Exhibit 10
OPERATING AGREEMENT
OF
IKM JV, LLC
September 10, 2007

 

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TABLE OF CONTENTS

                      Page
 
            ARTICLE 1
FORMATION

 
           
1.1.
  Formation     1  
1.2.
  Intent     1  
1.3.
  Definitions     1  
 
            ARTICLE 2
GENERAL PROVISIONS

 
           
2.1.
  Name     12  
2.2.
  Principal Office     12  
2.3.
  Company Purpose     12  
2.4.
  Purpose Limited     12  
2.5.
  Statutory Compliance     12  
2.6.
  Term     13  
2.7.
  Registered Agent for Service of Process     13  
2.8.
  No Payment of Individual Obligations     13  
2.9.
  Licensing     13  
2.10.
  Conduct of Business Through Single Purpose Entities     14  
 
            ARTICLE 3
CAPITALIZATION

 
           
3.1.
  Issuance of Units     14  
3.2.
  Initial Capital Contributions by the Members; Representations and Warranties  
  14  
3.3.
  Satisfaction of Closing Conditions     22  
3.4.
  Failure to Make a Capital Contribution     22  
3.5.
  Additional Remedies for Failure to Make a Capital Contribution     25  
3.6.
  Member Loans     25  
3.7.
  No Further Capital Contributions     25  
3.8.
  Excess Carrying Costs     25  
 
            ARTICLE 4
DISTRIBUTIONS

 
           
4.1.
  Amount and Time of Distributions     26  
4.2.
  Return of Capital     26  

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TABLE OF CONTENTS
(continued)

                      Page
 
           
4.3.
  MGM JV’s Distribution     26  
4.4.
  Acknowledgment of Liability for Taxes     26  
 
            ARTICLE 5
PROFITS AND LOSSES

 
           
5.1.
  Profit Allocations     27  
5.2.
  Loss Allocations     27  
5.3.
  Allocation Rules     28  
5.4.
  Tax Allocations     28  
 
            ARTICLE 6
MANAGEMENT

 
           
6.1.
  Management Committee-Managed     29  
6.2.
  Responsibilities, Rights, and Powers of the Chief Executive Officer and the
Chief Financial Officer     32  
6.3.
  Management Committee     33  
6.4.
  Actions Requiring the Consent of the Management Committee     35  
6.5.
  Filing of Documents     37  
6.6.
  Indemnification and Liability     37  
6.7.
  Compensation     38  
6.8.
  Amendment of Agreement     39  
6.9.
  Standard of Care     39  
6.10.
  Transactions with Affiliates     40  
6.11.
  Independent Activities     40  
6.12.
  Management Employees of the Company     41  
6.13.
  Additional Arrangements     41  
6.14.
  Right to Exercise Remedies     42  
 
            ARTICLE 7
THE MEMBERS

 
           
7.1.
  Meetings of the Members     42  
7.2.
  Voting of the Members     42  
7.3.
  Other Business Interests of the Members     42  
7.4.
  Rights and Obligations of Members     42  

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TABLE OF CONTENTS
(continued)

                      Page
 
           
7.5.
  Defaulting Member     43  
7.6.
  Member Determined Unsuitable or Unqualified by a Gaming Authority     44  
 
            ARTICLE 8
BOOKS, RECORDS, REPORTS AND ACCOUNTING

 
           
8.1.
  Records     45  
8.2.
  Fiscal Year and Accounting     46  
8.3.
  Preparation of Tax Returns     46  
8.4.
  Tax Elections     46  
8.5.
  Tax Controversies     46  
8.6.
  Reports     47  
 
            ARTICLE 9
TRANSFERS, WITHDRAWALS

 
           
9.1.
  Restrictions on Transfers     47  
9.2.
  Permitted Transfers     47  
9.3.
  Conditions to Transfers     48  
9.4.
  Prohibited Transfers     49  
9.5.
  Distributions and Allocations in Respect of Transferred Units     49  
9.6.
  Right of First Offer     49  
9.7.
  Consequence of Certain Transfers     50  
 
            ARTICLE 10
LIQUIDATION AND WINDING UP; MERGER

 
           
10.1.
  Dissolution     51  
10.2.
  Liquidation     52  
10.3.
  Liquidating Trust     53  
10.4.
  Deficit Capital Account     53  
10.5.
  Filings     53  
10.6.
  Merger     53  
10.7.
  Representations and Warranties of the Members     53  
 
            ARTICLE 11
GAMING LAWS

 
           
11.1.
  Gaming Licensing Matters     55  

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TABLE OF CONTENTS
(continued)

                      Page
 
           
11.2.
  Qualifications     55  
11.3.
  Additional Requirements     56  
 
            ARTICLE 12
DISPUTE RESOLUTION

 
           
12.1.
  Dispute Resolution     57  
12.2.
  Commencement of Mediation and Arbitration     57  
12.3.
  Mediation     57  
12.4.
  Rules of Arbitration     57  
12.5.
  Selection of Arbitrator     57  
12.6.
  Choice and Adoption of Law     58  
12.7.
  Place of Hearing     58  
12.8.
  Confidentiality     58  
12.9.
  Service of Process     58  
12.10.
  Form of Arbitrator’s Award     58  
12.11.
  Performance During Disputes     59  
12.12.
  Review of Arbitrator’s Award     59  
12.13.
  Discovery     59  
12.14.
  Costs of Arbitration and Attorneys’ Fees     59  
12.15.
  Joinder of Third Parties     59  
 
            ARTICLE 13
MISCELLANEOUS

 
           
13.1.
  Governing Law     59  
13.2.
  Method of Providing Notices     59  
13.3.
  Severability     60  
13.4.
  Binding Effect     60  
13.5.
  Titles and Captions     61  
13.6.
  Pronouns and Plurals     61  
13.7.
  No Third Party Rights     61  
13.8.
  Further Assurances     61  
13.9.
  Estoppel Certificates     61  
13.10.
  Schedules Included in Exhibits; Incorporation by Reference     61  

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TABLE OF CONTENTS
(continued)

                      Page
 
           
13.11.
  Amendments     61  
13.12.
  Counterparts     61  
13.13.
  Creditors     61  
13.14.
  Entire Agreement     61  
13.15.
  Independent Legal Counsel     62  
13.16.
  Proceeding Expenses     62  
13.17.
  Specific Performance     62  
13.18.
  Non-Involvement of Certain Parties     62  
13.19.
  Expansion of Relationship     63  
13.20.
  Waiver of Partition Right     63  
13.21.
  Interpretation     63  

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OPERATING AGREEMENT
OF
IKM JV, LLC
THIS OPERATING AGREEMENT (the “Agreement”) of IKM JV, LLC (the “Company”) is
made and entered into effective as of September 10, 2007, by and among IKM MGM,
LLC, a Nevada limited liability company (“MGM JV”) and Kerzner Istithmar Las
Vegas LLC, a Delaware limited liability company (“KERZNER JV”), as members and
IKM MGM Management, LLC, a Nevada limited liability company (“IKM MGM
Management”) and Kerzner Concepts Limited, a Bahamian company (“Kerzner Concepts
Limited”), as managers of the Company.
ARTICLE 1 FORMATION
     1.1. Formation. The Company has been formed pursuant to Chapter 86 of the
NRS (the “Act”) by filing of the Articles of Organization with the Secretary of
State of the State of Nevada. The parties agree to promptly execute all
amendments of the Articles of Organization and all other documents that are
needed to enable the Members to accomplish all filing, recording, publishing and
other acts necessary or appropriate to comply with all requirements for the
formation and continuation of the Company under the Act.
     1.2. Intent. The Members intend that the Company be operated as a
“partnership” for federal and state income tax purposes. No Member may take any
action inconsistent with the express intent of the parties hereto as set forth
herein.
     1.3. Definitions. Appendix 1 hereof sets forth the definitions of certain
terms relating to the maintenance of capital accounts and accounting rules. In
addition, the following terms used in this Agreement have the meanings described
below:
     “Acceptance Notice” is defined in Section 9.6(b).
     “Access License” means a license or other agreement among Circus Circus and
the MGM Property Owners granting the MGM Property Owners the right to use the
“ACCESS LICENSE AREA” indicated on Schedule 1.3(a). The MGM Property Owners’
rights to use the “ACCESS LICENSE AREA” shall be subject to reasonable
restrictions as determined by Circus Circus, and the Access License shall be
terminable on thirty (30) days written notice by Circus Circus.
     “Act” means the Limited Liability Company Act of the State of Nevada.
     “Adjusted Additional Percentage Interest” is defined in Section 3.4(b)(ii).
     “Affiliate” means, with respect to the subject Person (a) any Person
directly or indirectly controlling, controlled by or under common control with
the subject Person and (b) any officer, director, general partner, manager,
member or trustee of either such Person. For purposes of this Agreement, the
terms “controlling,” controlled by,” or “under common control with” shall

 

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mean the possession, direct or indirect, of the power to direct or cause the
direction of the management and policies of a Person, whether through the
ownership of voting securities, by contract or otherwise, or the power to elect
the majority of the directors, managers, general partners, or Persons exercising
similar authority with respect to such Person or entities. For the avoidance of
doubt, each of Kerzner International, Istithmar and their respective controlled
Affiliates shall be deemed to be an Affiliate of Kerzner JV. Notwithstanding
anything to the contrary, “Affiliate” does not include Tracinda Corporation and
its Affiliates (other than MGM MIRAGE and its Subsidiaries) or any other
stockholder of MGM MIRAGE in each case in its capacity as such or any of the
Kerzner Related Persons.
     “Agreement” means this Operating Agreement, as it may be amended from time
to time, including all exhibits and schedules hereto.
     “Appraised Value” is defined in Section 7.6.
     “Approved Budget/Plan” is defined in Section 6.1(b)(iv).
     “Arbitrator” is defined in Section 12.5.
     “Available Cash Flow” means the Company’s gross cash proceeds from any
source, less the portion thereof used to pay or establish reserves for the
Company’s ordinary and necessary expenses (including reserves maintained with
respect to executive incentive compensation payments) and fees in amounts and
for purposes set forth in the then Approved Budget/Plan, principal and interest
payments on all Company debt (including Member Loans), capital improvements,
replacements and contingencies, all as determined by the Management Committee
(taking into account, to the extent applicable, amounts available to the Company
from Company loan proceeds to pay off Company expenses). Available Cash Flow
shall not be reduced by depreciation, amortization or other similar non-cash
allowances, including amortization with respect to executive incentive
compensation, and shall be increased by any reductions in reserves which, when
previously established, reduced Available Cash Flow.
     “Bankruptcy” means, with respect to a Person, the happening of any of the
following:
          (a) the making by such Person of a general assignment for the benefit
of creditors;
          (b) the filing by such Person of a voluntary petition in bankruptcy or
the filing by such Person of a pleading in any court of record admitting in
writing an inability to pay debts as they become due;
          (c) the entry of an order, judgment or decree by any court of
competent jurisdiction adjudicating such Person to be bankrupt or insolvent;
          (d) the filing by such Person of a petition or answer seeking any
reorganization, arrangement, composition, readjustment, liquidation, dissolution
or similar relief under any statute, law or regulation;

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          (e) the filing by such Person of an answer or other pleading admitting
the material allegations of, or consenting to, or defaulting in answering, a
bankruptcy petition filed against such Person in any bankruptcy proceeding;
          (f) the filing by such Person of an application or other pleading or
any action otherwise seeking, consenting to or acquiescing in the appointment of
a liquidating trustee, receiver or other liquidator of all or any substantial
part of such Person’s properties;
          (g) the commencement against such Person of any proceeding seeking
reorganization, arrangement, composition, readjustment, liquidation, dissolution
or similar relief under any statute, law or regulation which has not been
quashed or dismissed within one hundred eighty (180) days; or
          (h) the appointment, without the consent or acquiescence of such
Person of a liquidating trustee, receiver or other liquidator of all or any
substantial part of such Person’s properties without such appointment being
vacated or stayed within ninety (90) days and, if stayed, without such
appointment being vacated within ninety (90) days after the expiration of any
such stay.
     “Base Percentage Interest” is defined in Section 3.4(b)(ii).

     “Budgets and Plans” is defined in Section 6.1(c).
     “Business Day” means any day other than Saturday, Sunday or any other day
on which commercial banks in Las Vegas, Nevada are authorized or required to
close under the laws of the State of Nevada or applicable federal law.
     “Business Plan” is defined in Section 6.1(b)(ii).
     “Capital Contribution” means, with respect to any Member, the amount of
money contributed by that Member to the Company and, if property other than
money is contributed, the initial Gross Asset Value (as defined in Appendix 1)
of such property, net of liabilities assumed or taken subject to by the Company.
     “CEO” is defined in Section 6.2(a).
     “CFO” is defined in Section 6.2(a).
     “Chair” is defined in Section 6.3(b)(ii).
     “Circus Circus” means Circus Circus Casinos, Inc., a Nevada corporation.
     “Closing Date” means a date determined by the Members that is no later than
five Business Days from the date on which (A) the condition set forth in
Section 3.2(a)(iii)(D) and in Section 3.2(b)(ii)(F) is satisfied by the Company
or validly waived by MGM JV and KERZNER JV, respectively and (B) the conditions
set forth in Section 3.2(a)(iii)(A) through (C), Section 3.2(b)(ii)(A) through
(E) and Section 3.2(b)(ii)(G) are satisfied by KERZNER JV and MGM JV,
respectively, or validly waived by MGM JV and KERZNER JV, respectively.

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     “Code” means the Internal Revenue Code of 1986 (or successor thereto), as
amended from time to time.
     “Company” means IKM JV, LLC.
     “Confidential Information” is defined in Section 7.4(b).
     “Default Interest Rate” means Prime Rate plus three percent (3%).
     “Defaulting Member” means a Member that has committed an event of default
as described in Section 7.5(a).
     “Delinquent Member” is defined in Section 3.4.
     “Determination Date” is defined in Section 7.6.
     “Disposing Member” is defined in Section 9.6(a).
     “Disposition Notice” is defined in Section 9.6(a).
     “Dispute” means any claim, dispute or other matter in controversy between
the Members or one or more Members and the Managers or a Management Committee
member arising directly or indirectly out of or relating to this Agreement or
the subject matter hereof, including one involving an alleged violation of Law,
an alleged default by a Manager, a Management Committee member, or an officer
(if any) of the Company, an alleged breach of this Agreement (including for
non-payment of any Capital Contribution and the re-determination of the
Percentage Interest of the Members pursuant to Section 3.4(b)) or alleged
misconduct by a Member, whether or not during the term or after the termination
of this Agreement. For the avoidance of doubt and notwithstanding anything to
the contrary contained in this Agreement (i) any Major Decision proposed to be
executed, taken, or performed by the Company at the direction of the Managers
which has not received consent of the Management Committee and (ii) any other
claim, dispute or other matter in controversy involving an issue of business
judgment shall not be considered to be a Dispute and shall not be subject to the
Dispute Resolution provisions of Article 12.
     “Dispute Notice” is defined in Section 12.2.
     “Encumbrance” means any mortgage, pledge, lien, charge, hypothecation,
security interest, encumbrance, adverse right, interest or claim, license,
covenant, title defect, option, right of first refusal or other restriction or
limitation of any nature whatsoever .
     “End Date” is defined in Section 10.1(g).
     “Excess Carrying Costs” means all real estate taxes, insurance premiums,
interest, and other carrying costs, in each case to the extent incurred in
connection with the ownership of the Property for the period starting on
February 1, 2008 and continuing through the Closing Date, in excess of any
income (which income shall be deemed to include $55,000 per month, representing
the fair market value of the billboards used by MGM MIRAGE pursuant to the
Agreement for

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Off-Premise Advertising dated July 11, 2007 between Clear Channel Outdoor and
MGM MIRAGE) received by MGM MIRAGE and/or its Affiliates during such period in
respect of the Property. The Excess Carrying Costs are set forth on Exhibit D
attached hereto, provided that the dollar amounts appearing on Exhibit D for
interest, taxes, and insurance are based on MGM MIRAGE’s best available
estimates and are for illustrative purposes only. The actual Excess Carrying
Costs will be calculated as follows: (x) interest will be calculated based on
the blended cost of funds to MGM MIRAGE reflecting the actual interest carrying
costs to MGM MIRAGE, (y) taxes will be calculated based on the actual tax
expenses of the Property, and (z) liability insurance will be calculated based
on MGM MIRAGE’s share of liability insurance expenses reasonably allocable to
the Property which in no event shall exceed $100,000 per year.
     “Fiscal Year” means the year in which the accounting and federal income tax
records of the Company are kept, as identified in Section 8.2 hereof. The first
Fiscal Year (or portion thereof) shall start on the organization date of the
Company and the last Fiscal Year (or portion thereof) shall end on the
termination of the Company.
     “FF&E” means furniture, fixtures and equipment.
     “GAAP” means United States generally accepted accounting principles, as in
effect from time to time.
     “Gaming” means to deal, operate, carry on, conduct, maintain or expose for
play any game as defined in NRS § 463.0152, or to operate an inter-casino linked
system.
     “Gaming Approvals” means with respect to any action by a particular Person,
any consent, finding of suitability, license, approval, waiver, registration,
permit or other authorization required for such action by such Person from a
Gaming Authority or under Gaming Laws.
     “Gaming Authority” means those national, state, local and other
governmental, regulatory and administrative authorities, agencies, boards and
officials responsible for or regulating Gaming or Gaming activities in any
jurisdiction and, within the State of Nevada, specifically, the Nevada Gaming
Commission, the Nevada State Gaming Control Board, and the Clark County Liquor
and Gaming Licensing Board.
     “Gaming Components” means all Resort components in which Gaming will take
place.
     “Gaming Laws” means those laws pursuant to which any Gaming Authority
possesses regulatory, licensing or permit authority over Gaming or the ownership
of an interest in an entity that conducts Gaming within any jurisdiction and,
within the State of Nevada, specifically, the Nevada Gaming Control Act, as
codified in NRS Chapter 463, the regulations of the Nevada Gaming Commission
promulgated thereunder, and the Clark County Code.
     “Gaming Lease Agreements” is defined in Section 2.9(b).
     “Gross Revenues” means any and all revenues directly or indirectly received
by, accrued to or derived from the operation of the Company, including all
income and proceeds of sales (whether in cash or on credit) of every kind,
including hotel revenue, room service, catering,

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food and beverage sales, gaming, aquarium and related facilities, parking
revenues, retail sales for stores directly managed by the Managers, ticket
revenues or other fees or receipts from the convention/event center, rental or
other receipts including retail rental receipts, spa, health club, beauty salon
and fitness center revenues received from tenants, transient guests, lessees,
licensees and concessionaires and other persons occupying space at or otherwise
utilizing the Resort facilities and/or rendering services to the Resort guests
(but not including the gross receipts of such lessees, licensees,
concessionaires or other persons), all income from catering operations conducted
outside the Resort; the proceeds of business interruption and use and occupancy
insurance actually received by Managers or the Company with respect to the
operation of the Resort (after deduction from the proceeds of all necessary
expenses incurred in the adjustment or collection thereof), but the term “Gross
Revenues” shall exclude the following:

  1.   direct-room or room-sales-related taxes, fees or levies, sales taxes or
any other tax or levy to be paid to the Government or any administrative
authority that are directly recoverable from patrons;     2.   any proceeds from
the sale or other disposition of furnishings, equipment or other capital assets
of the Resort;     3.   the proceeds from any insurance or condemnation award
other than the interruption of operation insurance;     4.   revenues which are
not derived from operations, such as revenues of investments in securities or
real estate or revenues of financial investments on cash flow (reserve funds,
investment funds or others) as reflected in the audited accounts of the Company
relating to the Company for the year in question and as calculated in accordance
with GAAP; and     5.   Accommodations, food and beverage, and other services
furnished to guests without charge.

In addition, amounts provided to patrons in connection with sales incentive
programs, including marker discounts and player-loyalty points programs, will be
deducted in computation of Gross Revenues.
     “Guarantee” is defined in Section 3.5.
     “Guarantor” means each of Kerzner International, MGM MIRAGE, and Istithmar.
     “HSR Act” means the Hart-Scott-Rodino Antitrust Improvements Act of 1976,
as amended.
     “Improvements” means any and all improvements included in or built or to be
built on the Property by the Company pursuant to the Approved Budget/Plan.
     “Indemnitee” is defined in Section 6.6(a).
     “Independent Activities” is defined in Section 6.11(a).

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     “Indirect Owner” means any Person that indirectly owns any of the Units.
     “Initial Capital Contribution” is defined in Section 3.2.
     “Istithmar” means Istithmar PJSC, a public joint stock company incorporated
under the laws of Dubai, United Arab Emirates.
     “Istithmar Member” means IH Las Vegas LLC, a Delaware limited liability
company.
     “Kerzner Conditions Precedent” is defined in Section 3.2(b)(ii).
     “Kerzner International” means Kerzner International Holdings Limited, an
international business company incorporated under the laws of the Commonwealth
of The Bahamas.
     “KERZNER JV Members” means Kerzner Investments Nevada, Inc., a Delaware
corporation and the Istithmar Member or any other Person that may become a
member of KERZNER JV in a manner that is not in default of this Agreement.
     “KERZNER Management Prerequisites” is defined in Section 6.1(a)(i)(A).
     “KERZNER Manager” means any Manager appointed by KERZNER JV pursuant to the
terms of this Agreement.
     “Kerzner Related Persons” means any of (i) Baron Capital Group, Inc.,
(ii) Colony Capital LLC, (iii) Whitehall Street Global Real Estate Limited
Partnership 2005, (iv) Istithmar, (v) The Related Companies, L.P., (vi) WLG
Holdings Limited, (vii) Howarth International Holdings Limited and (viii) other
Persons who are or may become equity holders of Kerzner International, in each
case solely in their capacity as stockholders of Kerzner International.
     “Knowledge of KERZNER JV” means the actual knowledge, after due
investigation, of the following persons: Sol Kerzner, Paul O’Neil, Tobin Prior,
John Alison, Richard Levine, Bill Murtha and Bob Cotter.
     “Knowledge of MGM JV” means the actual knowledge, after due investigation,
of the following persons: J. Terrence Lanni, Jim Murren, Gary Jacobs, Ken
Rosevear, Robert Selwood, Dan D’Arrigo, Troy McHenry, Bryan Wright and Don
Thrasher.
     “Law” is defined in Section 10.7(b).
     “Lending Member” is defined in Section 3.4(a).
     “Liquidating Trustee” is defined in Section 10.2.
     “MAI” is defined in Section 7.6.
     “Major Decisions” is defined in Section 6.4.

