Exhibit
10.42


FINAL


 


 




	
  

  
	
   

  
	
  AMENDED
  AND RESTATED OPERATING AGREEMENT

  
	
   

  
	
  OF

  
	
   

  
	
  ALIANTE
  GAMING, LLC

  
	
   

  
	
   

  
	
   

  
	
  JANUARY
  6, 2006

  






 















 


TABLE OF
CONTENTS


	
  ARTICLE I

  	
   

  	
  DEFINITIONS

  	
   

  	
   

  
	
  1.1

  	
   

  	
  Definitions

  	
   

  	
  2

  
	
  ARTICLE II

  	
   

  	
  FORMATION

  	
   

  	
   

  
	
  2.1

  	
   

  	
  Formation

  	
   

  	
  17

  
	
  2.2

  	
   

  	
  Name; Licenses

  	
   

  	
  17

  
	
  2.3

  	
   

  	
  Purposes and Powers

  	
   

  	
  18

  
	
  2.4

  	
   

  	
  Registered Agent and Registered Office

  	
   

  	
  18

  
	
  ARTICLE III

  	
   

  	
  MANAGEMENT

  	
   

  	
   

  
	
  3.1

  	
   

  	
  The Manager

  	
   

  	
  18

  
	
  3.2

  	
   

  	
  Expense of Construction; Matters Relating to
  Construction and Development; Matters Relating to Financing the Construction
  of the Project

  	
   

  	
  19

  
	
  3.3

  	
   

  	
  Manager’s Duties During Pre-Opening Period

  	
   

  	
  20

  
	
  3.4

  	
   

  	
  Manager’s Duties During Operating Period and With
  Respect to Expansion Projects

  	
   

  	
  20

  
	
  3.5

  	
   

  	
  Compensation of the Manager

  	
   

  	
  20

  
	
  3.6

  	
   

  	
  Removal of the Manager

  	
   

  	
  21

  
	
  3.7

  	
   

  	
  Officers

  	
   

  	
  22

  
	
  3.8

  	
   

  	
  Conflicts of Interest; Right to Participate

  	
   

  	
  23

  
	
  3.9

  	
   

  	
  Tax Matters Partner

  	
   

  	
  24

  
	
  3.10

  	
   

  	
  Liability of Holding, as a Member, and Station, as
  Manager

  	
   

  	
  25

  
	
  3.11

  	
   

  	
  Prohibition Against Publicly Traded Partnership

  	
   

  	
  25

  
	
  3.12

  	
   

  	
  The Executive Committee

  	
   

  	
  25

  
	
  3.13

  	
   

  	
  Decisions Subject to Executive Committee Approval

  	
   

  	
  25

  
	
  3.14

  	
   

  	
  Place of Meetings and Meetings by Telephone

  	
   

  	
  30

  
	
  3.15

  	
   

  	
  Regular Meetings

  	
   

  	
  30

  
	
  3.16

  	
   

  	
  Special Meetings

  	
   

  	
  30

  
	
  3.17

  	
   

  	
  Quorum

  	
   

  	
  30

  
	
  3.18

  	
   

  	
  Manner of Acting

  	
   

  	
  30

  
	
  3.19

  	
   

  	
  Waiver of Notice

  	
   

  	
  30

  
	
  3.20

  	
   

  	
  Adjournment

  	
   

  	
  30

  
	
  3.21

  	
   

  	
  Action Without a Meeting

  	
   

  	
  30

  
	
  3.22

  	
   

  	
  Resignation

  	
   

  	
  30

  
	
  3.23

  	
   

  	
  Removal

  	
   

  	
  31

  
	
  3.24

  	
   

  	
  Vacancies

  	
   

  	
  31

  
	
  3.25

  	
   

  	
  Compensation to EC Members

  	
   

  	
  31

  
	
  3.26

  	
   

  	
  Liability to Third Parties

  	
   

  	
  31

  
	
  3.27

  	
   

  	
  No Guarantee of Return by EC Members

  	
   

  	
  31

  
	
  3.28

  	
   

  	
  Transactions with Company or Otherwise

  	
   

  	
  31

  
	
  3.29

  	
   

  	
  Indemnification

  	
   

  	
  31

  
	
  ARTICLE IV

  	
   

  	
  FINANCIAL
  MATTERS

  	
   

  	
   

  
	
  4.1

  	
   

  	
  Initial Capital Contributions

  	
   

  	
  32

  
	
  4.2

  	
   

  	
  Additional Capital Contributions

  	
   

  	
  32

  



 



 i
 








 


	
  4.3

  	
   

  	
  [Reserved]

  	
   

  	
  35

  
	
  4.4

  	
   

  	
  Allocation of Profits and Losses

  	
   

  	
  35

  
	
  4.5

  	
   

  	
  Distributions

  	
   

  	
  36

  
	
  ARTICLE V

  	
   

  	
  MEMBERS;
  TRANSFER OF INTERESTS

  	
   

  	
   

  
	
  5.1

  	
   

  	
  Admission

  	
   

  	
  36

  
	
  5.2

  	
   

  	
  Transfer of Interests

  	
   

  	
  36

  
	
  5.3

  	
   

  	
  Gaming Licensing

  	
   

  	
  37

  
	
  5.4

  	
   

  	
  Required Member Approvals

  	
   

  	
  37

  
	
  5.5

  	
   

  	
  Meetings

  	
   

  	
  37

  
	
  5.6

  	
   

  	
  In General

  	
   

  	
  38

  
	
  ARTICLE VI

  	
   

  	
  DISSOLUTION,
  LIQUIDATION AND TERMINATION

  	
   

  	
   

  
	
  6.1

  	
   

  	
  Dissolution

  	
   

  	
  40

  
	
  6.2

  	
   

  	
  Liquidation and Termination

  	
   

  	
  40

  
	
  6.3

  	
   

  	
  Articles of Dissolution

  	
   

  	
  41

  
	
  6.4

  	
   

  	
  Negative Capital Accounts

  	
   

  	
  41

  
	
  6.5

  	
   

  	
  Limitations on Rights of Holding

  	
   

  	
  41

  
	
  ARTICLE VII

  	
   

  	
  AMENDMENTS

  	
   

  	
   

  
	
  7.1

  	
   

  	
  Amendments

  	
   

  	
  41

  
	
  ARTICLE VIII

  	
   

  	
  MISCELLANEOUS

  	
   

  	
   

  
	
  8.1

  	
   

  	
  Notices

  	
   

  	
  41

  
	
  8.2

  	
   

  	
  Binding Effect

  	
   

  	
  42

  
	
  8.3

  	
   

  	
  Headings

  	
   

  	
  42

  
	
  8.4

  	
   

  	
  Severability

  	
   

  	
  42

  
	
  8.5

  	
   

  	
  Further Action

  	
   

  	
  42

  
	
  8.6

  	
   

  	
  Governing Law

  	
   

  	
  42

  
	
  8.7

  	
   

  	
  Waiver of Action for Partition

  	
   

  	
  42

  
	
  8.8

  	
   

  	
  Counterpart Execution

  	
   

  	
  42

  
	
  8.9

  	
   

  	
  Publicity

  	
   

  	
  43

  
	
  8.10

  	
   

  	
  Transition as Manager

  	
   

  	
  43

  
	
  8.11

  	
   

  	
  Broker Fees

  	
   

  	
  43

  
	
  8.12

  	
   

  	
  Securities Under the UCC

  	
   

  	
  43

  



 



 ii














 


	
  LIST OF EXHIBITS

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  Exhibit A

  	
   

  	
  Articles of Organization

  
	
  Exhibit B

  	
   

  	
  Original Operating Agreement

  
	
  Exhibit C

  	
   

  	
  Additional Property

  
	
  Exhibit D

  	
   

  	
  Example of Shared Expenses

  
	
  Exhibit E

  	
   

  	
  Legal Description of Losee Property

  
	
  Exhibit F

  	
   

  	
  Legal Description of Resort Property

  
	
  Exhibit G

  	
   

  	
  Restricted Area

  
	
  Exhibit H

  	
   

  	
  Location of Relocated Drainage Easement

  
	
  Exhibit I

  	
   

  	
  Notice Addresses

  
	
   

  	
   

  	
   

  
	
  LIST OF SCHEDULES

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  Schedule 3.3

  	
   

  	
  Manager’s Duties During Pre-Opening Period

  
	
  Schedule 3.4

  	
   

  	
  Manager’s Duties During Operating Period

  
	
   

  	
   

  	
   

  
	
  ATTACHMENTS

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  Attachment I

  	
   

  	
  Form of License and Support Agreement

  
	
  Attachment II

  	
   

  	
  Form of License Agreement

  
							



 



 1















 


AMENDED AND RESTATED OPERATING AGREEMENT


OF


ALIANTE
GAMING, LLC


 


This AMENDED AND RESTATED OPERATING AGREEMENT OF ALIANTE GAMING, LLC,
dated as of January 6, 2006 (the “Effective Date”), is entered into by
and among (1) ALIANTE GAMING, LLC,
a Nevada limited liability company (the “Company”); (2) ALIANTE HOLDING, LLC,
a Nevada limited liability company, the sole Member following the Effective
Date (“Holding”); and (3) ALIANTE
STATION, LLC, a Nevada limited liability company (“Station”),
a wholly-owned subsidiary of Station Casinos, Inc., a Nevada corporation (“Parent”),
and the Manager (as hereinafter defined); and acknowledged and agreed to by G.C. ALIANTE, LLC, a Nevada limited
liability company, as a member of Holding (“GC”), and Station, as a
member of Holding.  Each of the Company,
Holding and the Manager is sometimes referred to herein as a “Party”
and, all of them, together, are sometimes collectively referred to herein as
the “Parties.”  All references to
Holding in this Agreement are to Holding, in its capacity as the sole Member,
unless the context clearly indicates otherwise.


RECITALS


WHEREAS,
the Company was formed by the filing of the Articles of Organization with the
Nevada Secretary of State on December 16, 2005, a copy of which is attached
hereto as Exhibit A (the “Articles”); and


WHEREAS,
immediately prior to the GC Contribution (as defined below), the Company and
GC, the then sole member of the Company, were parties to that certain Operating
Agreement of Aliante Gaming, LLC, a copy of which is attached hereto as Exhibit
B (the “Original Operating Agreement”); and


WHEREAS,
(a) on the Effective Date, GC contributed one hundred percent (100%) of the
issued and outstanding membership interests in the Company to Holding in
exchange for a fifty percent (50%) membership interest in Holding (the “GC
Contribution”), and Station contributedone hundred percent (100%) of the
issued and outstanding membership interests in Losee Elkhorn Properties, LLC, a
Nevada limited liability company (“Losee LLC”) to Holding in exchange
for a fifty percent (50%) membership interest in Holding (the “Station
Contribution”); and (b) immediately following the GC Contribution and the
Station Contribution, Holding became the sole Member; and


WHEREAS,
the Parties now desire to enter into this Agreement in order to amend and
restate the Original Operating Agreement, in its entirety, on the terms and
subject to the conditions set forth herein.


NOW, THEREFORE, for
good and valuable consideration, the receipt and sufficiency of which are
hereby acknowledged, the Parties agree as follows:



 1
 









AGREEMENT


ARTICLE
I


Definitions


1.1           Definitions.  The following capitalized words and phrases
have the indicated meanings in this Agreement:


“Act” means Chapter 86 of the Nevada Revised
Statutes, as amended from time to time (and any corresponding provisions of
succeeding law).


“Additional Property” means the additional real
property generally depicted on Exhibit C.


“Additional Reserve” shall equal $5,000,000, in the aggregate, which shall be a reserve above and
beyond the Reserve Fund to be funded pursuant to Paragraph (b)(ii) of Schedule
3.4; provided, however, that the Additional Reserve need not
be a “cash” reserve, but rather the Manager may, to the maximum extent
permitted under the terms and conditions of each and all of the Construction
Financing, Expansion Financing(s) and/or Permanent Financing, maintain
unencumbered funds from such credit facility to be used in lieu of such “cash-funded”
Additional Reserve.


“Affiliate” means, with respect to any Person,
(i) any other Person directly or indirectly controlling, controlled by, or
under common control with, such Person (excluding employees of a Person, other
than executive officers and board members of such Person), (ii) any Person who
is an officer or director of any Person described in Clause (i) of this
definition, (iii) with respect to GC, any Greenspun Family Member, and with
respect to either Parent or Station, any Fertitta Family Member, or (iv) any
family member of any Person described in Clause (iii) of this definition.  For purposes of this definition, the term “family
member” shall be deemed to be the spouses and lineal descendants of the
Persons described in Clause (iii) of this definition.


“Affiliate Transaction” has the meaning set
forth in Section 3.8(c).


“Agreement” means this Amended and Restated
Operating Agreement of Aliante Gaming, LLC, together with all exhibits and
schedules hereto, as amended from time to time in accordance herewith.  Words such as “herein,” “hereinafter,” “hereof,”
“hereto,” and “hereunder” refer to this Agreement as a whole, unless the
context otherwise requires.


“Annual Plan and Operating Budget” means the
operating plan and budget for each Fiscal Year during the Operating Period, as
proposed by the Manager and approved by the Executive Committee pursuant to the
terms of this Agreement, setting forth in reasonable detail the Company’s
projected Gross Revenues, Operating Costs, debt service requirements and
capital expenditures and working capital requirements, including in each case
the components thereof.  The Annual Plan
and Operating Budget also shall include a concise written narrative regarding
any material changes to the Project’s operating standards, policies and
procedures or to the Company’s projections regarding the components of Gross
Revenues or Operating Costs.  With
respect to any Expansion Projects, until such time as such Expansion Project is
completed, the Annual Plan and Operating Budget shall break out separately the
Expansion Project Budget for 



 2
 









such Expansion Project with comparable line items to
those included in the Annual Plan and Operating Budget, to the extent
applicable.


“Articles” has the meaning set forth in the
Recitals.


“Bank Accounts” means those bank or financial
institution accounts as are necessary for the construction, day-to-day and
long-term management and operation of the Project, including the Operating Bank
Account and the Reserve Fund.


“Bankrupt” means, with respect to any Person,
the occurrence of any of the following:


(i)            Filing of a voluntary petition in
bankruptcy or for reorganization or for adoption of an arrangement under the
United States Bankruptcy Code, as amended from time to time (or any
corresponding provisions of succeeding law);


(ii)           Making a general assignment for the
benefit of creditors;


(iii)          The appointment by a court of a
receiver for all or substantially all of the assets of such Member;


(iv)          The entry of an order for relief in
the case of an involuntary petition in bankruptcy; or


(v)           The assumption of custody or
sequestration by a court of competent jurisdiction of all or substantially all
of such Person’s assets.


“Base Management Fee” means the base management
fee to be paid to the Manager pursuant to Section 3.5(a).


“Capital Account” means the capital account
maintained for Holding in accordance with the following provisions:


(i)            To Holding’s Capital Account there
shall be credited Holding’s Capital Contributions, Holding’s distributive share
of Profits and any items in the nature of income or gain that are specially
allocated to Holding hereunder, and the amount of any Company liabilities
assumed by Holding or that are secured by any Company property distributed to
Holding;


(ii)           To Holding’s Capital Account there
shall be debited the amount of cash and the Gross Asset Value of any property
other than money distributed to Holding pursuant to any provision of this
Agreement (other than payments made pursuant to Section 3.5 hereof),
Holding’s distributive share of Losses and any items in the nature of expenses
or losses that are specially allocated to Holding hereunder;


(iii)          In the event that all or any part of a
Holding’s Membership Interest is Transferred in accordance with the terms of
this Agreement, the transferee shall succeed to Holding’s Capital Account; and



 3
 









(iv)          In determining the amount of any
liability for purposes of the foregoing Clauses (i) and (ii) of this
definition, there shall be taken into account Code Section 752(c) and any other
applicable provisions of the Code and Regulations.


The foregoing provisions
and the other provisions of this Agreement relating to the maintenance of
Capital Accounts are intended to comply with Regulations Section 1.704-1(b) and
shall be interpreted and applied in a manner consistent with such Regulations.  The Manager, with the consent of the
Executive Committee, shall make any appropriate modifications to Holding’s
Capital Account in the event unanticipated events might otherwise cause this
Agreement not to comply with Section 1.704-1(b) of the Regulations.


“Capital Contribution” means, as of any date,
the amount of money and other property actually contributed to the Company by
Holding through such date.  The amount of
a Capital Contribution made in property other than money shall be the fair
market value, net of assumed liabilities, of the contributed property as
determined in good faith by the Executive Committee; provided, however,
that Holding’s opening Capital Account balance on the Effective Date shall be
$50,000,000.00.


“Capital Improvements and Replacements” means a
capital expenditure, as defined under GAAP, for a modification, refurbishment,
alteration, addition, improvement or renovation to any portion of the Project,
including the Furniture, Fixtures and Equipment associated with the Project.


“Claims” has the
meaning set forth in Section 3.29(a).


“Code” means the Internal Revenue Code of 1986,
as amended from time to time (or any corresponding provisions of succeeding
law).


“Collateral’s Fair
Market Value” has the meaning set forth in Section 4.2(g).


“Company” has the meaning set forth in the
introductory paragraph.


“Construction Financing” means third-party debt
financing for the construction of the Project (not including any Expansion
Project).


“Construction Loan Documents” means any and all
documents executed in connection with the Construction Financing.


“Construction Manager” means the individual
selected and appointed by the Manager with the prior approval of the Executive
Committee to manage and supervise the construction activities of the Project
(not including any Expansion Project) on a day-to-day basis.


“Construction Plan” means the comprehensive
construction plan for the Project (not including any Expansion Project)
submitted by a construction firm selected by the Executive Committee, including
the estimated time frame for completion and implementation of such plan, which
Construction Plan shall be approved by the Executive Committee.  The Construction Plan may be approved as a
whole or in segments or by components by the Executive Committee.



 4
 









“Cross-Default Party”
has the meaning set forth in Section 4.2(g).


“Curable Default” has the meaning set forth in Section
4.2(g).


“Cure Collateral” has the meaning set forth in Section
4.2(g).


“Cure Cost of Capital” has the meaning set
forth in Section 4.2(g).


“Cure Pledge” has the meaning set forth in Section
4.2(g).


“Curing Party” has the meaning set forth in Section
4.2(g).


“Default Amount” has the meaning set forth in Section
4.2(g).


“Default Loan” has the meaning set forth in Section
4.2(g).


“Design, Development and Construction Budget”
means the aggregate hard and soft costs of construction of the Project (not
including any Expansion Project), proposed by the Manager and approved by the
Executive Committee, including real estate costs, all costs associated with the
Resort Property, Improvements, allowances for Furniture, Fixtures and Equipment
attached or used within the Project, construction and design fees, permits and
licenses, Pre-Opening Plan costs, capitalized interest, and all associated
financing fees through the date that the Project receives a final certificate
of occupancy from the applicable governmental authority.  The Design, Development and Construction
Budget may be approved as a whole or in segments or by components by the
Executive Committee (e.g., the components of the Improvements, such as
interior furnishings as compared to the foundation and exterior facade, etc.).


“Design Plan” means the architectural, interior
design and landscaping plans for the Project (not including any Expansion
Project) submitted by architectural, interior design and landscaping firms
selected by the Manager and approved by the Executive Committee, which Design
Plan shall be approved by the Executive Committee.  The Design Plan may be approved as a whole or
in segments or by components by the Executive Committee.


“Dilution Date” has the meaning set forth in
Section 4.3(d)(i) of the Aliante Operating Agreement.


“Distributable Cash”
has the meaning set forth in Schedule 3.4, paragraph (k)(viii).


“EBITDA” for any period means the Company’s net
income for such period (after deduction of the Base Management Fee for such
period but prior to any deduction of the Incentive Management Fee for such
period) plus, to the extent deducted in determining such net income, the
Company’s interest, income tax, depreciation and amortization expenses
(including pre-opening expenses) for such period, in accordance with GAAP
consistently applied and excluding in such calculation non-operating,
non-recurring gains and losses.


“EC Member” means either of the GC EC Member
and the Station EC Member.


“Effective Date” has the meaning set forth in
the introductory paragraph hereof.



 5
 









“Entitlements” has the meaning set forth in Section
5.6(h).


“Entitlements
Claims/Proceedings” has the meaning set forth in Section 5.6(h).


“Excess Construction Contributions” has the
meaning set forth in Section 4.2(b).


“Executive Committee” has the meaning set forth
in Section 3.12.


“Exempt Affiliate” means a Person who is not a
Fertitta Family Member, but who is an Affiliate solely because such Person is
an investor in Parent or an investor in a successor to Parent by merger,
consolidation, acquisition or similar manner, for a bona fide business purpose
other than to evade the prohibition set forth in Section 3.8(a).


