Tenant pursuant to such section,
and Landlord and Tenant shall each be entitled to receive an amount equal to
fifty (50) percent of the amount (if any) by which the aggregate awards exceed
the amount described in clauses (x) and (y) immediately preceding; and (ii) if
the aggregate awards are less than an amount equal to the aggregate amount under
clauses (i)(x) and (i)(y) preceding,
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then Landlord shall be entitled to receive an amount equal to the fair value of
the portion of the Project Site being taken multiplied by a fraction, the.
numerator of which is the aggregate awards and the denominator of which is the
aggregate of the amounts described in clauses (i)(x) and (i)(y) preceding, and
the Tenant shall be entitled to receive the balance of the aggregate awards. In
either case, Tenant shall be entitled to collect the entire award and withhold
therefrom the portion thereof to which Tenant is entitled pursuant to this
Section 8.2(a) and pay to Landlord the portion thereof to which Landlord is
entitled. Tenant shall execute any and all documents that may be required in
order to facilitate the collection and distribution of the award in accordance
with the terms of this section. (b) If the ESA is not terminated as a result of
such partial taking, then (i) Tenant, at its sole cost and expense, shall
complete Tenant's Work and comply with its obligations in respect of restoring
the Project set forth in Section 7.1(a) of the ESA; (ii) this Lease shall
continue and the Term shall not be reduced or affected in any way; and (iii) at
Tenant's election, the award or awards made in connection with such taking shall
be distributed to Tenant in whole or in part and the amount which Tenant
receives shall be applied to the cost and expense of restoring the Project, with
any excess deemed to be a payment in reduction of the "Investment in the
Northwind Facilities" under the ESA. In the event such excess is applied to
reduce the "Investment in the Northwind Facilities," the Contract Capacity
Charge payable by Landlord under the ESA shall be reduced to reflect such
payment (such reduction to be determined by assuming that such payment is
applied 60% in reduction of debt incurred to finance the Project and 40% as a
return of Tenant's capital). If the ESA is not terminated, then, to the extent
(if any) that the cost of restoring the Project exceeds any award or awards
which are received by Tenant, the "Investment in the Northwind Facilities" shall
be adjusted accordingly and Landlord's obligation to pay the Contract Capacity
Charge as set forth in the ESA shall be modified in accordance therewith.
8.3 Settlement. Landlord and Tenant shall each be entitled to
participate at their own expense in the negotiation and settlement of any
amounts or other compensation resulting from or in connection with the
condemnation or other taking of the Project Site or any part thereof.
Article 9. Maintenance and Alterations.
9.1 Landlord's Maintenance. During the Term, Landlord shall
keep and maintain, repair and replace the Landlord's Work and the Landlord's
Property in good working order and repair in compliance with all Applicable Law
and in the manner necessary to enable Tenant to perform its obligations under
the Development Agreement and the ESA.
9.2 Tenant's Maintenance. During the Term, Tenant shall keep
and maintain, repair and replace, at Tenant's sole cost and expense (subject to
the provisions of
15
the Development Agreement and the ESA governing the cost of the Project and the
charges payable in respect of Services), the Project and the Project Site in
good working order and repair in compliance with all Applicable Law.
9.3 Alterations. Tenant shall have the right to make
additions, improvements and alterations in and to the Project and the Project
Site (collectively, "Alterations") from time to time during the Term, provided
such Alterations comply with the terms of the Development Agreement, the E5A and
this Lease, and provided that for material Alterations Tenant first obtains
Landlord's consent, which consent may be withheld in Landlord's sole discretion,
except as otherwise provided in Section 4.4 hereof. Tenant agrees that any
Alterations made shall be made in a good and workmanlike manner and shall be
made in accordance with the terms of the Development Agreement, the ESA, all
Applicable Law, and the requirements of Section 5.2 herein and will be
completed on a lien-free basis (except as provided in Section 11.1 hereof.)
Article 10. Assignment And Subletting.
10.1 Assignment and Subletting. Except for a "Permitted
Transfer" (as such term is herein defined) or an assignment made in accordance
with the terms of Section 11.2 below, any of which shall be permitted at any
time without Landlord's consent, but only after prior written notice to
Landlord, Tenant shall not, either prior or subsequent to the commencement of
the Term, (i) assign this Lease or any interest under this Lease, or (ii) sublet
the Project Site or any part thereof, without Landlord's prior written consent,
which shall not be unreasonably withheld or delayed.
10.1.1 For purposes of this Article 10, the term
"Permitted Transfer" shall mean any transfer or assignment of
Tenant's interest in this Lease made in connection with a
transfer of Tenant's interest in the ESA or the Development
Agreement which is permitted under the terms thereof.