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     “Major Lease” means any lease of space at the Property covering more than
20,000 rentable square feet at the Property; provided, that in the case of a
restaurant lease, Major Lease means any lease covering more than 5,000 rentable
square feet.
     “Management Committee” is defined in Section 6.1(a)(i).
     “Managers” means the KERZER Manager and the MGM Manager, or any other
Person that is appointed as a Manager pursuant to the terms of this Agreement.
     “Mediation Period” is defined in Section 12.3.
     “Member” means any Person that executes this Agreement as a member, and any
other Person admitted to the Company as an additional or substituted member, in
each case that has not made a disposition of all of such Person’s Units.
     “Member Loan” means a loan to the Company from a Member in accordance with
Section 3.6.
     “MGM Conditions Precedent” is defined in Section 3.2(a)(iii).
     “MGM Management Prerequisites” is defined in Section 6.1(a)(i)(B).
     “MGM Manager” is any Manager appointed by MGM JV pursuant to the terms of
this Agreement.
     “MGM MIRAGE” means MGM MIRAGE, a Delaware corporation.
     “MGM Property Owners” means Vintage Land Holdings II, LLC a Nevada limited
liability company and/or a newly formed wholly owned subsidiary of New York-New
York Hotel & Casino, LLC, a Nevada limited liability company, or a successor to
New York-New York Hotel & Casino LLC, formed to hold the Property.
     “Non-Delinquent Member” is defined in Section 3.4.
     “Non-Disposing Member” is defined in Section 9.6(b).
     “Notices” is defined in Section 13.2.
     “NRS” means the Nevada Revised Statutes, as amended from time to time.
     “Offer Notice” in defined in Section 9.6(b).
     “Offer Period” in defined in Section 9.6(b).
     “Offered Units” in defined in Section 9.6(a).
     “Opening Date” means the date the Resort is open for business to the
general public.
     “Operating Budget” is defined in Section 6.1(b)(iii).

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     “Percentage Interest” means at any particular time the percentage interest
of each Member determined with respect to a particular Member by dividing the
number of Units owned by such Member by the aggregate number of outstanding
Units.
     “Permitted Encumbrances” means the Encumbrances set forth on Schedule
1.3(b)(1).
     “Permitted Transferee” means, (i) in the case of MGM JV: MGM MIRAGE or any
Person, one hundred percent (100%) of the voting stock or beneficial ownership
of which is owned directly or indirectly, including through subsidiaries, by MGM
MIRAGE, and (ii) in the case of KERZNER JV: (a) prior to the Transfer
Restriction Lapse Date, Kerzner International or any Person, one hundred percent
(100%) of the voting stock or beneficial ownership of which is owned directly or
indirectly, including through subsidiaries, by Kerzner International or KERZNER
JV and (b) following the Transfer Restriction Lapse Date, Kerzner International,
Istithmar or any Person, one hundred percent (100%) of the voting stock or
beneficial ownership of which is owned directly or indirectly, including through
subsidiaries, by Kerzner International, KERZNER JV or Istithmar.
     “Person” means an individual, firm, corporation, partnership, limited
liability company, association, estate, trust, pension or profit-sharing plan,
or any other entity.
     “Pre-Development Budget” is defined in Section 6.1(b)(i).
     “Pre-Development Expenses” means all costs, fees, and expenses incurred by
the Company or a Manager during the Pre-Development Period in connection with
pre-development activities, including conceptual design and planning, to the
extent such costs are provided for in the Pre-Development Budget.
     “Pre-Development Period” means the period starting on the Signing Date and
ending on the earlier of the Closing Date and the date of dissolution of the
Company in accordance with Section 10.1.
     “Prime Rate” means the U.S. “prime rate” published in the “Money Rates” or
equivalent section of the Western Edition of The Wall Street Journal, provided
that if a “prime rate” range is published by The Wall Street Journal, then the
highest rate of that range will be used, or if The Wall Street Journal ceases
publishing a prime rate or a prime rate range, then the Management Committee
will select a prime rate, a prime rate range or another substitute interest rate
index that is based upon comparable information.
     “Principal Office” means the Nevada office of the Company at which the
records of the Company are kept as required under the Act.
     “Proceeding” is defined in Section 13.16.
     “Professional Services Agreement” means that certain Professional Services
Agreement entered into by and between the Company and Kerzner Concepts Limited,
in the form attached hereto as Exhibit E, as may be supplemented, modified or
amended from time to time.

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     “Property” means the real estate more particularly described in Exhibit B
hereof (as it may be revised in accordance with Section 3.2(c) below), together
with (i) all improvements thereon, (ii) all easements (including access
easements with respect to contiguous properties), covenants and other rights
appurtenant thereto, (iii) all entitlements, development rights, licenses,
permits and approvals related thereto, and (iv) all other tangible or intangible
personal property used in connection with the operation thereof.
     “Proposal” is defined in Section 6.1(b)(v).
     “Qualified Manager” means a Manager appointed under the terms of this
Agreement who, in the case of the Manager appointed by KERZNER JV, is wholly
owned, directly or indirectly, by Kerzner International, and, in the case of the
Manager appointed by MGM JV, is wholly owned, directly or indirectly, by MGM
MIRAGE.
“Record Encumbrances” means the Encumbrances set forth on Schedule 1.3(b)(2)
     “Regulations” means pronouncements, as amended from time to time, or their
successor pronouncements, which clarify, interpret and apply the provisions of
the Code, and which are designated as “Treasury Regulations” by the United
States Department of the Treasury.
     “Related Agreements” means the Professional Services Agreement, the
Guarantee and any agreements of the type contemplated by Section 6.13 entered
into after the Signing Date.
     “Resort” is defined in Section 2.3(a)(iii).
     “Rules” is defined in Section 12.4.
     “Securities Act” means the Securities Act of 1933, as amended.
     “Signing Date” means the date of this Agreement.
     “Subsequent Capital Contribution” is defined in Section 3.4(b)(ii)(C).
     “Subsidiary” or “Subsidiaries” is defined in Section 2.10.
     “Tax Distribution Rate” is defined in Section 4.5.
     “Tax Matters Partner” means the “tax matters partner” as defined in Code
Section 6231(a)(7).
     “Tier-I Competitor” is defined in Schedule 1.3(c).
     “Tier-II Competitor” is defined in Schedule 1.3(c).
     “Title Policy” means a ALTA Owner’s Policy of Title Insurance (2006 Form)
issued by a nationally recognized title insurance company (as reasonably
determined by MGM JV) as of the date and time of the Initial Capital
Contribution, in the amount of at least $800 million insuring the MGM Property
Owners as owners of fee simple title to the Property, subject only to Permitted
Encumbrances, together with (a) a non-imputation endorsement with respect to the

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knowledge and acts of MGM JV, the MGM Property Owners and their respective
Affiliates; (b) endorsements in the then current CLTA form (or equivalent) for
100.9 (Comprehensive), 103.7 (Abutment), 116.1 (Survey), 103.5 (Water), 116.4
(Contiguity) and 116.7 (Subdivision) and (c) such other customary endorsements
agreed to by the Members.
     “Transfer” means, with respect to a Unit, to directly or indirectly sell,
assign, transfer, give, donate, pledge, hypothecate, deposit, alienate,
bequeath, devise or otherwise dispose of or encumber such Unit. Notwithstanding
the foregoing, the following shall not constitute Transfers:
          (a) the transfer of interests (in one or more transactions) of an
entity that owns, directly or indirectly, any Units if: (A) the value of the
Units held, directly or indirectly, by such entity does not exceed fifty percent
(50%) of the fair market value of the total assets of such entity, (B) following
such transfer, the entity may continue to be consolidated with MGM MIRAGE,
Kerzner International or Istithmar, as applicable, for financial reporting
purposes in accordance with GAAP, (C) all Gaming Approvals required under Gaming
Laws to effect such a transfer with respect to the Company have been obtained
prior to such transfer, and (D) the transfer would not, in the opinion of
counsel chosen by the Company, result in the termination of the Company within
the meaning of Section 708 of the Code;
          (b) an offering of securities by MGM MIRAGE, Kerzner International or
Istithmar, or a change of control of MGM MIRAGE or Kerzner International;
          (c) the transfer by Istithmar and/or any of its Affiliates of any or
all of its direct or indirect interest in KERZNER JV to any Person directly or
indirectly controlled by the Government of Dubai provided that all Gaming
Approvals required under Gaming Laws to effect such a transfer with respect to
the Company have been obtained prior to such transfer, and the transfer would
not, in the opinion of counsel chosen by the Company, result in the termination
of the Company within the meaning of Section 708 of the Code; and
          (d) adjustments to the ownership interests of the KERZNER JV Members
(for the purpose of this clause (d) the KERZNER JV Members shall include only
Kerzner Investments Nevada, Inc., the Istithmar Member and their respective
Affiliates to whom a transfer is otherwise permitted under this Agreement) in
KERZNER JV (i) to maintain one of the KERZNER JV Member’s indirect interest in
the Company following any decrease in KERZNER JV’s Percentage Interest resulting
from the application of the provisions of Section 3.4(b)(i), (ii) resulting from
one of the KERZNER JV Members causing KERZNER JV to exercise one of the remedies
set forth in Section 3.4 or (iii) resulting from one of the KERZNER JV Members
curing a payment default of another KERZNER JV Member with respect to KERZNER JV
if the failure to cure such payment default would have resulted in a default by
KERZNER JV under this Agreement.
     “Transferee” means a Person to whom a Transfer is made.
     “Transfer Restriction Lapse Date” is defined in Section 9.1.
     “Units” is defined in Section 3.1.

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ARTICLE 2 GENERAL PROVISIONS
     2.1. Name. The name of the Company is “IKM JV, LLC” or such other name as
the Members select from time to time.
     2.2. Principal Office. The Principal Office of the Company in Nevada is at
3600 Las Vegas Boulevard South, Las Vegas, Nevada 89109, or such other place as
the Managers may designate from time to time.
     2.3. Company Purpose.
          (a) The nature of the business and of the purposes to be conducted and
promoted by the Company is to:
               (i) Acquire the Property or the MGM Property Owners by
contribution from MGM JV;
               (ii) Design, develop, finance and construct the Improvements on
the Property pursuant to the Approved Budget/Plan; and
               (iii) Directly or indirectly, own and operate an integrated
resort casino (including all related or incidental activities such as rental of
rooms and retail and all other activities and facilities related to such resort
casino) (the “Resort”) on the Property.
          (b) In addition, the Members will consult throughout the
Pre-Development Period on the prospects for a residential product for the
Property and synergies that can be obtained in connection with up to two
(2) acres of real property adjacent to the Property to be developed or
redeveloped by MGM MIRAGE through its subsidiaries. To the extent approved by
the Management Committee in accordance with Section 6.3(b)(vii), the purpose of
the Company may then include the development of a residential product.
          (c) The Company may exercise all powers enumerated in the Act
necessary or convenient to the conduct, promotion or attainment of such
purposes, including, but not limited to, entering into or acquiring interests in
any partnerships, joint ventures, corporations, limited liability companies, or
similar entities or arrangements to engage in any of the foregoing, all in
accordance with, and subject to the terms and conditions of, this Agreement and
the Related Agreements.
     2.4. Purpose Limited. The Company shall be a limited liability company
having the sole purposes specified in Section 2.3. Except as otherwise provided
in this Agreement, the Company shall not engage in any other activity or
business and neither Member shall have any authority to hold itself out as an
agent of the Company or the other Member in any other business or activity.
     2.5. Statutory Compliance. The Members shall make all filings (including
all required filings under the HSR Act) and disclosures required by, and shall
otherwise comply with, all Laws in connection with this Agreement, the Property
and the Resort. The Members shall execute, file and record in the appropriate
records any assumed or fictitious name certificate required by Law

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to be filed or recorded in connection with the formation of the Company and
shall execute, file and record such other documents and instruments as may be
necessary or appropriate with respect to the formation of, and conduct of
business by, the Company. Each Member shall and shall cause its Affiliates to
cooperate reasonably with the other Member with respect to all filings that the
Company or a Member is required or otherwise elects to make under Law in
connection with this Agreement, the Property and the Resort. The Company and
each Member shall also cooperate in taking all reasonable and appropriate
actions to cause early termination of any applicable waiting period under the
HSR Act. The Company shall bear the cost of any HSR Act filing fees.
     2.6. Term. The term of the Company commences on the filing of the Articles
of Organization and continues until dissolved, wound-up and terminated in
accordance with Article 10 of this Agreement.
     2.7. Registered Agent for Service of Process. The Registered Agent for
Service of Process for the Company is Corporation Trust Company of Nevada, 6100
Neil Road, Suite 500, Reno, Nevada, 89511, or such other Person as the
Management Committee appoints from time to time.
     2.8. No Payment of Individual Obligations. The Members and Managers shall
use the Company’s credit and assets solely for the benefit of the Company. No
asset of the Company shall be transferred or encumbered for or in payment of any
individual obligation of a Member or a Manager.
     2.9. Licensing.
          (a) General. Upon formation of the Company, the Company, each Member,
and each Management Committee member shall use commercially reasonable efforts
to prepare, file and process applications to obtain all necessary Gaming
Approvals that are required for the Company and its Subsidiaries to own and
operate the Resort. Further, each Member shall, and shall use commercially
reasonable efforts to cause the members of such Members to, use commercially
reasonable efforts to prepare, file and process applications to obtain all
necessary Gaming Approvals from Gaming Authorities that are required in
connection with the ownership of a direct or indirect interest in the Company
and to obtain as soon as practicable all consents necessary to permit the
Company to consummate its purposes as set forth in Section 2.3 hereof without
breaching or violating any applicable Law. Each Member shall cooperate
reasonably and shall (i) furnish upon request to each other such further
information, (ii) execute and deliver to each other such other documents, and
(iii) do such other acts and things, as may be reasonably requested by the other
Member or the Managers in obtaining the licenses and consents referred to in
this Section 2.9(a).
          (b) Delayed Gaming Approval. The Members agree that, in the event that
the Management Committee believes that all necessary Gaming Approvals will
likely not be granted or issued until some time after the anticipated Opening
Date, the Company will enter into one or more lease agreements (the “Gaming
Lease Agreements”) prior to the anticipated Opening Date pursuant to which MGM
MIRAGE or its Affiliate will lease the Gaming Components from the Company and
operate and manage such Gaming Components. The terms of such Gaming Lease
Agreement shall be approved by the Management Committee and shall provide for
such

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payment terms to the Company to reflect substantially the identical economic
benefits that the Company would have realized from such Gaming Components under
this Agreement. The Gaming Lease Agreements shall terminate five (5) Business
Days after all necessary Gaming Approvals have been duly issued; provided,
however, that, in the event that MGM MIRAGE or its Affiliates are prohibited by
the Gaming Authorities from being associated with KERZNER JV or its Affiliates
in connection with the Resort or the Company, the Gaming Approvals shall be
deemed to have been rejected or revoked and the provisions of Section 7.6 shall
apply.
     2.10. Conduct of Business Through Single Purpose Entities. It is the
intention of the Members that the Company serve as a holding company and operate
its business through one or more single purpose wholly owned limited liability
companies or other wholly owned entities (each, a “Subsidiary” or, together, the
“Subsidiaries”). Where applicable in this Agreement, any reference to the
Company or the business of the Company also includes a reference to the
Subsidiaries and the business of the Subsidiaries.
ARTICLE 3 CAPITALIZATION
     3.1. Issuance of Units. Upon execution of this Agreement, the Company will
issue two membership units (each a “Unit” and collectively, the “Units”) to the
Members (1 to each Member). In addition, the Company will issue ninety-nine
thousand nine hundred ninety-eight (99,998) Units to the Members (forty-nine
thousand nine hundred ninety-nine (49,999) to Kerzner JV and forty-nine thousand
nine hundred ninety-nine (49,999) to MGM JV on the Closing Date upon the
contribution by such Member of the full amount of such Member’s Initial Capital
Contribution (as defined below). Issuance of additional Units pursuant to this
Agreement does not constitute an amendment of this Agreement. Exhibit A will be
revised from time to time to reflect the Units issued from time to time to the
Members.
     3.2. Initial Capital Contributions by the Members; Representations and
Warranties. Each Member shall make its initial Capital Contribution to the
Company (“Initial Capital Contribution”) subject to the terms and conditions of
this Agreement and in the following manner:
          (a) MGM JV’s Initial Capital Contribution:
               (i) On the Closing Date, and subject to the satisfaction or
written waiver by MGM JV of all of the MGM Conditions Precedent (as defined
below), MGM JV will contribute the Property through contribution of 100% of the
equity ownership of the MGM Property Owners to the Company on the Closing Date
in a manner reasonably acceptable to KERZNER JV, vacant of occupants (except for
occupants pursuant to the Permitted Encumbrances) and free and clear of any
Encumbrances whatsoever other than Record Encumbrances. Prior to MGM JV’s
Initial Capital Contribution to the Company, MGM JV shall cause the Property to
be (i) reparceled as necessary to create one or more separate legal parcels in a
manner sufficient for the Company to obtain coverage in the Title Policy
insuring, among other things, against loss due to a violation of the subdivision
law in Chapter 278 of NRS and that each of the parcels constitutes a separate
tax parcel and (ii) transferred to the MGM Property Owners by grant bargain sale
deed. On the Closing Date, MGM JV shall execute and deliver or

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cause the MGM Property Owners to execute and deliver any other necessary or
customary documentation delivered in connection with MGM JV’s Initial Capital
Contribution. On or prior to the Closing Date, MGM JV shall deliver the Access
License. MGM JV shall cause the MGM Property Owners to deliver to the applicable
title company issuing the Title Policy a seller’s affidavit reasonably
acceptable to MGM JV providing, among other things, that, to the Knowledge of
the MGM Property Owners, the Property is not subject to any Encumbrance other
than the Record Encumbrances, and customary evidence of the MGM Property Owners
good standing in the State of Nevada and MGM JV shall deliver, and cause the MGM
Property Owners to deliver, any affidavits required by the Title Company in
order for the Title Company to issue the non-imputation endorsement required
under the definition of “Title Policy”. Notwithstanding anything to the contrary
contained in this Agreement, the Members stipulate that the initial Gross Asset
Value of the Property for purposes of determining MGM JV’s total Initial Capital
Contribution to the Company is equal to Eight Hundred Million Dollars
($800,000,000) and that the MGM JV’s Initial Capital Contribution to the Company
shall be (A) the sum of Eight Hundred Million Dollars ($800,000,000) (as
adjusted pursuant to Section 3.2(d)) minus (B) the amount payable to MGM JV
pursuant to Section 4.3. In addition, in the event that the Closing Date does
not occur as a result of the conditions set forth in Section 3.2(a)(iii)(D) or
Section 3.2(b)(ii)(F) not being satisfied or waived and provided that KERZNER JV
has complied with Section 3.3, MGM JV shall contribute to the Company one-half
of the Pre-Development Expenses, which amount shall be distributed to KERZNER JV
to reimburse it for one-half of the Pre-Development Expenses. The obligations
under the immediately preceding sentence shall survive the termination or
expiration of this Agreement.
               (ii) MGM JV’s Initial Capital Contribution will be made subject
to the following warranties and representations in addition to any other
warranties and representations set forth within this Agreement, all of which
representations and warranties shall be made as of the Signing Date; provided
that the representations and warranties made under Sections 3.2(a)(ii)(A), (I),
(K) and (M) and Section 10.7 shall also be made as of the Closing Date.
                    (A) MGM JV is lawfully and duly formed, validly existing and
in good standing under the laws of the State of Nevada. MGM JV has the power and
authority to execute and deliver this Agreement and to make MGM JV’s Initial
Capital Contribution. The compliance with or fulfillment of the terms and
conditions of this Agreement will not conflict with, or result in a breach of,
the terms, conditions or provisions of, or constitute a default under, any
contract or form of agreement to which MGM JV is a party or by which it is
otherwise bound.
                    (B) To the Knowledge of MGM JV, Circus Circus and Vintage
Land Holdings II, LLC have good and marketable, indefeasible, fee simple
interest in the Property, free and clear of any Encumbrances other than Record
Encumbrances. Except for Permitted Encumbrances, to the Knowledge of MGM JV
there are no material adverse claims relating to the Property or other parties
who have an interest in the Property.
                    (C) Except for Record Encumbrances, none of MGM JV, Circus
Circus, or the MGM Property Owners have entered into any agreements to sell,
assign, convey, transfer or lease the Property or any service contracts or other
agreements affecting or creating an Encumbrance on all or any portion of the
Property. MGM JV has delivered to