“Exempt Property” means a hotel and/or casino
owned, operated, or managed by an investor in Parent (other than a Fertitta
Family Member) or a successor to Parent (by merger, consolidation, acquisition
or similar manner which is undertaken for an independent, bona fide business
purpose other than to evade the prohibition set forth in Section 3.8(a))
which was owned, operated or managed by such an investor in Parent (other than
a Fertitta Family Member) or a successor to Parent prior to such merger, consolidation,
acquisition or similar transaction.


“Expansion Financing” means third-party debt
financing for the construction of each Expansion Project and to refinance the
previous construction financing therefor, as approved by the Executive
Committee at any time and from time to time pursuant to the terms of this
Agreement.


“Expansion Project” means each additional
construction project at the Project after the initial construction project if
and as approved by the Executive Committee at any time and from time to time
pursuant to the terms of this Agreement.


“Expansion Project Budget” means the budget for
each Expansion Project, which includes the aggregate hard and soft costs of
construction of such Expansion Project, as approved by the Executive Committee
at any time and from time to time pursuant to the terms of this Agreement.


“Expansion Project Construction Manager” means
the individual selected by the Manager and approved by the Executive Committee
to manage and supervise the construction activities of each Expansion Project
on a day-to-day basis.


“Expansion Project Construction Plan” means the
comprehensive construction plan for each Expansion Project, including the
estimated time frame for completion and implementation thereof, as approved by
the Executive Committee at any time and from time to time pursuant to the terms
of this Agreement.


“Expansion Project Design Plan” means the
architectural, interior design and landscaping plans for each Expansion Project
submitted by architectural, interior design and landscaping firms, as approved
by the Executive Committee at any time and from time to time pursuant to the
terms of this Agreement.



 6
 









“Expansion Project Loan Documents” means any
and all documents, agreements and instruments evidencing the terms and conditions
of an Expansion Financing, as approved by the Executive Committee at any time
and from time to time pursuant to the terms of this Agreement.


“Fertitta
Family Members” means Frank J. Fertitta III and Lorenzo J. Fertitta, and
such Persons’ spouses and lineal descendants or trusts for the benefit of such
Persons or their spouses or lineal descendants.


“Fertitta
Person” means each of the Manager, Station, Parent, the Fertitta Family
Members or any Affiliate of the foregoing (excluding any Exempt Affiliate).


“Fiscal Month” means an individual monthly
accounting period of the Company ending on the close of business on the last
day of each calendar month.


“Fiscal Year” means the Company’s fiscal year
ending on December 31 of each year (or, if earlier, the date on which the
Company is liquidated within the meaning of Regulations Section
1.704-1(b)(2)(ii)(g)).  The first Fiscal
Year of the Company shall commence on the Effective Date, and subsequent Fiscal
Years shall commence on January 1.


“Force Majeure” means war, insurrection,
strikes, walkouts, riots, floods, earthquakes, fires, casualties, acts of God,
acts of the public enemy, epidemics, quarantine restrictions, freight
embargoes, lack of transportation, governmental restrictions, laws, rules,
regulations, ordinances and/or proceedings (including, without limitation,
those relating to building, zoning and land use and litigation brought by
unrelated third parties, including eminent domain), unusually severe weather,
inability to secure necessary labor, materials or tools, delays of any
contractor, subcontractor or supplier outside the reasonable control of the
affected Party, acts or failures to act (including the failure to issue
Governmental Approvals or other approvals, consents, permits or licenses) of an
unaffiliated party, acts or failures to act of any public or governmental
agency, private or public utility or other entity (including GC with regard to
Station, and Station with regard to GC) not due to the delay or fault of the
affected Party, or any other causes beyond the reasonable control or without
the fault of the Party claiming an extension of time to perform; provided,
however, that such event actually affects such Party’s ability to
perform and only for so long as it does affect such Party’s ability to perform.


“Furniture, Fixtures and Equipment” means all
furniture, fixtures and equipment reasonably required for the operation of the
Project, including but not limited to office furniture, computer and
communications systems, specialized hotel equipment necessary for the operation
of the hotel/casino, food and beverage equipment, laundries and recreational
facilities, but not including any such furniture, fixtures or equipment owned
by Parent, the Manager or their Subsidiaries (other than the Company) and used
in the operation of the Project.  Such
items also shall include specialized casino equipment, including cashier, money
sorting and money counting equipment, slot machines, table games, video gaming
equipment, and other similar gaming equipment as well as surveillance
equipment.


“GAAP” means United States generally accepted
accounting principles, as in effect from time to time.



 7
 









“Gaming Authority” means those federal, state
and local governmental, regulatory and administrative authorities, agencies,
boards and officials responsible for or involved in the regulation of gaming or
gaming activities in any jurisdiction, including within the State of Nevada,
specifically, the Nevada Gaming Commission, the Nevada State Gaming Control
Board, and applicable local authorities.


“Gaming Laws” means those laws pursuant to
which any Gaming Authority possesses regulatory, licensing or permit authority
over gaming within any jurisdiction and, within the State of Nevada,
specifically, the Nevada Gaming Control Act, as codified in the Chapter 463 of
the Nevada Revised Statutes, and the regulations of the Nevada Gaming
Commission and Nevada State Gaming Control Board promulgated thereunder, as
amended from time to time.


“Gaming Licenses” shall mean all licenses, consents,
permits, approvals, authorizations, registrations, findings of suitability,
franchises and entitlements issued by any Gaming Authority necessary for or
relating to the conduct of activities under the Gaming Laws.


“Gaming Problem” has the meaning set forth in Section
5.3(b).


“GC” has the meaning set forth in the
introductory paragraph.


“GC Affiliates” has the meaning set forth in Section
4.2(f).


“GC Contribution” has the meaning set forth in
the Recitals.


“GC EC Member” has the meaning set forth in Section
3.12.


“GC/Holding Capital Contribution” means each
capital contribution that (a) GC is required to make to Holding pursuant to the
terms of the Holding Operating Agreement and (b) which is designated in writing
by Holding, at the time it makes the capital contribution call therefor, as an “Aliante
Additional Capital Call” in accordance with the terms and conditions of the
Holding Operating Agreement.


“GC Pledgors” has the meaning set forth in Section
4.2(f).


“General Manager” means the individual selected
and appointed by the Manager with the prior approval of the Executive Committee
to manage and supervise the activities of the Project on a day-to-day basis
during the Operating Period.


“Governmental Approvals” means all permits,
licenses, consents and approvals of agencies of the City of North Las Vegas,
Nevada, Clark County, Nevada, the State of Nevada   and the United States necessary for the
construction of the Project (including the Improvements) in accordance with the
Master Development Plan, and operation of the Project, excluding any Gaming
Licenses or liquor licenses, permits or approvals required to be obtained by
the Member(s).  The material terms and
conditions of all Governmental Approvals (excluding Gaming Licenses and liquor
licenses) shall be subject to the prior approval of the Executive Committee; provided,
however, that if neither EC Member notifies the Manager within seven (7)
calendar days after such written request for approval of a material term that
he objects to such term, the Executive Committee shall be deemed to have
approved such material term.



 8
 









“Greenspun Family Member” means any of the
following people: Susan Fine, Daniel Greenspun, Jane Greenspun Gayle, Brian
Greenspun, and Phillip Peckman, and each of such Persons’ spouses and lineal
descendants or trusts for the benefit of any such Persons or their spouses and
lineal descendants.


“Greenspun Person” means each of GC, the
Greenspun Family Members or any Affiliate of the foregoing (excluding any
Exempt Affiliate).


“Gross Asset Value” means, with respect to any
asset, the asset’s adjusted basis for federal income tax purposes, except
as follows:


(i)            The Gross Asset Values of all
Company assets shall be adjusted to equal their respective gross fair market
values, as determined in good faith by the Executive Committee, as of the
liquidation of the Company within the meaning of Regulations Section
1.704-1(b)(2)(ii)(g); the acquisition of an additional interest in the Company
by any new or existing Member in exchange for more than a de minimis Capital Contribution; and the
distribution by the Company to Holding of more than a de minimis amount of property as
consideration for Holding’s Membership Interest;


(ii)           The Gross Asset Value of any Company
asset distributed to Holding shall be the gross fair market value of such
asset, as determined in good faith by the Executive Committee, on the date of
distribution;


(iii)          The Gross Asset Values of Company
assets shall be increased (or decreased) to reflect any adjustments to the
adjusted basis of such assets pursuant to Code Section 734(b) or Code Section
743(b), but only to the extent that such adjustments are taken into account in
determining Capital Accounts pursuant to Regulations Section
1.704-1(b)(2)(iv)(m); provided, however, that Gross Asset Values
shall not be adjusted pursuant to this Clause (iii) to the extent that
an adjustment pursuant to the foregoing Clause (i) is made in connection with a
transaction that would otherwise result in an adjustment pursuant to this
Clause (iii); and


(iv)          The Gross Asset Value of any asset
contributed to the Company shall be its agreed-upon fair-market value, adjusted
for book depreciation, amortization or other cost recovery deductions for
periods subsequent to its contribution in the manner provided in Clause (vi) of
the definitions of “Profit” and “Loss.”


“Gross Revenues” means all cash revenues and
income (excluding interest income) of any kind derived from the use or
operation of the Project determined in accordance with GAAP consistently applied,
including without limitation, income from gaming activities; income from rental
of guest rooms; food and beverage sales; income from entertainment programs and
merchandise sales; telephone, telegraph and telex revenues; rental or other
payments from lessees, sublessees and concessionaires and others occupying
space or rendering services at the Project (but not (A) reimbursements for
utilities, taxes or similar matters, or (B) the gross receipts of such lessees,
sublessees or concessionaires except to the extent the same is part of
such rental payments); income from vending machines; health club fees; and the
actual cash proceeds of business interruption or similar insurance and of
temporary condemnation awards 



 9
 









after deducting necessary expenses in connection with
the adjustment or collection of such proceeds; excluding, however,
to the extent included in cash revenues and income of any kind derived from the
use or operation of the Project and without duplication, (i) any proceeds from
the sale, financing or refinancing or other disposition of the Project or
substantially all of the assets of the Company; (ii) any proceeds from the
sale, financing, refinancing or other disposition of Furniture, Fixtures and
Equipment or other capital assets; (iii) proceeds of any fire, extended
coverage or other insurance policies (excluding any proceeds of business
interruption or similar insurance); (iv) condemnation (other than temporary)
awards and other amounts received by the Company in lieu of condemnation; (v)
any refunds, rebates, discounts and credits of a similar nature given, paid or
returned in the course of obtaining Gross Revenues or components thereof, other
than complementaries provided to patrons of the Project in the ordinary course
of business and consistent with the Annual Plan and Operating Budget; (vi)
gratuities or service charges or other similar receipts which the Company or
the Manager pays to employees or others; (vii) excise, sales, gross receipts,
admission, entertainment, tourist, use or 
similar taxes or charges collected from patrons or guests or as part of
the sale price for goods, services or entertainment, other than taxes imposed
on gaming revenues; (viii) any sum and credits received for lost or damaged
merchandise; (ix) credit card processing fees and costs; and (x) bad debts.


“Holding” has the meaning set forth in the
introductory paragraph.


“Holding Operating Agreement” means that
certain Operating Agreement of Aliante Holding, LLC, dated as of December 16,
2005, by and among Holding, GC and Station (together with all exhibits and
schedules thereto), as amended from time to time.


“Hotel/Casinos” has the meaning set forth in Exhibit
D.


“Improvements” means (i) all buildings,
structures and improvements to be constructed on the Resort Property and all
Furniture, Fixtures and Equipment attached to or forming a part thereof
(including, without limitation, heating, lighting, plumbing, sanitation, air
conditioning, laundry, refrigeration, kitchen, elevator and similar items or
systems, guest rooms, restaurants, bars and banquet, meeting and other public
areas, commercial space, including concessions and shops, garage and parking
space, storage and service areas, recreational facilities and areas, public
grounds and gardens, permanently affixed signage, aquatic facilities, and other
facilities and appurtenances) in accordance with the Master Development Plan
and (ii) all grading of the Resort Property.


“Incentive Management Fee” means the incentive
management fee payable to the Manager pursuant to Section 3.5(b).


“Indemnitee” has the meaning set forth in Section
3.29(a).


“License Party” has
the meaning set forth in Section 5.3.


“Losee Property”
means the real property owned by Losee LLC. 
The Losee Property is legally described on Exhibit E.


“Losee LLC” has the
meaning set forth in the Recitals.



 10
 









“Manager” means Station or any successor to
Station approved by the Executive Committee pursuant to the terms of this
Agreement.


“Master Development Plan” means the
comprehensive development plan (including estimated time lines therefor) for
the Project, including the Design Plan, the Construction Plan, and the Design,
Development and Construction Budget, each as may be amended from time to time
in accordance with the terms of this Agreement, and all as approved by the
Executive Committee at any time and from time to time pursuant to this
Agreement.  The components of the Master
Development Plan may be approved as a whole or in segments or by components by
the Executive Committee.  The Master
Development Plan shall be amended from time to time to include comparable
information for any and all Expansion Projects.


“Member” means Holding and any other Person
that is or becomes a party to this Agreement as a member of the Company. The
sole Member of the Company on the Effective Date is Holding.


“Membership Interest” means a Member’s
undivided percentage interest in the Company. 
Such interest includes any and all rights to which such Member may be
entitled as provided in this Agreement or the Act, including such Member’s
Capital Account, together with all obligations of such Member under this
Agreement or the Act.  Holding’s initial
percentage Membership Interest is 100%


“Minimum Gain” shall mean “partnership minimum
gain” as determined in accordance with Regulations Section 1.704-2(d)(1).


“Minimum Gain Attributable to Member Nonrecourse
Debt” shall mean “partner nonrecourse debt minimum gain” as determined in
accordance with Regulations Section 1.704-2(i)(3).


“Notice Address” has the meaning set forth in Section
8.1.


“Notices” has the meaning set forth in Section
8.1.


“NVE” has the meaning set forth in Section
2.2(c).


“Opening” means the date on which the casino
portion of the Project is first opened to the public and commences business.


“Operating Bank Account” means the Bank Account
maintained by and in the name of the Company for the payment of Operating Costs
and the deposit of monies related to the business, which account shall be
separate and distinct from any other accounts, reserves or deposits required by
this Agreement.  The Operating Bank
Account shall be an interest bearing account if such an account is reasonably
available and all interest earned shall be retained in the Operating Bank
Account.


“Operating Consumables” means all food,
beverages and other immediately consumable items utilized in operating the
Project, such as soap, cleaning materials, matches, stationary, brochures,
folios, and other similar items.



 11
 









“Operating Costs” means, to the extent included
within the Design, Development and Construction Budget, each Expansion Project
Budget, or the then-current Annual Plan and Operating Budget, or to the extent
otherwise approved by the Executive Committee at any time and from time to time
pursuant to the terms of this Agreement, all costs and expenses of
constructing, maintaining, conducting and supervising the operation of the
Project which are properly attributable to the Fiscal Month or Fiscal Year
under consideration in accordance with GAAP, including without limitation:


(i)            the cost of all food and beverages
sold or consumed by the Company and of all Operating Supplies and Operating
Consumables, with the exception of the cost of food and beverages and other
items sold or consumed by lessees and sublessees;


(ii)           salaries, wages and other benefits of
the Company’s personnel employed with respect to the Project, including costs
of payroll taxes and employee benefits, the salaries, wages, benefits, and
expenses, including travel expenses, of third-party consultants;


(iii)          the cost of all other materials, supplies,
goods and services used in connection with the operation of the Project
including, without limitation, heat and utilities, trash removal, office
supplies, security and all other services performed by third parties, telephone
and data processing equipment and other equipment;


(iv)          the cost of repairs to and maintenance
of the Project to the extent not paid for from the Reserve Fund or by the
actual cash proceeds of any fire or casualty insurance after deducting
necessary expenses in connection with the adjustment or collection of such
proceeds;


(v)           insurance and bonding premiums with
respect to the Project, including, without limitation, property damage
insurance, public liability insurance, workers’ compensation insurance, or
insurance required by similar employee benefits acts and such business
interruption or other insurance as may be provided for protection against
claims, liabilities and losses incurred with respect to deductibles applicable
to the foregoing types of insurance;


(vi)          all taxes, assessments, water/sewer
charges, and other fees and charges (other than federal, state or local income
taxes and franchise taxes or the equivalent) payable by or assessed against the
Company with respect to the operation of the Project;


(vii)         legal, consulting, lobbying, political
and charitable contributions, accounting and other fees for professionals for
services related to the development or operation of the Project;


(viii)        all expenses for marketing the Project,
including all expenses of advertising, sales, promotion and public relations
activities; and


(ix)           all excise, sales, gross receipts,
admission, entertainment, tourist or use taxes, gaming taxes and device fees,
real estate taxes, ad valorem taxes, personal property 



 12
 









taxes, utility taxes and
other taxes (as those terms are defined by GAAP), assessments for public
improvements, and municipal, county and state license and permit fees.


Operating Costs
shall include Shared Expenses.  The type
and estimated amount of Shared Expenses and method for calculation of the same
shall be approved by the Executive Committee to fairly distribute the costs of
such services when it considers the Annual Plan and Operating Budget; provided,
however, that such allocation will not discriminate against the Company
as compared with the allocation of such expenses among other properties
operated by Parent, Manager or their Subsidiaries.  For example, subject to the prior sentence,
Shared Expenses may include the costs incurred by the Manager, Parent or their
respective Subsidiaries for direct salary and wages (including, without
limitation, employer’s contributions under FICA, unemployment compensation or
other employment taxes, and Manager’s, Parent’s or their respective
Subsidiaries’ regular pension fund contributions, worker’s compensation, group
life, accident, health and other health insurance premiums, profit sharing, and
retirement plans, disability and other similar benefits) paid to or accrued for
the benefit of employees of the Manager, Parent or their respective Subsidiaries
that are assigned to perform a function for the Company that otherwise would be
filled by an employee of, or third-party provider to, the Company, prorated to
the extent actually attributable to each such employee’s actual time incurred
for the benefit of the Company.


Operating Costs and Shared Expenses will not include
(i) any costs incurred by the Manager, Parent, or Manager’s or Parent’s
Subsidiaries, or GC or GC’s Affiliates that are not expressly reimbursable by
the Company pursuant to the terms of this Agreement or the then-current Annual
Plan and Operating Budget, such as general overhead expenses of Station,
Manager, or Parent or Manager’s or Parent’s Subsidiaries, or (ii) the Base
Management Fee or Incentive Management Fee.


“Operating Period” means that time period from
the Opening until the liquidation of the Company.


“Operating Supplies” means all non-capital
equipment necessary for the day-to-day operation of the Project, including but
not limited to chips, tokens, uniforms, playing cards, glassware, linens,
silverware, utensils and dishware.


“Original Operating Agreement” has the meaning
set forth in the Recitals.


“Parent” has the meaning set forth in the
introductory paragraph.


“Party” and “Parties” have the meanings
set forth in the introductory paragraph.


“Permanent Financing”
means any debt financing incurred by the Company for refinancing or replacing,
in whole or in part, the Construction Financing, any Expansion Financing or
prior Permanent Financing on terms and conditions approved by the Executive
Committee.


“Permanent Loan Documents”
means any and all documents executed in connection with any Permanent
Financing.


 



 13














“Person” means any individual, corporation,
limited liability company, partnership, trust or other entity.


“Pledge/Guaranty Document” and “Pledge/Guaranty
Documents” have the meanings set forth in Section 4.2(f).


“Pre-Opening Period” means that time period
from the Effective Date to the Opening.


“Pre-Opening Plan” means a written action plan
and budget delineating the key actions (with estimated timelines) to be taken
by the Manager on behalf of the Company to prepare the Project for the Opening,
including recruitment, training, marketing, advertising, operations planning
and cost estimates, in each case consistent with the Design, Development and
Construction Budget, which Pre-Opening Plan shall be subject to approval by the
Executive Committee.


“Problem Party”
has the meaning set forth in Section 5.3(a) and (b).


“Profits” and “Losses” for each Fiscal
Year (or other period) means an amount equal to the Company’s taxable income or
loss for such year or period, determined in accordance with Code Section 703(a)
(for this purpose, all items of income, gain, loss or deduction required to be
stated separately pursuant to Code Section 703(a)(1) shall be included in
taxable income or loss), with the following adjustments:


(i)            Any income of the Company that is
exempt from federal income tax and not otherwise taken into account in
computing Profits or Losses pursuant to this definition shall be added to such
taxable income or loss;


(ii)           Any expenditures of the Company
described in Code Section 705(a)(2)(B) or treated as Code Section 705(a)(2)(B)
expenditures pursuant to Regulations Section 1.704-1(b)(2)(iv)(i) and not
otherwise taken into account in computing Profits or Losses pursuant to this
definition shall be subtracted from such taxable income or loss;


(iii)          In the event the Gross Asset Value of
any Company asset is adjusted pursuant to Clause (i) or Clause (ii) of the
definition of Gross Asset Value, the amount of such adjustment shall be taken
into account as gain or loss from the disposition of such asset for purposes of
computing Profits or Losses;


(iv)          Gain or loss resulting from any
disposition of property with respect to which gain or loss is recognized for
federal income tax purposes shall be computed by reference to the Gross Asset
Value of the property disposed of, notwithstanding that the adjusted tax basis
of such property differs from its Gross Asset Value;


(v)           Notwithstanding any other provision
of this definition, any items that are specially allocated pursuant to this
Agreement shall be excluded from such taxable income or loss; and


(vi)          If the Gross Asset Value of any
Company asset is different from its adjusted tax basis at the beginning of the
Fiscal Year, then, in lieu of the depreciation,



 14
 








amortization and other
cost recovery deductions taken into account in computing such taxable income or
loss, there shall be taken into account an amount which bears the same ratio to
such beginning Gross Asset Value as the federal income tax depreciation,
amortization or other cost recovery deduction bears to such beginning adjusted
tax basis; provided, however, that if such beginning adjusted tax
basis is zero, such amount shall be determined with reference to such beginning
Gross Asset Value using any reasonable method determined by the Manager.