Landlord acknowledges and agrees that the transferee under any assignment or
transfer to which Landlord has consented as aforesaid, as well as the transferee
or assignee under any Permitted Transfer, shall be deemed to be the "Tenant" for
purposes of this Lease and shall be afforded all of the rights, benefits and
obligations of Tenant hereunder (regardless of whether or not such assignment
occurs concurrently with a transfer, sale or assignment of all or a portion of
Tenant's right, title and interest in the Project). In the event of an
assignment, transfer or sublease, other than a Permitted Transfer, the
transferee shall expressly assume the obligations of Tenant in writing, and the
terms of this Lease shall be binding upon and inure to the benefit of the
parties hereto and their respective successors and assigns. Any assignment or
sublease in violation of this Article 10 shall be null and void.
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10.2 Consent Not a Release. Neither a Permitted Transfer nor
the consent by Landlord to any assignment or subletting shall operate to relieve
Tenant from any covenant or obligation hereunder except to the extent, if any,
expressly provided for in such consent and except, with respect to a Permitted
Transfer, to the extent that Tenant is relieved of its obligations under the ESA
and the Development Agreement, or be deemed to be a consent to or relieve Tenant
from obtaining Landlord's consent to any subsequent assignment or subletting
requiring consent under Section 10.1 above.
Article 11. Liens and Encumbrances.
11.1 Encumbering Landlord's Title. Tenant shall make all
payments and take all actions at its own cost and expense as may be necessary to
ensure that no lien, charge, or order for payment of money is registered against
Landlord's interest in and to the Project Site that results from any work,
services or materials supplied to Tenant or the Project Site or any act or
omission of Tenant and that is not discharged or vacated (or with respect to
which payment has not been secured by the placement of a bond in an amount, form
and content reasonably acceptable to Landlord) within ten (10) business days
after Tenant receives notice of such registration. Tenant shall indemnify and
save harmless Landlord against any and all costs, liabilities, suits, penalties,
claims and demands, including reasonable attorney's fees, arising therefrom. Any
claim to, or lien upon, the Project Site arising from the acts or omissions of
Tenant shall accrue only against the leasehold estate of Tenant. If Tenant fails
to cause such lien, charge or order to be discharged of record or bonded within
twenty (20) days after Tenant receives notice of such registration, then
Landlord shall have the right to cause the same to be discharged. All amounts
paid by Landlord to cause any such lien, charge or order to be discharged shall
constitute additional rent payable by Tenant to Landlord, or, at Landlord's
option, may be recovered from Tenant in an appropriate proceeding.
11.2 Collateral Assignment and Liens. Landlord agrees that
Tenant shall have the right to grant to a lender a security interest in Tenant's
interest in this Lease for collateral purposes and to grant to such lender
security interests in and liens on the personal property, machinery and
equipment of Tenant located at the Project Site.
Article 12. Utilities; Services. Tenant shall purchase the water, gas
and sewage services necessary for the operation of the Project directly from the
utility, authority or municipality providing such service, and shall pay for
such services when such payments are due. Tenant covenants to pay all such
charges for these utility services and any others required in the operation of
its business on or before their due date.
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Article 13. Indemnity.
13.1 Generally. Subject to Section 13.2 below, each party
hereto shall protect, indemnify and save the other parry and its agents and
employees harmless from and against all liabilities, obligations, claims,
damages (other than lost business, lost profits and other special and/or
consequential damages, whether direct or indirect, all claims for which are
hereby irrevocably waived, provided that this shall not be deemed to waive any
rights or obligations of Tenant or Landlord under the ESA or the Development
Agreement), penalties, causes of action, costs and expenses (including, without
limitation, reasonable attorneys' fees and expenses) imposed upon or asserted
against such other party by reason of any accident, physical injury to or death
of persons or physical loss of or physical damage to property arising (i) from
the indemnifying party's entry upon or occupancy of the Project Site or conduct
of such party's business in or from the Project Site; (ii) from any breach or
default on the part of the indemnifying party in the performance of any covenant
or agreement on the part of such party to be performed pursuant to the terms of
this Lease; (iii) any violation of Federal, state or local law, regulation or
action governing environmental or safety statutes applicable to the Project; or
(iv) due to any other legally actionable act or omission of the indemnifying
party or its agents, contractors or employees. In case any action, suit or
proceeding is brought against a party hereto by reason of any such occurrence,
the other party shall, at the indemnified party's option, at the indemnifying
party's expense, by counsel selected by the indemnifying party (which counsel
must be reasonably satisfactory to the indemnified party), defend such action,
suit or proceeding, or cause the same to be defended.