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KERZNER JV true, correct and complete copies of each of the leases, service
contracts and other agreements set forth on Schedule 3.2(a)(ii)(C). To the
Knowledge of MGM JV, there is no default or condition that with the passing of
time or giving of notice would constitute a default under any leases, service
contracts or other agreements affecting or encumbering all or any portion of the
Property.
                    (D) Except for Gaming Approvals, MGM JV does not require the
consent, third party approvals, or joinder of any persons or entities in order
to effect MGM JV’s Initial Capital Contribution, fully and completely, to the
Company pursuant to the terms of this Agreement, or to fulfill MGM JV’s
obligations hereunder.
                    (E) Except as otherwise set forth on Schedule 3.2(a)(ii)(E),
none of MGM JV, Circus Circus or the MGM Property Owners are a party to any
actions, proceedings, litigation or governmental investigations or condemnation
actions, pending against the Property. To the Knowledge of MGM JV, there are no
actions, proceedings, litigation or governmental investigations or condemnation
actions either pending or threatened against the Property. None of MGM JV,
Circus Circus or the MGM Property Owners have received any written notice of any
actions, proceedings, litigation or governmental investigations or condemnation
actions, either pending or threatened, against the Property.
                    (F) Except for Permitted Encumbrances, there are no
mechanic’s liens filed or, to the Knowledge of MGM JV, threatened to be filed of
record against the Property.
                    (G) None of MGM JV, Circus Circus or the MGM Property Owners
have received any written notifications from the United States of America, the
State of Nevada, Clark County, or any other governmental authority, including
but not limited to, the Gaming Authorities, of: (i) any uncured violation of any
ordinance or statute or Gaming Laws regarding the Property or the operation
thereof (including any environmental law or land use regulation) which has
remained uncured or (ii) any material violation of any ordinance or statute or
Gaming Laws regarding the Property (including any environmental law or land use
regulation) during the past three (3) years, whether or not such violation has
been cured. To the Knowledge of MGM JV, no remediation is needed to be taken
with respect to the Property necessary to comply with any Law (including any
environmental law or land use regulation).
                    (H) None of MGM JV, Circus Circus or the MGM Property Owners
have received any written notification of any special assessment against the
Property except for Permitted Encumbrances.
                    (I) Except as otherwise set forth on Schedule 3.2(a)(ii)(C),
none of MGM JV, Circus Circus or the MGM Property Owners have granted any
Encumbrances on the Property (excluding for the purpose of this representation
any Permitted Encumbrances).
                    (J) To the Knowledge of MGM JV, there are no pending
condemnation or similar proceedings affecting the Property, and no such action
is threatened or contemplated. None of MGM JV, Circus Circus or the MGM Property
Owners have received

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any written notification of any current or pending condemnation or similar
proceedings affecting the Property.
                    (K) MGM JV is not a “foreign person” as defined in Internal
Revenue Code Section 1445 and the regulations issued thereunder.
                    (L) None of MGM JV, Circus Circus or the MGM Property Owners
have received any written notice of violation of zoning or other land use
regulations affecting the Property.
                    (M) (1) Each of the MGM Property Owners have been (or, if
not yet formed, upon formation will be) lawfully and duly formed, validly
existing and in good standing under the laws of its jurisdiction of
organization.
                    (2) MGM JV owns (or, with respect to MGM Property Owners not
yet formed, will own) beneficially and of record all of the units of each of the
MGM Property Owners free and clear of any Encumbrances (other than any
Encumbrances created pursuant to the Agreement), and all of the units or stock
of each of the MGM Property Owners will have been duly authorized, validly
issued, fully paid and non-assessable.
                    (3) Except as set forth in clause (2) above and except to
the extent of any obligation of MGM JV to contribute the ownership interest in
the MGM Property Owners to the Company, there will be no preemptive or other
outstanding rights, options, warrants, conversion rights, stock appreciation
rights, performance units, redemption rights, repurchase rights, agreements,
arrangements, calls, commitments or rights of any kind that obligate either of
the MGM Property Owners to issue or sell any units or other equity securities of
the MGM Property Owners or any securities or obligations convertible or
exchangeable into or exercisable for, or giving any Person a right to subscribe
for or acquire, any units or other equity securities of any of the MGM Property
Owners, and no securities or obligations evidencing such rights will be
authorized, issued or outstanding.
                    (4) The MGM Property Owners have been (or if not yet formed,
will be) formed solely for the purpose of owning an interest in the Property and
have not conducted any other business.
                    (5) The MGM Property Owners do not have, and have never had,
any asset other than their ownership interest in the Property.
                    (6) The MGM Property Owners do not have, and will never have
had, any employees.
                    (7) The MGM Property Owners do not have any liabilities or
obligations of any nature (whether accrued, absolute, contingent or otherwise)
other than with respect to Permitted Encumbrances.

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     The representation and warranties made pursuant to Section 3.2(a)(ii)(M)
shall survive indefinitely and all other warranties and representations made
pursuant to this Section 3.2(a)(ii) shall survive the Closing Date for a period
of twenty-four (24) months.
               (iii) The obligation of MGM JV to make its Initial Capital
Contributions shall be conditioned on the satisfaction or written waiver by MGM
JV of the following conditions (collectively, the “MGM Conditions Precedent”):
                    (A) All of the representations and warranties of KERZNER JV
set forth in Section 10.7 shall have been true and correct in all material
respects as of the Signing Date, and shall be true and correct in all material
respects on and as of the Closing Date;
                    (B) KERZNER JV shall have performed or complied in all
material respects with its obligations and covenants set forth in this Agreement
which are required to be performed or complied with on or prior to the Closing
Date;
                    (C) KERZNER JV is not a Defaulting Member; and
                    (D) The Company has obtained the committed financing in the
amount required by the Approved Budget/Plan on then current market terms,
consistent, in the aggregate, with the financing terms then available to
similarly situated parties for projects similar to the Resort.
               (iv) Except to the extent of the representations and warranties
expressly provided herein, MGM JV’s Initial Capital Contribution will be made on
as “AS IS” basis, without any other express or implied warranties of any kind.
               (v) From the Signing Date until MGM JV’s Initial Capital
Contribution on the Closing Date, except as contemplated by this Agreement or as
otherwise waived or consented to in writing by KERZNER JV, MGM JV shall:
                    (A) cause the MGM Property Owners to continue to operate,
manage, maintain, service and protect the Property consistent with past
practice, and in any event in a commercially reasonable and prudent manner;
including maintaining liability insurance in commercially reasonable amounts;
                    (B) not and shall cause the MGM Property Owners not to
(1) sell, assign, convey, transfer or lease all or any portion of the Property
(except for leases included in the Permitted Encumbrances), (2) enter into any
contracts or other agreements relating to the repair, management or operation
of, or the provision of services to the Property unless terminable without fee
or penalty upon no more than thirty (30) days’ notice, (3) (x) grant, create, or
incur any Encumbrance (other than a Permitted Encumbrance) on the Property which
did not exist before the Signing Date, or (y) suffer to exist any Encumbrance
(other than a Record Encumbrance) that is not removed within thirty (30) days
after MGM JV or the MGM Property Owners receive notice thereof and in any event
prior to the Closing Date; provided that if MGM MIRAGE first becomes aware of
any such Encumbrance within fifteen (15) days of the date on which the Closing
Date would otherwise have occurred, MGM JV may elect to postpone the Closing
Date to remove such Encumbrance until the earlier of (i) the date that is
fifteen (15) 

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days after the date on which MGM MIRAGE first becomes aware of such Encumbrance
and (ii) the End Date, if it is reasonably likely that such Encumbrance could be
removed within such timeframe, (4) initiate or permit any actions, proceedings
or litigation related to the Property, (5) amend, modify or otherwise supplement
any existing lease, contract or Encumbrance affecting the Property, (6) take any
action which would reasonably be expected to impede or delay the satisfaction of
any of the conditions set forth in Section 3.2(b)(ii), or (7) take any action
which would reasonably be expected to result in the failure of any of the
representations and warranties contained in Sections 3.2(a)(ii) to be true as of
the Closing Date if the failure to be true is of a type that would have resulted
in the condition set forth in Section 3.2(b)(ii) not being satisfied if such
failure to be true had been in existence as of the Signing Date; provided that
if MGM JV breaches this clause (7) within fifteen (15) Business Days of the date
on which the Closing Date would have otherwise occurred, MGM JV may elect to
postpone the Closing Date to cure such breach until fifteen (15) business days
after the date of the scheduled Closing Date if it is reasonably likely that the
breach could be cured within such timeframe;
                    (C) provide notice to KERZNER JV of (1) any actions,
proceedings, litigation or governmental investigations or condemnation actions
pending or threatened against the Property that are brought to the Knowledge of
MGM JV, and (2) any written notifications received between the Signing Date and
Closing Date from the United States of America, the State of Nevada, Clark
County, or any other governmental authority, including, but not limited to, the
Nevada Gaming Authorities, of: (a) any uncured violation of any ordinance or
statute regarding the Property or the operation thereof (including any
environmental law or land use regulation) which has remained uncured, (b) any
material violation of any ordinance or statute regarding the Property, or
(c) any current or pending condemnation or similar proceedings affecting the
Property;
                    (D) notify KERZNER JV of the existence or occurrence of any
fact or circumstance that comes within the Knowledge of MGM JV which would
reasonably be expected to materially adversely affect the ability of MGM JV to
complete the transactions contemplated by this Agreement or which would
reasonably be expected to cause any of the conditions set forth in
Section 3.2(b)(ii) to fail to be satisfied on or prior to the End Date;
                    (E) notify KERZNER JV of the existence or occurrence of any
fact or circumstance that comes within the Knowledge of MGM JV which would have
reasonably been expected to render any of the representations and warranties
contained in Sections 3.1(a)(ii) untrue as of the Closing Date; and
                    (F) provide KERZNER JV and its representatives reasonable
access to the Property during normal business hours.
               (vi) The delivery of any notification to KERZNER JV pursuant to
Section 3.2(a)(v) shall not operate as a cure of any breach of this Agreement
requiring notification of such matter or otherwise limit or affect the remedies
or rights available to KERZNER JV under this Agreement.
               (vii) Upon the request of KERZNER JV, MGM JV shall cause Circus
Circus to deliver a notice of termination to the Lease Agreement, dated
November 12, 2003,

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between Circus Circus and Kampgrounds of America, Inc. and any costs incurred in
connection with early termination of such agreement shall be borne solely by MGM
JV.
               (viii) MGM JV shall indemnify the Company and KERZNER JV for,
from and against any loss or claim arising from those Record Encumbrances that
are not also Permitted Encumbrances. The obligations under the immediately
preceding sentence shall survive the termination or expiration of this
Agreement. The Guarantee shall contain an obligation on the part of MGM MIRAGE
in connection with its obligation to indemnify the Company and KERZNER JV
pursuant to this Section 3.2(a)(viii).
               (ix) Except as hereinafter provided, all costs and expenses
associated with any environmental assessment reports of the Property and any
costs and expenses of conveying ownership of the MGM Property Owners to the
Company, including the cost of obtaining any surveys and the cost of the Title
Policy, shall be borne by the Company; provided that notwithstanding anything in
the Agreement to the contrary, the costs of (1) delivering the Property to the
Company vacant of occupants (except for occupants pursuant to the Permitted
Encumbrances), and (2) termination of that certain Lease Agreement dated
November 12, 2003 between Circus Circus and Kampgrounds of America, Inc shall be
borne solely by MGM JV.
          (b) KERZNER JV’s Initial Capital Contribution.
               (i) On or before the Closing Date, as set forth in the Approved
Budget/Plan, and subject, in the case of the amounts to be contributed on the
Closing Date, to the satisfaction or waiver by the KERZNER JV, of all of the
Kerzner Conditions Precedent (as defined below), KERZNER JV shall contribute Six
Hundred Million Dollars ($600,000,000) to the Company based on the following
schedule:
                    (A) Twenty Million Dollars ($20,000,000) within three
(3) Business Days after the date on which the Company delivers wire transfer
instructions to KERZNER JV;
                    (B) Ten Million Dollars ($10,000,000) on April 1, 2008 (the
amounts in clauses (A) and (B) to be used to pay Pre-Development Expenses,
including the Initial Services Fee (as defined in the Professional Services
Agreement)); and
                    (C) The remaining amounts, if any, on the Closing Date
(unless any additional amounts are required to be paid under any obligations of
the Company prior to the Closing Date (including under the Professional Services
Agreement), in which case such additional amounts shall be contributed to the
Company from time to time by KERZNER JV and the amount required to be
contributed on the Closing Date shall be reduced accordingly).
               (ii) The obligation of KERZNER JV to make its Capital
Contributions required to be contributed on the Closing Date shall be
conditioned on the satisfaction or written waiver by KERZNER JV of the following
conditions (collectively, the “Kerzner Conditions Precedent”):
                    (A) All of the representations and warranties of MGM JV set
forth in Section 3.2(a) and Section 10.7 shall have been true and correct in all
material respects

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as of the Signing Date, and the representations and warranties of MGM JV set
forth in Sections 3.2(a)(ii)(A), (I), (K) and (M) and Section 10.7 shall be true
and correct in all material respects on and as of the Closing Date;
                    (B) MGM JV shall have performed or complied in all material
respects with its obligations and covenants set forth in this Agreement which
are required to be performed or complied with on or prior to the Closing Date;
                    (C) MGM JV shall have delivered (or shall deliver
simultaneously with KERZNER JV’s making of its Capital Contributions required to
be made on the Closing Date hereunder) ownership of the MGM Property Owners to
the Company in accordance with this Agreement;
                    (D) The Title Insurance Company shall have issued the Title
Policy, subject only to payment of the applicable premium;
                    (E) MGM JV is not a Defaulting Member;
                    (F) The Company has obtained committed financing in the
amount required by the Approved Budget/Plan on then current market terms,
consistent, in the aggregate, with the financing terms then available to
similarly situated parties for projects similar to the Resort; and
                    (G) MGM MIRAGE shall have affirmed the support arrangements
set forth on Schedule 6.13(a)(i).
          (c) Kerzner Covenants. From the Signing Date until MGM JV’s Initial
Capital Contribution on the Closing Date, except as contemplated by this
Agreement or as otherwise waived or consented to in writing by MGM JV, the
KERZNER JV shall:
               (i) not take any action which would reasonably be expected to
impede or delay the satisfaction of any of the conditions set forth in
Section 3.2(a)(ii); and
               (ii) notify MGM JV of the existence or occurrence of any fact or
circumstance that comes within the Knowledge of KERZNER JV which would
reasonably be expected to materially adversely affect the ability of KERZNER JV
to complete the transactions contemplated by this Agreement or which would
reasonably be expected to cause any of the conditions set forth in Section
3.2(a)(ii) to fail to be satisfied on or prior to the End Date.
          (d) Potential Incremental Increase in the Property Size. The Members
understand and acknowledge that KERZNER JV has expressed an interest to expand
the Property by an additional two (2) acres and both Members understand that the
other “half of the horseshoe” is to be maintained as an independently viable
site. The Members agree to revise Exhibit B from time to time as necessary to
reflect the Members’ agreement regarding the size and contours of the Property.
In the event that, prior to the Closing Date, the Members determine that the
Property size should be increased from the forty (40) acres contemplated as of
the date of Signing, the Members agree that the valuation of the Property shall
be adjusted to equal the product of the total number of acres contributed by MGM
JV multiplied by a per acre

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price of Twenty Million Dollars ($20,000,000). In that event, on the Closing
Date, KERZNER JV will contribute an amount equal to one half of the value of the
excess acreage over the forty (40) acres. The additional sum contributed by
KERZNER JV shall then be distributed to MGM JV pursuant to Section 4.3 hereof.
By way of example, if the size of the Property contributed by MGM JV is forty
two (42) acres, then KERZNER JV shall contribute an additional Twenty Million
Dollars ($20,000,000) to the Company on the Closing Date, which amount shall be
distributed to MGM JV pursuant to Section 4.3 hereof. After such contribution
and distribution, the Capital Accounts of the Members shall be as follows:

     
MGM JV:
  $840,000,000 – $220,000,000 = $620,000,000
 
   
KERZNER JV:
  $620,000,000

     3.3. Satisfaction of Closing Conditions. From the Signing Date through the
earlier of the Closing Date and the dissolution of the Company in accordance
with Section 10.1, IKM MGM, LLC shall use its commercially reasonable efforts to
take all actions necessary to cause the conditions set forth in
Section 3.2(b)(ii) to be satisfied and Kerzner Istithmar Las Vegas LLC shall use
its commercially reasonable efforts to take all actions necessary to cause the
conditions set forth in Sections 3.2(a)(iii) to be satisfied.
     3.4. Failure to Make a Capital Contribution. If a Member fails to make any
required Capital Contribution, then the Member shall be subject to the
provisions of Section 7.5(b) and Section 7.5(c). In addition, subject to
applicable Gaming Laws, the non-delinquent member (the “Non-Delinquent Member”)
may exercise, on notice to that Member (the “Delinquent Member”) within fifteen
(15) Business Days following such time when that Member becomes a Delinquent
Member, one (but not both) of the following remedies set forth in
Sections 3.4(a) and 3.4(b) below:
          (a) the Non-Delinquent Member may (the “Lending Member”) advance the
portion of the Delinquent Member’s Capital Contribution that is in default, with
the following results:
               (i) The sum advanced constitutes a loan from the Lending Member
to the Delinquent Member and a Capital Contribution of that sum to the Company
by the Delinquent Member and shall be treated as such by all parties for
federal, state and local income tax purposes;
               (ii) The unpaid principal balance of the loan and all accrued
unpaid interest is due and payable on the tenth day after written demand by the
Lending Member to the Delinquent Member;
               (iii) The unpaid balance of the loan bears interest at the
Default Interest Rate, compounded monthly, from the day that the advance is
deemed made until the date that the loan, together with all accrued interest, is
repaid to the Lending Member;
               (iv) All amounts distributable by the Company to the Delinquent
Member shall (A) be paid to the Lending Member until the loan and all accrued
interest have been paid in full; (B) constitute a distribution to the Delinquent
Member followed by a

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repayment of the loan and accrued interest from the Delinquent Member to the
Lending Member; and (C) be treated as such by all parties for federal, state and
local income tax purposes;
               (v) The payment of the loan and accrued interest is secured by a
security interest in the Delinquent Member’s assets;
               (vi) In addition to the other rights and remedies granted to it
under this Agreement, the Lending Member has the right to take any action
available at law or in equity, at the cost and expense of the Delinquent Member,
to obtain payment from the Delinquent Member of the unpaid balance of the loan
and all accrued and unpaid interest; and
               (vii) The Delinquent Member grants to the Company, and to each
Lending Member with respect to any loans made to that Delinquent Member, as
security, equally and ratably for the payment of all Capital Contributions that
the Delinquent Member has agreed to make and the payment of all loans and
interest accrued made by Lending Members to that Delinquent Member, a security
interest in its assets under the Uniform Commercial Code of the State of Nevada.
On any default in the payment of a required Capital Contribution or in the
payment of a loan to a Lending Member or interest accrued, the Company or the
Lending Member, as applicable, is entitled to all the rights and remedies of a
secured party under the Uniform Commercial Code of the State of Nevada with
respect to the security interest granted. Each Delinquent Member hereby
authorizes the Company and each Lending Member, as applicable, to prepare and
file financing statements and other instruments that the Managers or the Lending
Member, as applicable, may deem necessary to effectuate and carry out the
preceding provisions of this Section.
          (b) Subject to the receipt of all Gaming Approvals, to the extent
required under Gaming Laws, the Non-Delinquent Members may, in proportion to
their Percentage Interests or in such other percentages as they may agree,
contribute the portion of the Delinquent Member’s Capital Contribution that is
in default, with the following results:
               (i) Immediately following the contribution by the Non-Delinquent
Member of a portion or all of the Delinquent Member’s Capital Contribution, the
Percentage Interest of the Non-Delinquent Member in the Company shall be
increased and the Percentage Interest of the Delinquent Member in the Company
shall be decreased, with the result that such change in Percentage Interest
shall be permanent, and the Delinquent Member shall not have the option, unless
agreed to by the Non-Delinquent Member, to restore its initial Percentage
Interest by making a curative Capital Contribution at a later time. The
resulting “Percentage Interest” of the Non-Delinquent Member shall be the number
of percentage points (rounded to the nearest one hundredth of a percentage
point) equal to the sum of (A) the Percentage Interest of the Non-Delinquent
Member immediately prior to the corresponding Subsequent Capital Contribution
(as defined below) and (B) the Adjusted Additional Percentage Interest (as
defined below) corresponding to such Member with respect to such Subsequent
Capital Contribution. The resulting Percentage Interest of the Delinquent Member
shall be the number of percentage points (rounded to the nearest one-hundredth
of a percentage point) equal to the sum of the Percentage Interest of such
Delinquent Member immediately prior to the corresponding Subsequent Capital
Contribution and the Adjusted Additional Percentage Interest corresponding to
such Member with respect to such Subsequent Capital Contribution.