“Project” means, collectively, the
Improvements, including all Improvements included as part of each Expansion
Project.


“Regulations” means the Income Tax Regulations,
including Temporary Regulations, promulgated under the Code, as such
regulations may be amended from time to time (including corresponding
provisions of succeeding regulations).


“Reserve Fund” means a Bank Account maintained
by and in the name of the Company for the payment of Capital Improvements and
Replacements for the Project, which account shall be separate and distinct from
any other accounts, reserves or deposits required by this Agreement.  The Reserve Fund shall be an interest bearing
account if such an account is reasonably available and all interest earned shall
be retained in the Reserve Fund.


“Resort Property” means the real property upon
which the Project is to be developed. 
The Resort Property is legally described on Exhibit F.  The Resort Property shall include the
Additional Property following its acquisition by the Company.


“Restricted Activity” has the meaning set forth
in Section 3.8(a).


“Restricted Area” means the property area set
forth on Exhibit G.


“Restricted Period” has the meaning set forth
in Section 3.8(a).


“Return on Total Project Cost” means, with
respect to any Fiscal Year of the Company, the percentage determined by
dividing the Company’s EBITDA for such Fiscal Year by the quotient resulting
from dividing (i) the Total Project Cost as of the beginning of such
Fiscal Year (excluding any Project cost associated with any unopened portion of
the Project), plus the Total Project Cost as of the end of such Fiscal
Year (excluding any Project cost associated with any unopened portion of the
Project), by (ii) the integer two (2). 
(In the event that the Incentive Management Fee is payable in any year
in which there are less than twelve (12) calendar months, then the Incentive
Management Fee shall be calculated in such year utilizing the EBITDA for the
actual months (or portions thereof) on an annualized basis, with the Return on
Total Project Costs similarly being determined based on the first and last day
of the applicable period, rather than a Fiscal Year).


“Section 3.8(a)
Restrictions” has the meaning set forth in Section 3.8(a).


“Shared Expenses” means Parent’s, the Manager’s
or their respective Subsidiaries’ (as the case may be) allocated out-of-pocket
costs (not including any mark-up or other profit margin) for shared employees
and for shared services related to the Project as approved by the Executive



 15
 








Committee (examples of Shared Expenses and method for
allocating the same are set forth on Exhibit D).


“Station” has the meaning set forth in the
introductory paragraph.


“Station Contribution”
has the meaning set forth in the Recitals.


“Station EC Member” has the meaning set forth
in Section 3.12.


“Station Officer” means the Chief Executive
Officer, the President or any Executive Vice President of Parent.


“Station Pledgors” has the meaning set forth in
Section 4.2(f).


“Station/Holding Capital Contribution” means
each capital contribution that (a) Station is required to make to Holding
pursuant to the terms of the Holding Operating Agreement and (b) which is
designated in writing by Holding, at the time it makes the capital contribution
call therefor, as an “Aliante Additional Capital Call” in accordance with the
terms and conditions of the Holding Operating Agreement.


“Subsidiary” means, with respect to any Person,
any other Person at least fifty percent (50%) of the economic or voting
interest of which is owned by such Person.


“Tax Matters Member” has the meaning set forth
in Section 3.9.


“TC” means that certain Title Commitment, No.
05-09-1341-DTL (1st Amendment), issued by the Nevada Title
Company, dated as of November 17, 2005, at 7:30 a.m.


“Temporary Cell Tower Leases” means those temporary
cell tower leases that encumber the Resort Property.


“Timetable” has the meaning set forth in Section
3.13(tt).


“Total Project Costs” means the total
investment in the land, property, improvements, plant and equipment of the
Project, in accordance with GAAP, plus pre-opening expenses, but
excluding amortization and depreciation.


“Transfer” means, as a noun, any voluntary or
involuntary transfer, sale, assignment, pledge, hypothecation or other
disposition and, as a verb, voluntarily or involuntarily to transfer, sell,
assign, pledge, hypothecate or otherwise dispose of.


“Transition Period” has the meaning set forth
in Section 4.2(h).


“Unsuitable Person” means the Company, Holding,
Manager or an officer or EC Member of the Company, Parent, GC or an Affiliate
of any such Persons, (i) who is denied or refused a Gaming License by any
Gaming Authority in the State of Nevada, disqualified from eligibility for a
Gaming License necessary for the ownership of or participation in
non-restricted gaming in the State of Nevada, determined to be unsuitable to
own or control a Membership Interest or



 16
 








determined to be unsuitable to be connected with a
Person engaged in gaming activities in the State of Nevada by a Gaming
Authority or otherwise fails to obtain a Gaming License necessary for the
ownership of or participation in non-restricted gaming in the State of Nevada,
or (ii) whose continued involvement in the business of the Company as a Member,
Manager, officer, employee or otherwise, (A) causes the Company to lose or to
be threatened with the reasonably likely loss of any Gaming License, or (B) is
deemed likely, in the reasonable discretion of the EC Members and based on
verifiable information or information received from the Gaming Authorities, to
jeopardize or adversely affect the likelihood that the Gaming Authorities will
issue a Gaming License to the Company or to adversely affect the Company’s use
of or entitlement to any Gaming License or that of Holding, GC, Station or
Parent, or any of their Affiliates.


“Voting Stock” means all issued and outstanding
shares of a Person’s stock of any type, or class or any other security issued
by such Person, entitling the holder of such stock or other security to vote
for any member of such Person’s board of directors or otherwise with respect to
the control and affairs of such Person.


“Withheld Taxes” has the meaning set forth in Section
4.5(b).


ARTICLE
II


Formation


2.1           Formation.  The Company was formed by the filing of the
Articles with the Nevada Secretary of State on December 16, 2005.


2.2           Name;
Licenses.


(a)           Name.  The name of the Company is “Aliante Gaming, LLC,” and all business
of the Company shall be conducted in such name or in any other name or names
that are selected by the Manager with the prior approval of the Executive
Committee.


(b)           License
from Parent.  Subject to Executive
Committee approval, the name of various portions of the Project may include
some variation of the words “Station Casino,” and Parent shall license to the
Company such name and all associated trademarks, logos and systems necessary for use in connection with the operation of
the Project pursuant to a license agreement executed contemporaneously with
this Agreement. On the Effective Date, Parent and the Company shall enter into
a License and Support Agreement in substantially the form attached hereto as Attachment
I.  


(c)           License
from NVE.  Subject to Executive
Committee approval, the name of various portions of the Project may include
some variation of the word “Aliante,” and GC or its affiliate(s) shall license
to the Company such name and all associated trademarks and logos necessary for
use in connection with the operation of the Project pursuant to a license
agreement executed contemporaneously with this Agreement.  On the Effective Date, GC shall cause North
Valley Enterprises, LLC, an affiliate of GC (“NVE”), to enter into with
the Company, and the Company shall enter into with NVE, a License Agreement in
substantially the form attached hereto as Attachment II, or as otherwise
agreed by the Executive Committee.



 17
 








2.3           Purposes
and Powers.  The purpose of the
Company is to develop and operate the Project. 
In connection therewith, the Company shall have authority to engage in
any lawful business, purpose or activity permitted by the Act, and it shall
possess and may exercise all of the powers and privileges granted by the Act or
which may be exercised by any limited liability company organized pursuant to
the Act, together with any powers incidental thereto, so far as such powers or
privileges are necessary or convenient to the conduct, promotion or attainment
of the business, purposes or activities of the Company.


2.4           Registered
Agent and Registered Office.  The
Manager shall constitute the Company’s registered agent for purposes of the Act
and the Manager shall maintain the registered office of the Company as required
by the Act.  The address of the Company’s
initial registered office shall be 2411 Sahara Avenue, Las Vegas, Nevada
89102.  In addition to any records
required by the Act, the Manager shall maintain the following records at the
registered office: (a) a current list of the full name and last known business
address of Holding, as the sole Member, and the Manager; (b) a copy of the
filed Articles and all amendments thereto, together with executed copies of any
powers of attorney pursuant to which any document has been executed; (c) copies
of the Company’s federal, foreign, state and local income tax returns and
reports, if any, for the three (3) most recent years; (d) copies of this Agreement
and any amendments thereto; and (e) any financial statements of the Company for
the three (3) most recent years.  The
Company’s registered agent and office may be changed by the Executive
Committee.


ARTICLE
III


Management


3.1           The
Manager.  Subject to this Agreement,
the approval rights vested in the Executive Committee and Holding pursuant to
this Agreement and any approval rights vested in the members of Holding, the
sole responsibility and authority for the management of the Company is vested
in the Manager, and the Manager shall have the complete right and authority to
manage the business and affairs of the Company. 
The rights, duties and obligations of Station as Manager are personal to
Station based on Station and Parent’s unique experience and, except as
expressly set forth in this Agreement, may not be transferred, assigned or
delegated without the prior approval of the Executive Committee.  Except as limited in Section 3.7, any
duly authorized officer of the Manager shall have the authority to act on
behalf of the Manager.  Except as set
forth in this Agreement, the Manager may not resign without the approval of the
Executive Committee and may be removed only as expressly set forth in this
Agreement.  Holding, in its capacity as
the sole Member, shall not constitute an agent of the Company or have any
authority to act for or bind the Company. 
The EC Members agree that they shall use commercially reasonable efforts
to cooperate with the Manager as reasonably requested by the Manager in
carrying out its duties under this Agreement and in complying with any
restrictions placed on Holding, the EC Members or the Company by any Gaming
Authority.  Notwithstanding the
foregoing, the Manager shall not have the authority to dissolve or liquidate
the Company except in compliance with Article VI.


(a)           Standard
of Care.  In conducting the
management of the Company, the Manager shall (i) comply with the provisions of
this Agreement, and (ii) act in good faith in a manner



 18
 








reasonably believed to be in the best interests of the
Company and with the same care as a prudent person would exercise in the
management of its own hotel and gaming properties.  Subject to the foregoing, the Manager may
reasonably rely on information, opinions, reports or statements prepared or
presented by officers, employees or other agents of the Company acting within
the scope of their employment or by counsel, public accountants or other
advisors to the Company.


(b)           Standard
of Operation.  The Manager shall
operate the Project (in its respective constituent components and taken as a
whole) to a standard of operation at least as high as the standard of
operations at the Parent’s or the Parent’s Subsidiaries’ larger, higher quality
resorts (in their respective components and each taken as a whole) as of the
Effective Date (such as Santa Fe Station Hotel & Casino and Sunset Station
Hotel & Casino, but not including Green Valley Ranch Station Casino or Red
Rock Resort Spa Casino), unless the Annual Plan and Operating Budget would not
reasonably allow the maintenance of such standard of operation.


3.2           Expense
of Construction; Matters Relating to Construction and Development; Matters
Relating to Financing the Construction of the Project.


(a)             Subject to the Design, Development and
Construction Budget approved by the Executive Committee, the Company shall pay
the fees, costs and expenses of planning, constructing, financing, designing,
equipping, decorating and furnishing the Project; provided, however,
that all fees, costs and expenses of relocating the drainage easement on the
Resort Property shall be the sole obligation, liability and responsibility of,
and shall be paid solely by, GC and/or its Affiliates and shall not be an
obligation, liability or the responsibility of Holding, the Company, Parent or
Station.  The Parties agree that if the
design of the Project does not accommodate the existing drainage easement at
either its present location or an alternative location requested by GC and
approved by the Executive Committee, such easement shall be relocated to the
area designated on Exhibit H.


(b)           The
Parties further agree as follows:


(i)            [Reserved.]


(ii)           Upon not less than thirty (30) days
prior notice, the Manager, at the direction of the Executive Committee, may
terminate the Temporary Cell Tower Leases at such time as the temporary cell
tower facilities interfere with the development of the Project.  Following such termination, the Company shall
enter into a permanent cell tower leases on commercially reasonable terms for
the placement of permanent cell tower facilities at a location on the Resort
Property reasonably approved by the Executive Committee.


(iii)          The Company shall assume such
obligations, if any, to construct the extension of Elkhorn Road from Valley
Drive to Clayton Street as were imposed on NVE as a condition to approval of
the Master Transportation Study for the Aliante Master Development Planned
Community which such condition was set forth as Item 5 in correspondence dated
November 13, 2001, from the City of North Las Vegas, Nevada, to G.C. Wallace.



 19
 








(iv)          The Company shall enter into one or
more unrecorded license agreements in form and substance approved by the
Executive Committee with respect to the temporary placement of construction
trailers and spoils (including caliche) stockpile on portions of the Resort
Property by an Affiliate of GC and third parties.


(v)           Upon the expiration of the license
agreements (or, if no such license agreements are entered into, upon not less
than ninety (90) days’ prior written notice provided by the Company), GC shall
cause all loose construction and other debris that is on the Resort Property on
the Effective Date or placed thereon thereafter pursuant to such license
agreements to be removed therefrom at the sole expense of GC.


3.3           Manager’s
Duties During Pre-Opening Period. 
During the Pre-Opening Period, the Manager shall make available to the
Company and the EC Members its unique experience in the design and planning of
modern hotels and casinos.  The Manager
shall supervise the planning, designing, construction, equipping, decorating
and furnishing of the Project.  Without
limiting the foregoing, the Manager shall have the duties and responsibilities
set forth on Schedule 3.3 during the Pre-Opening Period.


3.4           Manager’s
Duties During Operating Period and With Respect to Expansion Projects.  During the Operating Period, the Manager
shall provide to the Company all services customarily provided by Parent,
Station or their respective Subsidiaries or Affiliates to other casinos owned
or controlled by Parent, including financial, accounting, marketing,
reservations, human resources and risk management services, shall afford the
Company the benefit of group purchasing and similar services, and shall,
subject to the Annual Plan and Operating Budget, take commercially reasonable
steps to include the Company in such promotions being offered through Parent’s
(or its Subsidiaries’ or Affiliates’) other casinos in the Las Vegas area.  In addition, the Manager shall provide the
Company with the services of senior management personnel of Parent to the
extent required to enable the Company to conduct its operations in accordance
with Section 3.1(b).  Without
limiting the foregoing, during the Operating Period, and, to the extent
applicable, prior to the Operating Period, and for each Expansion Project, the
Manager shall have the responsibilities and duties set forth on Schedule 3.4.


3.5           Compensation
of the Manager.  In addition to other
reimbursements expressly provided for in this Agreement, during the Operating Period
but except for any period occurring after Station has been removed as Manager
pursuant to Section 3.6(a), and subject to Section 3.6(b) and paragraph
(k) of Schedule 3.4, the Company shall pay to Station when it is the
Manager the amounts set forth below in this Section 3.5.


(a)           Base
Management Fee.  The Company shall
pay the Manager a Base Management Fee equal to two percent (2%) of the Company’s
Gross Revenues for the applicable period. 
The Base Management Fee for each Fiscal Year during the Operating Period
will be paid in monthly installments in arrears immediately following the
delivery of the Company’s financial statements for each Fiscal Month.  After the delivery of the Company’s audited
financial statements for each Fiscal Year, appropriate adjustments shall be
made for any overpayment or



 20
 








underpayment of Base Management Fees during such
Fiscal Year on the next monthly installment of Base Management Fees due.


(b)           Incentive
Management Fee.  In addition to the
Base Management Fee, the Company shall pay the Manager an Incentive Management
Fee in an amount equal to the sum (determined without duplication) of
(i) five percent (5.0%) of the Company’s EBITDA during the Operating Period for
the applicable Fiscal Year to the extent such EBITDA is positive and represents
a Return on Total Project Cost of up to fifteen percent (15.0%), and
(ii) ten percent  (10.0%) on that portion
of the Company’s EBITDA during the Operating Period for such Fiscal Year that
exceeds a fifteen percent (15.0%) Return on Total Project Costs; provided,
however, that the Incentive Management Fee for any Fiscal Year shall not
exceed an amount equal to five and four tenths percent (5.4%) of the Company’s
EBITDA for the applicable Fiscal Year. 
Five percent (5.0%) of the Company’s monthly EBITDA shall be paid
monthly in arrears immediately following delivery of the Company’s financial
statements for each Fiscal Month as a partial payment on the annual Incentive
Management Fee.  After the delivery of
the Company’s audited financial statements for each Fiscal Year, appropriate
adjustments shall be made for any overpayment or underpayment of the Incentive
Management Fees during such Fiscal Year on the next monthly installment of
Incentive Management Fees due.


(c)           Expense
Reimbursement.  The Company shall be
responsible for all Operating Costs incurred in accordance with the terms and
provisions of this Agreement, including the Annual Plan and Operating Budget,
and will reimburse all such Operating Costs incurred thereby by or on behalf of
the Manager, Holding, Parent, Station or GC pursuant to an approved Annual Plan
and Operating Budget.


3.6           Removal
of the Manager.


(a)           So
long as GC is not in material breach of the provisions of the Holding Operating
Agreement or this Agreement, the GC EC Member may give notice to the Manager
that it desires to remove Station as the Manager:


(i)            upon thirty (30) days prior written
notice in the event that Station defaults upon the making of any required
Station/Holding Capital Contribution to Holding, if Station has not made such
Station/Holding Capital Contribution within the time period required therefor
under the Holding Operating Agreement, including any applicable cure period;


(ii)           upon not fewer than ten (10) days
prior written notice in the event (A) Station’s Gaming License is revoked or is
suspended for more than thirty (30) days in any calendar year (provided,
however, that Station shall not act as Manager during any such period of
revocation or suspension), (B) Station becomes Bankrupt, or (C) a trustee in
bankruptcy is appointed for Parent, a receiver is appointed for substantially
all of the assets of Parent, or Parent is Bankrupt and because of such
Bankruptcy Station is unable to fulfill the material terms of its obligations
as Manager; provided, however, that, in no event may the GC EC
Member remove Station as Manager upon a determination that Station is an
Unsuitable Person until the conditions contained in Clause (A) of this Clause



 21
 








(ii) have been satisfied;
provided, further, for the time that Station is not acting as
Manager, it shall not receive the compensation set forth in Section 3.5;


(iii)          upon thirty (30) days prior written
notice in the event that Station engages in an act or omission that is grossly
negligent, reckless or constitutes intentional misconduct, and such action or
omission has a material adverse effect on the Company (including, but not
limited to, the failure to comply with the covenant set forth in Paragraph
(k) of Schedule 3.3); provided, however, that such
termination shall be effective with respect to any such action or omission that
is susceptible to complete cure (i.e.,
as if there has been no such action or failure to act) only if such action or
failure to act has remained uncured at the end of such thirty (30) day period;
or


(iv)          if Station no longer is a member of
Holding.


The GC EC Member
shall give Station notice of its desire to remove Station as Manager pursuant
to Section 3.6(a) within sixty (60) days after the GC EC Member has
actual knowledge of the events giving rise to the right to remove Station.  If the GC EC Member does not give such
written notice within such sixty (60) day period, then the GC EC Member shall
not have a right to remove Station based on the grounds for which it had such
actual knowledge; provided, however, that nothing herein shall
prevent the GC EC Member from removing Station if it subsequently has actual
knowledge of further ground(s) for removal.


(b)           Notwithstanding
that the GC EC Member may not have grounds to remove Station as the Manager
pursuant to Section 3.6(a), the GC EC Member nonetheless may bring an
action on its own behalf or on behalf of the Company, at law, equity or
pursuant to other available remedies against Station as the Manager for breach
of its material obligations hereunder (including, but not limited to material
breach of the standards of care and operation) as the Manager and for any
damages or other costs incurred by the GC EC Member or the Company as a result
of such breach, including, but not limited to, during the design and
construction phase of the Project.  The
Company may offset any final non-appealable judgment against the Manager
against any fees owed Manager pursuant to Section 3.5.


(c)           In
the event that Station is removed as Manager, Station shall have the right to
require GC to acquire Station’s entire membership interest in Holding as
provided for in the Holding Operating Agreement.