13.2 Effect of Waiver. The indemnities of either party
contained in this Lease shall not apply or pertain to liabilities, obligations,
claims, damages, penalties, causes of action, costs or expenses to the extent
such party has waived claims in respect thereto pursuant to Section 6.3 above.
13.3 Survival of Obligation. The duty to indemnify under this
Article will continue in full force and effect notwithstanding the expiration or
termination of this Lease, with respect to any loss, liability, damage or other
expense based on factors and conditions which occurred prior to such
termination.
Article 14. Rights Reserved to Landlord; Additional Landlord
Representations, Warranties and Covenants.
14.1 Inspection. Landlord shall have the right, upon
reasonable advance written notice to Tenant, except in case of emergency, when
no notice shall be required, to inspect the operation of the Project during
normal business hours to determine whether it is being operated in compliance
with all Applicable Law and in the manner required under this
18
Lease and to enable Landlord to perform its obligations hereunder. Tenant or its
designated representative shall have the right to be present during any such
inspection.
14.2 Representations and Warranties. Landlord hereby
represents and warrants to Tenant that:
14.2.1 There are no leasing or rental agreements in
effect demising the Project Site other than the Lease, and
there are no executory contracts, options or agreements in
existence which relate to the purchase of all or any portion
of the Project Site or any interest therein.
14.2.2 Landlord has no knowledge of any outstanding
violations of any applicable pollution, zoning, Environmental
Protection Agency, health, safety, OSHA, fire, environmental,
sewerage and building codes, statutes, ordinances and
regulations pertaining to the Project Site.
14.2.3 Landlord has no knowledge of any special taxes
or assessments against the Project Site, or any portion
thereof.
14.2.4 Landlord has no knowledge of any increase in
the real estate tax assessment of the Project Site or any
portion thereof.
14.2.5 To Landlord's knowledge, during Landlord's
ownership of the Project Site, (i) no "Hazardous Materials"
(as hereinafter defined) have been located on the Project Site
or have been released into the environment, or discharged,
placed or disposed of at, on or under the Project Site; (ii)
no underground storage tanks have been located on the Project
Site; (iii) the Project Site has never been used as a dump for
waste material; (iv) no portion of the Project Site is located
in an area that has been designated a wetlands or other
environmental protection area; and (v) the Project Site and
its prior uses comply with and at all times have complied
with, any applicable governmental law, regulation or
requirement relating to environmental and occupational health
and safety matters and Hazardous Materials.
14.2.6 Landlord believes it has not misstated any
material fact, or failed to disclose any material fact,
relating to the Project Site or Landlord's Property.
14.3 Security; No Obstruction. Landlord, at its sole expense,
shall at all times from and after the date hereof provide reasonable security
for and protection of all
19
property of Tenant located on, in or under the Landlord's Property in accordance
with the terms of this Lease.
Article 15. Environmental Matters.
15.1 Definitions. For the purposes of this Article 15, the
following terms shall have the following meanings: (i) the term "Hazardous
Material" shall mean any material or substance that, whether by its nature or
use, is now or hereafter defined as a hazardous waste, hazardous substance,
pollutant or contaminant under any Environmental Requirement, or which is toxic,
explosive, corrosive, flammable, infectious, radioactive, carcinogenic,
mutagenic or otherwise hazardous and which is now or hereafter regulated under
any Environmental Requirement, or which is or contains ammonia, petroleum,
gasoline, diesel fuel or any other petroleum hydrocarbon product or material,
(ii) the term "Environmental Requirements" shall collectively mean all present
and future laws, statutes, ordinances, rules, regulations, orders, codes,
licenses, permits, decrees, judgments, directives or the equivalent of or by any
Governmental Authority and relating to or addressing the protection of the
environment or human health or safety, and (iii) the term "Governmental
Authority" shall mean any of the following having jurisdiction over the Project
Site, the Project or any part of either thereof: the federal or state government
or any political subdivision thereof, or any agency, court or body of the
federal or state government or any political subdivision thereof, exercising
executive, legislative, judicial, regulatory or administrative functions.
15.2 Compliance with Environmental Requirements. Each party
to this Agreement agrees that it will not use, store or bring onto the Project
Site any Hazardous Material in violation of Environmental Requirements without
first obtaining the prior written consent of the other party. Each party shall
comply in all material respects with all Environmental Requirements, and will
not generate, store, handle, process, dispose of or otherwise use Hazardous
Materials at, in, on, under or about the Project Site in a manner that causes
the imposition on Tenant, Landlord, the Project Site or any part thereof of any
liability or lien of any nature whatsoever under any Environmental Requirement.