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               (ii) For the purposes of this Section 3.4(b):
                    (A) “Base Percentage Interest” shall mean, with respect to a
Member, the percentage equivalent of a fraction, the numerator of which shall be
the aggregate Capital Contributions made to the Company by such Member pursuant
to this Agreement, and the denominator of which shall be the aggregate Capital
Contributions made to the Company by all the Members pursuant to this Agreement;
                    (B) “Adjusted Additional Percentage Interest” shall mean the
product of (i) 1.5 and (ii) the difference between (x) the Base Percentage
Interest of such Member immediately after the corresponding Subsequent Capital
Contribution, and (y) the Base Percentage Interest of such Member immediately
prior to such Subsequent Capital Contribution;
                    (C) “Subsequent Capital Contribution” means any Capital
Contributions made by a Member in connection with the capital call with respect
to which the Percentage Interests of the Members are being adjusted pursuant to
this Section 3.4(b).
               (iii) By way of illustration, assume that (x) the Base Percentage
Interest and the Percentage Interest of each Member is fifty percent (50%), in
each case, immediately prior to a Subsequent Capital Contribution; (y) each of
the parties have made a prior Capital Contribution of $600,000,000; (z) the
Members approve a Subsequent Capital Contribution in the amount of $100,000,000,
and (D) KERZNER JV contributes only $30,000,000 (versus $50,000,000). If MGM JV
contributes the $20,000,000 shortfall by KERZNER JV in addition to its own
$50,000,000 pro rata share of the Capital Contribution, the resulting Percentage
Interest of MGM JV and KERZNER JV following such contribution would be 52.31%
and 47.69% respectively, determined as follows:
Base Percentage Interest of MGM JV after the Subsequent Capital Contribution:

[$600,000,000 plus $70,000,000] divided by [$1,300,000,000] = 51.54%
Base Percentage Interest of MGM JV prior to the Subsequent Capital Contribution:
50%
Adjusted Additional Percentage Interest of MGM JV as a result of the Subsequent
Capital Contribution: (51.54%-50%) x 1.5 = 2.31%
Percentage Interest of MGM JV after the Subsequent Capital Contribution: 50% +
2.31% = 52.31%.
Base Percentage Interest of KERZNER JV after the Subsequent Capital
Contribution:
[$600,000,000 plus $30,000,000] divided by [$1,300,000,000] = 48.46%
Base Percentage Interest of KERZNER JV prior to the Subsequent Capital
Contribution: 50%

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Adjusted Additional Percentage Interest of KERZNER JV as a result of the
Subsequent Capital Contribution: (48.46%-50%) x 1.5 = – 2.31%
Percentage Interest of KERZNER JV after the Subsequent Capital Contribution: 50%
– 2.31% = 47.69%.
     3.5. Additional Remedies for Failure to Make a Capital Contribution. In
addition to the remedies provided under Section 3.4, the Non-Defaulting Member
may, on notice to a Delinquent Member, take such action, at the cost and expense
of the Delinquent Member, to obtain payment by the Delinquent Member of the
portion of the Delinquent Member’s Capital Contribution that is in default,
together with interest on that amount at the Default Interest Rate from the date
that the Capital Contribution was due until the date that it is made, provided
that in the event that either party fails to make its Initial Capital
Contribution on the Closing Date, then such Delinquent Member shall also be
required to pay the other Member an “inconvenience fee” equal to ten percent
(10%) of any Capital Contribution shortfall. The Delinquent Member’s obligation
to make Capital Contributions or repay any loan to a Lending Member shall be
recourse to such Delinquent Member (except to the extent and after such time
that the Non-Delinquent Member elects to make a contribution of any portion of
the Delinquent Member’s Capital Contribution). The Delinquent Member shall have
direct liability for the Delinquent Member’s obligation to make Capital
Contributions or repay any loan to a Lending Member. Further, each Member’s
obligation to make its Initial Capital Contributions shall be recourse to each
of the Guarantors to the extent set forth in the Guarantee (as defined below)
(except to the extent and after such time that the Non-Delinquent Member elects
to make a contribution of any portion of the Delinquent Member’s Initial Capital
Contribution). Simultaneously with the signing of this Agreement, each Member
shall cause its affiliated Guarantor to provide a guarantee (the “Guarantee”) in
connection with its obligation to make its Initial Capital Contributions under
Section 3.2 in the form attached hereto as Exhibit C.
     3.6. Member Loans. If the Capital Contributions of the Members, third-party
loans to the Company, and the revenues of the Company are insufficient to
satisfy the capital requirements of the Company as set forth in the Approved
Budget/Plan, or if bridge funds are needed by the Company on an interim basis,
the Members may make loans (“Member Loans”) to the Company in such amounts as
are reasonably determined by the Management Committee. Notwithstanding anything
in this Agreement to the contrary, no Member is required to make a Member Loan.
Each Member may elect to participate as a lender in a Member Loan, pro rata,
based upon the Percentage Interest held by the Members electing to make such
Member Loan or, upon the agreement of all participating Members, in a differing
proportion. The terms of the Member Loans shall be determined by the Management
Committee.
     3.7. No Further Capital Contributions. The Members shall not be required to
contribute additional capital or lend any funds to the Company, except as
expressly provided in this Article 3.
     3.8. Excess Carrying Costs. If the Closing Date occurs subsequent to
January 31, 2008, any Excess Carrying Costs shall become the responsibility of
the Company and concurrently with the Closing an amount equal to such Excess
Carrying Costs shall be paid by the Company to MGM JV or its designee. In the
event the Closing Date does not occur for any

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reason, the Excess Carrying Costs shall remain the responsibility of MGM JV.
Notwithstanding the foregoing, in the event that KERZNER JV elects to extend the
End Date pursuant to the proviso contained in Section 10.1(g) and the Closing
Date does not occur for any reason (other than primarily due to a breach of this
Agreement by MGM JV that would give rise to a failure of a condition set forth
in Section 3.2(b)(ii) to be satisfied), KERZNER JV shall contribute to the
Company one-half of the Excess Carrying Costs incurred during the period from
the 18-month anniversary of the Signing Date until the earlier of the End Date
or the date that KERZNER JV provides MGM JV written notice of its election to
dissolve the Company pursuant to Section 10.1(g), which amount shall be
distributed to MGM JV to reimburse it for one-half of the Excess Carrying Costs
incurred during such period; provided that if MGM JV elects to postpone the
Closing Date pursuant to Section 3.2(a)(v)(B)(3) or (7) and the Closing Date
does not occur, KERZNER JV shall not be obligated to contribute to the Company
one-half of Excess Carrying Costs incurred on or after the date which would have
been the Closing Date had it not been postponed. The obligations under the
immediately preceding sentence shall survive the termination or expiration of
this Agreement. The Guarantee contemplated by Exhibit C shall contain an
obligation on the part of Kerzner International and Istithmar in connection with
its obligation to contribute one-half of the Excess Carrying Costs during the
period from the 18-month anniversary of the Signing Date until the End Date.
ARTICLE 4 DISTRIBUTIONS
     4.1. Amount and Time of Distributions. Subject to any applicable covenants
contained in the documentation governing the Financing, except as otherwise
provided in Section 4.3 and Section 4.5, or otherwise agreed by the Management
Committee, distributions of Available Cash Flow will be made to the Members
(i) for capital proceeds, within the ten (10) days of any capital event giving
rise to such capital proceeds, and (ii) for non-capital proceeds, on the first
Business Day of each calendar quarter, in each case in proportion to the
Percentage Interest of the Members.
     4.2. Return of Capital. No Member is entitled to the return of, or interest
on, that Member’s Capital Contributions, except as provided herein.
     4.3. MGM JV’s Distribution. Simultaneous with MGM JV’s Initial Capital
Contribution, the Company shall distribute to MGM JV (i) Two Hundred Million
Dollars ($200,000,000); and (ii) any additional distribution payable to MGM JV
in accordance with Section 3.2(d). It is intended that a portion (with such
portion to be reasonably determined by MGM JV) of the distributions made to MGM
JV pursuant to Section 4.3(i) shall be treated as qualifying for the exception
to the disguised sales rules of the Code for reimbursements of preformation
expenditures pursuant to Regulations Section 1.707-4(d). The Company shall
report the income tax consequences of such distribution consistently with this
Section 4.3, to the extent permitted by applicable Law.
     4.4. Acknowledgment of Liability for Taxes.
     To the extent that the Laws of any taxing jurisdiction require, each Member
requested to do so by a Manager shall submit an agreement indicating that the
Member shall make timely income tax payments to the taxing jurisdiction and that
the Member accepts personal jurisdiction

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of the taxing jurisdiction with regard to the collection of income taxes,
interest, and penalties attributable to the Member’s income. If a Member fails
to provide such agreement, the Company may withhold or pay over to such taxing
jurisdiction the amount of tax, penalty, and interest determined under the Laws
of the taxing jurisdiction with respect to such income. Any such payments shall
be treated as distributions for purposes of Article 4 shall be taken into
account in determining subsequent distributions pursuant to Section 4.1.
Further, to the extent that the Laws of any taxing jurisdiction require, each
Member shall provide the Company with sufficient information for the Company to
prepare its tax returns.
     4.5 Tax Distributions. The Company shall distribute quarterly to the
Members in accordance with their Percentage Interest, to the extent cash is
available to the Company, an amount sufficient to enable the Members (or, if
applicable, the owners or members of such Member) to fund their federal and
state income tax liabilities attributable to their respective distributive
shares of net taxable income of the Company (calculated for each Member (or, if
applicable, the owners or members of such Member) net of any taxable loss of the
Company previously allocated to such Member (or, if applicable, the owners or
members of such Member) and not previously offset by allocations of taxable
income), in each case assuming that each Member (or, if applicable, the owners
or members of such Member) is taxable at the Tax Distribution Rate applicable
for the taxable year with respect to which such distribution is made. The “Tax
Distribution Rate” for any taxable year shall equal the highest effective
combined federal and state income tax rate submitted to the CFO by any Member
for such taxable year pursuant to the following sentence. On or before the 15th
day of each taxable year, each Member shall submit to the CFO the highest
effective combined federal and state income tax rate applicable to such Member
(or, if applicable, the owners or members of such Member), together with a
calculation setting forth the basis for such rate. The amounts to be distributed
to a Member as a tax distribution pursuant to this Section 4.5 in respect of any
Fiscal Year shall be computed as if any distributions made pursuant to
Section 4.1 during such Fiscal Year were a tax distribution in respect of such
Fiscal Year.
ARTICLE 5 PROFITS AND LOSSES
     5.1. Profit Allocations. After making any special allocations required
under Appendix 1, Profits for each Fiscal Year (including each item of income
and gain entering into the computation thereof) shall be allocated among the
Members (and credited to their respective Capital Accounts) in the following
order and priority:
          (a) First, to the Members until the cumulative Profits allocated
pursuant to this Section 5.1(a) are equal to the cumulative Losses, if any,
previously allocated to the Members pursuant to Section 5.2(b) and the proviso
in Section 5.2, such Profits being allocated under this Section 5.1(a) on a
last-in first-out basis with respect to the Losses allocated under
Section 5.2(b) and the proviso in Section 5.2, for all prior periods in
proportion to the Members’ respective shares of the Losses being offset;
          (b) Thereafter, to the Members in accordance with their Percentage
Interests.
     5.2. Loss Allocations. After making any special allocations required under
Appendix 1, Losses for each Fiscal Year (including each item of deduction and
loss entering into the

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computation thereof) shall be allocated among the Members (and charged to their
respective Capital Accounts) in the following order and priority:
          (a) First, to the extent that Profits have previously been allocated
to the Members for prior periods pursuant to Section 5.1(b) hereof, Losses shall
be allocated to the Members to offset such Profits on a last-in, first-out basis
with respect to the Profits allocated under Section 5.1(b) in proportion to the
Members’ respective shares of the Profits being offset;
          (b) The balance, if any, to the Members in accordance with their
respective Percentage Interests;
provided that Losses allocated to any Member’s Capital Account in accordance
with this Section 5.2 shall not exceed the maximum amount of Losses that can be
so allocated without creating an Adjusted Capital Account Balance deficit with
respect to such Capital Account. This limitation shall be applied individually
with respect to each Member in order to permit the allocation pursuant to this
proviso of the maximum amount of Losses permissible under Regulations
Section 1.704-1(b)(2)(ii)(d). All Losses in excess of the limitations set forth
in this proviso shall be allocated solely to those Members that bear the
economic risk for such additional Losses within the meaning of Code Section
704(b) and the Regulations thereunder. If it is necessary to allocate Losses
under the preceding sentence, the Managers shall, in accordance with the
Regulations promulgated under Code Section 704(b), determine those Members that
bear the economic risk for such additional Losses.
     5.3. Allocation Rules.
          (a) For purposes of determining the Profits, Losses or any other items
allocable to any period, Profits, Losses, and any such other items will be
determined on a daily, monthly or other basis, as determined by Management
Committee using the accrual method of accounting, or any permissible method
under Code Section 706 and the Regulations thereunder.
          (b) The Members are aware of the income tax consequences of the
allocations made under this Article 5 and hereby agree to be bound by the
provisions of this Article 5 in reporting their respective shares of Company
income and loss for income tax purposes.
     5.4. Tax Allocations.
          (a) Except as provided in paragraph (b) below, items of Company
income, gain, loss, deduction and credit shall be allocated, for federal, state
and local income tax purposes, among the Members in accordance with the
allocation of such income, gain, losses, deductions, and credits among the
Members under Sections 5.1 and 5.2.
          (b) In accordance with Code Section 704(c) and the Regulations
thereunder, income, gain, loss, and deduction with respect to any property
contributed to the capital of the Company will, solely for tax purposes, be
allocated among the Members so as to take account of any variation between the
Adjusted Basis of such property to the Company for federal income tax purposes
and its initial Gross Asset Value (computed in accordance with the definition of
Gross Asset Value) using the “traditional method” pursuant to the Regulations
under Code Section 704(c). If the Gross Asset Value of any Company asset is
adjusted pursuant to

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paragraph (b) of the definition of Gross Asset Value, subsequent allocations of
income, gain, loss, and deduction with respect to such asset will take account
of any variation between the Adjusted Basis of such asset for federal income tax
purposes and its Gross Asset Value in the same manner as under Code Section
704(c) and the Regulations thereunder using the “traditional method” pursuant to
the Regulations under Code Section 704(c). The Management Committee will make
any elections or other decisions relating to such allocations in any manner that
reasonably reflects the purpose and intention of this Agreement. Allocations
pursuant to this Section 5.4 are solely for purposes of federal, state, and
local taxes and will not affect, or in any way be taken into account in
computing, any Member’s Capital Account or share of Profits, Losses, other items
or distributions pursuant to any provision of this Agreement.
ARTICLE 6 MANAGEMENT
     6.1. Management Committee-Managed.
          (a) General Management Terms.
               (i) The business and affairs of the Company will be managed
exclusively by or under the direction of a management committee (the “Management
Committee”) as set forth in Section 6.3. The day-to-day operations of the
Company shall be jointly overseen by the Managers pursuant to the terms of this
Agreement. In the event that no party to this Agreement or their respective
successors or assigns is entitled to appoint a Manager, the day-to-day
operations of the Company shall be overseen by the Management Committee.
                    (A) For so long as (a) KERZNER JV or its Permitted
Transferee is a Non-Defaulting Member of the Company and is not controlled
directly or indirectly by a Tier I Competitor or Tier II Competitor and
(b) Kerzner International owns at least a ten percent (10%) direct or indirect
economic interest in the Units (“KERZNER Management Prerequisites”), KERZNER JV
shall appoint one Manager who must be a Qualified Manager. The initial Manager
appointed by KERZNER JV is Kerzner Concepts Limited. Any Manager appointed by
KERZNER JV may only be removed with the consent of KERZNER JV; provided that in
the event that KERZNER JV fails to meet any of the KERZNER Management
Prerequisites or if the Manager fails to be a Qualified Manager then, at the
option of MGM JV, the Manager appointed by KERZNER JV shall be removed as a
Manager without further action and KERZNER JV shall not be permitted to appoint
another Manager.
                    (B) For so long as (a) MGM JV or its Permitted Transferee is
a Non-Defaulting Member of the Company and is not controlled directly or
indirectly by a Tier I Competitor or Tier II Competitor and (b) MGM MIRAGE owns
at least a ten percent (10%) direct or indirect economic interest in the Units
(“MGM Management Prerequisites”), MGM JV shall appoint one Manager who must be a
Qualified Manager. The initial Manager appointed by MGM JV is IKM MGM
Management, LLC. Any Manager appointed by MGM JV may only be removed with the
consent of MGM JV; provided that in the event that MGM JV fails to meet any of
the MGM Management Prerequisites or if the Manager fails to be a Qualified
Manager, then, at the option of KERZNER JV, the Manager appointed by MGM JV
shall be removed as the Manager without further action and MGM JV shall not be
permitted to appoint another Manager.

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                    (C) If a proposed or existing Manager is determined by a
Gaming Authority to be unsuitable to serve as a Manager, the Member appointing
such Manager will be entitled to appoint a replacement Manager. In the event
that two consecutive nominees of a Member are determined by a Gaming Authority
to be unsuitable to serve as a Manager, such Member will forfeit its right to
nominate a Manager unless it nominates a Manager that the other Member
reasonably determines will be found by a Gaming Authority to be suitable to
serve as a Manager.
               (ii) Subject to Section 6.1(a)(iii) and the other terms and
conditions set forth in this Agreement, the Management Committee hereby directs
the Managers (and the Managers hereby agree) to oversee the day-to-day
management of the Company and development of the Property. The Managers shall
direct the Company’s management team to develop the Property and operate the
Company under the direction of the Management Committee on the terms and subject
to the conditions set forth in this Agreement. The Managers shall direct the
Company’s management team to conduct the business of the Company in conformity
with the Approved Budget/Plan and, subject to the provisions of this Agreement,
may take any action that is consistent with the Approved Budget/Plan. The
Managers’ actions shall be deemed to be in conformity with the Approved
Budget/Plan if the Managers’ action do not materially deviate from the Approved
Budget/Plan, or are otherwise specifically permitted by this Agreement. The
Managers shall use commercially reasonable efforts to keep the Management
Committee informed of the day-to-day business of the Company. Each Manager
agrees to devote to the Company such time as may be necessary for the proper
performance of the duties assigned to the Managers under this Agreement, but is
not required to devote full time to the performance of such duties.
               (iii) It is understood and agreed that for so long as KERZNER JV
shall be entitled to appoint a Manager pursuant to Section 6.1(a)(i), the
KERZNER Manager shall be primarily responsible for the development of the
Property, assembling the support and infrastructure for the Company, and
preparing, until such time as management of the Company is in place, the
Approved Budget/Plan. Thereafter, the Management Committee shall agree on levels
of authority of Kerzner Manager, as lead Manager, and the MGM Manager. The lead
Manager shall act as the main liaison between the management of the Company and
the Management Committee.
          (b) Approved Budget/Plan. The Managers shall prepare and submit for
approval of the Management Committee business plans and operating and
development budgets as set forth in this Section 6.1(b):
               (i) Attached hereto as Exhibit F is the pre-development budget
(the “Pre-Development Budget”), which Pre-Development Budget has been approved
by the Management Committee.
               (ii) Within one hundred eighty (180) days after the Signing Date,
the Managers, in cooperation with the Members and the Management Committee,
shall develop a business plan and development budget (“Business Plan”) for the
Company, which, among other things, sets forth the timeline for any development
activity and the manner in which the Company proposes to finance the activity,
and shall include the proposed terms of any

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acquisition or construction financing and such other matters as the Managers or
the Management Committee consider material to the development of the Property.
Exhibit G sets forth certain general parameters for the scope of the Resort,
subject to the Management Committee’s final approval. The Managers shall update
and revise the Business Plan for review and approval by the Management Committee
at least once prior to the Closing and annually thereafter (or more often if the
Managers deems appropriate).
               (iii) At least one hundred eighty (180) days before substantial
completion of the Resort, management of the Company, in cooperation with the
Members, the Managers and the Management Committee, shall propose the annual
operating and capital budget for the Resort for the first Fiscal Year of
operations which budget will describe the proposed revenues, expenses and
capital expenditures for the operation of the Resort and such other matters as
the Managers or the Management Committee consider material (the “Operating
Budget”). The Operating Budget shall include a component for unspecified capital
expenditures. Further, the Managers shall propose a new Operating Budget for
review and approval by the Management Committee once annually (or more often if
the Managers deems appropriate), which shall be submitted by the Managers to the
Management Committee no later than forty-five (45) days prior to the
commencement of each Fiscal Year of the Company. Prior to taking on any capital
improvements, development, or redevelopment activity that is not included in the
Approved Budget/Plan and involves amounts in excess of the unused amount of the
component for unspecified capital expenditures included in the Operating Budget,
and on or before sixty (60) days prior to the proposed date of initiation of
such activity, the Managers shall submit to the Management Committee for
approval the financial and other relevant terms of such activity as the Managers
or Management Committee consider material to such activity.
               (iv) Together, the Pre-Development Budget, the Business Plan and
the Operating Budget, when and as approved by the Management Committee in
accordance with the provisions of this Section 6.1(b), shall be referred to as
the “Approved Budget/Plan”.
               (v) At the time that the Managers propose the adoption of the
Business Plan, or an Operating Budget, as applicable, or at any time that the
Managers propose any revisions, including any annual adjustments, to such plan
or budget or the Pre-Development Budget (each a “Proposal”), the Managers shall
first obtain the consent of the Management Committee. Any Proposal by the
Managers must (i) be in the same general format as the existing, if any,
Pre-Development Budget, Business Plan, or Operating Budget, as applicable, and
(ii) address, at a minimum, all material matters that are addressed in such
existing budget or plan. The Management Committee shall have thirty (30) days to
either approve or disapprove of the Proposal.
               (vi) If a Proposal fails to be approved by the Management
Committee under Section 6.1(b)(v) above, the Members shall cause their duly
authorized representatives on the Management Committee to meet and discuss the
merits of the Proposal within fifteen (15) days after notice of disapproval was
received by the Managers. If the Members cannot agree within the fifteen
(15) day time period, or within a longer time period agreed to by all Members in
writing, the Managers shall operate the Company in accordance with the existing
Approved Budget/Plan, if any, provided that the Managers shall honor previously
approved obligations of the Company, but shall not make any improvements or
incur additional obligations, except to the

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extent consistent with the Approved Budget/Plan (modified to reflect any
increases or decreases in the U.S. Consumer Price Index from the date of the
most recent Approved Budget/Plan) or the provisions of Section 6.1(b)(iii)
above, until such time as a new Proposal has been approved.
          (c) Operating Agreement Controls. None of the Pre-Development Budget,
the Business Plan, or the Operating Budget, as any of them may be amended or
revised from time to time (the “Budgets and Plans”) shall be deemed an amendment
of this Agreement. To the extent that any provision of any of the Budgets and
Plans deals with the same matter as this Agreement, the provisions of this
Agreement shall control.
     6.2. Responsibilities, Rights, and Powers of the Chief Executive Officer
and the Chief Financial Officer.
          (a) Officers. The initial chief executive officer (“CEO”) and chief
financial officer (“CFO”) and subsequent CEOs and CFOs will be appointed by the
Management Committee. If either the CEO or CFO enters into an employment
agreement with the Company, the entry into, and any renewal or extension of,
such agreement shall require the approval of the Management Committee. The
officers of the Company may be an officer or employee of a Member or its
Affiliate. All officers of the Company shall act under the authority granted to
such officers by the Management Committee, and the Management Committee may
expand or limit such authority at its discretion.
          (b) Responsibilities, Rights and Powers of the Chief Executive
Officer. The CEO shall be generally responsible for overseeing and managing the
day-to-day business and operations of the Company.
          (c) Responsibilities, Rights and Powers of the Chief Financial
Officer. The CFO shall have fiduciary responsibility for the safekeeping and use
of all funds and assets of the Company, whether or not in his immediate
possession or control. The funds of the Company shall not be commingled with the
funds of any other Person and the CFO shall not employ, or permit any other
Person to employ, such funds in any manner except for the benefit of the
Company. The bank accounts of the Company shall be maintained in such banking
institutions as are approved by the Management Committee and withdrawals shall
be made only in the regular course of Company business and as otherwise
authorized in this Agreement on such signature or signatures as the Management
Committee may determine. All funds of the Company shall be invested in
accordance with the then applicable Approved Budget/Plan.