3.7           Officers.  Subject to applicable provisions of the
Gaming Laws, the Manager shall have the authority to appoint and remove, in its
sole discretion, Persons serving as operating (as opposed to corporate)
officers of the Company subordinate to the General Manager and to delegate to
such Persons such duties and responsibilities as the Manager shall deem to be
in the best interests of the Company (except that the Manager shall not
be permitted to delegate the essential management and supervisory functions of
the General Manager).  All such
appointments and delegations may be revocable at will by the Manager.  Notwithstanding the foregoing, the Company
shall engage a Construction Manager approved by the Executive Committee at all
times during the Pre-Opening Period, an Expansion Project Construction Manager
during the period of the construction of any Expansion Project and a General
Manager approved by the Executive Committee at all times during the Operating
Period.  Either EC



 22
 








Member may require the Manager to discharge the
Construction Manager, Expansion Project Construction Manager or the General
Manager in the event that, after notice from the Manager to such Person and a
sixty (60) day opportunity to cure, such Person’s performance is unsatisfactory
to such EC Member.  The second request by
the same EC Member to discharge the Construction Manager, Expansion Project
Construction Manager or the General Manager shall result in termination of such
Person by the Manager without further notice or opportunity to cure.  If any Person appointed to serve as an
officer of the Company is found to be an Unsuitable Person, the Manager shall
immediately remove such person as an officer and such Person shall thereupon
automatically cease to be an officer.


3.8           Conflicts
of Interest; Right to Participate.


(a)           Until
the fifth (5th)
anniversary of the date of the Opening (the “Restricted Period”), (i)
none of the Fertitta Persons, whether alone or with other Persons, shall,
directly or indirectly, own, develop, manage or operate all or any portion of
any hotel and/or casino (other than an Exempt Property) within the Restricted
Area and (ii) none of the Greenspun Persons, whether alone or with other
Persons, shall, directly or indirectly, own, develop, manage or operate all or
any portion of any hotel and/or casino (other than an Exempt Property) within
the Restricted Area (either of the foregoing (i) or (ii) being referred to
herein as a “Restricted Activity”) (the restrictions set forth in this Section
3.8(a) are referred to herein as the “Section 3.8(a) Restrictions”);
provided, however, that:


(A)          the Section 3.8(a) Restrictions shall
not apply to the Losee Property;


(B)           the Section 3.8(a) Restrictions shall
not apply to any New Property (as defined in and) subject to the Holding
Operating Agreement; and


(C)           the Section 3.8(a) Restrictions shall
not prohibit the Greenspun Persons from collectively and in the aggregate
owning less than five percent (5%) of the publicly traded Voting Stock of a
company involved in a Restricted Activity, or prohibit Parent, and the Fertitta
Persons from collectively and in the aggregate owning less than five percent (5%)
of the publicly traded Voting Stock of a company involved in a Restricted
Activity, in both cases only so long as such investment is passive and without
any ability or intent to exercise influence or control over the management or
direction of the entity in which the Voting Stock is owned.


(b)           Subject
to the Section 3.8(a) Restrictions, during the Restricted Period, a Fertitta
Person, alone or with other Fertittta Persons and/or with other Persons, or a
Greenspun Person, alone or with other Greenspun Persons and/or with other
Persons, may acquire an interest, directly or indirectly, in whole or in part,
in real property located entirely or partially within the Restricted Area, only
if such Fertitta Person(s) or Greenspun Person(s), as the case may be, comply(ies)
with each and all of the requirements with respect thereto set forth in the
Holding Operating Agreement.


(c)           Subject
to Sections 3.8(a) and 3.8(b) and any restrictions or conditions
set forth in the Holding Operating Agreement, each Fertitta Person and each
Greenspun Person shall be entitled to enter into any transaction that may be
considered to be competitive with, or a business



 23
 








opportunity that may be beneficial to, the Company or
to Holding.  Any transactions or
agreements (other than transactions or agreements expressly contemplated by
this Agreement, including reimbursement of Shared Expenses, as long as such
transactions are otherwise in compliance with this Agreement) between the
Fertitta Persons and the Greenspun Persons (on the one hand) and the Company
(on the other) (any such transaction referred to herein as an “Affiliate
Transaction”) shall be disclosed to the EC Members and members of Holding
in advance and shall be on commercially reasonable, arms-length terms that are
no less favorable to the Company or Holding than could be obtained from an
independent third party.  No transaction
with the Company shall be voidable solely because a Fertitta Person or a
Greenspun Person has a direct or indirect interest in the transaction if either
(i) the transaction is fair to the Company or (ii) the disinterested Manager or
the disinterested EC Member, in either case knowing the material facts of the
transaction and the Fertitta Person’s or Greenspun Person’s interest,
authorize, approve or ratify the transaction. 
Notwithstanding the foregoing, any loans to the Company by a Fertitta
Person, a Greenspun Person or one or more of their Affiliates shall require the
approval of the Executive Committee pursuant to the terms of this Agreement.


(d)           The
Parties acknowledge that an Affiliate
of GC shall be the “declarant” under the declaration of covenants, conditions
and restrictions affecting the Resort Property, and that the “declarant” may
take actions that are inconsistent with this Agreement, or not in the best
interest of the Company, and Holding and GC shall not be in breach hereof by
reason of such actions and “declarant” shall not have any duty under this
Agreement to Station, Parent, Holding or the Company; provided, however,
that nothing in this Section 3.8(d) shall permit such Affiliate “declarant”
to engage in a Restricted Activity.


(e)           The
Section 3.8(a) Restrictions shall survive the withdrawal, expulsion or other
termination of GC or Station as a member of Holding, through the earlier to
occur of the date that is five (5) years after the date of the Opening or three
(3) years after the withdrawal, expulsion, buyout or termination of GC or
Station as a member of Holding.  The
rights afforded the parties in Section 3.8(b) hereto and the applicable
provisions of the Holding Operating Agreement shall not apply to any real
property acquired by a Fertitta Person or a Greenspun Person after the date of
withdrawal, expulsion, buy-out or other termination of GC or Station as a
member of Holding; provided, that any such real property shall remain
subject to the Section 3.8(a) Restrictions as provided in the preceding
sentence.


3.9           Tax
Matters Partner.  Holding is hereby
designated as the “tax matters partner” of the Company under Code Section
6231(a)(7) (the “Tax Matters Member”). 
The Tax Matters Member shall give prompt notice to Holding of (i) the
receipt by the Tax Matters Member of written notice that a federal, state or
local taxing authority intends to examine the Company’s income tax returns for
any year; (ii) receipt by the Tax Matters Member of written notice of a final
partnership administrative adjustment under Code Section 6223; and (iii)
receipt by the Tax Matters Member of any request from the Internal Revenue
Service for waiver of any applicable statute of limitations with respect to any
tax return of the Company.  The Tax
Matters Member may not extend or waive the statute of limitations or take any
other action that would compromise any tax position of the Company or Holding,
without the approval of the Holding, GC or Station.



 24














3.10         Liability
of Holding, as a Member, and Station, as Manager.  Except as otherwise provided by the Act, (a)
Holding (and its members) shall not be obligated personally for any debt,
obligation or liability of the Company, solely by reason of being the sole
Member, and (b) Station, as the Manager, shall not be obligated personally for
any debt, obligation or liability of the Company or any Member solely by reason
of being the Manager.  Except as
otherwise provided in this Agreement or by applicable law, neither Holding, as
the sole Member, nor the Manager shall have any fiduciary or other duty to the
Company or Holding with respect to the business and affairs of the
Company.  The Company shall indemnify
Holding (and each of its members) and hold Holding (and its members) harmless
from and against any and all debts, obligations, and liabilities of the
Company, if any, to which Holding(or any of its members) becomes subject solely
by reason of being a Member (or a member of Holdings), whether arising in contract,
tort or otherwise; provided, however, that the indemnification
obligation of the Company under this Section 3.10 shall be paid only
from the assets of the Company .


3.11         Prohibition
Against Publicly Traded Partnership. 
The Manager shall take all action necessary to prevent the Company from
qualifying as a publicly traded partnership within the meaning of Section 7704
of the Code.


3.12         The
Executive Committee.  There shall be
an executive committee (the “Executive Committee”) of the Company
comprised of one (1) representative of each of Station (the “Station EC
Member”)  and GC (the “GC EC
Member”), so long as such Persons remain as members of Holding.  The initial Station EC Member designated by
Station shall be Frank J. Fertitta III, and the initial GC EC Member designated
by GC shall be Brian L. Greenspun so long as they are alive and not disabled
and are not found to be Unsuitable Persons. 
Station and GC shall designate their respective replacement appointees to
the Executive Committee in writing to the Company and Holding and, except
as set forth in the immediately preceding sentence, GC and Station may remove
their respective EC Members at any time by written notice to the other
parties.  Subject to Section 4.3(c) of
the Holding Operating Agreement, at all times the GC EC Member shall be a
Greenspun Family Member, and the Station EC Member shall be either a Fertitta
Family Member or a Station Officer.  Subject to Section 4.3(c) of the
Holding Operating Agreement, at any time a vacancy is created on the Executive
Committee by death, removal (with or without cause) or resignation, no action
shall be taken by the Executive Committee until the Executive Committee is
reconstituted in accordance with the provisions of this Section 3.12,
unless the member of Holding that is entitled to nominate such replacement
member of the Executive Committee shall consent to the taking of such
action.  In the event of a Transfer
permitted pursuant to Section 5.2(a) of Holding’s entire Membership
Interest, the transferee shall have the power to remove the existing EC
Member(s) and appoint one (1) or more replacement EC Members; provided, however,
that if Station continues to serve as the Manager following such transfer, the
transferee’s proposed replacement EC Member(s) must be approved, in advance, by
Station.  If any Person appointed to
serve as an EC Member is found to be an Unsuitable Person, such Person shall
immediately be removed as an EC Member and shall thereupon automatically cease
to be an EC Member.


3.13         Decisions
Subject to Executive Committee Approval. 
Notwithstanding the powers of the Manager pursuant to Section 3.1,
the following matters shall require the prior unanimous approval of the
Executive Committee:



 25
 








(a)           Any
contracts, agreements (whether written or oral) or commitments (including
leases of Furniture, Fixtures and Equipment) which (i) obligate the Company for
a period of more than one (1) year, and (ii) subject to the Company to
potential liability or payments of $250,000 or more (including any extensions
thereof);


(b)           Any
sale of any portion of the assets of the Company having a fair market value of
$500,000 or more;


(c)           The
terms of the Construction Financing, any Expansion Financing and Permanent
Financing, together with the terms of any other financing for the improvement,
construction or operation of the Project (including lease/purchase or similar
financing transactions) which subjects the Company to principal and interest
payment obligations equaling or exceeding $1,000,000 in any Fiscal Year;


(d)           Any
decision (i) to approve an Expansion Project Loan Document, (ii) to amend or
waive any material provisions of Construction Loan Documents, Expansion Project
Loan Documents or Permanent Loan Documents, (iii) that is reasonably likely to
cause an event of default under the Construction Loan Documents, Expansion
Project Loan Documents or Permanent Loan Documents, (iv) that is reasonably
likely to materially expand the liability of, or materially diminish the rights
of, the Company under the Construction Loan Documents, Expansion Project Loan
Documents or Permanent Loan Documents, (v) to acquire any portion of the loans
(whether revolving or term) under the Construction Financing, Expansion
Financing or Permanent Financing, whether by assignment, purchase, participation
or otherwise, (vi) to engage in an acquisition (as such term may be defined in
any financing documents), or (vii) that has the effect of extending the
maturity of any of the obligations under any financing documents;


(e)           If
any Construction Financing, Expansion Financing or Permanent Financing permits
the Company to increase the aggregate amount of the facility beyond the dollar
amount determined by the Executive Committee at the time it approves such
Construction Financing, Expansion Financing or Permanent Financing, then the
Company may not draw upon any amount in excess of such specified dollar amount
without Executive Committee approval;


(f)            The
Company shall not permanently reduce any portion of any Construction Financing,
Expansion Financing or Permanent Financing more quickly than the required
payment and amortization schedule stated in the Construction Loan Documents,
Expansion Project Loan Documents or Permanent Loan Documents without the prior
written approval of the Executive Committee;


(g)           Any
lease termination or acquisition of a tenant’s business that exceeds $250,000;


(h)           Each
Annual Plan and Operating Budget and any amendments thereto;


(i)            The
value of any Capital Contribution made in property other than money;


(j)            The
individual to be retained as the Construction Manager;


(k)           The
general contractor, and the construction, architectural, interior design and
landscaping firms for the Project;



 26
 








(l)            The
Construction Plan (which may be approved as a whole or in segments or by
components);


(m)          The
Design Plan and the Design, Development and Construction Budget (each of which
may be approved as a whole or in segments or by components);


(n)           With
respect to each and every Expansion Project, the Expansion Project Budget,
Expansion Project Construction Manager, Expansion Project Construction Plan and
Expansion Project Design Plan;


(o)           The
individual to be retained as the General Manager;


(p)           The
material terms and conditions of all Governmental Approvals (other than Gaming
Licenses and liquor licenses); provided, however, that if neither
EC Member notifies the Manager within seven (7) calendar days after receipt of
a written request for approval of a material term of any Governmental Approval
that he objects to such term, the Executive Committee shall be deemed to have
approved such material term;


(q)           Approval
of the resignation of the Manager required pursuant to Section 3.1,
and  appointment of a successor Manager;


(r)            The
Master Development Plan (which may be approved as a whole or in segments or by
components);


(s)           The
type and estimated amount of Shared Expenses and method for calculation of such
Shared Expenses;


(t)            The
adoption of and any amendments to the Pre-Opening Plan;


(u)           The
name(s) under which the Company will conduct business;


(v)           Any
change to the registered agent and/or office;


(w)          Any
loans to the Company by Holding or an Affiliate of Holding;


(x)            The
form, amount and timing of any additional Capital Contributions;


(y)           [Reserved];


(z)            Subject
to first obtaining the prior approval of all of the members of Holding,
admission of a new Member pursuant to Section 5.1, Transfers pursuant to
Section 5.2(a) and each and all of the amendments to this Agreement
required, necessary or desirable to give effect to the admission of such new
Member or such Transfer;


(aa)         The
time, date, location, matters to be addressed, manner and effectiveness of
notices, quorum requirements, voting requirements, waiver of notice of, the
rules regarding written consents in lieu of and all other matters relating to
meetings of EC Members and the Members;



 27
 








(bb)         [Reserved];


(cc)         Any
change order that materially changes the Design Plan, Construction Plan,
Design, Development and Construction Budget or Master Development Plan; provided,
however, that if neither EC Member notifies the Manager within seven (7)
calendar days after receipt of a written request for approval of such change
order that he objects to such change order, the Executive Committee shall be
deemed to have approved such change order;


(dd)        
Capital Improvements and Replacements and expenditures therefor;


(ee)         Any
decision to contest the validity or application of any governmental
requirement;


(ff)           Entering
into any union contracts;


(gg)         Any
decision to contest any tax payment or assessment or any governmental or
regulatory order or requirements;


(hh)         The
accounting firm to be retained to perform the audits of the Company’s annual
financial statements;


(ii)           Establishment
of reserve funds in addition to the Reserve Fund;


(jj)           Any
tenant, licensee or concessionaire and the terms of the leases, licenses or
other occupancy agreements with respect thereto;


(kk)         The
decision to commence or defend any legal action (or settlement thereof) where
there is a reasonable possibility of exposure to the Company in excess of
$250,000 or that could have a material adverse effect on the operation of the
Project; provided, however, that if neither EC Member notifies
the Manager within seven (7) calendar days after receipt of a written request
for approval of the institution of such action or defense (or settlement
thereof), the Executive Committee shall be deemed to have approved such action;


(ll)           Retaining
legal counsel with respect to such actions described in Clause (kk);


(mm)       The
establishment of parameters within which the Manager may make change orders
with respect to any Expansion Project without the approval of the Executive
Committee;


(nn)         Subject
to first obtaining the prior approval of all of the members of Holding,
dissolution of the Company pursuant to Section 6.1(a);


(oo)         Any
permitted encumbrances in addition to the Permitted Exceptions (as defined in
the Holding Operating Agreement);


(pp)         Any
material change to the interior or exterior use, operation, functionality or
appearance of the Project; provided, however, that if neither EC
Member notifies the Manager within seven (7) calendar days after receipt of a
written request for approval of such material



 28
 








change that the EC Member objects to such material
change, the Executive Committee shall be deemed to have approved such material
change;


(qq)         (i)
Filing or causing to be filed any petition, action or an assignment by or on
behalf of the Company for the benefit of creditors or in Bankruptcy or for
similar relief under any statute, law or regulation, (ii) admitting or failing
to contest the material allegations of a petition filed against the Company in
any proceeding for reorganization, involuntary Bankruptcy or other similar
proceeding or (iii) appointing, consenting to or acquiescing to the appointment
of a trustee, receiver or liquidator of the Company;


(rr)           The
terms and conditions of the acquisition, and the acquisition, of the Additional
Property;


(ss)         The
preliminary conceptual architectural design for the Project (not including any
Expansion Projects), which the EC Members shall use their best efforts to agree
on within six (6) months of the Effective Date;


(tt)           The
preliminary timetable for construction and opening of the Project (the “Timetable”)
(not including any Expansion Projects), which the EC Members agree to use best
efforts to agree on within six (6) months of the Effective Date;


(uu)         The
preliminary construction budget for the Project (not including any Expansion
Projects), which the EC Members shall use their best efforts to agree on within
six (6) months of the Effective Date;


(vv)         The
term sheet for the Construction Financing and Permanent Financing for the
Project, which the EC Members shall use their best efforts to agree upon, and
to obtain written expressions of interest from one or more lenders interested
in providing such financing to the Company, within six (6) months of the
Effective Date; and


(ww)       Subject
to first obtaining the prior approval of all of the members of Holding,
approval of a Restricted Activity by a Person;


(xx)          Subject
to first obtaining the prior approval of all of the members of Holding,
approval of an Affiliate Transaction which is not on commercially reasonable
terms no less favorable to the Company than could be obtained from an
independent third party;


(yy)         Subject
to first obtaining the prior approval of all of the members of Holding,
amendments to the Articles and any amendment of this Agreement;


(zz)          Subject
to first obtaining the prior approval of all of the members of Holding, any
sale of the business or substantially all of the assets of the Company, or
merger of the Company in which the Company is not the surviving entity and
Holding does not hold a majority of the Voting Stock of the entity surviving
such merger, which sale or merger is not an arms-length bona fide fair market
value transaction; and


(aaa) Any other decision reserved to, or approval
required by, the Executive Committee pursuant to this Agreement.



 29
 








3.14         Place
of Meetings and Meetings by Telephone. 
All meetings of the Executive Committee may be held at any place that
has been designated from time to time by resolution of the EC Members.   In the absence of such a designation,
regular meetings shall be held at the principal place of business of the
Company.  Any meeting, regular or
special, may be held by conference telephone or similar communications
equipment so long as all EC Members participating in the meeting can hear one
another, and all EC Members participating by telephone or similar
communications equipment shall be deemed to be present in person at the
meeting.


3.15         Regular
Meetings.  The Executive Committee
shall not be required to have regular meetings, except as otherwise
determined by the Executive Committee.


3.16         Special
Meetings.  Special meetings of the
Executive Committee for any purpose or purposes may be called at any time by
one (1) EC Member.  Notice of the time
and place of a special meeting shall be given and deemed received pursuant to Section
8.1.


3.17         Quorum.  All of the EC Members shall constitute a
quorum for the transaction of business, except to adjourn as provided in
Section 3.20.


3.18         Manner
of Acting.  Every act or decision of
the Executive Committee shall require the affirmative unanimous approval of all
of the EC Members.


3.19         Waiver
of Notice.  Notice of any meeting of
the Executive Committee need not be given to any EC Member who either before or
after the meeting signs a written waiver of notice, a consent to holding the
meeting, or an approval of the minutes. 
The waiver of notice or consent need not specify the purpose of the
meeting.  All such waivers, consents, and
approvals shall be filed with the records of the Company or made a part of the
minutes of the meeting.  Notice of a
meeting shall also be deemed given to any EC Member who attends the meeting
without protesting before or at its commencement the lack of notice to that EC
Member.


3.20         Adjournment.  If a quorum is not present, any EC Member
present (including all EC Members participating as permitted by Section 3.14),
whether or not constituting a quorum, may adjourn any meeting to another time
and place.  Notice of the time and place
of holding an adjourned meeting need not be given unless the meeting is
adjourned for more than forty eight (48) hours, in which case notice of the
time and place shall be given before the time of the adjourned meeting in the
manner specified in Section 3.16.


3.21         Action
Without a Meeting.  Any action to be
taken by the Executive Committee at a meeting may be taken without such meeting
by the written consent of all of the EC Members.  Any such written consent may be executed and
given by telecopy or similar electronic means.