Each party shall notify the other party promptly in the event that such party
receives notice of any spill or other release of any Hazardous Material at, in,
on, under or about the Project Site which is required to be reported to a
Governmental Authority under any Environmental Requirement, will promptly
forward to the other party copies of any notices received by such party relating
to alleged violations by such party of any Environmental Requirement. If at any
time it is determined by a Governmental Authority that a party's operation or
use of the Project Site violates any applicable Environmental Requirement or
that as a consequence of such party's action or inaction there are Hazardous
Materials located at, in, on, under or about the Project Site which, under any
Environmental Requirement, require special handling in collection,
20
storage, treatment or disposal, or any Other form of cleanup or corrective
action, such parry shall, within thirty days after receipt of notice from any
Governmental Authority, or sooner if required by such notice, take, at the sole
cost and expense of such party (except as otherwise set forth in the ESA), such
actions as may be necessary to fully comply in all respects with all
Environmental Requirements; provided, however, that if such compliance cannot
reasonably be completed within such thirty day period, such party shall commence
such necessary action within such thirty-day period and shall thereafter
diligently and expeditiously proceed to fully comply in all respects and in a
timely fashion with all Environmental Requirements.
15.3 Environmental Indemnity. Subject to the terms of Article
13 above, each party (the "Indemnifying Party") shall defend, indemnify, and
hold harmless the other party, its members, employees, agents, officers, and
directors (the "Indemnified Parties"), from and against any and all claims,
demands, penalties, causes of action, fines, liabilities, settlements, damages
(other than lost business, lost profits and other special and/or consequential
damages, whether direct or indirect, all claims for which are hereby irrevocably
waived), costs, or expenses of whatever kind or nature, known or unknown,
foreseen or unforeseen, contingent or otherwise (including, without limitation,
reasonable counsel and consultant fees and expenses, investigation and
laboratory fees and expenses, court costs, and litigation expenses) arising out
of, or in any way related to, (i) any breach by the Indemnifying Party of the
provisions of Section 15.2 above or by Landlord of the representations and
warranties contained in Section 14.2.5 above, (ii) the presence, disposal,
spillage, discharge, emission, leakage, release, or threatened release of any
Hazardous Material which is at, in, on, under, about, from or affecting the
Project Site or any portion thereof, including, without limitation, any damage
or injury resulting from any such Hazardous Material to or affecting the Project
Site or the soil, water, air, vegetation, buildings, personal property, persons
or animals located on the Project Site or on any other property or otherwise,
which arose or occurred through the act or omission of the Indemnifying Party or
resulted from the Indemnifying Party's use or occupancy of the Project Site,
(iii) any personal injury (including wrongful death) or property damage (real or
personal) arising out of or related to the generation, storage, handling,
processing, disposal of or use of any such Hazardous Material by the
Indemnifying Party, (iv) any lawsuit brought, settlement reached, or order or
directive of or by any Governmental Authority relating to the Indemnifying
Party's use of such Hazardous Material, or (v) any violation by the Indemnifying
Parry of any Environmental Requirement.
15.4 Limitation on Indemnity. The aforesaid indemnification
shall not be applicable to any claim, demand, penalty, cause of action, fine,
liability, settlement, damage, cost or other expense of any type whatsoever
occasioned, arising and caused solely and directly as the result of the
negligence or willful misconduct of a party claiming a right to be
21
indemnified, or, with respect to Tenant's indemnification obligations, arising
in connection with (i) an environmental condition occurring prior to the date
upon which Tenant enters upon the Project Site, or (ii) an environmental
condition occurring subsequent to the date upon which Landlord acquires
possession of the Project Sice if such claim, demand, penalty, cause of action,
fine, liability, settlement, damage, cost or other expense was not caused by an
act or omission of Tenant or an employee, agent or contractor of Tenant, and
Landlord shall be solely responsible for all claims and other expenses resulting
from the conditions described in the preceding clauses (i) and (ii).
15.5 Survival of Indemnity. Except as hereinabove specifically
provided to the contrary in this Article 15, the obligations and liabilities of
Landlord and Tenant under this Article 15 in respect to a claim which arises or
accrues prior to the expiration or termination of the Term shall survive and
continue in full force and effect and shall not be terminated, discharged or
released, in whole or in part, irrespective of whether the Lease has terminated
pursuant to the provisions of this Lease or acceptance by Landlord of possession
of the Project Site.