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     6.3. Management Committee.
          (a) Composition of the Management Committee. The Management Committee
shall consist of six (6) individuals. Each of (i) MGM JV (or its transferee) and
(ii) KERZNER JV (or its transferee) shall have the right to appoint three
(3) members to the Management Committee for so long as (A) no such Member is
controlled, directly or indirectly, by a Tier I Competitor or Tier II
Competitor, and (B) such Person is not a Defaulting Member. Two (2) of the
KERZNER JV Management Committee member appointments shall be made by Kerzner
International and the other one shall be made by Istithmar; provided, that at
any time that Istithmar’s (or its transferee) direct or indirect ownership
interest in the Units falls below ten percent (10%), then Istithmar (or its
transferee) shall not have the right to appoint a Management Committee Member,
in which case the right to appoint such Management Committee member shall
automatically revert to KERZNER JV. Subject to Section 9.7 and except as
otherwise specifically provided herein, the right to appoint a member to the
Management Committee may, but is not required to, be transferred at the
discretion of the transferring Member (or a member of the Member in the case of
KERZNER JV) to a third party in connection with a Transfer made in accordance
with Article 9 to such third party. The initial Management Committee members
appointed by MGM JV are: (A) Terry Lanni; (B) Jim Murren; and (C) Ken Rosevear.
The initial Management Committee members appointed by KERZNER JV are: (A) Sol
Kerzner; (B) Paul O’Neil; and (C) Joe Sita.
          (b) Management Committee Meetings.
               (i) Meetings. The Management Committee will meet not less than
once each calendar quarter and the Members anticipate that the Management
Committee or subcommittees thereof will hold regular monthly meetings at such
time and place as it determines. Any Management Committee member (including the
Chair) may call a special meeting of the Management Committee by giving the
notice specified in Section 6.3(a)(vi).
               (ii) Chair. For so long as KERZNER JV or any of its Permitted
Transferees meets the KERZNER Management Prerequisites, the chairperson of the
Management Committee (“Chair”) will be designated by KERZNER JV and will be a
member appointed by KERZNER JV. The initial Chair appointed by KERZNER JV is Sol
Kerzner. At such time as KERZNER JV or any of its Permitted Transferees no
longer meets the KERZNER Management Prerequisites, the Chair will be selected by
MGM JV if it meets the MGM Management Prerequisites. The Chair will preside at
all meetings of the Management Committee.
               (iii) Participation. Management Committee members may participate
in a meeting of the Management Committee by conference video or telephone or
similar communications equipment by means of which all persons participating in
the meeting can hear each other. Such participation will constitute presence in
person at the meeting.
               (iv) Written Consent. Any action required or permitted to be
taken at any meeting of the Management Committee may be taken without a meeting
upon the written consent of the all members of the Management Committee. Each
Management Committee member will be given a copy of the written consent promptly
after the last required signature is

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obtained. A copy of the consent will be filed with the minutes of Management
Committee meetings.
               (v) Minutes. The Management Committee will keep written minutes
of all of its meetings. Copies of the minutes will be provided to each
Management Committee member.
               (vi) Notice. Written notice of each special meeting of the
Management Committee will be given to each Management Committee member at least
ten (10) Business Days before the meeting and will identify the items of
business to be conducted at the meeting. No business other than those items
listed in the notice may be conducted at the special meeting, unless otherwise
expressly agreed by all the members of the Management Committee. The notice
provisions of this Section may be waived in writing and will be waived by a
Management Committee member’s attendance at the meeting, unless the Management
Committee member at the beginning of the meeting or promptly upon his arrival
objects to holding the meeting or transacting business at the meeting and does
not thereafter vote for or assent to action taken at the meeting.
               (vii) Voting and Quorum. Each Management Committee member will
have one vote. The persons appointed to the Management Committee by the KERZNER
JV shall vote as a block until such time as Istithmar’s direct or indirect
ownership interest in the Units falls below ten percent (10%). A quorum of the
Management Committee shall require at least one (1) of the Management Committee
members appointed by MGM JV and at least two (2) of the Management Committee
members appointed by KERZNER JV, at least one (1) of which Management Committee
members appointed by KERZNER JV shall be a member appointed by Istithmar for so
long as Istithmar is entitled to appoint a Management Committee member. Except
as otherwise specifically set forth herein, all actions of the Management
Committee shall require the approval of (i) a majority of the members of the
Management Committee, (ii) for so long as KERZNER JV meets the KERZNER
Management Prerequisite, the approval of at least one member of the Management
Committee appointed by KERZNER JV (to the extent such member of the Management
Committee is entitled to vote hereunder) and (iii) for so long as MGM JV meets
the MGM Management Prerequisite, the approval of at least one member of the
Management Committee appointed by MGM JV (to the extent such member of the
Management Committee is entitled to vote hereunder). If a Member is a Defaulting
Member under this Agreement, the members appointed to the Management Committee
by such Member shall not be entitled to vote on any matter requiring Management
Committee Approval for so long as such Member is a Defaulting Member, and, in
such case, the quorum requirement will adjust to exclude the Defaulting Member’s
appointee to the Management Committee. Notwithstanding anything to the contrary
herein, a Management Committee member appointed by (a) KERZNER JV shall have no
vote on a matter relating to whether a default has occurred with respect to an
Agreement entered into by the Company, on one hand, and KERZNER JV or its
Affiliates, on the other hand; and (b) MGM JV shall have no vote on a matter
relating to whether a default has occurred with respect to an Agreement entered
into by the Company, on one hand, and MGM JV or their Affiliates, on the other
hand.
               (viii) Expenses. Each Member will pay the compensation and
expenses of the member it appoints to the Management Committee, provided, that
the Company shall

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reimburse each Member for any reasonable documented out-of-pocket travel costs
and expenses incurred in connection with any Management Committee member
attending any meeting of the Members or the Management Committee, provided that
reimbursable costs for air travel shall not exceed the cost of first-class
travel on a commercial carrier. Except as provided in the previous sentence,
without the approval of the Management Committee no Person shall be entitled to
any fee or compensation from the Company in connection with his service as a
member of the Management Committee or any subcommittee thereof.
               (ix) Removal. Each Member may remove and replace the Management
Committee member appointed to the Management Committee by such Member. Each
Member agrees, as necessary, to vote or cause its designated representatives on
the Management Committee to vote, for any person so nominated by the Member
whose representative has caused such vacancy.
               (x) Gaming Approvals. If a proposed or existing Management
Committee member is determined by a Gaming Authority to be unsuitable to serve
as a member of the Management Committee, the Member (or the member of the Member
in the case of KERZNER JV) nominating such Management Committee member will be
entitled to nominate a replacement Management Committee member. In the event
that two consecutive nominees of a Member (or the member of the Member in the
case of KERZNER JV) are determined by a Gaming Authority to be unsuitable to
serve as a member of the Management Committee, such Member (or the member of the
Member in the case of KERZNER JV) will forfeit its right to nominate a member
for that seat and the other Member (and the other member of the Member in the
case of KERZNER JV) shall select to fill that seat with a Management Committee
member who is deemed to be “independent” with respect to any Member as
determined under the New York Stock Exchange Listing Standards for U.S. listed
companies; provided that at any time following the second anniversary of a
Member (or the member of the Member in the case of KERZNER JV) forfeiting its
right to nominate a member of the Management Committee, such Member (or the
member of the Member in the case of KERZNER JV) may once again nominate a person
to fill that seat if it nominates a member that the other Member reasonably
determines will be found by a Gaming Authority to be suitable to serve as a
member of the Management Committee.
     6.4. Actions Requiring the Consent of the Management Committee. The
following acts (“Major Decisions”) may not be taken by the Company or the
Managers without the consent of the Management Committee:
          (a) Acquiring any real property in addition to the Property, except
for immaterial acquisitions of property rights ancillary to the development of
the Property;
          (b) Causing the Company to file for Bankruptcy;
          (c) Using the Company’s or the Subsidiaries’ funds or capital in any
way other than for the business and purpose of the Company as set forth in
Section 2.3 and in accordance with the then Approved Budget/Plan;
          (d) Amending an Approved Budget/Plan;

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          (e) Taking any intentional action that would reasonably be expected to
result in a material deviation from the Approved Budget/Plan; provided that the
foregoing to the contrary, in cases where there exists a present and material
risk of damage to property, injury to person, or breach of a Company obligation
(unless resulting from the action or failure to act of the Managers), the
Managers may reasonably and in good faith take such steps as the Managers deem
immediately necessary or advisable to eliminate or reduce the risk, injury or
breach without regard to whether such action would result in a material
deviation from the Approved Budget/Plan. In the event of any such emergency
action, the Managers shall limit their actions to those necessary to reduce the
risk, injury or breach and shall give the other Members notice of such actions
as soon thereafter as possible;
          (f) Admitting any Person as a Member of the Company other than as set
forth in Article 9 hereof or issuing any additional Units;
          (g) Selling, exchanging, conveying, transferring or otherwise
disposing of a material portion of Company property other than in the ordinary
course of the Company’s or a Subsidiary’s business;
          (h) Entering into any Major Lease other than in the manner permitted
under the Approved Budget/Plan;
          (i) Except as otherwise provided in this Agreement, dissolving or
liquidating the Company, or merging, consolidating or recapitalizing the
Company;
          (j) Compromising any claim owed by the Company in excess of $1,000,000
or submitting to arbitration any dispute or controversy involving the Company or
a Subsidiary;
          (k) Selecting accountants that perform an annual audit and issue an
opinion letter with respect to the financial statements of the Company or the
Subsidiaries;
          (l) Requiring additional Capital Contributions in excess of those
contemplated by this Agreement;
          (m) Requiring or permitting Member Loans and in connection therewith
determining the terms of any Member Loans;
          (n) Loaning Company or Subsidiary funds or assets, but the foregoing
does not preclude the Managers’ ability to encumber the Company’s assets as
security for loans to the Company in a manner consistent with the Approved
Budget/Plan;
          (o) Incurring indebtedness for borrowed money or any other amounts
payable as a debtor, borrower, issuer or guarantor pursuant to an agreement or
instrument involving or evidencing borrowed money in excess of $5,000,000 per
year (which amount may be adjusted by the Management Committee), other than
trade debt incurred in the ordinary course of the Company’s business;
          (p) Making any charitable or political donations not specifically set
forth in the Approved Budget/Plan;

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          (q) Making any material change in accounting or tax policies of the
Company except as required by law or to satisfy GAAP;
          (r) Entering into any contracts that involve annual amounts in excess
of $2,000,000 per year (which amount may be adjusted by the Management
Committee);
          (s) Adopting or revising any component of the Approved Budget/Plan,
including the Business Plan and any annual Operating Budget;
          (t) Altering any rights attaching to any Units;
          (u) Issuing any debenture, option, or other securities convertible
into Units;
          (v) Entering or purporting to enter into any contract or obligation
with any Member or an Affiliate of a Member (including any renewal thereof or
any variation in the terms of any existing contract or obligation);
          (w) Admitting the whole or any part of the Units to the board of any
recognized stock exchange;
          (x) Approving or adopting any amendments to the Articles of
Organization except to the extent required to comply with any Laws;
          (y) Taking any other action for which Management Committee or Member
approval is required pursuant to this Agreement; or
          (z) Authorizing, agreeing or committing to do any of the foregoing.
     6.5. Filing of Documents. The Members agree to file or cause to be filed
all certificates or documents as may be reasonably determined by the Members to
be necessary or appropriate for the formation, continuation, qualification and
operation of a limited liability company in the State of Nevada, as appropriate,
and any other state in which the Company or a Subsidiary may elect to do
business.
     6.6. Indemnification and Liability.
          (a) Company Indemnification. The Company agrees to indemnify, defend
and hold harmless the Members, the Managers and their Affiliates (which, for
purposes of this Section 6.6(a), includes Kirk Kerkorian, Tracinda Corporation
and the Kerzner Related Persons) and Management Committee members (each, an
“Indemnitee”) for, from and against any and all losses, claims, damages,
liabilities, expenses (including reasonable attorneys’ fees and costs),
judgments, fines, settlements, demands, actions, or suits relating to or arising
out of the business of the Company, the development of the Property or the
exercise by such Indemnitee of any authority conferred on it hereunder or the
performance by such Indemnitee of any of its duties and obligations hereunder,
even if such Indemnitee was negligent to the maximum extent permitted under the
Act. Notwithstanding anything contained in this Agreement to the contrary, no
Indemnitee is entitled to indemnification hereunder with respect to any claim,
issue or matter in respect of which such Indemnitee (or the Company as the
result of an act or omission of such

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Indemnitee) has been finally adjudged (without possibility of further appeal) to
be liable for fraud, gross negligence or willful misconduct. In addition, no
Manager, Member or its Affiliate, or a Management Committee member is entitled
to indemnification as a result of a material breach by such Person of any term
or provision of this Agreement, the Members acknowledging that the remedies of
the Members for a breach of this Agreement are as set forth in Section 7.5
below.
          (b) Liability. An Indemnitee will not be liable, responsible,
accountable in damages or otherwise to the Company or the Members for any act or
failure to act in connection with the Company and its business unless such act
or omission (i) constitutes gross negligence, willful misconduct and/or fraud by
such Person, or (ii) causes a material breach by such Person of any material
term or provision of this Agreement.
          (c) Terms of Indemnification. Each indemnity provided for under this
Agreement is subject to the following provisions:
               (i) The indemnity will cover the costs and expenses of the
Indemnitee, including reasonable attorneys’ fees and costs, related to any
actions, suits or judgments incident to any of the matters covered by such
indemnity.
               (ii) The Indemnitee must notify the Company of any claim against
the Indemnitee covered by the indemnity within forty-five (45) days after the
Indemnitee has notice of such claim, but failure to notify the Company in no
case prejudices the rights of the Indemnitee under this Agreement unless the
Company is prejudiced by such failure and then only to the extent the Company is
prejudiced by such failure. If the Company fails to discharge or undertake to
defend the Indemnitee against such liability upon learning of such liability,
then the Indemnitee may settle such liability, and the liability of the Company
hereunder will be conclusively established by such settlement, which liability
will include both the settlement consideration and the reasonable costs and
expenses, including reasonable attorneys’ fees and costs, incurred by the
Indemnitee in effecting such settlement.
               (iii) No indemnity hereunder may be construed to limit or
diminish the coverage of any Member under any insurance obtained by the Company.
Payment under any such policy is not a condition precedent to any
indemnification provided in this Agreement.
     6.7. Compensation
          (a) Compensation. Unless expressly provided for in this Agreement or
approved by the Management Committee’s consent, no Member or Manager, nor any
Affiliate of any of them, shall be paid any compensation for its management
services to the Company.
          (b) Reimbursable Expenses.
               (i) The Company shall reimburse the Managers for all actual
out-of-pocket expenses incurred in connection with the carrying out of the
Managers’ duties set forth in this Agreement, including all costs incurred by
the Managers during the Pre-Development Period, which costs shall constitute
Pre-Development Expenses, so long as such costs are approved by the Management
Committee or otherwise included in the Approved Budget/Plan.

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In the case of Pre-Development Expenses, to the extent that KERZNER JV counts
the Pre-Development Expenses towards the satisfaction of its obligation to make
its initial Capital Contributions under Section 3.2(b)(i), then KERZNER JV shall
not be entitled to a reimbursement of such Pre-Development Expenses.
               (ii) Reimbursable costs and expenses under this Section 6.7(b)
include all actual out-of-pocket costs and expenses (which, for the sake of
clarification, shall include no allocation of overhead or similar costs) and the
costs of any employees whose involvement is pre-approved or included the
Approved Budget/Plan and who are dedicated to the project on a full-time basis
for at least three (3) consecutive months and any such costs or expenses
incurred during the Pre-Development Period shall constitute Pre-Development
Expenses. Employee costs shall include the employees’ salaries, pro-rated
bonuses in amounts consistent with past practices, and costs of employee
benefits such as health, life and disability insurance premiums, contributions
to 401k or retirement plans and the like, but such costs shall not include any
costs associated with equity incentive plans of either Member. Further,
reimbursable costs for travel shall not exceed the cost of first-class travel on
a commercial carrier.
          (c) Expense Audits. All reimbursable expenses, including the
Pre-Development Expenses, shall be subject to audit and review at the request of
either Member.
     6.8. Amendment of Agreement. This Agreement may be amended or modified only
by a written agreement signed by each of the Members; provided that at such time
as both (i) MGM JV is no longer entitled to appoint any members to the
Management Committee and (ii) KERZNER JV meets the KERZNER Management
Prerequisites, this Agreement may be amended by KERZNER JV, without the consent
of any other Member, to provide for the establishment of a “Reserve Fund” to pay
for FF&E and routine capital expenditures, consistent with the principles set
forth on Schedule 6.8.
     6.9. Standard of Care.
          (a) The Managers shall direct the Company’s management team to conduct
the business of the Company on a day-to-day basis and perform the duties
assigned to it under this Agreement in accordance with the standard of care of
prudent and experienced third-party asset managers performing similar functions
in accordance with customary industry standards, and will use commercially
reasonable efforts to conduct the business of the Company in a manner consistent
with the Approved Budget/Plan.
          (b) Unless otherwise specifically provided in this Agreement, whenever
hereunder a Manager or Member is required or permitted to make a decision, take
or approve an action or omit to do any of the foregoing: (i) in its sole
discretion, such Member or Manager shall be entitled to consider only such
factors and interest, including its own, as it desires, and shall have no duty
or obligation to consider any other interest (including the interest of any
other Member) or factors whatsoever, (ii) with an express standard of behavior
(including standards such as “reasonable” or “good faith”), then such Member or
Manager shall comply with such express standard, or (iii) without any express
standard, then, in the case of a Member, such Member shall be obligated to act
in good faith, and, in the case of a Manager, such Manager shall be obligated to
act consistently with the standards set forth in Section 6.9(a).

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          (c) Without limiting the foregoing, each Member agrees that the
standards set forth in this Section 6.9 are intended to supersede any fiduciary
obligations that would otherwise apply to the Members under any applicable Law
(excluding any fiduciary duty for the benefit of the Company required of
Members’ Affiliates pursuant to any written contract between such Affiliates and
the Company).
     6.10. Transactions with Affiliates. The Managers may employ or retain, or
enter into any transaction or contract with, any Member or any officer, employee
or Affiliate (which, for the purposes of this Section 6.10 includes Tracinda
Corporation and its Affiliates and the Kerzner Related Persons) of any Member,
provided that (i) the compensation and other terms and conditions of any such
arrangement are no less favorable to the Company than those that could
reasonably be obtained at the time from an unrelated party providing comparable
goods or services; and (ii) the Manager obtains specific approval for such
transaction from the Management Committee prior to entering into such
arrangement.
     6.11. Independent Activities.
          (a) General Scope of Independent Activities. The Members hereby
expressly agree and acknowledge that each of the Members, either directly or
through the Member’s Affiliates (which, for the purposes of this Section 6.11
includes Kirk Kerkorian, Tracinda Corporation and its Affiliates, and the
Kerzner Related Persons), is involved in transactions, investments and business
ventures and undertakings of every nature, which include the managing and
operating of Gaming businesses and other related activities such as retail and
room rental and the ownership, construction, development, marketing, sale and
operation of real property and improvements of every type and nature thereon, as
well as activities which are not associated in any manner with the Gaming
business or real estate (all such investments and activities being referred to
hereinafter as the “Independent Activities”).
          (b) Waiver of Rights with Respect to Independent Activities. Nothing
in this Agreement shall be construed to: (i) prohibit any Member or the Member’s
Affiliates (or the member of a Member and such member’s Affiliates) from
continuing, acquiring, owning or otherwise participating in any Independent
Activity that is not owned or operated by the Company, even if such Independent
Activity is or may be in competition with the Company; or (ii) require any
Member or the Member’s Affiliates (or the member of a Member and such member’s
Affiliates) to allow the Company or any other Member to participate in the
ownership or profits of any such Independent Activity. To the extent any Member
would have any rights or claims against any other Member as a result of the
Independent Activities of such Member or such Member’s Affiliates (or the member
of a Member and such member’s Affiliates), whether arising by statute, common
law or in equity, the same are hereby waived.
          (c) Limitation on Company Opportunities. Each Member hereby represents
and warrants to the other Member that it has not been offered, as an inducement
to enter into this Agreement, the opportunity to participate in the ownership or
profits of any present or future Independent Activity of any kind whatsoever of
such other Member or such other Member’s Affiliates.