3.22         Resignation.  Any EC Member may resign at any time by
giving written notice to the other EC Member, the Company, Holding, Station and
GC.  The resignation of any EC Member
shall take effect upon receipt of notice thereof or at such later time as shall
be specified in such notice; and, unless otherwise specified therein, the
acceptance of such resignation shall not be necessary to make it effective.



 30
 








3.23         Removal.  An EC Member may only be removed pursuant to Section
3.12 or as provided for in the Holding Operating Agreement.


3.24         Vacancies.  A vacancy on the Executive Committee may only
be filled in accordance with Section 3.12.


3.25         Compensation
to EC Members.  The EC Members shall
receive no compensation, but shall be reimbursed for their reasonable and
customary expenses incurred in attending meetings of the Executive Committee.


3.26         Liability
to Third Parties.  The debts,
obligations, and liabilities of the Company, whether arising in contract, tort,
or otherwise, shall be solely the debts, obligations, and liabilities of the
Company, and no EC Member or the Manager shall be obligated personally for any
such debt, obligation, or liability by reason of his or her acting as an EC
Member or, except as otherwise provided in this Agreement, as the
Manager.


3.27         No
Guarantee of Return by EC Members. 
The EC Members and the Manager do not, in any way, guarantee the return
of any Capital Contributions or a profit for Holding from the operations of the
Company.  Except as set forth in Section
3.8, the EC Members shall incur no liability to the Company or to Holding
as a result of engaging in any other business or venture.  The EC Members shall be entitled to any other
protection afforded to such EC Members under the Act.


3.28         Transactions
with Company or Otherwise.  Subject
to Section 3.8, the EC Members, or any agent, servant, or employee of
the EC Members, may engage in and possess any interest in other businesses or
ventures of every nature and description, independently or with other Persons,
and neither the Company nor Holding shall have any rights, by virtue of this
Agreement or otherwise, in and to such independent ventures or the income or
profits derived therefrom, or any rights, duties, or obligations in respect
thereof.


3.29         Indemnification.  To the fullest extent permitted by the Act:


(a)           The
Company (and any receiver, liquidator, or trustee of, or successor to, the
Company) shall indemnify and hold harmless the Manager and each EC Member, as
well as each Affiliate of the Manager and the EC Members and their respective
officers, partners, shareholders, directors, managers, members and employees
(each an “Indemnitee”), from and against any and all liabilities,
obligations, losses, damages, penalties, actions, judgments, suits, claims,
proceedings, costs, expenses and disbursements of any kind or nature whatsoever
(“Claims”) (including, without limitation, all reasonable costs and
expenses of defense, appeal and settlement of any and all suits, actions and
proceedings involving an Indemnitee, and all costs of investigation in
connection therewith) that may be imposed on, incurred by, or asserted against
an Indemnitee, in any way relating to or arising out of, or alleged to relate
to or arise out of the performance of any duties or services by or on behalf of
the Company or any action, inaction or omission on the part of an Indemnitee in
connection with managing the Company’s business and affairs or otherwise acting
as Manager or the EC Members pursuant hereto; provided, however,
that the indemnification obligations in this Section 3.29 shall not
apply to Claims brought by Holding or the Manager; provided, further,
that the indemnification



 31
 








obligations in this Section 3.29 shall not
apply to the portion of any liability, obligation, loss, damage, penalty, cost,
expense or disbursement that has been finally adjudged in a non-appealable
order of court of competent jurisdiction to have resulted from (i) the gross
negligence of the Manager, (ii) the intentional misconduct or actual fraud by
the proposed Indemnitee or (iii) any action for which indemnification is
prohibited under the Act.


(b)           The
Company shall pay expenses as they are incurred by an Indemnitee in connection
with any action, claim or proceeding that such Indemnitee asserts in good faith
to be subject to the indemnification obligations set forth herein, upon receipt
of an undertaking from such Indemnitee to repay all amounts so paid by the
Company to the extent that it is finally determined that the Indemnitee is not
entitled to be indemnified therefor under the terms hereof.


(c)           The
indemnification and expense payments to be provided by the Company hereunder
shall be paid only from the assets of the Company, and Holding shall not have
any personal obligation, or any obligation to make any Capital Contribution,
with respect thereto.


ARTICLE
IV


Financial
Matters


4.1           Initial
Capital Contributions.  Holding will
not be required to make an initial Capital Contribution to the Company on the
Effective Date.  Holding’s opening
Capital Account balance on the Effective Date shall be $50,000,000.


4.2           Additional
Capital Contributions.


(a)           Except
as set forth in this Section 4.2, as determined by the Executive
Committee (after using commercially reasonable efforts to obtain third-party
loans) or as set forth in any “make-well,” completion guaranty or similar
obligation to which Holding becomes subject pursuant to the terms of the
Construction Financing, Expansion Financing or Permanent Financing,
Holding shall not be required to make any Capital Contribution.  Any additional Capital Contributions pursuant
to this Section 4.2 shall be made by Holding as of the date that such
Capital Contribution is required to be made pursuant to the terms of this
Agreement, in such form and amount as may be determined by the Executive
Committee.  In connection with any such
additional Capital Contribution, the Company may revalue Holding’s Capital
Account in accordance with Section 1.704-1(b)(2)(iv)(f) of the
Regulations.  Except as expressly
provided in this Agreement, Holding shall not be entitled to withdraw as a
Member or to demand or receive a return of its Capital Contribution.  No obligation of Holding to make any Capital
Contribution hereunder may be enforced by a creditor of the Company unless
Holding expressly consents to such enforcement or to the assignment of such
obligation to such creditor.


(b)           Holding
shall make such additional Capital Contributions to the Company as are required
to be made pursuant to the terms of this Agreement upon thirty (30) days’ prior
written notice from the Executive Committee specifying (i) the amount and
intended use of such Capital Contribution and (ii) the date on which such
Capital Contribution is to be made.  The
EC Members agree to use their best efforts to agree, within nine (9) months of
the Effective Date, on the amounts of Holding’s additional Capital Contribution
obligations for the construction of the



 32
 








Project, based on the preliminary construction budget,
and, subject to reaching such agreement, Holding acknowledges and agrees that,
until the Construction Financing closes, it will make additional Capital
Contributions, loans or advances, or any combination thereof, to fund
construction of the Project in excess of its initial Capital Contribution.  Loans, advances and capital contributions in
excess of Holding’s initial Capital Contribution are collectively referred to
herein as the “Excess Construction Contributions.”  In the event the Company obtains Construction
Financing and such Construction Financing permits the Company to distribute
money from the proceeds of such Construction Financing to Holding, then,
notwithstanding anything in this Agreement to the contrary (but subject to the
terms of the Holding Operating Agreement)), the Executive Committee will cause
the Company, to the maximum extent permitted by the Construction Financing
(consistent with prudent business judgment and reasonable reserves), to
distribute to Holding (either as a return of capital contributions or repayment
of loans or advances, as the case may be) amounts of Distributable Cash equal
to the aggregate amount of Excess Construction Contributions.


(c)           If
any EC Member determines that reasonable financing is unavailable to meet the
requirements of the current approved Annual Plan and Operating Budget, then the
Executive Committee, upon thirty (30) days’ prior written notice specifying the
amount of such Capital Contribution and the date on which such Capital
Contribution is to be made, may demand an additional Capital Contribution from
Holding to fund such current requirements, which shall be made by Holding as of
the date that such Capital Contribution is required to be made pursuant to the
terms of this Agreement; provided, however, the aggregate amount
of such additional Capital Contributions pursuant to this Section 4.2(c)
shall not exceed $20,000,000, in the aggregate, over the term of this
Agreement.


(d)           If
the revenues of the Project are insufficient to fund the Reserve Fund during
any Fiscal Month, then any EC Member, upon thirty (30) days’ prior written
notice specifying the amount of such Capital Contribution and the date on which
such Capital Contribution is to be made, may demand an additional Capital
Contribution from Holding to fund such Reserve Fund shortfall, which shall be
made by Holding as of the date that such Capital Contribution is required to be
made pursuant to the terms of this Agreement; provided, however,
the aggregate amount of such additional Capital Contributions pursuant to this Section
4.2(d) shall not exceed in any Fiscal Year the difference between three
percent (3%) of Gross Revenues for such Fiscal Year (or partial Fiscal Year to
date) less the Reserve Fund previously funded in such Fiscal Year.  Within one hundred twenty (120) days after
the end of the applicable Fiscal Year, if any additional Capital Contributions
were made pursuant to this Section 4.2(d) in such Fiscal Year, the
Company shall distribute to Holding the positive amount, if any, equal to the
difference between (x) the sum of (I) the amounts reserved from revenues
by the Company for the Reserve Fund plus (II) all additional Capital
Contributions made pursuant to this Section 4.2(d) in such Fiscal
Year, less (y) an amount equal to three percent (3%) of Gross Revenues
for such Fiscal Year.


(e)           The
Company acknowledges and understands that it is Holding’s intent to fund all
additional Capital Contributions to the Company, if any, solely with and from
GC/Holding Capital Contributions and Station/Holding Capital Contributions to
Holding and that, if GC or Station fails to fund its GC/Holding Capital



 33
 








Contributions or Station/Holding Capital
Contributions, Holding may not have sufficient funds from other sources to fund
its Additional Capital Contributions.


(f)            Holding
acknowledges that it, Parent, Station, GC and/or Affiliates of GC (“GC Affiliates”) may execute “make-well”
agreements, completion guaranties, pledge agreements, indemnity agreements, or
similar surety or guaranty documents in connection with the Construction
Financing, any Expansion Financing, and/or the Permanent Financing
(individually a “Pledge/Guaranty Document” and collectively the “Pledge/Guaranty
Documents”; GC and GC Affiliates collectively hereinafter may be referred
to as the “GC Pledgors;”
and Station and Parent together hereinafter may be referred to as the “Station Pledgors”).


In the event that (i) Holding is required to make a
payment to the lender(s) with respect to an applicable Pledge/Guaranty
Document, (ii) any collateral of Holding is pledged thereunder is foreclosed or
transferred in lieu of foreclosure or (iii) any dividends or distributions with
respect to any pledged collateral of Holding is used to make a payment to the
lender(s) on behalf of the Company, the Station Pledgors or the GC Pledgors
with respect to any Pledge/Guaranty Document, then the amount credited against
(or used to reduce) amounts owed by the Company, Holding, the Station Pledgors
or the GC Affiliates under the Construction Loan Documents, Expansion Project
Loan Documents, Permanent Loan Documents or the Pledge/Guaranty Documents as a
result of the foreclosure or transfer of the collateral shall be deemed an
additional Capital Contribution by Holding to the Company for purposes of this
Agreement.


In the event that (i) any GC Pledgor is required to
make a payment to the lender(s) with respect to an applicable Pledge/Guaranty
Document, (ii) any collateral of a GC Pledgor pledged thereunder is foreclosed
or transferred in lieu of foreclosure or (iii) any dividends or distributions
with respect to any pledged collateral of any GC Pledgor is used to make a
payment to the lender(s) on behalf of the Company, Holding, the Station
Pledgors or the GC Pledgors with respect to any Pledge/Guaranty Document, then
the amount credited against (or used to reduce) amounts owed by the Company,
Holding, the Station Pledgors or the GC Pledgors under the Construction Loan
Documents, Expansion Project Loan Documents, Permanent Loan Documents or the
Pledge/Guaranty Documents as a result of the foreclosure or transfer of the
collateral shall be deemed an additional Capital Contribution by GC to Holding
and then by Holding to the Company for purposes of this Agreement.


In the event that (i) any Station Pledgor is required
to make a payment to the lender(s) with respect to an applicable
Pledge/Guarantee Document, (ii) any collateral of a Station Pledgor pledged
thereunder is foreclosed or transferred in lieu of foreclosure or (iii) any
dividends or distributions with respect to any pledged collateral of a Station
Pledgor is used to make a payment to the lender(s) on behalf of the Company,
Holding, a Station Pledgor or a GC Pledgor with respect to any Pledge/Guaranty
Document, then the amount credited against (or used to reduce) amounts owed by
the Company, Holding, the Station Pledgors or the GC Pledgors under the
Construction Loan Documents, Expansion Project Loan Documents, Permanent Loan
Documents or the Pledge/Guaranty Documents as a result of the foreclosure or
transfer of the collateral shall be deemed an additional Capital Contribution
by Station to Holding and then by Holding to the Company for purposes of this
Agreement.



 34
 








(g)           Holding acknowledges that it,
the Company, the Station Pledgors or the GC Pledgors may, under the
Construction Financing, Expansion Financing or Permanent Financing, have the
right to pledge additional collateral (including cash) to cure the default (a “Curable Default”) of one (1) of
the Company, Holding, the Station Pledgors or the GC Pledgors under other loan
documents or by reason of Bankruptcy or a similar event (a “Cure Pledge”).  In
the event that a Curable Default by the Company, Holding, the Station Pledgors
or the GC Pledgors occurs, then Station and Parent in the case of a Curable
Default by a Station Pledgor, and GC and the GC Affiliates in the case of a
Curable Default by a GC Pledgor, shall have ten (10) days from such Curable
Default to make the Cure Pledge.  If they
fail to do so, then the GC Pledgors in the case of the failure by a Station
Pledgor, and the Station Pledgors in the case of the failure by a GC Pledgor,
may make the Cure Pledge (the party failing to cure being the “Cross-Default
Party,” the party making such pledge being the “Curing Party,” and
the collateral pledged being the “Cure Collateral”). The Cross-Default
Party shall indemnify and hold harmless the other parties from the cost of
curing the Curable Default, such as reasonable attorneys’ fees, escrow costs,
and filing fees, but expressly excluding the opportunity cost of such cure (e.g.,
the lost opportunity for other uses of the Cure Collateral), but expressly
including the fair market value of the Cure Collateral valued as of the date of
the pledge if the same is foreclosed or conveyed in lieu of foreclosure (the “Collateral’s
Fair Market Value”).  If the Cure
Collateral is foreclosed or otherwise conveyed in lieu of foreclosure, the
party who pledged the Cure Collateral (or on whose behalf the Cure Collateral
was pledged) may elect to treat the Collateral’s Fair Market Value as a Default
Amount (as defined in the Holding Operating Agreement) or Default Loan (as
defined in the Holding Operating Agreement). 
In the event that a Curing Party makes a Cure Pledge, then the
Cross-Default Party shall, for so long as such Cure Pledge is outstanding, on
each annual anniversary date of such pledge, pay to the other Curing Party an
amount equal to the lesser of (i) ten percent (10%) of the Collateral’s Fair
Market Value, or (ii) the maximum permitted by law (the “Cure Cost of
Capital”); such payment shall be prorated for any partial year that the
Cure Pledge is outstanding.  In the event
the Cure Cost of Capital is not paid when due, it shall, at the election of the
non-defaulting party, constitute either a Default Amount or Default Loan under
this Agreement.


(h)           In
the event of the expulsion of Station as a member of Holding, or a dilution of
Station under Section 4.2(f) of the Holding Operating Agreement, Station
may give written notice to GC that it desires to resign as Manager; provided,
however, Station shall, if requested by GC, be obligated to serve as the
Manager for a period of up to thirty six (36) months (the “Transition Period”)
after the expulsion or Dilution Date, during which time Station shall continue
to perform its obligations hereunder and continue to receive compensation and
expense reimbursement pursuant to Section 3.5, and will cooperate with
GC in its efforts to engage a successor Manager of the Project.  Notwithstanding the foregoing to the contrary,
Station may not resign as Manager without GC’s prior written consent (which may
be given or withheld in GC’s sole discretion) if such resignation would cause a
termination of the commitment for or an acceleration of the Construction
Financing, Expansion Financing or Permanent Financing.


4.3           [Reserved.]


4.4           Allocation
of Profits and Losses.   As long as
the Company has only one Member, the Company shall be treated as a “disregarded
entity” for federal income tax purposes and the sole Member shall be treating
as recognizing directly the Company’s Profits and Losses and all



 35
 








items entering into the computation thereof.  If the Company has more than one (1) Member,
this Agreement will be appropriately amended including, inter alia,
as reasonably necessary to comply with the requirements for allocations being
equivalent to allocations that have substantial economic effect under Treasury
Regulations 1.704-1(b) and 1.704-2.


4.5           Distributions.


(a)           Distributions
Prior to Liquidation.  Subject to any
limitations in the Construction Financing, Expansion Financing or Permanent
Financing, Distributable Cash shall be disbursed or distributed entirely to
Holding twenty five (25) days after the end of each calendar quarter in an
amount equal to Distributable Cash less Additional Reserves (which
Additional Reserves may include unencumbered funds from the Construction
Financing, Expansion Financing or Permanent Financing, as the case may be, to
the maximum extent permitted under such financing).


(b)           Withholding.  The Company shall withhold and pay over to
the Internal Revenue Service or other applicable taxing authority all taxes or
withholdings, and all interest, penalties, additions to tax, and similar
liabilities in connection therewith or attributable thereto (hereinafter “Withheld
Taxes”) to the extent that the Manager reasonably determines that such
withholding and/or payment is required by the Code or any other law, rule or
regulation.  All amounts withheld
pursuant to this Section 4.5(b) with respect to any allocation, payment
or distribution to Holding shall be treated as amounts distributed to Holding
pursuant to Section 4.5(a) hereof for all purposes of this Agreement.


ARTICLE
V


Members;
Transfer of Interests


5.1           Admission.  Holding became the sole Member as of the Effective
Date.  Notwithstanding any contrary
provision of the Act, the Company may admit new Members to the Company only
with the prior consent of the Executive Committee on such terms and conditions
as the Executive Committee approves.  No
Person shall be admitted as a Member until all approvals required by the Gaming
Laws are obtained.  The Parties agree to
cooperate with each other and the Executive Committee in adopting and
implementing each and all of the amendments to this Agreement that will be
required, necessary or desirable to give effect to the admission of a new
Member.


5.2           Transfer
of Interests.


(a)           No
Transfer Without Executive Committee Consent.  Holding may not Transfer all or any part of
its Membership Interest or otherwise assign or delegate any of Holding’s rights
and obligations as a Member without the prior consent of the Executive
Committee.  Notwithstanding anything in
this Agreement to the contrary, in the event of any Transfer by Station or GC
of any or all of its membership interest in Holding in contravention of the
Holding Operating Agreement, such as, but not limited to, by operation of law,
Bankruptcy or the like, the transferee shall have no rights with respect to the
Company, and the other member of Holding shall have the sole right to vote and
appoint all EC Members.  The Parties
agree to



 36
 








cooperate with each other and the Executive Committee
in adopting and implementing each and all of the amendments to this Agreement
that will be required, necessary or desirable to give effect to a Transfer.


(b)           Attempted
Transfers in Contravention.  Any
attempted Transfer in contravention of this Article V shall be void and
of no effect and shall not bind or be recognized by the Company.  In the case of an attempted Transfer not
permitted hereby, the parties attempting to engage in such Transfer shall
indemnify and hold harmless (and hereby agree to indemnify and hold harmless),
the Company from all costs, liabilities and damages that any of such
indemnified Person may incur (including, without limitation, incremental tax
liability and attorneys’ fees and expenses) as a result of such attempted
Transfer and efforts to enforce the indemnity granted hereby.


(c)           Compliance
with Gaming Laws.  Notwithstanding
anything to the contrary set forth herein, no Membership Interest or other
ownership interest in the Company shall be issued or Transferred in any manner
whatsoever except in compliance with all Gaming Laws and only after the receipt
of all necessary Gaming Licenses.


5.3           Gaming
Licensing.  The Company, Holding,
Station, Parent and GC (each a “License Party”) each shall promptly and
diligently, at its own cost, file for and seek to obtain all required Gaming
Licenses for the Project.


(a)           In
the event that any License Party (the “Problem Party”) has not received
its Gaming License for the Project by the time of the Opening or, by virtue of
its pending gaming application, is substantially impairing or impeding the
receipt by the Company of the Gaming Licenses necessary for the Opening, then
the Company, Holding and the members of Holding shall have the rights and
obligations set forth in the Holding Operating Agreement.


(b)           If,
subsequent to Opening and the initial licensing of each License Party, a
Licensing Party (also, a “Problem Party”) is substantially impeding or
impairing the ability of the Company to maintain its Gaming License for the
Project, or is resulting in the imposition of significantly burdensome terms
and conditions on any such Gaming Licenses (a “Gaming Problem”), then
the Company, Holding and the members of Holding shall have the rights and
obligations set forth in the Holding Operating Agreement.


5.4           Required
Member Approvals.  The only matters
requiring the approval of Holding, in its capacity as the sole Member, shall be
those matters that are required to be submitted to Holding for its approval
hereunder, if any, or by the Act.


5.5           Meetings.  No meetings of Members shall be required,
except that upon the written request of Holding, the Executive Committee shall
convene a meeting of Members to be held at such time and date and to address
such matters as agreed to by Holding and the Executive Committee.  Meetings of Members shall be held at any
place designated by the Executive Committee. 
In the absence of any such designation, meetings of Members shall be
held at the principal place of business of the Company.  Any meeting of Members may be held by
conference telephone or similar communications equipment so long as all Members
participating



 37
 








in the meeting can hear one another, and all Members
participating by telephone or similar communications equipment shall be deemed
to be present in person at the meeting.