Article 16. Title; Subordination. Landlord represents and warrants to
Tenant that prior to the date upon which the Notice to Proceed (as defined in
the Development Agreement) is received by Northwind, Landlord will hold fee
simple title to the Aladdin Lands and the Project Site, and that the Project
Site is free and clear of any mortgage, trust deed, ground lease or other
financial encumbrance, and Landlord will promptly notify Tenant in writing if
any mortgage, trust deed or ground lease hereafter encumbers the Project Site.
If at any time the Project Site shall become subject to any mortgage, trust deed
or ground lease, then within thirty (30) days after the creation of such lien or
the commencement of the term of such ground lease, as the case may be, Landlord
shall deliver to Tenant a recordable non-disturbance agreement (pursuant to
which, among other things, the Lease, and Tenant's right of possession of the
Project Site and the Landlord's Property on the terms and conditions set forth
in the Lease, would be honored by any lender, ground lessor or person or entity
claiming by, through or under such lender or ground lessor, in the event a
foreclosure or deed-in-lieu of foreclosure occurred or a ground lease was
terminated and no Tenant Default then existed) satisfactory in form and
substance to Tenant acting in a commercially reasonable manner (herein called a
"Non-Disturbance Agreement") signed by such lender or ground lessor, as the case
may be. Without limiting the foregoing, if the mortgagee or trustee in any first
mortgage or first trust deed hereafter made desires this Lease to be subject and
subordinate to its first mortgage or first trust deed, then all or a portion of
the rights and interests of Tenant under this Lease (other than rights in
respect of any casualty loss of the Project or under Sections 8.1 and 8.2
hereof) shall be subject and subordinate to such first mortgage or first trust
deed and to any and all advances to be made thereunder, and to the interest
thereon, and all renewals, replacements and extensions
22
thereof, if and only if such mortgagee or trust deed holder or such ground
lessor, as the case may be, has theretofore delivered to Tenant a
Non-Disturbance Agreement signed by such lender or ground lessor, as the case
may be. Any mortgagee or trustee in any first mortgage or trust deed may elect
that, instead of making this Lease subject and subordinate to its first mortgage
or first trust deed, the rights and interest of Tenant under this Lease shall
have priority over the lien of its mortgage or trust deed. Tenant agrees that in
the event that any trustee or mortgagee or ground lessor elects to make this
Lease subordinate to its mortgage, trust deed or ground lease, and Tenant has
received from such lender or ground lessor a signed Non-Disturbance Agreement,
Tenant shall, upon the request thereof, attorn to any such trustee or mortgagee
who becomes owner of the Project Site through foreclosure or deed in lieu of
foreclosure or to any other purchaser of the Project Site at a foreclosure sale
or to such ground lessor, as the case may be.
Article 17. Surrender And Holdover.
17.1 Surrender and Removal of Improvements. In the event that
Landlord requires Tenant to remove the "Northwind Facilities" pursuant to
Section 9.2 of the ESA, then no later than the 180th day following the date on
which this Lease expires or is terminated in accordance with the terms hereof,
Tenant shall surrender the Project Site and shall remove therefrom any and all
machinery, equipment and personal property at Landlord's expense, except that in
the event Tenant negligently performs such removal or willfully causes any
damage in the course of performing such removal, Tenant shall be responsible at
its sole expense for repairing all damage it negligently or willfully caused.
Otherwise Tenant shall surrender the Project Site immediately following the date
of expiration or termination and Tenant shall not remove such property if
Landlord or its assignee has exercised any rights it may have to acquire the
same under the terms and conditions of the Development Agreement or the ESA.
Tenant shall restore the Project Site to a condition approved by Landlord, which
approval shall not be unreasonably withheld or delayed, and Tenant shall repair
any damage to Landlord's Property which is due to Tenant's use thereof. Tenant's
interest in all improvements remaining on the Project Site after the expiration
or earlier termination of the Lease shall be vacated and surrendered by Tenant
to Landlord and shall automatically become the property of Landlord except to
the extent that Landlord requires Tenant to remove the same, and Tenant agrees
to execute and deliver to Landlord such deeds, bills of sale, assignments or
other instruments of conveyance as Landlord may deem reasonably necessary to
evidence such transfer of such improvements to Landlord.
17.2 Holding Over. Except as necessary to comply with its
obligations under Section 17.1 hereof, Tenant shall have no right to occupy the
Project Site or any portion thereof after the expiration of the Term or after
termination of the Lease or of Tenant's right to possession. In the event Tenant
holds over, Landlord may exercise any and
23
all remedies available to it at law or in equity to recover possession of the
Project Site and for any damages resulting from such holdover.