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           (d) Acknowledgment of Reasonableness. The Members hereby expressly
acknowledge, represent and warrant that they are sophisticated investors, they
understand the terms, conditions and waivers set forth in this Section 6.11 and
that the provisions of this Section 6.11 are reasonable, taking into account the
relative sophistication and bargaining position of the Members.
     6.12. Management Employees of the Company. The Company shall maintain an
incentive compensation plan for executive management of the Company, which plan
will be on such terms as the Management Committee may approve from time to time.
In the event that an employee of Kerzner International or MGM MIRAGE or their
respective Affiliates are seconded to the Company, the Company shall pay such
employees’ fully-loaded costs, including any incentive compensation under the
Company’s executive incentive compensation plan (but excluding any costs
associated with equity incentive plans of either Kerzner International or MGM
MIRAGE), with the understanding that such secondees will return to his or her
seconding employer following his or her tenure with the Company.
     6.13. Additional Arrangements.
          (a) MGM Support Arrangements. Schedule 6.13(a)(i) sets forth the terms
of an Agreement between the Company and MGM MIRAGE relating to support
arrangements with MGM MIRAGE and its Affiliates. In connection with adopting the
initial Approved Budget/Plan, the Company and MGM MIRAGE shall negotiate in good
faith to enter into a more definitive agreement relating to the support
arrangements set forth on Schedule 6.13(a)(i), including the consideration and
other terms relating to such support arrangements, but in any event the parties
do not intend such terms to include allocation of overhead or similar costs. In
addition, and to the extent requested by the Company, MGM JV agrees to discuss
in good faith with the Company the provision by MGM MIRAGE of certain other
services, including those services set forth on Schedule 6.13(a)(ii) and to
negotiate in good faith to enter into one or more support agreements with MGM
MIRAGE and its Affiliates covering such services, including the matters set
forth on such schedule and on the terms set forth on such schedule, where
applicable, but in any event the parties do not intend such terms to include
allocation of overhead or similar costs.
          (b) Joint Marketing Arrangements. The Company agrees to negotiate in
good faith to enter into an agreement with MGM MIRAGE and Kerzner International
covering the matters set forth on Schedule 6.13(b) and on the terms set forth on
such schedule.
          (c) Effect of Failure to Enter into Additional Arrangements. If the
parties cannot enter into an agreement in connection with the support
arrangements as set forth in Section 6.13(a)(ii) or the joint marketing
arrangements as set forth in Section 6.13(b), such failure shall not be deemed
to result in the termination of this Agreement.
          (d) Breach. The Members and Managers hereby acknowledge that the
breach by a party of any Related Agreement (other than the Guarantee) shall not
be considered a default under this Agreement.

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     6.14. Right to Exercise Remedies. The Manager appointed by MGM JV shall
have the sole and exclusive right, on behalf of the Company and all
subsidiaries, to exercise all remedies of the Company and any subsidiaries under
this Agreement or the operating agreement of any subsidiary against KERZNER JV
or its Affiliates. Similarly, the Manager appointed by KERZNER JV shall have the
sole and exclusive right, on behalf of the Company and all subsidiaries, to
exercise all remedies of the Company and any subsidiaries under this Agreement
or the operating agreement of any subsidiary against MGM JV or its Affiliates.
ARTICLE 7 THE MEMBERS
     7.1. Meetings of the Members. Meetings of the Members will be held on the
call of a Manager or one or more non-Defaulting Members, provided that at least
ten (10) Business Days’ notice must be given to all Members with respect to any
meeting, and provided further that any Member may require that such meeting be
held by telephone. A waiver of any required notice is equivalent to the giving
of such notice if such waiver is in writing and signed by the Member entitled to
such notice, whether before, at or after the time stated therein. The Members
may make use of telephones and other electronic devices to hold meetings,
provided that each Member may simultaneously participate with the other Members
with respect to all discussions and votes of the Members. The Members may act
without a meeting if the action taken is reduced to writing (either prior to or
thereafter) and approved and signed by the required vote of Members in
accordance with the voting provisions of this Agreement. Written minutes will be
taken at each meeting of the Members; however, any action taken or matter agreed
upon by the Members will be deemed final, whether or not written minutes are
prepared or finalized.
     7.2. Voting of the Members. Unless this Agreement expressly states
otherwise, all votes, actions, approvals, elections and consents required in
this Agreement to be made by the Members will be effective when approved by the
Management Committee. Except as specifically set forth in this Agreement, no
Member shall have the right to vote on any matters.
     7.3. Other Business Interests of the Members. Except as set forth in
Section 6.2 above, this Agreement may not be construed to grant any right,
privilege or option to a Member to participate in any manner in any other
business, corporation, partnership or investment in which the other Members or
their Affiliates may participate including those which may be the same as or
similar to the Company’s business or in direct competition therewith including
the ownership and development of parcels adjacent to the Property. Each Member
expressly waives the doctrine of corporate opportunity (or any analogous
doctrine) with respect to any other such business, corporation, partnership or
investment of any other Member or such Member’s Affiliate; provided that this
waiver and all other terms and conditions of this Agreement will not restrict or
otherwise affect any party’s rights, obligations and duties under any employment
or consulting agreement with the Company.
     7.4. Rights and Obligations of Members.
          (a) Limitation of Liability. Each Member’s liability for the debts,
obligations and liabilities of the Company is limited as set forth in the Act
and other applicable Law.

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          (b) Confidentiality. Except as contemplated hereby or required by the
Gaming Laws, Gaming Authorities having jurisdiction over any Member or any of
their Affiliates or a court of competent authority, each Member must keep
confidential and not disclose or use, and must use its commercially reasonable
efforts to prevent such Member’s Affiliates (which, for purposes of this
Section 7.4(b), includes Tracinda Corporation and its Affiliates and the Kerzner
Related Persons) and any of such Member’s, or such Member’s Affiliates’, present
or former employees, agents and representatives, from disclosing or using,
without the prior written authorization of the Company, any information
pertaining to this Agreement, any of the transactions contemplated hereby or the
business of the Company, provided that each Member shall be permitted to share
pertinent documents relating to the Company with third-party advisors so long as
such third-party advisors agree to be bound by the confidentiality requirements
of this Section 7.4(b). The term “confidential information” is used in this
Section 7.4 to describe information that is confidential, non-public or
proprietary in nature, is provided to such Member or such Member’s
representative by the Company, any other Member, or any such Person’s agents,
representatives, members or employees, and relates either directly or indirectly
to the Company, the Member or any member of a Member and/or any of their
respective Affiliates. Notwithstanding anything herein to the contrary, the
Members acknowledge that the Members or their Affiliates may be publicly-traded
companies and nothing in this Agreement shall be construed to limit or otherwise
circumscribe the taking, by the Members or any Affiliate thereof, of all actions
reasonably determined by such Member to be necessary or appropriate to comply
with any disclosure obligations relating thereto; provided that the Member
making such disclosure shall, or shall cause its Affiliate to, notify the other
Member in advance of any such disclosure relating to the Company and to give the
other Member a reasonable opportunity to comment on any such disclosure. This
provision shall survive the termination or expiration of this Agreement in
perpetuity for as long as information shall remain confidential information. The
obligations not to use or disclose confidential information shall not apply to
information of a Member which (a) has been made previously available to the
public by such Member or its Affiliates or becomes generally available to the
public, other than as a result of a breach of this Agreement or any other
confidentiality agreement between the Members or their respective Affiliates,
(b) prior to disclosure to any other Member or its respective Affiliates, was
already rightfully in any such other Member’s possession, or the possession of
any Affiliate of such other Member, (c) is obtained by such other Member from a
third party on a non-confidential basis who is not known by such other Member
after due inquiry to be in violation of any contractual, legal or fiduciary
obligation to the first Member with respect to such confidential information and
(d) is disclosed to a potential transferee in connection with a potential
Transfer permitted under Article 9 so long as such potential transferee agrees
to keep such information confidential.
     7.5. Defaulting Member.
          (a) Events of Default. The occurrence of any of the following events
constitutes an event of default and the Member so defaulting (herein referred to
as the “Defaulting Member”) will thereafter be deemed to be in default without
any further action whatsoever on the part of the Company or the other Members:
(i) attempted dissolution of the Company by such Member other than pursuant to
the express provisions of this Agreement; (ii) a Bankruptcy as to such Member;
(iii) a material breach of a material term or provision of this Agreement by
such Member; or (iv) the failure by the Member to make its Capital Contribution

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in accordance with Section 3.2. For the avoidance of doubt, any actions taken or
not taken, or any breach of this Agreement, by a Manager shall not affect the
rights of a Member and a Member shall not be considered a Defaulting Member for
any purpose under this Agreement by virtue of any actions taken or not taken, or
any breach of this Agreement, by a Manager.
          (b) Effect of Default. Notwithstanding anything in this Agreement to
the contrary, a Defaulting Member and the Management Committee members appointed
by such Defaulting Member do not have any voting, approval or consent rights
with respect to any matters set forth in this Agreement, including but not
limited to all approval and consent rights set forth in Article 6 and Article 7,
provided that except as specifically set forth in this Agreement, the
non-Defaulting Member may not (either directly or through its designees
appointed to the Management Committee) use its unanimous voting power to amend
this Agreement except to the extent reasonably necessary if the amendments
(i) are of a ministerial nature, (ii) do not adversely affect the Members in any
material respect or (iii) are required by law or regulations; provided, further
if the Non-Defaulting Member approves any additional capital contributions
without the consent of the other Member, the Percentage Interests of the Members
shall be determined under Section 3.4(b)(i) by substituting “1.0” in place of
“1.5” in the definition of “Adjusted Additional Percentage Interest”. The
Defaulting Member’s right to vote and the vote of its Management Committee
members will be reinstated if and when the Defaulting Member’s default is cured
in accordance with the provisions of this Agreement.
          (c) Remedies on Default. Upon the occurrence of a default by a Member
the non-Defaulting Member and the Company have all rights and remedies available
at law and in equity and may institute legal proceedings against the Defaulting
Member with respect to any damages or losses incurred by the Company or any
non-Defaulting Member, and/or the non-Defaulting Member may cause the Company to
dissolve and liquidate in accordance with the provisions of Article 10. The
Company is entitled to reasonable attorneys’ fees and costs incurred in
connection with any such action. Further, if the default results from the
failure of the Member to make all or any portion of a required additional
Capital Contribution under Section 3.2 above, then the remedies set forth in
Section 3.4 shall apply.
          (d) Notice and Opportunity to Cure. Notwithstanding anything contained
herein to the contrary, upon the occurrence of a default by a Member, the
non-Defaulting Member shall so notify the members of such Member, and any of
such members may cure such default. The non-Defaulting Member shall not take any
action against the Defaulting Member until the non-Defaulting Member has so
notified the members of the Defaulting Member of the default and, in the case of
a payment default, provided fourteen (14) Business Days in which to cure such
default and, in the case of any other default, provided thirty (30) days in
which to cure such default. In the case of a payment default, the default shall
not be considered cured unless interest is paid on the payment to the Company
for the duration of the default at the Default Interest Rate. If a non-payment
default cannot reasonably be cured within thirty (30) days, then the members of
such Defaulting Member shall have an additional thirty (30) days, so long as
they proceed with all reasonable diligence.
     7.6. Member Determined Unsuitable or Unqualified by a Gaming Authority.
Upon final determination by a Gaming Authority that a Member is unsuitable to
own an interest in the Company (“Determination Date”), then the Company or the
other Member shall, subject

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to the receipt of all Gaming Approvals, have the right to purchase such Member’s
Units at a price equal to (i) if the date of the repurchase is on or before the
first anniversary of the Signing Date, the Capital Contributions made by the
Member net of any distributions made to the Member as of the repurchase date;
(ii) if the date of the repurchase is after the first anniversary of the Signing
Date, the Appraised Value of the Units; or (iii) as may be otherwise ordered by
a Gaming Authority; provided that, notwithstanding the transfer restrictions set
forth in Article 9, in the event the unsuitability relates to a member of a
Member, the other members of such Member shall first have the opportunity to
purchase such unsuitable member’s interest in the Member prior to the Company or
the other Member becoming entitled to exercise such remedy. The “Appraised
Value” shall be an amount equal to the such Member’s Percentage Interest
multiplied by the fair market value of the Company, which shall represent the
amount that a single purchaser unrelated to any Member would reasonably be
expected to pay for the Company business and assets as a going concern, subject
to all existing indebtedness, liens and encumbrances, in a single cash purchase,
taking into account the current condition, use and net income of the Resort and
after taking into account any expenses relating to the purchase of such Member’s
Units. If the Members are unable to mutually agree upon the Appraised Value
within thirty (30) days after the Determination Date, each Member shall select a
reputable Member of the Appraisal Institute (“MAI”) appraiser to determine the
Appraised Value. The two appraisers shall furnish the Members with their written
appraisals within forty-five (45) days of their selection, setting forth their
determinations of the Appraised Value as of the Determination Date. If the
higher of such appraisals does not exceed the lower of such appraisals by more
than ten percent (10%), the Appraised Value shall be the average of the two
appraisals. If the higher of such appraisals exceeds the lower of such
appraisals by more than ten percent (10%), the two appraisers shall, within
twenty (20) days, mutually select a third reputable MAI appraiser. The third
appraiser shall furnish the Members with its written appraisal within forty-five
(45) days of its selection, and the Appraised Value shall be the average of the
three appraisals. The cost of the appraisals shall be borne equally by the
Members. The determination of the Appraised Value in accordance with this
Section 7.6 shall constitute a final and non-appealable arbitration. The closing
of the purchase and sale of the Units of the Member pursuant to this Section 7.6
shall occur not later than ninety (90) days after determination of the Appraised
Value, or such other time as may be directed by the Gaming Authorities. At the
closing, such Member shall deliver to the other Member good title to its Units,
free and clear of any Encumbrances.
ARTICLE 8 BOOKS, RECORDS, REPORTS AND ACCOUNTING
     8.1. Records. The Managers shall keep or cause to be kept at the Principal
Office of the Company the following: (a) a current list of the full name and
last known business, residence or mailing address of each Member; (b) a copy of
the Company’s initial Articles of Organization and all amendments thereto;
(c) copies of all written operating agreements and all amendments thereto,
including any prior written operating agreements no longer in effect; (d) copies
of any written and signed agreements by the Members to make Capital
Contributions to the Company; (e) copies of the Company’s federal, state and
local income tax returns and reports, if any, for the six most recent years;
(f) copies of any prepared financial statements of the Company for the six most
recent years; and (g) minutes (if reduced to writing) of every meeting of the
Management Committee or the Members as well as any written consents of the
Management Committee or the Members to actions without a meeting. Any such
records maintained by the Company may be kept on or be in the form of any
information storage device, provided that the records so kept are

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convertible into legible written form within a reasonable period of time. Each
Member has the right to inspect the records of the Company described in this
Section 8.1 in person at the Principal Office of the Company upon twenty-four
(24) hours’ notice. Upon request of a Member, the Company will photocopy and
send any requested Company records to that Member, provided that the requesting
Member pays to the Company any actual out-of-pocket costs incurred by the
Company in complying with such request.
     8.2. Fiscal Year and Accounting. The Fiscal Year of the Company is the
calendar year unless otherwise required by applicable Law. All amounts computed
for the purposes of this Agreement and all applicable questions concerning the
rights of Members will be determined using the method of accounting employed by
the Company for federal income tax purposes. The Managers, except as
specifically provided to the contrary herein, will make all decisions as to
other accounting matters.
     8.3. Preparation of Tax Returns. The CFO will arrange, at the expense of
the Company, for the preparation and timely filing of all returns of Company
income, gains, deductions, losses and other items necessary for income tax
purposes and cause to be furnished to the Members the tax information reasonably
required for income tax reporting purposes. As promptly as practicable, but in
any event by March 31 of each Fiscal Year, the CFO shall cause to be prepared
and distributed to each Member all information necessary for the preparation of
such Member’s federal and state income tax returns, including an Internal
Revenue Service Schedule K-1 and any other statement showing such Member’s share
of income, gains, losses, deductions and credits for such year for federal and
state income tax purposes and the amount of any distributions made to or for the
account of such Member pursuant to this Agreement. The classification,
realization and recognition of income, gain, losses and deductions and other
items, for federal income tax purposes, will be on that method of accounting as
the Management Committee determines or such other method as is required by the
Code.
     8.4. Tax Elections.
          (a) At the request of any Member, the CFO shall elect to adjust the
basis of the assets of the Company for federal income tax purposes in accordance
with Section 754 of the Code in the event of a distribution of any Company
property as described in Section 734 of the Code or a transfer by any Member of
its Units in the Company (or a direct or indirect transfer of an interest in a
Member) as described in Section 743 of the Code.
          (b) The CFO, on behalf of the Company, shall from time to time make
such other tax elections as it deems necessary or desirable to carry out the
business of the Company or the purposes of this Agreement, provided that the CFO
shall not make any material election without the consent of the senior tax
officers of MGM MIRAGE, Kerzner International, and Istithmar, which consent
shall not be unreasonably withheld.
     8.5. Tax Controversies. Kerzner JV shall be the Tax Matters Partner so long
as the Kerzner Management Prerequisites are satisfied. At such time as the
Kerzner Management Prerequisites are not satisfied, the Management Committee
shall appoint the Tax Matters Partner. The Tax Matters Partner is authorized and
required to represent the Company (at the Company’s expense) in connection with
all examinations of the Company’s affairs by tax authorities,

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including resulting administrative and judicial proceedings, and to expend
Company funds for professional services and costs associated therewith. The
Members agree to cooperate with the Tax Matters Partner and to do or refrain
from doing any or all things reasonably required by the Tax Matters Partner to
conduct those proceedings. The Tax Matters Partner agrees to promptly notify the
Members upon the receipt of any correspondence from any federal, state or local
tax authorities relating to any examination of the Company’s affairs, to consult
with the Members regarding the progress of any audit, to allow the Members to
participate in any such audit, and not to settle any tax matters without the
written consent of the senior tax officer of the other Member, such consent not
to be unreasonably withheld.
     8.6. Reports. Within twenty (20) days after the end of each Fiscal Year,
within fifteen (15) days after the end of each of the first three fiscal
quarters thereof, and within twelve (12) days after the end of each calendar
month other than March, June, September and December, the CFO shall cause the
Management Committee Members to be furnished with a copy of the balance sheet of
the Company as of the last day of the applicable period and a statement of
income or loss for the Company for such period. Quarterly and annual statements
shall also include a statement of the Members’ Capital Accounts and changes
therein for such Fiscal quarter or Fiscal Year, as applicable. Annual statements
shall be audited by the Company’s accountants, and shall be in such form as
shall enable the Members to comply with all reporting requirements applicable to
either of them or their Affiliates under the Securities Exchange Act of 1934, as
amended. The audited financial statements of the Company shall be furnished to
the Members within fifty (50) days after the end of each Fiscal Year.
ARTICLE 9 TRANSFERS, WITHDRAWALS
     9.1. Restrictions on Transfers. Except as set forth in Section 9.2, no
Transfers are permitted prior to the end of the third complete Fiscal Year
following the Opening Date (the “Transfer Restriction Lapse Date”; provided that
in the case of Istithmar (and the Istithmar Member), the Transfer Restriction
Lapse Date shall mean the Opening Date; provided further that if, prior to the
end of the third complete Fiscal Year following the Opening Date, Istithmar
desires to effect a Transfer under the terms of this Agreement and at the time
of such Transfer Istithmar has outstanding obligations to, or for the benefit
of, the Company, then Istithmar may not effect such Transfer unless (A) the
proposed transferee has creditworthiness at least as favorable as that of
Istithmar (as determined in the reasonable judgment of MGM JV and Kerzner
Concepts Limited) and agrees to assume such obligations of Istithmar or
(B) Istithmar agrees to remain liable with respect to such obligations).
Following the Transfer Restriction Lapse Date, Transfers are permitted, subject
to the conditions and restrictions set forth in Section 9.3 and to compliance
with the terms of the right of first offer set forth in Section 9.6.
     9.2. Permitted Transfers. Subject to the conditions and restrictions set
forth in Section 9.3 below, Units may be Transferred, directly or indirectly, to
(i) any other Member, (ii) the Company, or (iii) any Permitted Transferee.
          (a) As a condition to the Transfer to a Permitted Transferee, each
Permitted Transferee of any Member to which Units are Transferred shall agree to
Transfer back to such Member (or to another Permitted Transferee of such Member)
any Units it owns prior to such Permitted Transferee ceasing to be a Permitted
Transferee of such Member.

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          (b) MGM MIRAGE, Kerzner International, Istithmar (and the Istithmar
Member) or any Member may, directly or indirectly, pledge its Units as
collateral to lenders in connection with the financing contemplated by
Sections 3.2(a)(iii)(D) and 3.2(b)(ii)(F) or in connection with any bona fide
financing transaction by Kerzner International, MGM MIRAGE or Istithmar or any
of their subsidiaries; provided that, any agreement entered into with a lender
in connection with such pledge will provide that in the event the lender seeks
to enforce such pledge, the non-pledging Members would have a pro rata right of
first offer in accordance with the procedures set forth in Section 9.6, in
priority to the lender’s right to foreclose, in respect of the Units subject to
the lender’s pledge. To the extent such non-pledging Members do not acquire the
entirety of any Units subject to such pro rata right of first offer, the lender,
upon foreclosure may acquire, subject to the conditions and restrictions set
forth in Section 9.3 below, the remaining portion of the stake not acquired
pursuant to such pro rata right of first offer and shall adhere to all of the
obligations under this Agreement (including the transfer restrictions set forth
herein); provided further that, upon foreclosure the lender will not have any
right to vote any of its Units on any matter to be voted on by the Members and
will not have any right to appoint or designate any members of the Management
Committee.
     9.3. Conditions to Transfers. A Transfer will not be treated as a Transfer
permitted under this Article 9 unless and until all of the following conditions
are satisfied:
          (a) The transferor and transferee execute and deliver to the Company
such documents and instruments of conveyance as may be necessary or appropriate
in the opinion of counsel to the Company to effect such Transfer and the
transferee executes and delivers to the Company a joinder to this Agreement in a
form reasonably satisfactory to the Company to be bound by the terms and
conditions of this Agreement to the same extent that the transferring Member was
so bound. In all cases, the transferor and/or transferee must reimburse the
Company for all costs and expenses that the Company incurs in connection with
such Transfer.
          (b) The transferor and transferee must furnish the Company with the
transferee’s taxpayer identification number, sufficient information to determine
the transferee’s initial tax basis in the Units transferred, and any other
information reasonably necessary to permit the Company to file all required
federal and state tax returns and other legally-required information statements
or returns. Without limiting the generality of the foregoing, the Company is not
required to make any distribution otherwise provided for in this Agreement with
respect to any transferred Units until the Company has received such
information.
          (c) The Transfer would not, in the opinion of counsel chosen by the
Company, result in the termination of the Company within the meaning of
Section 708 of the Code.
          (d) The Units to be Transferred must be registered under the
Securities Act and any applicable state securities Laws, or, unless waived by
the non-transferring Members, the transferor must provide to the Company an
opinion of counsel, which opinion and counsel must be reasonably satisfactory to
the non-transferring Member, to the effect that such Transfer is exempt from
registration under the Securities Act and any other applicable state securities
Laws.