5.6           In
General.  As of the Effective Date,
Holding and the Manager (other than the Manager with respect to Sections
5.6(e) and (f)), hereby make each of the representations, warranties
and covenants applicable to Holding or Manager as set forth in this Section
5.6, and such representations, warranties and covenants shall survive the
execution of this Agreement, and be for the benefit of the Company, Holding and
Manager:


(a)           Due
Incorporation or Formation; Authorization of Agreement.  Such Person is a limited liability company,
it is duly organized or duly formed, validly existing, and in good standing
under the laws of the jurisdiction of its incorporation or formation and has
the corporate, limited liability company, or partnership 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
Person is duly licensed or qualified to do business and 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. 
Such Person has the limited liability company 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 limited liability company action.  This Agreement constitutes the legal, valid,
and binding obligation of such Person enforceable in accordance with its
respective terms (except as enforceability may be limited by applicable
bankruptcy, insolvency or other similar laws affecting creditor’s rights
generally, and except that the availability of equitable remedies is subject to
judicial discretion).


(b)           No
Conflict With Restrictions; No Default. 
Neither the execution, delivery, and performance of this Agreement nor
the consummation by such Person of the transactions contemplated hereby (i)
will conflict with, violate, or result in a breach of any of the terms,
conditions, or provisions of any law, regulation, order, writ, injunction,
decree, determination, or award of any court, any governmental department,
board, agency, or instrumentality, domestic or foreign, or any arbitrator,
applicable to such Person, (ii) will conflict with, violate, result in a breach
of, or constitute a default under any of the terms, conditions, or provisions
of the articles of organization or operating agreement of such Person or of any
material agreement or instrument to which such Person is a party or by which
such Person is or may be bound or to which any of its material properties or
assets is subject, (iii) will  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, or
require any consent, authorization, or approval under any indenture, mortgage,
lease agreement, or instrument to which such Person is a party or by which such
Person is or may be bound, or (iv) will result in the creation or imposition of
any lien upon any of the material properties or assets of such Person.


(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,
acceptance, and performance by such Person under this Agreement or the



 38
 








consummation by such Person of any transaction
contemplated hereby has been completed, made, or obtained on or before the
Effective Date, except as set forth in this Agreement.


(d)           Litigation.  There are no actions, suits, proceedings, or
investigations pending or, to the knowledge of such Person, threatened against
or affecting such Person or any of its properties, assets, or businesses in any
court or before or by any governmental department, board, 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 to materially impair such Person’s ability to perform its obligations
under this Agreement or to have a material adverse effect on the consolidated
financial condition of such Person; and such Person has not received any
currently effective notice of any default, and such Person is not in default,
under any applicable order, writ, injunction, decree, permit, determination, or
award of any court, any governmental department, board, agency, or
instrumentality, domestic or foreign, or any arbitrator which could reasonably
be expected to materially impair such Person’s ability to perform its
obligations under this Agreement or to have a material adverse effect on the
consolidated financial condition of such Person.


(e)           Investigation.  Holding acquired its Membership Interest
based upon its own investigation, and the exercise by Holding of its rights and
the performance of its obligations under this Agreement will be based upon its
own investigation, analysis, and expertise. 
Holding’s acquisition of its Membership Interest was made for its own
account for investment, and not with a view to the sale or distribution
thereof.


(f)            Accredited
Investor.  Holding is an “accredited
investor” within the meaning of applicable state and federal securities
laws.  Holding’s overall commitment to
investments that are not readily marketable is not disproportionate to its net
worth, and the acquisition of its Membership Interest will not cause such
overall commitment to become excessive.


(g)           No
Statute of Limitations Defense.  The
Company, Holding, Parent, Station and GC agree that during any period under the
Construction Loan Documents, Expansion Project Loan Documents or Permanent Loan
Documents, including any Pledge/Guaranty Documents, such Persons are required
to “stand still” with respect to claims against one another, each such Person
agrees not to assert the statute of limitations as a defense to any action
brought by another such Person to the extent such statute of limitations
applies solely because of such “stand still” and all such Persons agree that
any such statute of limitations period shall be tolled for the period of time
that any such Person is required to “stand still.”


(h)           Manager’s
Obligations with Respect to Entitlement Claims.  Notwithstanding anything herein to the
contrary, in the event the Manager receives notice of any claim, assertion of a
claim or other proceeding (“Entitlement Claims/Proceedings”) with
respect to any governmental permits, licenses, zoning, approvals relating to
the uses of, or similar land use entitlements (collectively, “Entitlements”)
for the Resort Property, Manager shall promptly notify the Company, Holding,
Parent and GC, and GC shall have the right, instead of the Manager, but at the
expense of the Company and subject to the limitations contained in the last
sentence of Paragraph (n) of Schedule 3.4, to control the defense
or prosecution of such Entitlements Claims/Proceeding; provided, however,
the Manager shall have the rights that GC



 39
 








otherwise would have under Paragraph (n) of Schedule
3.4.  In the event that GC gives
notice to the Company, Holding, Parent and Manager that it desires to control
such negotiations, litigation and other proceedings related to such Entitlement
Claims/Proceeding, (i) GC shall provide the Company, Holding, Parent and
Manager with copies of all correspondence, filings and/or submissions not less
than one (1) business day prior to the delivery, filing or submission thereof
and shall be entitled to participate in all negotiations, litigation and other
proceedings, (ii)  neither GC nor any GC Affiliate shall take any action
on behalf of the Company or otherwise in connection with such Entitlement Claims/Proceeding
which would have a material adverse impact on the Entitlements for the Resort
Property, (iii) if the Manager gives written notice to GC that, in the
reasonable judgment of the Manager, GC is not reasonably pursuing the
Entitlement/Claims Proceeding or that GC was not taking action reasonably
calculated to protect the interests of the Company, the Manager may resume, and
GC shall relinquish, full control of the Entitlement Claims/Proceeding on
behalf of the Company, and (iv) GC may not settle such Entitlement
Claims/Proceeding without the approval of the Manager (which shall not be
unreasonably withheld, conditioned or delayed). 
Nothing in the preceding sentence shall be construed or interpreted to
prevent or prohibit GC or any GC Affiliate from appearing at or participating
in any proceeding, hearing or other actions regarding Entitlements provided it
does so in its individual capacity and not as a representative of, or on behalf
of the Company.  Further, nothing herein
shall be deemed to have modified the provisions of Section 3.8(d) or to
impose any restrictions on any GC Affiliate from taking positions adverse to
the Company so long as neither GC nor any GC Affiliate is controlling the
Entitlement Claims/Proceeding on behalf of the Company.  In the event that GC or a GC Affiliate
controls any Entitlement Claims/Proceeding, it and its Indemnitees shall be
entitled to indemnification under Section 3.29 as if it were the Manager
thereunder (subject to the same limitations contained therein as applicable to
the Manager).


ARTICLE
VI


Dissolution,
Liquidation and Termination


6.1           Dissolution.  The Company shall dissolve and its affairs
shall be wound up upon the occurrence of any of the following:


(a)           the
Executive Committee’s consent; or


(b)           the
occurrence of any other event that effects a dissolution of the Company under
the Act.


6.2           Liquidation
and Termination.  On dissolution of
the Company, the Manager shall act as liquidating trustee or may appoint one
(1) or more EC Members as liquidating trustee. 
The liquidating trustee shall proceed diligently to wind up the affairs
of the Company and make final distributions as provided herein and in the
Act.  The costs of liquidation shall be
borne by the Company.  Until final
distribution, the liquidating trustee shall continue to operate the Company
properties with all of the power and authority of the Manager.  The steps to be accomplished by the
liquidating trustee are as follows:



 40















(a)           as
promptly as possible after dissolution and again after final liquidation, the
liquidating trustee shall cause an accounting to be made by a firm of
independent public accountants of the Company’s assets, liabilities and
operations through the last day of the calendar month in which the dissolution
occurs or the final liquidation is completed, as applicable;


(b)           the
liquidating trustee shall pay, satisfy or discharge from Company funds all of
the debts, liabilities and obligations of the Company (including, without
limitation, all expenses incurred in liquidation) or otherwise make adequate
provision for payment and discharge thereof (including, without limitation, the
establishment of a cash escrow fund for contingent liabilities in such amount
and for such term as the liquidating trustee may reasonably determine); and


(c)           all
remaining assets of the Company shall be distributed to Holding in accordance
with Section 4.5(a).


6.3           Articles
of Dissolution.  On completion of the
distribution of Company assets as provided herein, the Company’s existence
shall be terminated, and the Manager (or such other person or persons as the
Act may require or permit) shall file Articles of Dissolution with the
Secretary of State of Nevada under the Act and take such other actions as may
be necessary to terminate the existence of the Company.


6.4           Negative
Capital Accounts.  Holding shall not
have any obligation to make any contribution to the capital of the Company with
respect to any deficit balance in its Capital Account, and such deficit shall
not be considered a debt owed to the Company or to any other Person for any
purpose whatsoever.


6.5           Limitations
on Rights of Holding.  Holding shall
look solely to the assets of the Company for the return of its Capital
Contribution.


ARTICLE
VII


Amendments


7.1           Amendments.  Except as otherwise provided in this Article
VII, and notwithstanding any contrary provision of the Act, any amendments
to this Agreement and to the Articles may be adopted only with Holding’s and
the Executive Committee’s consent; provided, however, that in no
event may the provisions of Sections 3.1 through 3.8, 3.10,
3.13 and 3.26 through 3.29 (including the related
Schedules) or this Article VII regarding amendments to such provisions
be amended without the approval of the Manager as long as Station is the
Manager.


ARTICLE
VIII


Miscellaneous


8.1           Notices.  All notices, requests, consents and other
formal communication between Holding, the Manager, the EC Members and the
Company that are required or permitted under this Agreement (“Notices”)
shall be in writing and shall be sent to the address for the respective
addressee provided on Exhibit I (each a “Notice Address”).  Notices shall be (a) delivered



 41
 









personally with a written receipt of delivery, (b)
sent by a recognized overnight courier requiring a written acknowledgment of
receipt or providing a certification of delivery or attempted deliver (e.g., Federal Express, Airborne, UPS), (c)
sent by certified or registered mail, postage prepaid, return receipt requested,
or (d) transmitted by facsimile machine provided that the facsimile
transmission is received between 8:00 a.m. and 5:00 p.m. (as determined by the
time zone of the addressee), Monday through Friday but excluding holidays on
which the primary office of the addressee is closed, and provided,  further,
that a duplicate copy of the Notice is delivered to the respective Notice
Address on the first regular business day following the date of facsimile
transmission.  Notices shall be deemed
delivered when actually received by the addressee at the respective Notice
Address; provided, however, that if the Notice was sent by
overnight courier or mail as aforesaid and is affirmatively refused or cannot
be delivered during customary business hours by reason of the absence of a
signatory to acknowledge receipt, or by reason of a change of address with
respect to which the addressor did not have either knowledge or written notice
delivered in accordance with this Section, then the first attempted delivery
shall be deemed to constitute delivery.


Holding, the
Manager, the EC Members and the Company shall be entitled to change its Notice
Address from time to time, and to add up to two (2) additional notice
addressees, by delivering to Holding, the Manager, the EC Members and the
Company notice thereof in the manner herein provided for the delivery of
Notices.


8.2           Binding
Effect.  Except as otherwise provided
in this Agreement, every covenant, term and provision of this Agreement shall
be binding upon and inure to the benefit of Holding and its successors,
transferees and (subject to the limitations in Article V) assigns.


8.3           Headings.  Section and other headings contained in this
Agreement (except for the definitions in Section 1.1) are for reference
purposes only and are not intended to describe, interpret, define or limit the
scope, extent or intent of this Agreement or any provision hereof.


8.4           Severability.  Every provision of this Agreement is intended
to be severable.  If any term or
provision hereof is illegal or invalid for any reason whatsoever, such
illegality or invalidity shall not affect the validity or legality of the
remainder of this Agreement.


8.5           Further
Action.  Holding, upon the request of
the Manager, agrees to perform all further acts and execute, acknowledge and
deliver any documents which may be reasonably necessary, appropriate or
desirable to carry out the provisions of this Agreement.


8.6           Governing
Law.  The laws of the State of Nevada
shall govern the validity of this Agreement, the construction of its terms, and
the interpretation of the rights and duties of the Members.


8.7           Waiver
of Action for Partition.  Each Member
irrevocably waives any right that it may have to maintain any action for
partition with respect to any of the Company’s assets.


8.8           Counterpart
Execution.  This Agreement may be
executed in any number of counterparts with the same effect as if all of the
Parties had signed the same document. 
All counterparts shall be construed together and shall constitute one
agreement.



 42
 









8.9           Publicity.
 Neither the Company, Holding, GC, Parent
nor Station shall make any formal public statement(s) or announcements
regarding the Project or this Agreement without the prior consent of the other,
which consent shall not be unreasonably withheld; provided, however,
that if any Party is unable to obtain the prior consent of the other with
respect to a formal announcement that is, on the advice of legal counsel,
believed to be required by law, then such party may make or issue such legally
required statement or announcement and promptly furnish the other Parties with
a copy thereof.


8.10         Transition
as Manager.  After Station no longer
is Manager for any reason, (a) Station shall reasonably cooperate with the
Company, Holding and GC to make a transition in the management of the Project,
including transferring all of the property of the Project, including books and
records, customer lists, employee and services records and manuals, supplier
lists and other similar documents or information, which shall remain the sole
property of the Company, and (b) Station shall make itself reasonably available
for reasonable and customary compensation to advise and consult in any
transition for a reasonable period of time.


8.11         Broker
Fees.  Holding represents and
warrants that upon the formation of the Company or transfer of the Resort
Property to the Company, there will be no brokerage fees or commissions or
other compensation due or payable on an absolute or contingent basis to any
person, firm, corporation, or other entity, with respect to or on account of
the formation of the Company , arising by, through or under either such Party.


8.12         Securities
under the UCC.  Notwithstanding any
rule or construction to the contrary, the Membership Interest owned by
Holding  is hereby deemed to be a “security”
as that term is defined in Article 8 of the Uniform Commercial Code in effect
on this date in the State of Nevada and, as such, the Membership Interest shall
be governed thereby, and any certificate issued to evidence any Membership Interest
shall bear a legend to that effect.


[The remainder of
this page is left blank intentionally.]


 



 43














IN WITNESS WHEREOF,
the parties have executed and delivered this Agreement  as of the Effective Date.


 


	
  

  	
  COMPANY:

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  ALIANTE GAMING, LLC

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  Aliante Station, LLC, its Manager

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
  Station Casinos, Inc., its Manager

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
  /s/ RICHARD.
  J. HASKINS

  	
   

  
	
   

  	
   

  	
   

  	
  Richard J. Haskins

  	
   

  
	
   

  	
   

  	
   

  	
  Secretary

  	
   

  
							



 


 


	
  

  	
  MEMBER:

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  ALIANTE HOLDING, LLC

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  Aliante Station, LLC, a Member

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
  Station Casinos, Inc, its Manager

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
  /s/ RICHARD.
  J. HASKINS

  	
   

  
	
   

  	
   

  	
   

  	
  Richard J. Haskins

  	
   

  
	
   

  	
   

  	
   

  	
  Secretary

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  G.C. Aliante, LLC, a Member

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
  /s/ BRIAN L.
  GREENSPUN

  	
   

  
	
   

  	
   

  	
   

  	
  Brian L. Greenspun

  	
   

  
	
   

  	
   

  	
   

  	
  Manager

  	
   

  
								



 


	
  

  	
  MANAGER:

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  ALIANTE STATION, LLC

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  Station Casinos, Inc., its Manager

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
  /s/ RICHARD.
  J. HASKINS

  	
   

  
	
   

  	
   

  	
   

  	
  Richard J. Haskins

  	
   

  
	
   

  	
   

  	
   

  	
  Secretary

  	
   

  
							



 


Signature
Page To Operating Agreement











 


 


	
  

  	
  ACKNOWLEDGED AND AGREED TO:

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  ALIANTE STATION, LLC, a member of Holding

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  Station Casinos, Inc.

  	
   

  
	
   

  	
   

  	
  Its Manager

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
  /s/ RICHARD.
  J. HASKINS

  	
   

  
	
   

  	
   

  	
   

  	
  Richard J. Haskins

  	
   

  
	
   

  	
   

  	
   

  	
  Secretary

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  G.C. ALIANTE, LLC, a member of Holding

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
  /s/ BRIAN L.
  GREENSPUN

  	
   

  
	
   

  	
   

  	
   

  	
  Brian L. Greenspun

  	
   

  
	
   

  	
   

  	
   

  	
  Manager

  	
   

  
						



 
















EXHIBIT A


Articles of Organization


 


See attached.



 1















EXHIBIT B


Original Operating Agreement


 


See attached.



 1















EXHIBIT C


Additional Property


 


See attached.



 1














 


EXHIBIT D


Example of Shared Expenses


The following are
examples of costs that are allocated between Parent’s Subsidiaries that operate
non-restricted gaming facilities (the “Hotel/Casinos”).


Room
Reservations— Room Reservations is a centralized function
that is accounted for at the Parent level. 
This department books all rooms pre-sold at the Hotel/Casinos.  The costs incurred by Room Reservations
relate to payroll, telephone service fees, and reservation fees paid for
reservations booked by outside vendors. 
These costs are allocated based on each Hotel/Casino’s share of total
room inventory controlled by Parent’s Subsidiaries.


Station
Advertising— Parent’s in-house advertising department
performs various advertising functions for the Hotel/Casinos, including the
following, the costs of which are allocated as follows:


·                                          Media
purchases — billed directly to the Hotel/Casino which required the purchase at
one hundred percent (100%) of cost (Purchasing media in-house avoids paying a
fifteen percent (15%) media commission to an outside advertising agency).


·                                          Multi-Hotel/Casino
media — allocated based upon a formula (generally).


·                                          Public
relations—allocated equally between all Hotel/Casinos.


·                                          Special
promotions — system-wide (allocated on a formula dependent upon participation).


·                                          Special
promotions — single Hotel/Casino; billed to that Hotel/Casino.


·                                          In-house
production — publications for human resources, video production, commercials,
sign animation, web-site, etc. 
(allocated based upon the type of activity and the number of
Hotel/Casinos participating).


·                                          General
operations — allocated based on a total revenue formula.


Information
Technology (IT) — Parent runs its IT group centrally,
allowing for specialists (programmers, help-desk, system administrators, etc.)
to perform services at all Hotel/Casinos. This centralization and allocation
eliminates the need for each Hotel/Casino to hire specialists and purchase
related equipment. Direct costs, such as maintenance or service agreements for
on-property equipment, are billed directly to the applicable
Hotel/Casinos.  Indirect costs (primarily
payroll and related benefits costs) are allocated to the Hotel/Casinos based
upon percentage of total revenue.


Central
Mail — Parent processes all direct mail at a central location
rather than outsourcing this function. 
The capital and operating costs of this function are allocated to each
Hotel/Casino based upon the actual volume of mailings performed for that
Hotel/Casino.


Food
& Beverage Management — In order to ensure that the
food and beverage operations at each of the Hotel/Casinos remains at the
highest level of quality and consistency, Parent has centralized the
supervision of food and beverage activities. 
This function is allocated based on food and beverage revenue for each
of the Hotel/Casinos.  The costs
allocated are primarily 



 1
 








payroll and related
benefit costs, as well as travel and entertainment, general supplies, and some
consulting expenses.


Relationship
Marketing — Parent operates its relationship marketing (database
marketing) function centrally and allocates all costs equally between the
Hotel/Casinos.  The costs allocated are
primarily payroll and related benefit costs as well as travel and entertainment
expenses.


Bank
Charges — Parent manages its banking relationships
centrally and bills each Hotel/Casino for direct charges generated by that
Hotel/Casino.  These costs are
specifically identifiable to the Hotel/Casino and relate to the transaction
charges, primarily generated in the cage. 
No payroll is allocated for this item. 
Transactions include check cashing, purchasing and depositing currency,
armored car services, etc.


Sportsbook
— Parent manages its race and sportsbook operations centrally and allocates
costs equally to each Hotel/Casino for the personnel required to administer
this function.  The costs allocated are
primarily payroll and related benefit costs.


Payroll
Department — Parent processes all Nevada payroll from a
central location and allocates the costs related to this function based on the
number of employees at each Hotel/Casino. 
The costs allocated are primarily payroll and related benefits costs.