Article 18. Default And Remedies.
18.1 Tenant Defaults. Tenant agrees that any one or more of
the following events shall be considered "Tenant Defaults" as said term is used
herein:
18.1.1 Tenant shall fail to pay any Rent or other
charge owing by Tenant pursuant to the terms of this Lease
within thirty days after receipt of written notice from
Landlord that such amount is due and payable;
18.1.2 Tenant shall fail to keep, observe or perform
any of the other covenants or agreements herein contained to
be kept, observed and performed by Tenant, and such failure
shall continue for thirty days (or such shorter period as is
specifically referred to in this Lease for any particular
breach) after notice thereof in writing to Tenant; provided,
however, in the event that such failure cannot reasonably be
cured within the aforesaid thirty day period (or shorter
period, if applicable), and Tenant shall within said period
commence to cure said default and diligently thereafter
prosecutes to correction said failure, the period for
completion shall be extended for so long as is reasonably
required to cure said default;
18.1.3 The estate or interest of Tenant in the
Project Site or the Project is levied upon or attached in any
proceeding and such process is not stayed, vacated or
discharged within ninety (90) days after such levy or
attachment;
18.1.4 Any representation or warranty made by Tenant
to Landlord in connection with this Lease is false or
misleading in any material respect when made; or
18.1.5 Tenant is in default under the ESA or the
Development Agreement.
18.2 Landlord Remedies; Termination Event. Upon the occurrence
of any one or more of such Tenant Defaults, Landlord shall be entitled to
recover as damages all past due Rent and other sums then due and payable by
Tenant including costs and expenses reasonably incurred in the exercise of
Landlord's remedy (including reasonable attorney's fees), to seek appropriate
equitable relief including the termination of this Lease (but only if
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the Development Agreement and the ESA also are terminated in accordance with
their respective terms) and to pursue any and all remedies available at law, in
equity, in bankruptcy or in other appropriate proceedings and to seek
appropriate equitable relief. Upon the effective date of such termination (but
subject to the rights and obligations of Tenant under Section 17.1 above and to
Landlord's payment to Tenant of any amounts payable under the ESA and the
Development Agreement pursuant to termination thereof), Tenant shall surrender
possession of the Project Site to Landlord. If the Lease is terminated by
Landlord due to the occurrence of the events described in this Section, Landlord
shall be entitled to recover as damages all past due Rent and other sums due and
payable by Tenant on the date of termination including costs and expenses
reasonably incurred in the exercise of Landlord's remedy (including reasonable
attorney's fees). Subject to the foregoing, Landlord shall have such rights and
remedies for Tenant defaults as provided elsewhere in this Lease and at law and
in equity, and all remedies shall be cumulative such that Landlord's exercise or
failure to exercise of any remedy shall not limit or prevent Landlord from
exercising any other remedy available to Landlord.
18.3 Performance by Tenant's Lender. Landlord agrees and
acknowledges that in the event that Tenant grants a security interest in the
Project and/or Tenant's leasehold interest in or to the Project Site to a third
party lender, Landlord shall negotiate and enter into an agreement by which such
lender will be given notice and an opportunity to cure Tenant Defaults under
this Lease. Without limiting the foregoing, Landlord shall reasonably cooperate
with all commercially customary requests by such lender as such lender may
reasonably request.
18.4 Landlord Default; Tenant Remedies. In the event Landlord
shall fail to keep, observe or perform any of its covenants or agreements
contained in this Lease, and such failure shall continue for thirty (30) days
(if such failure is a monetary duty or obligation) or forty-five (45) days (if
such failure is a non-monetary duty or obligation) after written notice from
Tenant to Landlord, then Tenant shall have the right to exercise all remedies
available to Tenant at law and in equity (excluding the termination of the
Lease); provided, however, that Tenant may, at its election by written notice to
Landlord, terminate this Lease if and only if the ESA and/or Development
Agreement has been terminated or otherwise expires in accordance with its terms.
The effective date of such termination shall be the later of the effective
termination date of the ESA or Development Agreement. Subject to the foregoing,
Tenant shall have such rights and remedies for a breach by Landlord of its
obligations under this Lease as are set forth herein, and all remedies shall be
cumulative such that Tenant's exercise or failure to exercise of any remedy
shall not limit or prevent Tenant from exercising any other remedy available to
Tenant.
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Article 19. Miscellaneous.