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          (e) In the case of a Transfer to a Tier I Competitor, the
non-Transferring Member must consent to such Transfer.
          (f) All Gaming Approvals required under Gaming Laws to effect a
Transfer must be obtained prior to such Transfer.
          (g) Notwithstanding anything to the contrary in this Agreement, no
Member shall be permitted to Transfer its Units or any portion thereof to the
extent such Transfer would be in violation of applicable Law (including
securities laws and regulations and all Gaming Laws) or would cause a default
under any agreement or instrument to which the Company or any Subsidiary is a
party or by which it is bound.
     9.4. Prohibited Transfers. Any purported Transfer of Units that is not made
in compliance with the applicable provisions of Section 9.1, Section 9.2, and
Section 9.6 shall be null and void and of no force or effect whatsoever.
     9.5. Distributions and Allocations in Respect of Transferred Units. If any
Units are Transferred during any Fiscal Year in compliance with the provisions
of this Article 9, Profits, Losses, each item thereof and all other items
attributable to the Transferred Units for such Fiscal Year will be divided and
allocated between the transferor and the transferee by taking into account their
varying interests during the Fiscal Year in accordance with Code Section 706(d),
using any convention permitted by law and selected by the Management Committee.
All distributions on or before the date of such Transfer will be made to the
transferor and all distributions thereafter will be made to the transferee.
Solely for purposes of making such allocations and distributions, the Company
will recognize such Transfer not later than the end of the calendar month during
which the Company is given notice of the Transfer, provided that, if the Company
is given notice of a Transfer at least ten (10) Business Days prior to the
Transfer, the Company will recognize the Transfer as of the date of the
Transfer, and provided further that if the Company does not receive a notice
stating the date such Units were transferred and such other information as the
Managers may reasonably require within thirty (30) days after the end of the
Fiscal Year during which the Transfer occurs, then all such items will be
allocated, and all distributions will be made, to the Person who, according to
the books and records of the Company, was the owner of the Units on the last day
of such Fiscal Year. Neither the Company nor the Managers will incur any
liability for making allocations and distributions in accordance with the
provisions of this Section 9.5, whether or not the Managers or the Company have
knowledge of any Transfer of ownership of any Units.
     9.6. Right of First Offer.
          (a) Notice. A Member or Indirect Owner desiring to directly or
indirectly Transfer Units (other than pursuant to Section 9.2) (a “Disposing
Member”) shall first provide to the other Members and the Company prior written
notice of the Member or the Indirect Owner’s, as applicable, intention to make a
Transfer of Units (the “Disposition Notice”), which shall set forth the number
of Units proposed to be Transferred (it being understood that in the case of a
Transfer by an Indirect Owner, the number of Units proposed to be Transferred
shall be calculated on a look-through basis) (the “Offered Units”).

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          (b) Option to the Non-Disposing Member. Upon receipt of the
Disposition Notice, the other Member (or its designees that are Permitted
Transferees) (the “Non-Disposing Member”) has the right, exercisable within
sixty (60) days after receipt of the Disposition Notice (the “Offer Period”), to
offer to purchase for cash all, but not less than all, of the Offered Units by
giving written notice to the Disposing Member (the “Offer Notice”) and stating
the terms (including the cash purchase price per Unit) for which the
Non-Disposing Member irrevocably offers to purchase all of the Offered Units.
The Disposing Member may elect to accept the offer stated in the Offer Notice by
giving written notice (the “Acceptance Notice”) to the Non-Disposing Member
within thirty (30) days after receipt of the Offer Notice. The delivery of the
Acceptance Notice shall result in a binding contract between the Disposing
Member and the Non-Disposing Member at the price stated in the Offer Notice.
Within sixty (60) days following the receipt of the Acceptance Notice or, if
later, the receipt of any required Gaming Approvals, the Disposing Member and
the Non-Disposing Member shall complete the sale and purchase of the Units.
          (c) Sale to a Third Party. In the event that the Disposing Member does
not accept the offer set forth in the Offer Notice (or if the Non-Disposing
Member does not deliver an Offer Notice within the time period contemplated by
Section 9.6(b)), the Disposing Member shall have the right to Transfer the Units
to a third party for cash at a price that is not less than the price set forth
in the Offer Notice and other terms and conditions that are not less favorable
in the aggregate than the terms and conditions set forth in the Offer Notice
(or, if no Offer Notice was delivered pursuant to Section 9.6(b), at any price
and terms and conditions); provided that the consummation and closing of such
sale must occur within one hundred eighty (180) days after expiration of the
Offer Period, provided, further that such 180-day period may be extended to
allow for obtaining any necessary Gaming and regulatory approvals as long as the
Disposing Member and the proposed transferee of the Disposing Member’s Units are
using commercially reasonable efforts to obtain such approvals. If such sale of
the Units is not closed within such 180-day period, or if the Disposing Member
wishes to enter into a contract to sell the Units on terms less than the price
set forth in the Offer Notice or on terms and conditions less favorable in the
aggregate than set forth in the Offer Notice, then any subsequent sale of the
Units by the Disposing Member may be effected only after again complying with
the conditions of this Section 9.6.
     9.7. Consequence of Certain Transfers. If as a result of any direct or
indirect transfer of Units, including any Transfers that are permitted under
this Article 9 or any transfers of any direct or indirect interest in the Units
that do not constitute a “Transfer” due to clause (a) or (b) of the definition
of Transfer, a Tier I Competitor or Tier II Competitor acquires, directly or
indirectly, a controlling interest in the Member, in the case of an indirect
transfer of Units, or Units of the Company, in the case of a direct transfer of
Units, then, notwithstanding anything to the contrary in this Agreement, the
following shall apply:
          (a) The Member with respect to which a controlling interest has been
acquired by a Tier I Competitor or Tier II Competitor, in the case of an
indirect transfer of Units, and Tier II Competitor, in the case of a direct
Transfer to Tier II Competitor, will not be entitled to (x) appoint any members
to the Management Committee, and any Management Committee member previously
appointed by such Member will be removed immediately and with no further action,
(y) appoint a Manager, or (z) vote on any matters on which the Members or the
Management

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Committee are entitled to vote except that such Member or Tier II Competitor, as
the case may be, shall have the right to vote on the matters specified under
Subsections (f), (g), (i), (k), (q), (t), (u), (v), (w), or (x), of Section 6.4
and neither the Company nor any Manager may take any actions in connection with
the foregoing matters without the consent (not to be unreasonably withheld) of
such Member or Tier II Competitor, as the case may be. At any time in which the
provisions of this Section 9.7(a) apply to a Member or Tier II Competitor, in
the event that the Management Committee approves any additional capital
contribution, the failure by such Member or Tier II Competitor, as the case may
be, to satisfy such capital contributions shall be subject to the provisions of
Section 3.4(b)(i) provided that the Percentage Interests of the Members shall be
determined under Section 3.4(b)(i) by substituting “1.0” in place of “1.5” in
the definition of “Adjusted Additional Percentage Interest”.
          (b) At any time that a Member with respect to which a controlling
interest has been acquired by a Tier I Competitor or Tier II Competitor is no
longer controlled by a Tier I Competitor or a Tier II Competitor, the provisions
of Section 9.7 shall no longer apply to such Member and such Member shall be
entitled to all of the rights to which such Member was entitled to prior to the
provisions of Section 9.7 becoming applicable to such Member. In addition, in
the case of a direct Transfer to Tier II Competitor, at any time that Tier II
Competitor transfers its Units in a manner permitted under this Agreement to a
transferee that is not a Tier I Competitor or an Affiliate that is controlled by
a Tier II Competitor, the provisions of Section 9.7 shall not apply to such
transferee and such transferee shall be entitled to all the rights to which the
Member transferring its Units to a Tier II Competitor was entitled to before the
Transfer to the Tier II Competitor.
ARTICLE 10 LIQUIDATION AND WINDING UP; MERGER
     10.1. Dissolution. The Company will dissolve only upon:
          (a) The Management Committee’s approval;
          (b) the occurrence of any event that makes it unlawful for the
business of the Company to be carried on or for the Members to carry on the
business of the Company;
          (c) the sale or other disposition of all or substantially all of the
Company’s assets and properties and the collection of all notes received in
connection with such sale or other disposition;
          (d) the final and non-appealable denial of the Company’s application
for any Nevada Gaming registration and/or license for the Resort or, after
issuance, the final and non-appealable revocation of any such registration
and/or license;
          (e) the issuance of a final and non-appealable order or directive of a
governmental agency of any jurisdiction, including the Nevada Gaming
Authorities, disqualifying a Member from holding any registration, license,
approval or permit required for the business of the Company, or directing that
the other Company or any of its Affiliates terminate its relationship with such
Member;

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          (f) the failure or inability of a Member, its officers, directors, key
employees or direct or indirect owners or the officers, directors or key
employees of its direct or indirect owners to obtain any registration, license,
approval or permit required for the business of the Company or any other event
involving a Member that results in the Company or such Member becoming unable to
conduct the Gaming business of the Resort; or
          (g) at the request of any Non-Defaulting Member if the Closing Date
has not occurred by the date that is eighteen months after the Signing Date
(such date, as may be extended pursuant to the immediately succeeding proviso,
the “End Date”); provided that in the event that the Closing Date has not
occurred within eighteen months after the Signing Date, KERZNER JV may elect to
delay the right of MGM JV to dissolve the Company pursuant to this
Section 10.1(g) until May 8, 2009 by providing written notice of such election
to MGM JV at any time prior to the eighteen month anniversary of the Signing
Date (it being understood that notwithstanding the election by KERZNER JV to
extend the End Date, KERZNER JV shall have the right to cause the dissolution of
the Company pursuant to this Section 10.1(g) at any time following the date that
is eighteen months after the Signing Date by providing written notice to MGM
JV).
     10.2. Liquidation. Upon dissolution of the Company, the business and
affairs of the Company will be wound up and liquidated as rapidly as business
circumstances permit, the Managers or a Person (who may be an officer or
Affiliate of a Member) designated by the Managers, will act as the liquidating
trustee (the “Liquidating Trustee”), and the assets of the Company will be
liquidated and the proceeds thereof paid (to the extent permitted by applicable
Law) in the following order:
          (a) First, to creditors, including Members that are creditors, in the
order of priority as required by applicable Law (it being understood that prior
to the Closing Date, (i) KERZNER JV shall be considered a creditor to the
Company for one-half of the Pre-Development Expenses and (ii) that MGM JV shall
be considered a creditor to the Company for one-half of the Excess Carrying
Costs to the extent such Excess Carrying Costs are required to be paid by the
Company pursuant to the second sentence of Section 3.8);
          (b) Second, to a reserve for contingent liabilities to be distributed
at the time and in the manner as the Liquidating Trustee determines in its
discretion; and
          (c) Third, to the Members in accordance with the positive balance of
each Member’s Capital Account as determined after taking into account all
Capital Account adjustments for the Company’s taxable year during which the
liquidation occurs, including any Capital Account adjustments associated with
the allocation of Profits and Losses with respect to any sale, transfer or other
taxable disposition of any Company property. Any such distributions to the
Members in respect of their Capital Accounts shall be made within the time
requirements of Section 1.704-1(b)(3)(ii)(b)(2) of the Regulations. If for any
reason the amount distributable pursuant to this Section 10.2(c) shall be more
than or less than the sum of all the positive balances of the Members’ Capital
Accounts, the proceeds distributable pursuant to this Section 10.2(c) shall be
distributed among the Members in accordance with the ratio by which the positive
Capital Account balance of each Member bears to the sum of all positive Capital
Account balances.

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     10.3. Liquidating Trust. In the discretion of the Liquidating Trustee, a
pro rata portion of the distributions that would otherwise be made to the
Members pursuant to this Article 10 may be:
          (a) Distributed to a trust established for the benefit of the Members
solely for the purposes of liquidating Company property, collecting amounts owed
to the Company, and paying any contingent or unforeseen liabilities or
obligations of the Company. The assets of any such trust may be distributed to
the Members from time to time, in the reasonable discretion of the Liquidating
Trustee, in the same proportions as the amount distributed to such trust by the
Company would otherwise have been distributed to the Members pursuant to
Section 10.2 above; or
          (b) Withheld to provide a reasonable reserve for Company liabilities
(contingent or otherwise) and to allow for the collection of the unrealized
portion of any installment obligations owed to the Company, provided that such
withheld amounts are distributed to the Members as soon as practicable.
The portion of the distributions that would otherwise have been made to each of
the Members that is instead distributed to a trust pursuant to clause (a) or
withheld to provide a reserve pursuant to clause (b) will be determined in the
same manner as the expense or deduction would have been allocated if the Company
had realized an expense equal to such amounts immediately prior to distributions
being made pursuant to Section 10.2 above.
     10.4. Deficit Capital Account. Upon liquidation, if any Member has a
deficit balance in such Member’s Capital Account (after giving effect to all
contributions, distributions and allocations for all Fiscal Years, including the
Fiscal Year in which such liquidation occurs), such Member has no obligation to
make any contribution to the capital of the Company with respect to such
deficit, and such deficit will not be considered a debt owed to the Company or
to any other Person for any purpose whatsoever. Each Member agrees to look
solely to the assets of the Company for the return of that Member’s Capital
Contribution.
     10.5. Filings. Upon the dissolution of the Company, the Company will cease
to carry on its business, except insofar as may be necessary for the winding up
of its business, but its separate existence will continue until the Articles of
Dissolution have been filed with the Secretary of State of the State of Nevada
as required by the Act or until a decree dissolving the Company has been entered
by a court of competent jurisdiction. When all debts, liabilities and
obligations have been paid and discharged or adequate provisions have been made
therefor and all of the remaining assets have been distributed to Members,
Articles of Dissolution will be executed and filed with the Secretary of State
of the State of Nevada as required by the Act.
     10.6. Merger. The Management Committee may approve a plan of merger or
consolidation under which the Company (subject to applicable Gaming Laws) will
merge or consolidate with or into one or more Persons.
     10.7. Representations and Warranties of the Members. In addition to
representations and warranties made by the Members in other sections of this
Agreement, each Member hereby represents and warrants that:

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          (a) Due Incorporation or Formation; Authorization of Agreement. Such
Member is a corporation or a limited liability company (as the case may be),
duly organized, validly existing, and in good standing under the Law of the
jurisdiction of its incorporation or formation and has all power and authority
to own its property and carry on its business as owned and carried on at the
date hereof and as contemplated hereby. Such Member is duly licensed or
qualified to do business and is in good standing in each of the jurisdictions in
which the failure to be so licensed or qualified would have a material adverse
effect on its financial condition or its ability to perform its obligations
hereunder. Each Member has all power and authority to execute and deliver this
Agreement and to perform its obligations hereunder, and the execution, delivery,
and performance of this Agreement has been duly authorized by all necessary
corporate action. This Agreement has been duly executed and delivered by such
Member and constitutes the legal, valid, and binding obligation of such Member
enforceable in accordance with its terms.
          (b) No Conflict with Restrictions; No Default. Neither the execution,
delivery, and performance of this Agreement nor the consummation by any Member
of the transactions contemplated hereby will (i) conflict with, violate, or
result in a breach of, any of the terms, conditions, or provisions of any
statute, law, rule, regulation, ordinance, judgment, order, writ, injunction or
decree of any arbitrator or governmental authority (whether state, local,
federal, and whether written or established by custom or tradition)
(collectively, “Law”) applicable to such Member or any of its Affiliates, except
for the Gaming Approvals (ii) conflict with, violate, result in a breach of, or
constitute a default under, any of the terms, conditions, or provisions of the
articles of incorporation, bylaws, or other governing documents of such Member
or any of Affiliate thereof, or any material agreement or instrument to which
such Member or any Affiliate thereof is a party or by which such Member or any
Affiliate thereof is or may be bound or to which any of its material properties
or assets is subject, (iii) conflict with, violate, result in a breach of,
constitute a default under (whether with notice or lapse of time or both),
accelerate or permit the acceleration of the performance required by, give to
others any material interests or rights in, or require any consent,
authorization or approval under, any indenture, mortgage, lease agreement, or
instrument to which such Member or any Affiliate thereof is a party or by which
such Member or any Affiliate thereof is or may be bound, or (iv) result in the
creation or imposition of any lien upon any of the material properties or assets
of such Member or Affiliate thereof.
          (c) Governmental Authorizations. Any registration, declaration or
filing with, or consent, approval, license, permit or other authorization, or
order by, any governmental or regulatory authority (domestic or foreign), that
is required in connection with the valid execution, delivery and acceptance by
such Member of this Agreement has been completed, made or obtained on or before
the Signing Date. Each Member, at its own cost and expense, shall apply for and
obtain any and all registrations, approvals, licenses, findings of suitability
and permits necessary in connection with the Gaming business conducted by the
Company.
          (d) Litigation. There are no actions, suits, proceedings or
investigations pending or, to the knowledge of such Member, threatened against
or affecting such Member or any Affiliate thereof or any of their respective
properties, assets, or businesses in any court or before or by any governmental
department, agency, or instrumentality (domestic or foreign), or any arbitrator
which could, if adversely determined (or, in the case of an investigation could
lead to any action, suit, or proceeding, which if adversely determined could)
reasonably be expected

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to materially impair such Member’s ability to perform its obligations under this
Agreement or to have a material adverse effect on the consolidated financial
condition of such Member; and such Member or any Affiliate thereof has not
received any currently effective notice of any default, and such Member or any
Affiliate thereof is not in default, under any applicable Law which could
reasonably be expected to materially impair such Member’s ability to perform its
obligations under this Agreement or to have a material adverse effect on the
consolidated financial condition of such Member.
          (e) Investment Company Act. Such Member is not, and the Company will
not as a result of such Member holding Units be, an “investment company” as
defined in, or subject to regulation under, the Investment Company Act of 1940.
          (f) Securities Laws. Each Member acknowledges that the Units it is
acquiring hereunder have not been registered under the Securities Act, or any
other state or federal law relating to the sale or offering for sale of
securities. Such Member’s acquisition of its Units is being made for its own
account for investment, and not with a view to the sale or distribution thereof.
Each Member is aware that the Units it is acquiring hereunder cannot be resold
without registration under applicable securities laws, or exemption therefrom.
          (g) Investigation. Such Member is acquiring its Units based upon its
own investigation, and the exercise by such Member of its rights and the
performance of its obligations under this Agreement will be based upon its own
investigation, analysis and expertise.
     All warranties and representations made pursuant to this Section 10.7 shall
survive the Closing Date.
ARTICLE 11 GAMING LAWS
     11.1. Gaming Licensing Matters. Each Member (i) shall, and shall cause its
Affiliates to, reasonably cooperate with any investigation by any Gaming
Authority having jurisdiction over any Member or any Affiliate of any Member,
and use its best efforts to promptly comply with any directives of any such
Gaming Authority, and (ii) use its commercially reasonable efforts to cause any
transferee of any portion of its Units likewise to so cooperate and comply. Each
Member agrees that it shall not intentionally take any action or omit to take
any action that would have the effect of adversely affecting any Gaming Approval
held by any Member or Affiliate thereof. The Members and their Affiliates shall
cooperate in connection with any review of this Agreement by any Gaming
Authority, and the Members shall, and shall cause, their respective Affiliates
to execute and deliver any further documents or instruments, including
amendments to this Agreement, as any Gaming Authority may require. Each Member
acknowledges that monetary damages alone would not be adequate compensation for
a breach of this Section 11.1 and the Members agree that a non-breaching Member
shall be entitled to seek a decree or order from a court of competent
jurisdiction for specific performance to restrain a breach or threatened breach
of this Section 11.1 or to require compliance by a Member with this
Section 11.1.
     11.2. Qualifications.