* * * * *





 



 2















 


EXHIBIT E


Legal Description Losee Property


1.             The Losee Project, consisting of the following five
parcels:


PARCEL ONE (1):


THAT PORTION OF THE
SOUTHWEST QUARTER (SW 1/4) OF SECTION 13, TOWNSHIP 19 SOUTH, RANGE 61 EAST,
M.D.B.&M, DESCRIBED AS FOLLOWS:


LOT ONE (1) AND TWO (2)
OF THAT CERTAIN PARCEL MAP ON FILE IN FILE 71, PAGE 75 IN THE OFFICE OF THE
COUNTY RECORDER, CLARK COUNTY, NEVADA.


PARCEL TWO (2):


THE NORTHEAST QUARTER (NE
1⁄4) OF THE SOUTHEAST QUARTER (SE 1⁄4) OF THE SOUTHWEST QUARTER (SW 1⁄4) OF SECTION 13,
TOWNSHIP 19 SOUTH, RANGE 61 EAST, M.D.B.&M.


BEING FURTHER DESCRIBED
AS LOT ONE (1) OF THAT CERTAIN CERTIFICATE OF LAND DIVISION NO. 91-80 RECORDED
JULY 18, 1980 IN BOOK 1250 AS DOCUMENT NO. 1209181, OFFICIAL RECORDS, CLARK
COUNTY, NEVADA.


EXCEPTING THEREFROM THE
NORTH THIRTY (30) FEET, THE EAST FORTY (40) FEET, AND THAT CERTAIN SPANDREL
AREA LOCATED IN THE NORTHEAST CORNER (NE COR.) AS CONVEYED TO THE COUNTY OF
CLARK FOR ROAD PURPOSES BY DEED RECORDED JULY 8, 1980 IN  BOOK 1250 AS DOCUMENT NO. 1209182, OFFICIAL
RECORDS, CLARK COUNTY, NEVADA.


PARCEL THREE (3):


THE SOUTHEAST QUARTER (SE
1⁄4) OF THE SOUTHEAST QUARTER (SE 1⁄4) OF THE SOUTHWEST QUARTER (SW 1⁄4) OF SECTION
13, TOWNSHIP 19 SOUTH, RANGE 61 EAST, M.D.B.&M.


EXCEPTING THEREFROM THE
SOUTH FIFTY (50) FEET AND THE EAST 40 FEET, AS CONVEYED TO THE COUNTY OF CLARK
FOR ROAD PURPOSES BY DEED RECORDED JULY 8, 1980 AS DOCUMENT NO. 1201982 IN BOOK
1250 OF OFFICIAL RECORDS, CLARK COUNTY, NEVADA.


BEING FURTHER DESCRIBED
AS LOT 2 OF THAT CERTAIN CERTIFICATE OF LAND DIVISION RECORDED JULY 8, 1980 AS
DOCUMENT NO. 1209181 OF OFFICIAL RECORDS, CLARK COUNTY, NEVADA.


PARCEL FOUR (4):


 


 



 1
 









THE SOUTHWEST QUARTER (SW
1⁄4) OF THE SOUTHEAST QUARTER (SE 1⁄4) OF THE SOUTHWEST QUARTER (SW 1⁄4) OF SECTION
13, TOWNSHIP 19 SOUTH, RANGE 61 EAST, M.D.B.&M.;


ALSO KNOWN AS LOT THREE
(3) OF CERTIFICATE OF LAND DIVISION NO. 91-80, RECORDED JULY 8, 1980 IN BOOK
1250 AS DOCUMENT NO. 1209181, OFFICIAL RECORDS, CLARK COUNTY, NEVADA;


EXCEPTING THEREFROM THE
WEST 30.00 FEET, THE SOUTH 50.00 FEET, AND THAT CERTAIN SPANDREL AREA LOCATED
IN THE SOUTHWEST CORNER (SW COR.) THEREOF AS CONVEYED TO CLARK COUNTY FOR ROAD
PURPOSES BY THAT CERTAIN DEED RECORDED JULY 8, 1980 IN BOOK 1250 AS DOCUMENT
NO. 1209182, OFFICIAL RECORDS, CLARK COUNTY, NEVADA.


PARCEL FIVE (5):


THE NORTHWEST QUARTER (NW
1⁄4) OF THE SOUTHEAST QUARTER (SE 1⁄4) OF THE SOUTHWEST QUARTER (SW 1⁄4) OF SECTION
13, TOWNSHIP 19 SOUTH, RANGE 61 EAST, M.D.B.&M.


EXCEPTING THEREFROM THE
NORTH 30 FEET AND WEST 30 FEET, AS CONVEYED TO THE COUNTY OF CLARK FOR ROAD
PURPOSES BY DEED RECORDED JULY 8, 1980, IN BOOK 1250, AS INSTRUMENT/FILE NO.
1209182, OFFICIAL RECORDS, CLARK COUNTY, NEVADA.


BEING FURTHER DESCRIBED
AS LOT 4 OF THAT CERTAIN CERTIFICATE OF LAND DIVISION RECORDED JULY 8, 1980 AS
INSTRUMENT/FILE NO. 1209181, CLARK COUNTY, NEVADA.


 



 2















 


EXHIBIT F


Legal Description of Resort Property


ALL OF PARCEL 34 AS SHOWN
ON THE FINAL MAP OF ALIANTE NORTH, RECORDED IN BOOK 110 OF PLATS, PAGE 72, IN
THE OFFICE OF THE COUNTY RECORDER OF CLARK COUNTY, NEVADA


 



 1















 


EXHIBIT G


Restricted Area


 


See attached


 



 1















 


EXHIBIT H


Location of Relocated
Drainage Easement


 


See attached.


 



 1















 


EXHIBIT I


	
  

  	
   

  	
  Notice Addresses

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Company:

  	
   

  	
  Aliante Gaming, LLC

  	
   

  	
   

  
	
   

  	
   

  	
  c/o Aliante Station, LLC, its Manager

  	
   

  	
   

  
	
   

  	
   

  	
  c/o Station Casinos, Inc, its manager

  	
   

  	
   

  
	
   

  	
   

  	
  2411 Sahara Avenue

  	
   

  	
   

  
	
   

  	
   

  	
  Las Vegas, NV 89102

  	
   

  	
   

  
	
   

  	
   

  	
  Attention: Frank J. Fertitta III

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  with copy to:

  	
   

  	
  Station Casinos, Inc.

  	
   

  	
   

  
	
   

  	
   

  	
  2411 Sahara Avenue

  	
   

  	
   

  
	
   

  	
   

  	
  Las Vegas, NV 89102

  	
   

  	
   

  
	
   

  	
   

  	
  Attention: Richard J. Haskins, Esq.

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Holding:

  	
   

  	
  Aliante Station LLC, a member

  	
   

  	
   

  
	
   

  	
   

  	
  c/o Station Casinos, Inc, its manager

  	
   

  	
   

  
	
   

  	
   

  	
  2411 Sahara Avenue

  	
   

  	
   

  
	
   

  	
   

  	
  Las Vegas, NV 89102

  	
   

  	
   

  
	
   

  	
   

  	
  Attention: Frank J. Fertitta III

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  and

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  G.C. Aliante, LLC, a member

  	
   

  	
   

  
	
   

  	
   

  	
  c/o The Greenspun Corporation

  	
   

  	
   

  
	
   

  	
   

  	
  901 North Green Valley Parkway, Suite 210

  	
   

  	
   

  
	
   

  	
   

  	
  Henderson, NV 89074

  	
   

  	
   

  
	
   

  	
   

  	
  Attention: Brian L. Greenspun

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  with copies to:

  	
   

  	
  Station Casinos, Inc.

  	
   

  	
   

  
	
   

  	
   

  	
  2411 Sahara Avenue

  	
   

  	
   

  
	
   

  	
   

  	
  Las Vegas, NV 89102

  	
   

  	
   

  
	
   

  	
   

  	
  Attention: Richard J. Haskins, Esq.

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  and

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  The Greenspun Corporation

  	
   

  	
   

  
	
   

  	
   

  	
  901 North Green Valley Parkway

  	
   

  	
   

  
	
   

  	
   

  	
  Suite 210

  	
   

  	
   

  
	
   

  	
   

  	
  Henderson, NV 89014

  	
   

  	
   

  
	
   

  	
   

  	
  Attention: Key Reid

  	
   

  	
   

  



 



 1
 









 


	
  GC:

  	
   

  	
  G.C. Aliante, LLC

  	
   

  	
   

  
	
   

  	
   

  	
  c/o The Greenspun Corporation

  	
   

  	
   

  
	
   

  	
   

  	
  901 North Green Valley Parkway, Suite 210

  	
   

  	
   

  
	
   

  	
   

  	
  Henderson, NV 89074

  	
   

  	
   

  
	
   

  	
   

  	
  Attention: Brian L. Greenspun

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  with a copy to:

  	
   

  	
  The Greenspun Corporation

  	
   

  	
   

  
	
   

  	
   

  	
  901 North Green Valley Parkway

  	
   

  	
   

  
	
   

  	
   

  	
  Suite 210

  	
   

  	
   

  
	
   

  	
   

  	
  Henderson, NV 89014

  	
   

  	
   

  
	
   

  	
   

  	
  Attention: Key Reid

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Station:

  	
   

  	
  Aliante Station, LLC

  	
   

  	
   

  
	
   

  	
   

  	
  c/o Station Casinos, Inc., its manager

  	
   

  	
   

  
	
   

  	
   

  	
  2411 Sahara Avenue

  	
   

  	
   

  
	
   

  	
   

  	
  Las Vegas, NV 89102

  	
   

  	
   

  
	
   

  	
   

  	
  Attention: Richard J. Haskins, Esq.

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Manager:

  	
   

  	
  Aliante Station, LLC, Manager

  	
   

  	
   

  
	
   

  	
   

  	
  c/o Station Casinos, Inc, its manager

  	
   

  	
   

  
	
   

  	
   

  	
  2411 Sahara Avenue

  	
   

  	
   

  
	
   

  	
   

  	
  Las Vegas, NV 89102

  	
   

  	
   

  
	
   

  	
   

  	
  Attention: Frank J. Fertitta III

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  with copy to:

  	
   

  	
  Station Casinos, Inc.

  	
   

  	
   

  
	
   

  	
   

  	
  2411 Sahara Avenue

  	
   

  	
   

  
	
   

  	
   

  	
  Las Vegas, NV 89102

  	
   

  	
   

  
	
   

  	
   

  	
  Attention: Richard J. Haskins, Esq.

  	
   

  	
   

  



 



 2















 


SCHEDULE 3.3




Manager’s Duties During Pre-Opening Period


In addition to the
provisions of Section 3.3 of the Agreement, the Manager shall have the
following duties and responsibilities during the Pre-Opening Period:


(a)           The
Manager shall develop and submit to the Executive Committee for its approval,
along with supporting information therefor, the following:


(i)            the preliminary conceptual
architectural design for the Project;


(ii)           the 
preliminary Timetable for the Project; and


(iii)          the preliminary construction budget
for the Project.


(b)           Master
Development Plan.  The Manager shall
consult with the Executive Committee on a regular basis regarding the
formulation of the components of the Master Development Plan and shall submit
such components for approval by the Executive Committee prior to submittal
thereof to the City of North Las Vegas, Nevada, (or other application or filing
to any governmental or quasi-governmental entity) and at times necessary in
order to commence construction of the Project in accordance with the
Timetable.  Further, at the sole expense
of the Company, pursuant to the approved Design, Development and Construction
Budget, the Manager shall, subject to Force Majeure, take commercially
reasonable steps to cause the Company to obtain timely all Governmental
Approvals necessary in order to commence construction of the Project in
accordance with the Timetable.  In
addition, at the sole expense of the Company, pursuant to the approved Design,
Development and Construction Budget, the Manager shall take commercially
reasonable steps to cause the Company to procure and maintain insurance during
construction that conforms to reasonable industry standards; such insurance
shall conform to the applicable requirements of Paragraph (l) of Schedule
3.4 (e.g., Holding being an additional insured, thirty (30) day
notice of cancellation, etc.).


(c)           Construction
and Permanent Financing.  The Manager
shall develop and submit to the Executive Committee for its approval, along
with supporting information therefor, (i) the term sheet for the Construction
Financing and Permanent Financing for the Project and (ii) written expressions
of interest from one or more lenders interested in providing such financing to
the Company.  Subject to Section
3.13(vv) of the Agreement, the Manager shall make application for, and
shall, subject to Force Majeure, take all commercially reasonable steps within
its control to cause the Company to obtain, at the Company’s sole cost and
expense, a commitment or signed engagement letter for Construction Financing
and Permanent Financing in accordance with the Timetable.


(d)           Construction
of Improvements.  Subject to Force
Majeure, the Manager shall take commercially reasonable steps to cause the
Company to commence rough grading of the Resort Property and construction of
the Improvements in accordance with the Timetable and the Master Development
Plan and shall diligently prosecute such construction to completion, and in any




 1
 









event shall use commercially reasonable efforts to
protect the Resort Property’s land use entitlements.


The Manager may authorize a change order which changes
the Design Plan, the Construction Plan, the Design, Development and
Construction Budget or Master Development Plan without the prior approval of
the Executive Committee; provided, however, the Executive
Committee’s prior approval shall be required for any change order that
materially changes the Design Plan, the Construction Plan, the Design,
Development and Construction Budget or Master Development Plan.  The Manager shall provide to each of the EC
Members a written request for approval of each proposed material change in the
Design Plan, the Construction Plan, the Design, Development and Construction
Budget or Master Development Plan.  In
the event that neither EC Member notifies the Manager within seven (7) calendar
days after receipt of such written request for approval of a material change to
the Design Plan, the Construction Plan, the Design, Development and
Construction Budget or Master Development Plan that he objects to such change,
the Executive Committee shall be deemed to have approved such material
change.  A material change requiring the
approval of the Executive Committee is any item that: (i) materially changes the
scope, appearance or functionality of the Project; or (ii) increases the cost of the design and construction of the Project as
set forth in the Design, Development and Construction Budget by more than the
lesser of (A) the aggregate amount of the contingency reserve or (B) ten
percent (10%) of the aggregate budgeted cost of the Project, as set forth in
the Design, Development and Constructions Budget, or (iii) changes in
the cost of any single line item in the Design, Development and Construction
Budget by more than $1,000,000.


(e)           Major
Land Use Approvals.  The Manager
shall use commercially reasonable efforts to obtain, within nine (9) months
after the Executive Committee approves the preliminary architectural plans for
the Project, all major land use approvals necessary for the construction of the
Project in accordance with such preliminary architectural plans.


(f)            Construction
Contract Approvals.  The Manager
shall submit the Company’s contracts with the architect, interior design and
landscaping prime contractors for the Project and the general construction
contractor for the Project for the prior approval of the Executive Committee.


(g)           Pre-Opening
Plan.  The Manager shall prepare and
submit for Executive Committee approval within ninety (90) days prior to the
Opening, and put into effect as appropriate after receiving such approval, a
Pre-Opening Plan for the organization, services, sales and marketing program of
the Project, and shall use commercially reasonable efforts to cause the Company
to engage the General Manager and such employees as may be necessary in
connection with the operation of the Project.


(h)           Pre-Opening
Services.  Consistent with the
approved Pre-Opening Plan, the Manager shall use commercially reasonable
efforts to cause the Company to enter into agreements and arrangements with
concessionaires, licensees, tenants, suppliers, sub-contractors or other
intended users of the facilities of the Project, subject to the prior approval
of the Executive Committee in the case of leases, licenses or concessions or
other contracts as set forth in Paragraph (m) of Schedule 3.4 and
Section 3.13 of the Agreement. 
The Manager shall recruit and train for and on behalf of the Company the
initial staff of the Project through such training 



 2
 









programs and other training techniques as the Manager
shall deem advisable and test the proposed operation of the Project by
furnishing the services normally offered in the operation of a hotel/casino,
including the serving of food and beverages, and generally operating the
completed portions of the Project for a reasonable test period immediately
prior to the Opening.


(i)            Reporting.  During the Pre-Opening Period, the Manager
shall provide the Executive Committee with monthly progress reports not later
than the twenty-seventh (27th) day of each month, which progress reports shall set
forth in reasonable detail all expenditures during the preceding month together
with a comparison of such expenditures to budgeted amounts and a revised
estimate of the Project’s remaining cost to completion.  In addition, representatives of the Manager
shall be available to meet with the Executive Committee on at least a monthly
basis to review the status of the Project.


(j)            Contracts.  The Manager shall use commercially reasonable
efforts to cause the Company to comply with and not to become in default under
any contract, agreement, loan document or other obligation of the Company if
the failure to comply therewith or a default thereunder would have a material
adverse effect on the Company or any Member.


(k)           Additional Responsibilities.  The Manager shall comply with the provisions
of Paragraphs (c), (h), (j), (n) and (p) of Schedule 3.4
prior to Opening, and Holding and the Executive Committee shall have their
respective rights as set forth therein. 
Also, the provisions of Paragraphs (d), (e) and (f) of Schedule
3.4 shall apply prior to the Opening to the extent that they reasonably
should be applicable.


(l)            Opening Date.  Notwithstanding anything to the contrary in
the Agreement or in this Schedule 3.3, subject to Force Majeure, the
Manager shall use commercially reasonable efforts to cause the Company to take
all actions necessary to cause the Project to be completed and the Opening to
occur not later than the Opening date set forth in the Timetable.


 



 3














 


SCHEDULE 3.4


Manager’s Duties During Operating Period


                In
addition to the provisions of Section 3.4 of the Agreement, during the
Operating Period and, to the extent applicable, prior to the Operating Period,
and with respect to each Expansion Project, the Manager shall have the
following duties and responsibilities, which, except as provided in the
Agreement (including the necessity for approval of the Annual Plan and
Operating Budget or inclusion in the Design, Development and Construction
Budget, as applicable), shall be at the sole cost and expense of the Company:


(a)           Annual
Plan and Operating Budget.


(i)            Not fewer than ninety (90) days
prior to Opening and not fewer than forty five (45) days prior to the
commencement of each full Fiscal Year thereafter, the Manager shall submit for
approval by the Executive Committee a proposed Annual Plan and Operating
Budget.  If the Executive Committee fails
to approve the proposed Annual Plan and Operating Budget by December 1 of any
given calendar year, the Project shall continue to operate under the most
recent Annual Plan and Operating Budget as if it were for such upcoming Fiscal
Year until the Executive Committee otherwise agrees pursuant to the terms of
the Agreement; except that capital expenditures (including equipment
leases and similar transactions) for Capital Improvements and Replacements
shall be permitted to the extent that amounts on deposit in the Reserve Fund
are sufficient to fund the costs of such expenditures and thereafter only to
repair or replace damaged or worn portions of the Project or damaged, worn,
obsolete or unusable Furniture, Fixtures and Equipment.


(ii)           The Manager shall propose revisions
to the Annual Plan and Operating Budget from time to time to reflect any
unanticipated significant changes, variables or events or to include
significant additional unanticipated items of income or expense.  Any such revision shall be submitted to the
Executive Committee for approval.  If the
Executive Committee fails to approve such revision within thirty (30) days
after the date of such submission, the Project shall be operated in accordance
with the original Annual Plan and Operating Budget until the Executive
Committee otherwise agrees pursuant to the terms of the Agreement.


(iii)          Except as expressly set forth in Section
3.13 of the Agreement or elsewhere in the Agreement, the Manager may enter
into any contract, agreement, license or other financial obligation so long as
the amounts required to finance the Company’s performance of such contract, agreement,
license or other financial obligation during the then-current Fiscal Year have
been included in the then-current Annual Plan and Operating Budget, or make any
change in the interior or exterior use, operation, functionality or appearance
of the Project (that is not a material change), without the prior approval of
the Executive Committee.  In the event
that the Manager requests the approval of the Executive Committee for a
material change to the interior or exterior use, operation, functionality or appearance
of the Project and neither member of the Executive Committee notifies the
Manager within seven (7) calendar days after receipt of such 











written request that he
objects to such change, the Executive Committee shall be deemed to have
approved such material change.


(iv)          A pro forma for the first five (5)
years of operation of the Project, including compensation projected to be
payable to the Manager pursuant to Section 3.5 of the Agreement, shall
be provided to Holding and the EC Members prior to the Opening.  The pro forma shall be for illustrative
purposes only and shall not be an approved Annual Plan and Operating Budget.
and neither Holding nor GC nor Station 
shall make any representations or warranties with respect thereto.


(b)           Capital
Expenditures.


(i)            The Manager shall recommend to the
Executive Committee from time to time proposed Capital Improvements and
Replacements and the design and specifics thereof.  If the Executive Committee approves such
Capital Improvements and Replacements (including a budget therefor), the
Manager shall use commercially reasonable efforts to cause the installation
thereof.  All Capital Improvements and
Replacements approved by the Executive Committee shall be made at the sole cost
and expense of the Company (subject to the budget therefor) and to the extent
reasonably feasible in a manner that will minimize any adverse impact on the
normal operation of the Project.