19.1 Estoppel Certificates.
19.1.1 Tenant shall, at any time and from time to
time upon not less than thirty days' prior written request
from Landlord, execute, acknowledge and deliver to Landlord,
in form reasonably satisfactory to Landlord, a written
statement certifying (if true) that Tenant has accepted the
Project Site, that this Lease is unmodified and in full force
and effect (or, if there have been modifications, that the
same is in full force and effect as modified and stating the
modifications), that, to the best of Tenant's knowledge,
Landlord is not in default hereunder (or if there is a
default, stating the nature of said default), the date to
which the rental and other charges have been paid, and such
other accurate certifications as may reasonably be required by
Landlord or Landlord's mortgagee. Any statement delivered by
Tenant pursuant to this Section may be relied upon by Landlord
and Landlord's lenders and prospective lenders.
19.1.2 Landlord shall, at any time and from time to
time upon not less than thirty days' prior written request
from Tenant, execute, acknowledge and deliver to Tenant, in
form reasonably satisfactory to Tenant, a written statement
certifying (if true) that this Lease is unmodified and in full
force and effect (or, if there have been modifications, that
the same is in full force and effect as modified and stating
the modifications), that, to the best of Landlord's knowledge,
no Tenant Default then exists (or if there is a Tenant
Default, stating the nature thereof), the date to which the
rental and other charges have been paid and such other
accurate certifications as may reasonably be required by
Tenant or by such other person or entity, as the case may be.
Any statement delivered by Landlord pursuant to this Section
may be relied upon by Tenant and Tenant's lenders and
prospective lenders.
19.2 Amendments Must Be In Writing. None of the covenants,
terms or conditions of this Lease, to be kept and performed by either party,
shall in any manner be altered, waived, modified, changed or abandoned except by
a written instrument, duly signed by both parties and delivered.
19.3 Notices. All notices or other communications required or
permitted hereunder shall be in writing addressed to the respective party as set
forth below and shall be
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personally served, telecopied or sent by reputable overnight courier service and
shall be deemed to have been given: (a) if delivered in person, when delivered;
(b) if delivered by telecopy, on the date of transmission if transmitted on a
Business Day before 4:00 p.m. Chicago time, otherwise on the next Business Day
(provided, in either case, that receipt of such transmission is confirmed); and
(c) if delivered by overnight courier, one day after delivery to the courier
service properly addressed. Notices and other communications shall be addressed
to the applicable party as follows:
If to Landlord, then to:
Aladdin Gaming, LLC
c/o Aladdin Management Corporation
000 Xxxx Xxxxxx, 00xx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Xxxxxx Xxxxxxx
Fax: 000-000-0000
If to Tenant, then to:
Northwind Aladdin, LLC
c/o Unicom Thermal Technologies Inc.
00 Xxxx Xxxxxx Xxxxxx, Xxxxx 000
Xxxxxxx, XX 00000
Attention: President
Fax: 000-000-0000
Any part hereto may change its address for notices and other communications
hereunder by a notice delivered to the other party hereto in accordance with
this Section as then in effect.
19.4 Time of Essence. Time is of the essence of this Lease,
and all provisions herein relating thereto shall be strictly construed.
19.5 Relationship of Parties. Nothing contained herein shall
be deemed or construed by the parties hereto, nor by any third party, as
creating the relationship of principal and agent or of partnership, or of joint
venture, between Landlord and Tenant, it being understood and agreed that no
provision in this Lease or any acts of the parties hereto shall be deemed to
create any relationship other than the relationship of landlord and tenant.
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19.6 Captions. The captions of this Lease are for convenience
only and are not to be construed as part of this Lease and shall not be
construed as defining or limiting in any way the scope or intent of the
provisions hereof.
19.7 Severability. If any term or provision of this Lease
shall to any extent be held invalid or unenforceable, or shall be in conflict
with the requirements of any law, such term or provision shall be deemed to be
inapplicable and the remaining terms and provisions of this Lease shall not be
affected thereby, but each term and provision of this Lease shall be valid and
be enforced to the fullest extent permitted by law.
19.8 Law Applicable. This Lease shall be construed and
enforced in accordance with the law of the State of Nevada.
19.9 Covenants Binding on Successors: No Third Party
Beneficiaries. All of the covenants, agreements, conditions and undertakings
contained in this Lease shall extend and inure to and be binding upon the
successors and permitted assigns of the respective parties hereto, the same as
if they were in every case specifically named, xxx wherever in this Lease
reference is made to either of the parties hereto, it shall be held to include
and apply to, wherever applicable, the successors and permitted assigns of such
party. Nothing herein contained shall be construed to grant or confer upon any
person or persons, firm, corporation or governmental authority, other than the
parties hereto and their successors and permitted assigns, any right, claim or
privilege by virtue of any covenant, agreement, condition or undertaking in this
Lease contained.