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          (a) Subject to Gaming Laws. If the Company becomes, and for as long as
it remains, subject to regulation under any Gaming Laws, ownership of the
Company, including the admission of a Member and the issuance or Transfer of
Units, shall be subject to the applicable provisions of any applicable Gaming
Laws and the receipt of all Gaming Approvals.
          (b) Managers and Officers. The election or appointment of an
individual to serve as a manager or officer of, or in any other capacity with,
the Company is subject to any Gaming Approvals. For purposes of this Agreement,
an individual shall be qualified to serve as a manager, officer or in any other
capacity, for so long as that individual is determined to be, and continues to
be, qualified and deemed suitable by all Gaming Authorities and under all
applicable Gaming Laws. In the event any such individual does not continue to be
so qualified and suitable, that individual shall be disqualified and shall cease
to be a manager, officer or serve in such other capacity with the Company.
     11.3. Additional Requirements.
          (a) Notwithstanding anything to the contrary expressed or implied in
this Agreement, the sale, assignment, transfer, pledge, granting of an option to
purchase or other disposition of any interest in the Company is ineffective
unless approved in advance by the Nevada Gaming Commission. If at any time the
Nevada Gaming Commission finds that a Member which owns any such interest is
unsuitable to hold that interest, the Nevada Gaming Commission shall, pursuant
to N.R.S. Section 463.5733(2), immediately notify the Company of that fact.
Subject to Section 11.3(c), the Company shall, within ten (10) days from the
date that it receives the notice from the Nevada Gaming Commission, return to
the unsuitable Member the amount of its capital account as reflected on the
books of the Company. Beginning on the date when the Nevada Gaming Commission
serves notice of a determination of unsuitability, pursuant to the preceding
sentence, upon the Company, it is unlawful for the unsuitable Member: (i) to
receive any dividend or interest or any payment or distribution of any kind,
including any share of the distribution of profits or cash or any other property
of, or payments upon dissolution of, the Company, other than a return of capital
as required above; (ii) to exercise, directly or through a trustee or nominee,
any voting right conferred by such interest; (iii) to participate in the
management of the business and affairs of the Company; or (iv) to receive any
remuneration in any form from the Company, for services rendered or otherwise.
          (b) Subject to Section 11.3(c), any Member that is found unsuitable by
the Nevada Gaming Commission shall return all evidence of any ownership in the
Company to the Company, at which time the Company shall within ten (10) days
after the Company receives notice from the Nevada Gaming Commission, return to
the Member, in cash, the amount of its capital account as reflected on the books
of the Company, and the unsuitable Member shall no longer have any direct or
indirect interest in the Company.
          (c) Notwithstanding anything to the contrary expressed or implied in
this Section 11.3, to the extent permitted by applicable Gaming Laws and the
Nevada Gaming Authorities, if a Member has been found by the Nevada Gaming
Commission to be unsuitable, the Company or the other Member shall have the
right to purchase the unsuitable Member’s Units as provided in Section 7.6 of
this Agreement. In the event neither the Company nor the other Member exercises
its rights to purchase the unsuitable Member’s Units, the unsuitable

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Member shall, to the extent permitted by applicable Gaming Laws and the Nevada
Gaming Authorities, be permitted to Transfer any or all of its Units to a
third-party, subject to the unsuitable Member’s compliance with the provisions
of Section 9.3 and provided that such Transfer does not result in any delay in
the anticipated opening of the Resort or otherwise cause an interruption in the
operations of the Resort.
ARTICLE 12 DISPUTE RESOLUTION
     12.1. Dispute Resolution. The Members commit to each other to resolve any
Dispute or other issues in a commercially reasonable manner as promptly as
possible and to cause their respective representatives to be readily available
to address business issues that arise. Any Dispute not so resolved shall be
resolved exclusively under the mediation and arbitration procedures of this
Article 12.
     12.2. Commencement of Mediation and Arbitration. Any Member may invoke the
mediation and arbitration procedures under the provisions of this Article 12 by
giving written notice thereof (a “Dispute Notice”) to the other Member and to
the Company, specifying the Dispute to be arbitrated, the nature and amount (if
any) of the Dispute and a demand to resolve the Dispute.
     12.3. Mediation. The parties shall attempt in good faith to resolve the
Dispute by mediation under the Commercial Mediation Rules of JAMS effect on the
date of the Dispute Notice. If the parties cannot agree on the selection of a
mediator within five Business Days after delivery of the Dispute Notice, the
mediator will be selected by JAMS. If the Dispute has not been resolved by
mediation within sixty (60) days after delivery of the Dispute Notice (the
“Mediation Period”) then the Dispute shall be determined by arbitration in
accordance with the provisions of Section 12.2 through Section 12.15.
     12.4. Rules of Arbitration. Any arbitration shall be settled in accordance
with the Comprehensive Arbitration Rules and Procedures (the “Rules”) of JAMS in
effect on the date of the Dispute Notice, and the federal Arbitration Act,
except as specifically modified in this Section 12.4. The statute of
limitations, estoppel, waiver, laches and similar doctrines, which would
otherwise be applicable in an action brought by a Member, shall be applicable in
any arbitration proceeding, and the commencement of an arbitration proceeding
shall be deemed the commencement of any action for these purposes.
     12.5. Selection of Arbitrator. Within ten (10) calendar days of the
expiration of the Mediation Period, if any issues in the Dispute Notice have not
been resolved, the Members shall select a single arbitrator or a three-member
panel exclusively drawn from the JAMS panel of retired judges (individually or
collectively, as the case may be, the “Arbitrator”) to hear the Dispute,
depending upon the following circumstances: (i) if the Members are able to agree
upon one individual, such individual shall be the Arbitrator, (ii) if the
Members are not able to agree upon a single Arbitrator, the Member initiating
the request for arbitration shall select one Arbitrator from the JAMS panel of
retired judges and the adverse Member shall select one Arbitrator from the JAMS
panel of retired judges, and the two Arbitrators shall select as promptly as
possible but not later than twenty (20) days after the Members have selected
their Arbitrators, a third individual from the JAMS panel of retired judges, and
(iii) if the two

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Arbitrators are unable to agree upon a third Arbitrator, the JAMS case manager
shall select the third Arbitrator. Notwithstanding the foregoing, if the only
relief sought in the matter is for a monetary award of One Million Dollars
($1,000,000) or less, then one Arbitrator selected from the JAMS panel of
retired judges by the JAMS case manager shall resolve the Dispute. The
Arbitrator shall proceed to hear and decide the matters at issue in such manner
as the Arbitrator determines. The Arbitrator shall be neutral and independent
and no Arbitrator shall have or shall previously have had any relationship with
any of the Members or their Affiliates or the Company. The Arbitrator must be
knowledgeable and experienced in the subject matter of the Dispute. The Members
agree that it is in the best interests of the Company to have any matter
submitted to arbitration under the provisions of this Section 12.5 decided as
expeditiously as possible, which in no event may be more than one hundred twenty
(120) days after the date of the Mediation Period, unless the matter in dispute
requires a shorter period or the Members agree otherwise.
     12.6. Choice and Adoption of Law. The Members agree that the interpretation
and enforcement of this Agreement shall be governed by and construed in
accordance with the laws of the State of Nevada and applicable federal law,
including the federal Arbitration Act, 9 U.S.C. ‘1, et seq. The Members further
agree that all tribal laws are expressly excluded as applicable Law.
     12.7. Place of Hearing. All arbitration hearings shall be held at a place
designated by the Arbitrator in San Francisco, California or at such other place
that has received approval of the Members. To the extent possible, the hearings
shall be held on consecutive days, excluding weekends and holidays, until
completion.
     12.8. Confidentiality. The Members and the Arbitrator shall maintain strict
confidentiality with respect to the arbitration proceedings and enter into
customary confidentiality agreements regarding the same.
     12.9. Service of Process. Service of process may be made by any means
authorized by applicable Law and the JAMS rules.
     12.10. Form of Arbitrator’s Award. The Arbitrator shall issue its decision
in writing, with written findings of fact, conclusions of Law, and a calculation
of how damages, if any, were determined. Any award not so supported shall be
null and void, and the matter shall be referred to a new Arbitrator, to be
selected as set forth herein. If a three-member arbitration panel is involved,
the decision shall be by a majority vote. Except as may be limited elsewhere
herein, the Arbitrator shall have the power to award any remedy or relief that a
court of competent jurisdiction could order or grant, including damages,
equitable remedies, specific performance of any obligation created under this
Agreement, the issuance of any injunction, and the imposition of sanctions for
abuse or frustration of the arbitration process. The award rendered by the
Arbitrator shall be final, and judgment may be entered upon it in accordance
with the Act in any court having jurisdiction. As an additional limitation, a
monetary award may only be made for compensatory damages, and if any other
damages (whether exemplary, punitive, consequential or other) are included, the
award shall be vacated and remanded, modified or corrected as appropriate to
promote this damage limitation.

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     12.11. Performance During Disputes. It is mutually agreed that during any
Dispute, including a Dispute as to the validity of this Agreement, the Members
shall continue to possess the rights, duties, and obligations set forth in this
Agreement.
     12.12. Review of Arbitrator’s Award. Any party may seek to have the
Arbitrator’s award modified, corrected, confirmed or vacated in accordance with
NRS Chapter 38.
     12.13. Discovery. For any arbitration initiated hereunder, the Members may
conduct discovery in advance of the arbitration hearing in accordance with the
Nevada Rules of Civil Procedure. Upon the request of a Member or the Members,
the Arbitrator shall establish a discovery cutoff date and any other necessary
pre-hearing deadlines.
     12.14. Costs of Arbitration and Attorneys’ Fees. The prevailing party or
parties in any arbitration or judicial proceeding (including a proceeding to
compel arbitration or defending against an attempt to stay an arbitration award
or defending or enforcing an award) shall be awarded reasonable legal fees and
costs, including any expert witness expenses, and all fees and expenses of the
Arbitrator and JAMS. The prevailing party or parties shall submit a detailed
statement of its fees and costs to the Arbitrator within twenty (20) calendar
days after receipt of the arbitration award. The parties agree that the
Arbitrator shall retain jurisdiction after issuance of the arbitration award
solely to make a determination on the issue of awarding fees and costs to the
prevailing party.
     12.15. Joinder of Third Parties. No Member shall have the right to object
to the joinder of third parties in such proceedings in order to resolve any
other disputes, the facts of which are related to the Dispute submitted for
arbitration hereunder.
ARTICLE 13 MISCELLANEOUS
     13.1. Governing Law. This Agreement is governed by and construed in
accordance with the laws of the State of Nevada, without reference to conflict
of laws rules.
     13.2. Method of Providing Notices. All communications, notices, demands,
requests or advice (“Notices”) required or permitted hereunder shall be in
writing and shall be served on the parties at the address set forth below, which
address may be modified by the applicable Member by means of a Notice to the
other Members. When any written Notice is requested or may be given hereunder,
it shall be deemed sufficient if the party giving such Notice delivers the same
to the other party by overnight delivery service, by facsimile with a copy by
overnight delivery service for the next day, or by hand delivery. All Notices
delivered by mail or by hand shall be deemed to have been given when received or
first refused by any party hereto at the addresses listed on the signature page
hereto.

  (a)   if to MGM JV, to:

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      MGM MIRAGE
3600 Las Vegas Boulevard South
Las Vegas, Nevada 89109
Attention: James J. Murren, President and COO
          Gary N. Jacobs, Executive Vice President, General Counsel
          and Secretary
Fax: (702) 693-7628     (b)   If to KERZNER JV, to:         Kerzner
International North America, Inc.
730 Fifth Avenue — Fifth Floor
New York, New York 10019
Attention: Richard Levine
Facsimile: (212) 659-5196         and         Istithmar PJSC
Emirates Towers, Level 4
Sheikh Zayed Road — PO Box 17000
Dubai, United Arab Emirates
Attention: General Counsel
Facsimile: +971 4 3903818

with a copy to:

      Simpson Thacher & Bartlett LLP
425 Lexington Avenue
New York, NY 10017
Attention: Sean Rodgers
Facsimile: (212) 455-2502         and         Cleary Gottlieb Steen & Hamilton
LLP
One Liberty Plaza
New York, NY 10006
Attention: Steven Wilner
Facsimile: (212) 225-3999

     13.3. Severability. If any provision of this Agreement is conclusively
determined by a court of competent jurisdiction to be invalid or unenforceable
to any extent, the remainder of this Agreement is not affected thereby.
     13.4. Binding Effect. Except as otherwise provided herein, this Agreement
inures to the benefit of and is binding upon the Members and their respective
successors and assigns.

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     13.5. Titles and Captions. All article, section and paragraph titles and
captions contained in this Agreement are for convenience only and are not a part
of the context hereof.
     13.6. Pronouns and Plurals. All pronouns and any variations thereof are
deemed to refer to the masculine, feminine, neuter, singular or plural as the
identity of the appropriate Person(s) may require.
     13.7. No Third Party Rights. Except with respect to the rights of the
members of the Members set forth in Section 7.5(d) and Section 7.6 and except as
set forth in Section 13.18, this Agreement is intended to create enforceable
rights between the parties hereto only, and creates no rights in, or obligations
to, any other Persons whatsoever. Without limiting the generality of the
foregoing, as to any third party, a deficit capital account of a Member shall
not be deemed to be a liability of such Member nor an asset or property of the
Company.
     13.8. Further Assurances. The parties agree to execute all further
instruments and perform all acts that are or may become necessary to effectuate
and to carry on the business contemplated by this Agreement.
     13.9. Estoppel Certificates. Each Member agrees, at the request of another
Member, to execute and deliver an estoppel certificate stating that this
Agreement is in full force and effect and that to the best knowledge and belief
of the certifying Member there are no defaults by any Member under this
Agreement (or specifying in reasonable detail such defaults, if any are
claimed).
     13.10. Schedules Included in Exhibits; Incorporation by Reference. Any
reference to an Exhibit to this Agreement contained herein is deemed to include
any Schedules to such Exhibit. Each of the Exhibits referred to in this
Agreement, and each Schedule to such Exhibits, is hereby incorporated by
reference in this Agreement as if such Schedules and Exhibits were set out in
full in the text of this Agreement.
     13.11. Amendments. Amendments to this Agreement may be made in accordance
with the provisions of Section 6.8 and Section 7.5(b).
     13.12. Counterparts. This Agreement may be executed in one or more
counterparts each of which shall for all purposes be deemed an original and all
of such counterparts, taken together, shall constitute one and the same
Agreement. The exchange of copies of this Agreement and of signature pages by
facsimile transmission or .pdf delivered via email will constitute effective
execution and delivery of this Agreement as to the parties and may be used in
lieu of the original Agreement for all purposes.
     13.13. Creditors. No provision of this Agreement is for the benefit of or
enforceable by any creditors of the Company, and no creditor will be entitled to
require either Member to solicit or demand Capital Contributions from the other
Member. The Company may not assign a Member’s obligation to make Capital
Contributions to any third party without the prior written consent of such
Member.
     13.14. Entire Agreement. This Agreement, the Exhibits hereto and the
Related Agreements contain all of the agreements between the parties hereto and
supersede any and all

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prior agreements, arrangements or understandings between the parties relating to
the subject matter hereof. No oral understandings, oral statements, oral
promises or oral inducements exist. No representations, warranties, covenants or
conditions, expressed or implied, whether by statute or otherwise, other than as
set forth herein, have been made by the parties hereto.
     13.15. Independent Legal Counsel. Each party has had the opportunity to
consult with independent legal counsel in connection with the negotiation of
this Operating Agreement and the formation of the Company.
     13.16. Proceeding Expenses. In any controversy, claim or dispute arising
out of, or relating to, this Agreement or the method or manner of the
performance hereof, the prevailing party, as determined by the arbitrator or
court, as applicable, is entitled, in addition to any other relief, to recover
proceeding expenses. If no party wholly prevails, the party that substantially
prevails, as determined by the arbitrator or court, is entitled to recovery of
proceeding expenses. In determining the award of proceeding expenses, attorneys’
fees, proceeding costs, cost of investigation and other reasonable expenses must
be included. For the purposes of this provision, the term “proceeding” includes
arbitration, administrative, bankruptcy and judicial proceedings, including
appeals therefrom.
     13.17. Specific Performance. Each Member agrees that the Company and the
other Member(s) would be irreparably damaged if any of the provisions of this
Agreement are not performed in accordance with their specific terms and that
monetary damages may not provide an adequate remedy in such event. Accordingly,
it is agreed that, in addition to any other remedy to which the Company and the
non-breaching Member(s) may be entitled, at law or in equity the Company and the
nonbreaching Member(s) are entitled to injunctive relief to prevent breaches of
the provisions of this Agreement and to specifically enforce the terms and
provisions hereof in any action instituted in any court of the United States or
any state thereof having subject matter jurisdiction thereof.
     13.18. Non-Involvement of Certain Parties.
          (a) KERZNER JV hereby acknowledges and agrees in perpetuity that, in
the event that there is any breach or alleged default by MGM JV or any Affiliate
thereof of this Agreement, or the Company has or may have any claim arising from
or relating to the services to any actions to be taken by MGM JV or any
Affiliate thereof under this Agreement, KERZNER JV shall not, and shall cause
its Affiliates not to, commence any lawsuit or otherwise seek to impose any
liability whatsoever against Kirk Kerkorian or Tracinda Corporation with respect
to such breach or alleged default. KERZNER JV hereby further acknowledges and
agrees in perpetuity that neither Kirk Kerkorian nor Tracinda Corporation shall
have any liability whatsoever to any Person with respect to this Agreement or
with respect to any services provided or other actions taken hereunder or
pursuant hereto by any Member, any Affiliate thereof or the Company. KERZNER JV
hereby further acknowledges and agrees in perpetuity that it shall not permit,
by act or omission, any Person claiming through it, to assert a claim or impose
any liability against either Kirk Kerkorian or Tracinda Corporation, either
collectively or individually, as to any matter or thing arising out of, or
relating to, or any alleged breach or default by MGM JV, any Affiliate thereof,
or the Company under or pursuant to this Agreement. In addition, KERZNER JV
acknowledges and agrees in perpetuity that neither Kirk Kerkorian

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nor Tracinda Corporation, individually or collectively, is a party to, or bound
by any term or provision of, this Agreement or liable for any alleged breach or
default thereof.
          (b) MGM JV hereby acknowledges and agrees in perpetuity that, in the
event that there is any breach or alleged default by KERZNER JV or any Affiliate
thereof of this Agreement, or the Company has or may have any claim arising from
or relating to the services to any actions to be taken by KERZNER JV or any
Affiliate thereof under this Agreement, MGM JV shall not, and shall cause its
Affiliates not to, commence any lawsuit or otherwise seek to impose any
liability whatsoever against any Kerzner Related Person or any shareholder of
Istithmar in its capacity as such with respect to such breach or alleged
default. MGM JV hereby further acknowledges and agrees in perpetuity that no
Kerzner Related Person or any shareholder of Istithmar in its capacity as such
shall have any liability whatsoever to any Person with respect to this Agreement
or with respect to any services provided or other actions taken hereunder or
pursuant hereto by any Member, any Affiliate thereof or the Company. MGM JV
hereby further acknowledges and agrees in perpetuity that it shall not permit,
by act or omission, any Person claiming through it, to assert a claim or impose
any liability against any Kerzner Related Person or any shareholder of Istithmar
in its capacity as such, either collectively or individually, as to any matter
or thing arising out of, or relating to, or any alleged breach or default by
KERZNER JV, any Affiliate thereof, or the Company under or pursuant to this
Agreement. In addition, each of MGM JV acknowledges and agrees in perpetuity
that no Kerzner Related Person or any shareholder of Istithmar in its capacity
as such, individually or collectively, is a party to, or bound by any term or
provision of, this Agreement or liable for any alleged breach or default
thereof.
     13.19. Expansion of Relationship. The Members understand and acknowledge
that MGM MIRAGE and Kerzner International intend to explore opportunities to
jointly develop additional hotel casino projects in and outside of the Las Vegas
market, subject to the completion of due diligence as to the feasibility of such
projects, taking into account such matters as construction costs, land values,
competitive factors, potential alternative uses and other relevant matters and
subject further to the approval of any such project by the respective boards of
directors of MGM MIRAGE and Kerzner International. This Section 13.19 is subject
to Section 6.11 and shall be construed as a statement of general intent,
provided that neither MGM MIRAGE nor Kerzner International, nor their respective
Affiliates, shall have any obligation to the other except with respect to the
Resort which is the subject of this Agreement and for such transactions as they
may mutually determine, in their respective sole discretion, to enter into with
the other.
     13.20. Waiver of Partition Right. Each Member hereby waives any right to
partition or the right to take any other action that might otherwise be
available to such Member for the purpose of severing such Member’s relationship
with the Company or such Member’s interest in the assets and properties held by
the Company from the interest of the other Members until the dissolution of the
Company.
     13.21. Interpretation. When a reference is made in this Agreement to an
Article, Section, Schedule or Exhibit, such reference shall be to an Article or
Section of or a Schedule to or an Exhibit to, this Agreement unless otherwise
indicated. The table of contents and headings contained in this Agreement are
for reference purposes only and shall not affect in any way the

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meaning or interpretation of this Agreement. Whenever the words “include,”
“includes” or “including” are used in this Agreement, they shall be deemed to be
followed by the words “without limitation.” To the extent any restriction on the
activities of the Company under the terms of this Agreement requires prior
approval under any Gaming Laws, such restriction shall be of no force or effect
unless and until such approval is obtained. If any provision of this Agreement
is illegal or unenforceable under any Gaming Laws, such provision shall be void
and of no force or effect.

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IKM JV, LLC
MEMBER SIGNATURE PAGE
     The undersigned, by executing this Member Signature Page, hereby adopts all
of the terms, provisions and conditions of the Operating Agreement (the
“Agreement”) of IKM JV, LLC and agrees to become a Member under the terms of the
Agreement.
     IN WITNESS WHEREOF, the undersigned has executed this Agreement as of the
date first set forth above.

          IKM MGM, LLC
      By:   /s/ J. Terrence Lanni         Name:   J. Terrence Lanni       
Title:   Chairman        KERZNER ISTITHMAR LAS VEGAS LLC
      By:   /s/ Sol Kerzner         Name:   Sol Kerzner        Title:   Chairman
and Chief Executive Officer    

 

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IKM JV, LLC
MANAGER SIGNATURE PAGE
     The undersigned, by executing this Manager Signature Page, hereby adopts
all of the terms, provisions and conditions of the Operating Agreement (the
“Agreement”) of IKM JV, LLC and agrees to become a Manager under the terms of
the Agreement.
     IN WITNESS WHEREOF, the undersigned has executed this Agreement as of the
date first set forth above.

          KERZNER CONCEPTS LIMITED
      By:   /s/ Sol Kerzner         Name:   Sol Kerzner        Title: Chairman
and Chief Executive Officer       IKM MGM MANAGEMENT, LLC
      By:   /s/ J. Terrence Lanni         Name:   J. Terrence Lanni       
Title:   Chairman