(ii)           The Manager shall, to the extent
Company funds are available following disbursement of funds in accordance with Paragraph
(k) below, set aside within fifteen (15) days following the end of each
Fiscal Month after Opening an amount equal to three percent (3%) of Gross
Revenues for each such Fiscal Month, which amounts shall be deposited into the
Reserve Fund to pay for Capital Improvements and Replacements; provided,
however, to the extent that there is borrowing availability under the
Expansion Financing or Permanent Financing,
as the case may be, in an amount equal to or greater than the amount then required
to be deposited in the Reserve Fund, then the Manager may, to the maximum
extent permitted under any Expansion Financing or Permanent Financing, maintain
borrowing availability from such credit facility to be drawn in lieu of such “cash-funded”
Reserve Fund.  To the extent that the
Manager so maintains borrowing availability under any Expansion Financing or
Permanent Financing for the Reserve Fund, then Holding shall not have any
obligation to make additional Capital Contributions pursuant to Section 4.2(c) of the  Agreement. 
Any expenditures for Capital Improvements and Replacements during any
Fiscal Year which have been budgeted in the Annual Plan and Operating Budget or
otherwise approved by the Executive Committee may be made by the Manager without
additional approval and, to the extent funds are available, such payments shall
be made by the Manager from the Reserve Fund (including accrued interest and
unused accumulations from earlier years) or from borrowing under the Expansion
Financing or Permanent Financing, as the case may be.  Any amounts remaining in the Reserve Fund at
the close of a Fiscal Year shall be carried forward and retained in the Reserve
Fund until fully used as herein provided. 
To the extent the Reserve Fund is insufficient at a particular time, or
to the extent the Reserve Fund plus anticipated contributions for the
existing Fiscal Year is less than the amount required by the Annual Plan and
Operating Budget for the ensuing Fiscal Year, then 











additional expenditures
shall be subject to the prior approval of the Executive Committee pursuant to
the terms of the Agreement and, if such expenditures are approved, the
Executive Committee shall determine the source of funds for such Capital
Improvements and Replacements; provided, however, that Holding
shall have the funding obligation set forth in Section 4.2(c) of the
Agreement.  The Manager may, in its
reasonable discretion, sell capital items that are obsolete or are no longer
needed for the operation of the Project and deposit the proceeds thereof in the
Reserve Fund; provided, however, that prior approval of the
Executive Committee shall be required with respect to the sale of any capital
item with a fair market value of $500,000 or more.


(iii)          In the event a condition should exist
with respect to the Project of an emergency nature, including structural
repairs, which requires that immediate repairs are necessary to preserve and
protect the Project, assure its continued operation or protect the health and
safety of its guests or employees, the Manager, on behalf and at the sole cost
and expense of the Company and as an Operating Cost, is authorized to take all
steps and to make all expenditures reasonably necessary to repair and correct
any such condition, whether or not provisions have been made in the applicable
Annual Plan and Operating Budget for any such emergency expenditures, up to a
maximum of $500,000 for any single 
emergency.  The Manager agrees
that it shall cause the Company to make such repairs and replacements only after
it has made a reasonable attempt (if circumstances permit) to inform the
Executive Committee of the existence of such emergency, the repairs and
replacements it proposes to make, and the estimated amount of expenditures to
be incurred.  If the Manager has been
unable to advise the Executive Committee in advance, it shall promptly notify
the Executive Committee after taking any necessary action.  Expenditures made by the Manager in
connection with an emergency shall be paid for first by the Company from the
Reserve Fund to the extent funds are available, and then from the Operating
Bank Account.


(iv)          In the event that repairs to, or
additions, changes or corrections in, the Project of any nature shall be
required by reason of any laws, ordinances, rules or regulations now or
hereafter in force, or by order of any governmental or municipal power,
department, agency, authority or officer, the Manager shall inform the
Executive Committee of the existence of the governmental regulations and the
repairs, additions, changes or corrections it believes are required to be made
and the estimated expenditures to be incurred. 
The Executive Committee shall determine whether to contest the validity
or application of any such governmental requirements or to make such repairs; provided,
however, that the Manager shall be authorized and empowered to take all
actions it reasonably believes are necessary to comply with applicable laws if
the failure to so comply might expose the Company, Holding or the Manager to
criminal liability, materially and adversely affect the operation of the
Project, or jeopardize any Gaming License held by the Manager, Parent, any of
Parent’s Subsidiaries, Holding or the Company.


(c)           Permits.  The Manager, at the sole cost and expense of
the Company, shall use commercially reasonable efforts to obtain on or before
the Opening and thereafter keep in full force and effect, all Governmental
Approvals, including Gaming Licenses and liquor, bar, restaurant, sign and
hotel licenses, as may be required for the operation of the Project pursuant to











the operations standard in Section 3.1(b) of
the Agreement, other than any Gaming Licenses or liquor licenses, permits or
approvals required to be obtained by Holding, Parent, GC and their Affiliates
in their individual capacities (which Holding agrees to use its best efforts to
obtain at their respective sole cost and expense prior to the scheduled
Opening, including the timely submission of all applications and disclosures
required or requested by the Gaming Authorities and liquor licensing
authorities).  The Manager shall operate
and manage the Project in a manner that will not materially adversely affect
the Governmental Approvals necessary for the operation of the Project, but in
all events shall use all reasonable efforts within its control to cause the
Company, at the Company’s sole cost and expense, to comply with all material
conditions or requirements set out in any Governmental Approvals.


(d)           Operating
Supplies and Operating Consumables. 
After Opening, the Manager shall, on behalf of the Company, use
commercially reasonable efforts to obtain and maintain such Operating Supplies
and Operating Consumables as it deems reasonably necessary for the operation of
the Project in accordance with the Master Development Plan and subject to the
provisions of the Agreement and the then-current Annual Plan and Operating
Budget.


(e)           Personnel.


(i)            The Manager shall hire all employees
of the Company for and on behalf of the Company.  All personnel hired by the Company for the
Project (other than those that constitute Shared Expenses) shall be employees
of the Company and all wages, compensation and benefits shall be the exclusive
obligation of the Company and the Manager shall not be liable to any of the
Company’s personnel therefor, except to the extent that the Manager sets the
compensation in contravention of the Annual Plan and Operating Budget without
the Executive Committee’s approval. 
Subject to the Annual Plan and Operating Budget, the Manager shall hire,
supervise, direct, discharge and determine the compensation, other benefits and
terms of employment of the Company’s personnel. 
With the exception of the General Manager, the Manager shall be the sole
judge of the fitness and qualifications of such personnel and is vested with
absolute discretion in hiring, supervising, directing, discharging and
determining the compensation, other benefits and terms of employment of such
personnel.  Holding may consult, advise
or communicate with the Manager, Construction Manager or the General Manager
regarding Project personnel or problems related to personnel at any time, but
Holding shall not interfere with or give orders or instructions to any
personnel employed at the Project.


(ii)           The Manager shall use commercially
reasonable efforts to cause the Company to obtain workers’ compensation
insurance and employer’s liability insurance. 
The insurance coverages required hereunder shall be set forth in the
Annual Plan and Operating Budget.


(iii)          The general hiring policies and the discharge
of employees at the Project shall in all material respects comply with all “Equal
Employment Opportunity” laws and regulations, and the Manager agrees to comply
in all material respects with all laws, regulations and ordinances regarding
the employment and payment of persons engaged in 











the operation of the
Project, including without limitation all “Equal Employment Opportunity” laws
and regulations.


(iv)          The Manager shall keep the Executive
Committee informed of all negotiations with labor unions representing employees
at the Project, and neither the Manager nor the Company shall enter into any
union contracts covering its employees without the prior approval of the
Executive Committee pursuant to the terms of the Agreement, unless required by
law to do so (which contracts, in all cases, shall be furnished to the
Executive Committee as soon as reasonably possible).


(f)            Sales,
Marketing and Advertising.  Subject
to the Annual Plan and Operating Budget, the Manager shall, at the sole cost
and expense of the Company, advertise and promote the business of the Project,
institute and supervise a sales and marketing program, and coordinate with tour
programs marketed by airlines, travel agents and government tourist departments
when the Manager deems the same to be advisable for the operation of the
Project.  Subject to the Annual Plan and
Operating Budget, the Manager may cause the Project to participate in sales and
promotional campaigns and activities involving complimentary rooms, food and
beverages to customers, bona fide travel agents, tourist officials and airline
representatives where such is customary and appropriate in the gaming industry.


(g)           Maintenance
and Repairs.  Subject to the Annual
Plan and Operating Budget, the Manager shall make or cause the Company to make,
at the sole cost and expense of the Company, all repairs, replacements,
corrections and maintenance items to the Project as shall be required in the
normal and ordinary course of operation of the Project.  In conjunction therewith and subject to the
Agreement (including Section 3.13 of the Agreement) and the Annual Plan
and Operating Budget, the Manager is authorized to make and enter into in the
name of, for the account of and at the expense of the Company, all such
contracts and agreements as in the Manager’s opinion are reasonably necessary
for the repair and maintenance of the Project and to cause the same to be paid
by the Company when due.


(h)           Compliance
with Legal Requirements.  The Manager
shall take all commercially reasonable actions necessary to materially comply
with, and to cause the Company to materially comply with, any and all laws,
orders or requirements of any federal, state, county or municipal agency
affecting the Project or the ownership or operations thereof.  The Executive Committee shall determine
whether to contest any tax payment or assessment, or any governmental or
regulatory order or requirements (except that, where failure to comply
promptly with any such order or requirements might expose the Company, any Member
or the Manager to criminal liability, materially and adversely affect the
operation of the Project or jeopardize any Gaming License held by the Manager,
Parent, any of Parent’s Subsidiaries, Holding or GC or their Affiliates, the
Manager may take such action without Executive Committee approval).  The Manager shall promptly notify the
Executive Committee in writing of all such orders and notices or requirements
that are received by the Manager.  Except
as otherwise provided in the Agreement, the costs of such compliance shall be
at the expense of the Company.











(i)            Financial
Statements.


(i)            On or before the fifteenth (15th) day of each Fiscal Month,
the Manager shall deliver to Holding a Profit and Loss statement, statement of
income and balance sheet showing the results of the operation of the Project
for the preceding Fiscal Month and the year-to-date, and having attached
thereto a computation of the Base Management Fee and Incentive Management Fee
for such preceding month and the year-to-date.


(ii)           Within ninety (90) days after the end
of each Fiscal Year, the Manager shall deliver to Holding an audited balance
sheet together with a comparison to the previous Fiscal Year (after the first
full Fiscal Year) and a related detailed statement of Profit and Loss
(including all supporting departmental schedules of revenues and expenses),
together with a comparison to the previous Fiscal Year and the current Annual
Plan and Operating Budget, and having annexed thereto a computation in
reasonable detail of the Base Management Fee and Incentive Management Fee for
such Fiscal Year; and


(iii)          Upon the written request of Holding,
such other additional statements, computations and reports regularly or
otherwise prepared by the Company, or otherwise contemplated or required under
the Agreement.


(j)            Accounting
Matters and Fiscal Periods.


(i)            At the cost and expense of the
Company, the Manager shall cause an audit of the Company’s annual financial
statements to be performed following the end of each Fiscal Year (and upon termination
of the Agreement if not coincident with a Fiscal Year end) by a
nationally-recognized, independent certified public accounting firm with
expertise in gaming proposed by the Manager and approved by the Executive
Committee pursuant to the terms of the Agreement.


(ii)           The books and records reflecting the
Project operations shall be kept by the Manager in accordance with GAAP applied
on a consistent basis, and shall be maintained in the Las Vegas, Nevada
metropolitan area. Holding, Parent and GC and their accounting firms shall have
the right to examine and copy the books and records of the Project upon
reasonable prior notice to the Manager.


(k)           Operating
Bank Account.  Subject to the terms
and conditions of the Agreement, all sums received from the operation of the
Project and all sums advanced by the Company for purposes other than Capital
Improvements and Replacement shall be deposited in the Operating Bank
Account.  The Manager shall disburse
funds from the Operating Bank Account on a monthly basis in the following order
of priority and to the extent available:


(i)            when due, all Operating Costs;


(ii)           when due, the payment of debt service
with respect to the Construction Financing, Expansion Financing or Permanent
Financing;


(iii)          when due, the payment of debt service
with respect to other loans from third parties;











(iv)          the Base Management Fee and Incentive
Management Fee (including any accrued Base Management Fee and Incentive
Management Fee from prior periods); except in the event that Station (A) is no
longer a member of Holding, the Base Management Fee and Incentive Management
Fee (including any accrued Base Management Fee and Incentive Management Fee
from prior periods) shall be paid as an Operating Cost under Clause (i) above,
or (B) is in default of its obligations as a member of Holding, in which event
the Base Management Fee and Incentive Management Fee that accrues following
such default shall be paid after the payment of any debt service due to any
lender under Clause (vii) below;


(v)           the payment for emergency
expenditures to the extent paid from the Operating Bank Account or from amounts
on deposit in the Reserve Fund;


(vi)          deposits into the Reserve Fund and any
other reserves established by the Executive Committee for anticipated
expenditures, liabilities or contingencies;


(vii)         when due, the payment of debt service
with respect to any loans from Holding, GC or Parent; and


(viii)        the remaining balance thereof shall
constitute “Distributable Cash” for purposes of the Agreement.


In following the
priorities set forth above, the Manager will reserve funds in the Operating
Bank Account each Fiscal Month for payment of any Operating Costs for any of
the above items which the Manager has a duty to pay that are not paid on a
monthly basis (e.g., real estate taxes, insurance premiums and so
on).  To the extent that there are
sufficient funds on deposit in the Operating Bank Account, the Manager shall
perform the function of paying all Operating Costs and other items set forth
above (including but not limited to debt service, real estate taxes, insurance
premiums, etc.) unless otherwise agreed by the Executive Committee.


(l)            Insurance
Coverage.  The Manager agrees to use
commercially reasonable efforts to cause the Company to procure and maintain at
all times during the term hereof, as an Operating Cost, insurance in such
amounts and coverages as may be required by the then-current Annual Plan and
Operating Budget, which shall be no less than that necessary to conform to
reasonable industry standards for a similar hotel and casino, taking into
consideration inflation and any events or trends of liability which affect the
risks attendant to owning and operating the Project.  All such insurance shall be provided under policies
issued by insurance companies of good reputation and of sound financial
responsibility and licensed by the State of Nevada.  All liability, business interruption and
crime insurance policies shall be written in the name of the Company with
Holding, each of the members of Holding and the Manager being named thereon as
additional insureds.  All insurance
policies shall be endorsed specifically to the effect that the proceeds of any
crime or business interruption losses shall be made payable to the Company, or
to the extent required by any lender of Construction Financing, Permanent
Financing, Expansion Financing  or other
financing, to such lender.  All such
policies of insurance shall also be endorsed specifically to the effect that
such policies shall not be canceled or materially changed without at least
thirty (30) days prior written notice to Holding and the Manager.  To the extent obtainable without
significantly increasing the premium cost, all policies of comprehensive 











public liability insurance and comprehensive crime
insurance shall contain an endorsement to the effect that such insurance shall
be primary to any other similar insurance carried by the Company, Holding or
the Manager.  Certificates of insurance
shall be sent to Holding and the Manager pursuant to Section 8.1 of the Agreement.


(m)          Lease
Agreements.  The Manager shall be
responsible for the leasing of space in the Project in the Company’s name to
third-party lessees, licensees and concessionaires, subject to the prior
approval of the Executive Committee of the tenant, licensee or concessionaire,
and terms of such leases, licenses or other occupancy agreements.  The Manager will enforce such leases,
licenses or other occupancy agreements in a manner which is consistent with
sound business practices.  Revenues
received by the Company under any lease, license or occupancy agreements shall
be deemed a part of Gross Revenues as defined under the Agreement, except
for reimbursements for utilities, taxes or similar matters.


(n)           Legal
Action.  The Manager shall have the
right to institute, on behalf of and in the name of the Company, any and all
legal actions or proceedings affecting the Project, including the construction
thereof, such as, but not limited to, to collect charges, rent or other income
from the Project or to remove any tenants, terminate a lease, license, or
concession agreement, a breach thereof or default entered by any tenant,
licensee, concessionaire, supplier, or contractor, or to protect and/or
litigate to final decision in any appropriate forum, any violation, rule,
regulation or agreement concerning the Project, including the construction
thereof; provided, however, that approval of the Executive
Committee pursuant to the terms of the Agreement shall be required with respect
to the institution or defense of any action (or settlement thereof) where there
is a reasonable possibility of exposure to the Company in excess of $250,000 or
that could have a material adverse effect on the operation of the Project; provided,
further, that the Executive Committee shall be deemed to have approved
the institution of any action or defense of an action unless either EC Member
notifies the Manager that he disapproves such action within seven (7) days
after receipt of written notice requesting such institution or defense.  Any counsel to be engaged under this
subsection (n) with respect to any matter with a reasonable possibility of
exposure to the Company in excess of $250,000 or that could have a material
adverse effect on the operation of the Project shall be proposed by the Manager,
subject to the prior approval of the Executive Committee pursuant to the terms
of the Agreement.  The Annual Plan and
Operating Budget shall contain an amount, approved pursuant to Paragraph (a)
above, with respect to any litigation or legal fees the Company anticipates
incurring (as the same shall be amended pursuant to Paragraph (a)(ii)
above from time to time at the request of Holding, the Manager or GC in the
event of the need to incur litigation or legal fees after the establishment of
the Annual Plan and Operating Budget), which may be incurred by either Holding,
the Manager or GC (or an Affiliate of GC) as provided in the Agreement.


(o)           Consultation.  When requested to do so, representatives of
the Manager and the General Manager shall meet with the Executive Committee to
discuss the performance of the Project and of the Manager of its obligations
hereunder and the Manager’s plans and expectations for the Project for the
remaining Fiscal Year.


(p)           Emergencies.  Notwithstanding anything to the contrary
contained within this Schedule 3.4, if at any time it becomes necessary
in the Manager’s reasonable judgment to cease operations of all or part of the
Project to protect the Project from material and adverse 











consequences or to protect the health, safety or
welfare of the guests or employees of the Project, then the Manager may close
and cease operations of that portion of the Project, reopening the same when
the Manager reasonably believes that such event has passed; provided, however,
that the Manager shall immediately notify the Executive Committee of such event
and shall keep that portion of the Project closed for the minimum reasonable
period of time.


(q)           Contracts.  The Manager shall use commercially reasonable
efforts to cause the Company to comply with and not to become in default under
any contract, agreement, loan document or other obligation of the Company if
such failure to comply or a default thereunder would have a material adverse
effect on the Company or Holding, unless such action is approved by the
Executive Committee, to the extent so affected.


(r)            Expansion
Project(s).  With respect to each
Expansion Project:


(i)            In General.  Subject to Force Majeure, the Manager shall
use commercially reasonable efforts to (A) supervise and cause the completion
of each  Expansion Project in accordance
with the applicable Expansion Project Construction Plan and Expansion Project
Design Plan in line with the Expansion Project Budget for such  Expansion Project, (B) protect the Resort
Property’s land use entitlements and (C) obtain on behalf of the Company all
Furniture, Fixtures and Equipment requisite for the operation of the Expansion
Project, at the Company’s sole cost and expense.


(ii)           Expansion
Project Construction Manager.  The
Manager shall select the  Expansion
Project Construction Manager with the prior approval of the Executive Committee
pursuant to the terms of the Agreement.


(iii)          Expansion
Project Design, Plan and Budget.  The
Manager shall submit to the Executive Committee for approval each Expansion
Project, consisting of the Expansion Project Design Plan, Expansion Project
Construction Plan and Expansion Project Budget. 
The Expansion Project Design Plan and Expansion Project Construction
Plan may be approved in whole or in segments or by components by the Executive
Committee pursuant to the terms of the Agreement.


(iv)          Contractors.  The Manager shall select, subject to the
prior approval of the Executive Committee, the general contractor and
architectural, interior design and landscaping firms for each Expansion
Project.  The Manager shall submit the
Company’s contracts with the architect, interior design, landscaping prime
contractor and general construction contractor for the prior approval of the
Executive Committee pursuant to the terms of the Agreement.


(v)           Change
Orders.  With respect to change
orders relating to an Expansion Project, the Executive Committee shall
establish the parameters within which the Manager may make change orders
without the approval of the Executive Committee at the time the Executive
Committee approves the Expansion Project Budget.


(vi)          Reports.  The Manager shall provide the Executive
Committee with monthly progress reports on each Expansion Project no later than
the twenty seventh 











 


(27th) day
of each calendar month, which progress report shall state in reasonable detail
all expenditures during the preceding calendar month together with a comparison
of such expenditures to budgeted amounts and a revised estimate of the
Expansion Project’s remaining costs to completion.  In addition, representatives of the Manager
shall be available to meet with the Executive Committee when so requested to
review the status of such Expansion Project.


 















ATTACHMENT
I


Form of License
and Support Agreement


 


See Attached


 



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ATTACHMENT
II


Form of License
Agreement


 


See Attached


 



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