19.10 Recording of Lease. A short form notice of this Lease
and the easements created hereby (but not the Lease itself) may be recorded
against the Project Site by either party hereto, provided the form thereof has
received the prior approval of Landlord, which approval shall not be
unreasonably delayed or withheld.
19.11 Default Rate of Interest. Any amount owing by either
party under this Lease that is not paid on or before the 15th day after the due
date of such amount shall bear interest at a rate equal to one and one-half
percent (1.50%) per month, or the maximum legal rate, whichever is less, from
such date through and including the date of payment thereof (calculated using
actual days elapsed and a year of 365 or 366 days, as applicable).
19.12 Arbitration. Landlord and Tenant shall negotiate in good
faith and attempt to resolve promptly any dispute between them which may develop
under this Lease; however, if Landlord and Tenant are unable to resolve any such
dispute, then Landlord and Tenant jointly may request that such dispute be
resolved by arbitration in accordance with the provisions of the Commercial
Arbitration Rules of the American Arbitration Association. If
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Landlord and Tenant do not agree to submit such dispute to arbitration and are
not otherwise able to resolve such dispute, either Landlord or Tenant may bring
such dispute to any court of competent jurisdiction for resolution. The
provisions of this Section shall survive the termination or expiration of this
Lease.
19.13 Self-Help. Landlord may, but shall not be obligated to,
perform any duty or obligation of the Tenant under this Lease (including,
without limitation, the performance of maintenance, repairs and replacements
pursuant to Section 9) if and to the extent Tenant fails to perform such duty or
obligation and such failure continues for thirty days after written notice
thereof (which thirty day period shall not apply or pertain to any such failure
which creates an emergency situation). If Landlord so elects to cure or attempt
to cure such failure of the Tenant, then all reasonable costs and expenses
incurred by Landlord in curing or attempting to cure such failure, including
without limitation reasonable attorneys' fees and court costs (all such costs
and expenses being hereinafter referred to collectively as the "Self-Help
Expenses") shall be repaid by the Tenant within five business days after a
written request therefor (together with an invoice and reasonable back-up
therefor). The rights and remedies provided for in this Section are
non-exclusive, and nothing herein shall prevent Landlord from exercising any
other right or remedy available to it under this Lease or at law or in equity
(subject to the limitations set forth in this Lease).
19.14 No Merger. There shall be no merger of this Lease nor of
the leasehold estate created by this Lease with the fee estate in the Project
Site or any part thereof by reason of the fact that the same person may own or
acquire or hold, directly or indirectly (a) this Lease or the leasehold estate
created by this Lease or any interest in this Lease or in any such leasehold
estate and (b) the fee estate in the Project Site or any part thereof or any
interest in such fee estate and no such merger shall occur unless and until
Landlord, Tenant, each holder of a mortgage on the fee estate in the Project
Site and each holder of a mortgage on the leasehold estate created by this Lease
shall join in a written instrument effecting such merger.
19.15 Notice of Transfer. The term "Landlord" as used herein
means the owner of the Project Site, and in the event of the sale, assignment or
transfer by such owner of its interest in the Project Site, the Landlord shall
promptly give notice of the fact to Tenant setting forth the name and address of
the transferee, and thereupon the owner selling, assigning or transferring its
interest in the Project Site shall be released and discharged as Landlord herein
from all liabilities and obligations thereafter accruing and thereupon all such
liabilities and obligations shall be binding upon the transferee.
19.16 Non-Liability. Neither Landlord nor any partner, joint
venturer, director, officer, agent, servant or employee of Landlord shall be
liable to Tenant for any
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loss, injury or damage to Tenant, or to its property, unless the cause of such
injury, damage or loss was the gross negligence or willful misconduct of
Landlord, its agents, contractors, shareholders, servants or employees.
Landlord's total liability under this Lease shall in all events be limited to
Landlord's interest in the Project Site, or, if applicable, net proceeds derived
from the sale thereof.
[Balance of page intentionally left blank; signature page follows.]
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IN WITNESS WHEREOF, Landlord and Tenant have executed and delivered
this Lease as of the day and year first above written.
ALADDIN GAMING LLC, a NORTHWIND ALADDIN, LLC, a
Nevada limited-liability company Nevada limited-liability company
By: By: UTT Las Vegas Inc.,
----------------------- a Nevada corporation, its manager
Xxxxxx Xxxxxxx
Title: By:
---------------------------------
Title:
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